<PAGE>
As filed with the Securities and Exchange Commission on September 4, 1998
Registration Statement No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
______________________
FORM S-3
______________________
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
______________________
STAPLES, INC.
(Exact name of registrant as specified in its charter)
______________________
DELAWARE 04-2896127
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
ONE RESEARCH DRIVE
WESTBOROUGH, MASSACHUSETTS 01581
(508) 370-8500
(Address, including zip code, and
telephone number, including area code,
of registrant's principal
executive offices)
______________________
JOHN J. MAHONEY
EXECUTIVE VICE PRESIDENT, CHIEF ADMINISTRATIVE OFFICER AND CHIEF FINANCIAL
OFFICER
STAPLES, INC.
ONE RESEARCH DRIVE
WESTBOROUGH, MASSACHUSETTS 01581
(508) 370-8500
(Name, address, including zip code, and
telephone number, including area code,
of agent for service)
with a copy to:
MARK G. BORDEN, ESQ.
HALE AND DORR LLP
60 STATE STREET
BOSTON, MASSACHUSETTS 02109
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: AS SOON AS
PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_] 333-_______.
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_] 333-__________.
If delivery of the Prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
_____________________________________________________________
CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------------------------------
Proposed
Maximum Proposed
Amount Offering Maximum Amount of
Title of Each Class of to be Price Aggregate Registration
Securities to be Registered Registered Per Share (1) Offering Price(1) Fee
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $0.0006 par value per share 129,045 $29.10 $3,755,210 $1,108
- -------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(c) under the Securities Act and based upon the average of the
high and low prices on the Nasdaq National Market on September 1, 1998.
_____________________________________________________________
THE COMPANY HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE COMPANY SHALL FILE A
FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
SHALL DETERMINE.
================================================================================
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+ Information contained herein is subject to completion or amendment. A +
+ registration statement relating to these securities has been filed with the +
+ Securities and Exchange Commission. These securities may not be sold nor may +
+ offers to buy be accepted prior to the time the registration statement +
+ becomes effective. This Prospectus shall not constitute an offer to sell +
+ or the solicitation of an offer to buy nor shall there be any sale of these +
+ securities in any State in which such offer, solicitation or sale would be +
+ unlawful prior to registration or qualification under the securities laws of +
+ any such State. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED SEPTEMBER 4, 1998
PROSPECTUS
STAPLES, INC.
129,045 SHARES
COMMON STOCK
_____________________
This Prospectus relates to 129,045 issued and outstanding shares (the
"Shares") of Common Stock, $0.0006 par value per share (the "Common Stock"), of
Staples, Inc. ("Staples" or the "Company") held by certain stockholders of the
Company named herein (the "Selling Stockholders"). The Shares were issued by the
Company in connection with the Company's acquisition of Quill Corporation and
certain related entities ("Quill") in a pooling of interests transaction (the
"Merger") pursuant to an exemption from the registration requirements of the
Securities Act of 1933, as amended (the "Securities Act"). The Shares are being
registered by the Company pursuant to the terms of an Agreement and Plan of
Merger, dated as of April 6, 1998, as amended, by and among the Company, Quill
and the former stockholders of Quill, including the Selling Stockholders (the
"Merger Agreement"). See "The Merger" and "Selling Stockholders."
The Shares may be offered by the Selling Stockholders from time to time in
transactions on the Nasdaq National Market ("Nasdaq"), in privately negotiated
transactions, through the writing of options on the Shares or a combination of
such methods of sale, at fixed prices that may be changed, at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices. The Selling Stockholders may effect such
transactions directly or indirectly by selling the Shares to or through broker-
dealers, agents or underwriters, and such broker-dealers, agents or underwriters
may receive compensation in the form of discounts, concessions or commissions
from the Selling Stockholders or the purchasers of the Shares for whom such
broker-dealers, agents or underwriters, may act as agent or to whom they sell as
principal or both (which compensation to a particular broker-dealer, agent or
underwriter, might be in excess of customary commissions). See "Selling
Stockholders" and "Plan of Distribution."
This Prospectus may be used by the Selling Stockholders or by any broker-
dealer, agent or underwriter, who may participate in sales of the Shares. The
Selling Stockholders will pay all commissions, transfer taxes and other
expenses, if any, associated with the sale of the Shares by them.
The Company will not receive any of the proceeds from the sale of the
Shares by the Selling Stockholders. The Company has agreed to bear certain
expenses in connection with the registration and sale of the Shares being
offered by the Selling Stockholders. The Company and the Selling Stockholders
have agreed to indemnify each other against certain liabilities, including
certain liabilities under the Securities Act. See "Use of Proceeds."
The Company's Common Stock is traded on Nasdaq under the symbol "SPLS." On
September 1, 1998, the closing sale price of the Common Stock on Nasdaq was
$29.125 per share.
THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE
OF RISK. SEE "RISK FACTORS" BEGINNING ON PAGE 6.
______________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR
ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY
OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
_____________________
The date of this Prospectus is ________ __, 1998.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information may be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549 and at the Commission's regional offices
located at Seven World Trade Center, Suite 1300, New York, New York 10048, and
at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. Copies of such materials also may be obtained from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. In addition, reports, proxy statements and other information
concerning the Company can be inspected and copied at the offices of the Nasdaq
Stock Market, Inc., 1735 K Street, N.W., Washington, D.C. 20006. The Company is
required to file electronic versions of certain documents through the
Commission's Electronic Data Gathering, Analysis and Retrieval (EDGAR) system.
The Commission maintains a World Wide Web site at http://www.sec.gov that
contains reports, proxy and information statements and other information
regarding registrants that file electronically with the Commission.
The Company has filed with the Commission a Registration Statement on Form
S-3 (together with all amendments, supplements, exhibits and schedules thereto,
the "Registration Statement") under the Securities Act with respect to the
Shares offered hereby. This Prospectus does not contain all of the information
set forth in the Registration Statement, as certain items are omitted in
accordance with the rules and regulations of the Commission. For further
information pertaining to the Company and the Shares, reference is made to such
Registration Statement. Statements contained in this Prospectus regarding the
contents of any agreement or other document are not necessarily complete, and in
each instance reference is made to the copy of such agreement or document filed
as an exhibit to the Registration Statement, each such statement being qualified
in all respects by such reference. The Registration Statement may be inspected
without charge at the office of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and copies of all or any part thereof may be obtained
from the Commission at prescribed rates.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
January 31, 1998;
(2) The Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended May 2, 1998;
(3) The Company's Quarterly Report on Form 10-Q for the fiscal quarter
ended August 1, 1998;
(4) The Company's Current Report on Form 8-K dated April 6, 1998, filed
with the Commission on April 10, 1998;
(5) The Company's Current Report on Form 8-K dated May 21, 1998, filed
with the Commission on June 4, 1998;
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<PAGE>
(6) The Company's Current Report on Form 8-K dated July 1, 1998, filed
with the Commission on July 1, 1998;
(7) The Company's Current Report on Form 8-K dated July 9, 1998, filed
with the Commission on July 9, 1998; and
(8) The Company's Registration Statement on Form 8-A dated April 7, 1989
registering the Common Stock under Section 12(g) of the Exchange Act.
All documents filed by the Company with the Commission pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date hereof and
prior to the termination of the offering of the Shares registered hereby shall
be deemed to be incorporated by reference into this Prospectus and to be a part
hereof from the date of filing such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon written or oral
request of such person, a copy of any or all of the foregoing documents
incorporated by reference into this Prospectus (without exhibits to such
documents other than exhibits specifically incorporated by reference into such
documents). All such requests shall be directed to: Staples, Inc., One Research
Drive, Westborough, Massachusetts 01581, Attention: Investor Relations,
Telephone: (508) 370-8500.
SPECIAL NOTE REGARDING FORWARD-LOOKING INFORMATION
This Prospectus (including the information incorporated herein by
reference) contains forward-looking statements. For this purpose, any statements
contained herein (or incorporated herein by reference) that are not statements
of historical fact may be deemed to be forward-looking statements. Without
limiting the foregoing, the words "believes", "anticipates", "plans", "expects"
and similar expressions are intended to identify forward-looking statements.
There are a number of important factors that could cause actual events or the
Company's actual results to differ materially from those indicated by such
forward-looking statements. These factors include, without limitation, those set
forth below under the caption "Risk Factors."
THE COMPANY
Staples was founded in 1985 and pioneered the office products superstore
concept. The Company is a leading office products distributor with a total of
830 retail stores located in the United States, Canada, the United Kingdom and
Germany as of August 1, 1998, in addition to catalog and contract stationer
operations.
The Company views the office products market as a large diversified market
for office supplies and equipment, business machines and computers, and various
business services. Although there are
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<PAGE>
no clear demarcations among segments, the Company targets four principal end-
user groups: consumers and home offices; small businesses and organizations with
fewer than 50 office workers; medium-size businesses and organizations with more
than 50 office workers; and large businesses with more than 1,000 office
workers. The Company's ability to address all four major end-user groups
increases and diversifies its available market opportunities, increases
awareness of the Staples name among customers in all four end-user groups (who
often shop across distribution channels) and allows the Company to enjoy a
number of important economies of scale. These include increased buying power,
enhanced efficiencies in distribution and advertising and improved capacity to
leverage certain general and administrative functions.
The Company effectively reaches different sectors of the office products
market through different channels of distribution designed to be convenient to
each targeted market sector. Specifically, in-store operations seek to address
the retail needs of customers, while the Company's delivered office products
businesses focus on customers who desire delivery of their office products and
other specialized services.
NORTH AMERICAN SUPERSTORES
Staples' North American retail operations, consisting of 766 stores as of
August 1, 1998, are the core business of the Company, generating a substantial
majority of its sales and profits. The Company's retail operations focus on
serving the needs of customers primarily in the consumer, home office and small
business segments of the office products market.
Superstores. The Company's North American superstores are located in 33
states, the District of Columbia and nine Canadian provinces in both major
metropolitan markets and smaller outlying markets. The Company's current
superstore prototype is approximately 24,000 square feet and offers about 8,000
different stock keeping units ("SKUs"). The Company's strategy for its North
American superstores focuses on four key objectives: (i) providing superior
customer value through a combination of broad product selection, everyday low
prices, outstanding customer service and convenient locations; (ii) increasing
the Company's presence in targeted markets by adding new superstores and
achieving economies of scale in most of the major markets where it competes;
(iii) reducing operating costs to the lowest level consistent with providing
quality merchandise and service; and (iv) offering a comfortable, easy-to-shop
store environment with skilled sales associates available to assist the
customer.
Express Stores. In select urban markets, the Company operates a smaller
store format, "Staples Express," which offers a more focused assortment of
products. These smaller stores give the Company the opportunity to meet the
office supply needs of customers in a store format that is efficient and
economical in an urban environment. Staples Express stores range from
approximately 6,000 to 10,000 square feet in size, and generally stock about
6,000 different SKUs.
DELIVERED OFFICE PRODUCTS
The Company's delivered office products business is comprised of three
principal operations: the Company's two catalog businesses, operating under the
names "Staples Direct" and "Quill," and the Company's contract stationer
business, operating under the names "Staples National Advantage" and "Staples
Business Advantage."
Staples Direct. Staples Direct, the Company's direct mail catalog business,
was launched in 1990 to target segments of the office products market seeking
the convenience of telephone ordering and free next day delivery for orders over
$50. Delivery orders are shipped from the Company's delivery
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<PAGE>
distribution centers and are distributed through dedicated delivery hubs. In
some markets, the Company also delivers products directly from its retail
stores. The Company markets Staples Direct through both direct mail catalogs and
a sales force primarily focused on generating new accounts. The Company recently
expanded its catalog operations in Canada, the United Kingdom and Germany.
Quill. In May 1998, the Company acquired Quill and certain related entities
in a pooling of interests transaction for total consideration of approximately
$690 million consisting of 25,989,417 shares of the Company's Common Stock and
cash of approximately $48 million. In 1997, Quill had net sales of approximately
$551 million. Quill is a direct marketer focused on serving the needs of small-
to medium-sized business customers across the United States that employ between
10 and 100 office workers. Quill currently operates nine distribution centers
located throughout the United States. Quill uses targeted database marketing
techniques to address the specific needs of certain customer groups. The Company
incurred a charge to earnings of approximately $41 million in the fiscal quarter
ended August 1, 1998 in connection with the acquisition of Quill.
Staples National Advantage and Staples Business Advantage. The Company's
contract stationer operations focus primarily on serving the needs of medium-to-
large-size businesses that sometimes may seek more services than are provided by
a traditional retail or mail order business, such as customized pricing, payment
terms, usage reporting and the stocking of certain proprietary items. The
Company's contract stationer business is divided into two segments. Staples
National Advantage is a nationwide contract stationer business focused on
selling to large multi-regional businesses. Staples Business Advantage focuses
on selling to medium- and large-size regional companies and has the flexibility
to handle smaller accounts.
INTERNATIONAL
The Company believes that foreign markets provide significant growth
opportunities. In 1991, the Company established its first international joint
venture, "Business Depot," in Canada. Business Depot became a wholly-owned
subsidiary of the Company in 1994. The Company also became a partner in two
overseas office products superstore joint ventures operating in the United
Kingdom under the name "Staples UK" and in Germany under the name "MAXI-Papier-
Markt-GmbH," now known as Staples (Deutschland), Gmbh ("Staples Germany"). In
May 1997, the Company increased its ownership interest in the Staples UK
operations to 100% and in Staples Germany to approximately 92%. As of June 30,
1998, Staples UK operated 42 stores and Staples Germany operated 18 stores.
Staples Germany recently began operating the German stores under the name
"Staples Der Buro Mega Markt."
STRATEGY
The Company is focused on the following strategic priorities, with the
objective of enhancing its position as a leading office products supplier:
Profitably Increase Retail Sales Per Store. The Company is devoting
significant resources and efforts to profitably increase its retail sales per
store. Initiatives cover a wide-range of store operations including product and
service offerings, inventory planning, staffing, customer satisfaction and
improvements in store design.
Continue Rapid Growth in Delivered Office Products. The Company is
implementing a number of actions to profitably grow its Staples Direct and Quill
businesses. The Company seeks to focus on expanding the product offerings
available for delivery, pursuing marketing initiatives to appeal to target
customers, and expanding distribution capacity.
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<PAGE>
Continue Store Growth and Strengthen Infrastructure. The Company is
continuing its store growth program. The Company's store growth strategy is
based on pursuing expansion of its network in existing markets and on entering
both major and small new markets. The Company has made significant investments
in its distribution infrastructure and inventory management systems to support
this future growth.
Improve Productivity. The Company intends to maintain its historical focus
on being a low cost operator and believes that it has significant opportunities
to reduce costs as a percentage of sales. Expansion will allow it to leverage
fixed costs in store operations, marketing, distribution and administration and
generate increased productivity through improvements in operating practices.
Improve Customer Service. The Company has increased staffing levels in
stores and delivery operations to improve service. The Company actively monitors
customer satisfaction and has implemented programs which tie employee
compensation to achievement of corporate goals.
----------------
The Company's executive offices are located at One Research Drive,
Westborough, Massachusetts 01581 (telephone: (508) 370-8500). The Company was
organized in November 1985 and is incorporated in the State of Delaware.
RISK FACTORS
The Shares offered hereby involve a high degree of risk. The following risk
factors should be considered carefully in addition to the other information
included or incorporated by reference in this Prospectus before purchasing the
Shares offered hereby.
INTENSE COMPETITION
The Company operates in a highly competitive marketplace, in which it
competes with a variety of retailers, dealers and distributors. The Company
competes in most of its geographic markets with other high-volume office supply
chains that are similar in concept to the Company in terms of store format,
pricing strategy and product selection, such as Office Depot, OfficeMax and
Office World, as well as mass merchants, such as Wal-Mart, warehouse clubs,
computer and electronics superstores, and other discount retailers. In addition,
the Company's retail stores, as well as its delivery and contract business,
compete with numerous mail order firms, contract stationer businesses and direct
manufacturers. Such competitors have increased their presence in the Company's
markets in recent years. Some of the Company's current and potential competitors
in the office products industry are larger than the Company and have
substantially greater financial resources. No assurance can be given that
competition will not have an adverse effect on the Company's business.
RISKS OF EXPANSION
An important part of the Company's business plan is an aggressive store
growth strategy. The Company opened 130 stores in the United States, Canada and
Europe in fiscal 1997, plans to open approximately 170 new stores in fiscal 1998
and expects to continue to pursue an aggressive store growth strategy in fiscal
1999 and beyond. There can be no assurance that the Company will be able
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to identify and lease favorable store sites, hire and train employees, and adapt
its management and operational systems to the extent necessary to fulfill its
expansion plans. The failure to open new stores in accordance with its growth
plans could have a material adverse impact on the Company's future sales and
profits. Moreover, the Company's expansion strategy is based in part on the
continued addition of new stores to its store network in existing markets to
take advantage of economies of scale in marketing, distribution and supervision
costs; however, this may result in the "cannibalization" of sales of existing
stores. In addition, there can be no assurance that the new stores opened by the
Company will achieve sales or profit levels commensurate with those of the
Company's existing stores.
FLUCTUATIONS IN QUARTERLY OPERATING RESULTS; SEASONALITY
The Company has experienced and may experience in the future fluctuations
in its quarterly operating results. Moreover, there can be no assurance that
Staples will continue to realize the earnings growth experienced over recent
years, or that earnings in any particular quarter will not fall short of either
a prior fiscal quarter or investors' expectations. Factors such as the number of
new store openings (pre-opening expenses are expensed as incurred, and newer
stores are less profitable than mature stores), the extent to which new stores
"cannibalize" sales of existing stores, the mix of products sold, pricing
actions of competitors, the level of advertising and promotional expenses,
seasonality, and one-time charges associated with acquisitions or other events
could contribute to this quarterly variability. The Company's sales and
profitability are typically slightly lower in the first and second quarter of
its fiscal year than in other quarters. In addition, the Company's expense
levels are based in part on expectations of future sales levels, and a shortfall
in expected sales could therefore result in a disproportionate decrease in the
Company's net income.
MANAGEMENT OF GROWTH
The Company's business, including sales, number of stores and number of
employees, has grown dramatically over the past several years. In addition, the
Company has consummated a number of significant acquisitions in the last few
years, and may make additional acquisitions in the future. This internal growth,
together with the acquisitions made by the Company, have placed significant
demands on the management and operational systems of the Company. To manage its
growth effectively, the Company will be required to continue to upgrade its
operational and financial systems, expand its management team and increase and
manage its employee base.
INTEGRATION OF CERTAIN OPERATIONS OF QUILL
In May 1998, the Company acquired all of the capital stock of Quill, which
sells office supplies in the U.S. through mail order catalogs. The Company plans
to continue to operate the Quill business separately from that of Staples
Direct. However, over time, the Company may determine that integration of
certain operations of Staples Direct and Quill may be desirable. There can be no
assurance that the Company will not encounter difficulties in any such
integration and any such difficulties could have a material adverse effect on
the operations of the Company. The Company incurred a charge to earnings of
approximately $41 million in the quarter ended August 1, 1998 in connection with
the acquisition of Quill.
RISKS OF INTERNATIONAL OPERATIONS
The Company has a presence in international markets through its operations
in Canada, Germany and the United Kingdom, and may seek to expand into other
international markets in the future. The Company's operations in foreign markets
are subject to risks similar to those affecting its
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<PAGE>
U.S. operations, in addition to a number of additional risks inherent in foreign
operations, including local customs and competitive conditions, and foreign
currency fluctuations. Staples' European operations are currently unprofitable,
and there can be no assurance that they will become profitable.
AVAILABILITY OF FINANCINGS
The Company currently expects that its current cash and cash equivalents
and funds available under its revolving credit facility will be sufficient to
fund its planned store openings and other operating cash needs for at least the
next 12 to 18 months. However, there can be no assurance that the Company will
not require additional sources of financing prior to such time, as a result of
unanticipated cash needs or opportunities, an expanded growth strategy or
disappointing operating results. There also can be no assurance that the
additional funds required by the Company, whether within the next 12 to 18
months or thereafter, will be available to the Company on satisfactory terms.
RISKS ASSOCIATED WITH YEAR 2000
The Company has conducted a comprehensive review of its computer systems
and applications to identify those that might be affected by the year 2000 issue
and has begun an implementation plan to resolve the year 2000 issue. The Company
is in the process of correcting or replacing those systems and applications
which are not currently year 2000 compliant. The Company believes it will be
able to modify or replace its affected systems and applications in time to avoid
any material detrimental impact on its operations. The Company will incur
internal staff costs as well as consulting and other expenses related to
infrastructure and facilities enhancements necessary to prepare its systems and
applications for the year 2000 issue. The preliminary expense estimate for year
2000 corrective and replacement activities ranges from $20 to $30 million, a
portion of which would have been incurred as part of normal system and
application upgrades. It is anticipated that all year 2000 compliance efforts
will be complete by mid-1999. However, if such modifications and conversions are
not completed in a timely manner, the year 2000 issue may have a material
adverse impact on the operations of the Company.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of the Shares by
the Selling Stockholders.
The Company will bear all costs (excluding any brokerage fees, underwriting
discounts and selling commissions and expenses incurred by the Selling
Stockholders for legal services), fees and expenses incurred in effecting the
registration of the Shares covered by this Prospectus, including, without
limitation, all registration and filing fees required under federal and state
securities laws, fees and expenses of counsel for the Company and fees and
expenses of accountants for the Company.
THE MERGER
In May 1998, the Company acquired Quill and certain related entities in a
pooling of interests transaction for total consideration of approximately $690
million consisting of 25,989,417 shares of Common Stock and cash of
approximately $48 million.
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<PAGE>
SELLING STOCKHOLDERS
The following table sets forth, to the knowledge of the Company, certain
information regarding the beneficial ownership of shares of Common Stock of each
Selling Stockholder and as adjusted to give effect to the sale of the Shares
offered hereby. The Shares are being registered to permit public secondary
trading of the Shares, and the Selling Stockholders may offer the Shares for
resale from time to time.
All of the Shares being offered by the Selling Stockholders were acquired
by them from the Company in connection with the Merger in a private placement
transaction pursuant to an exemption from the registration requirements of the
Securities Act provided by Section 4(2) thereof. The Selling Stockholders are
former stockholders of Quill. See "The Merger."
Except as provided below, the Selling Stockholders have not served as
officers or directors of, or otherwise had a material relationship with, the
Company or any of its predecessors or affiliates since September 4, 1995 (other
than as stockholders of Quill prior to the Merger and as stockholders of Staples
subsequent to the Merger).
<TABLE>
<CAPTION>
Number of Shares of Number of Shares of
Common Stock Number of Common Stock
Name of Selling Beneficially Owned Shares Beneficially Owned After
Stockholder Prior to the Offering(1) Offered Hereby Offering (1)(2)
- --------------- ------------------------ -------------- ------------------------
<S> <C> <C> <C>
Cindy Levy 18,435 18,435 --
Gregory Miller 18,435 18,435 --
Avrum Miller 18,435 18,435 --
Gail Miller 18,435 18,435 --
Susan Pack 18,435 18,435 --
Harlan Miller 18,435 18,435 --
Lauren Jacobson 18,435 18,435 __
</TABLE>
____________________
(1) The number of shares of Common Stock beneficially owned is determined under
rules promulgated by the Commission, and the information is not necessarily
indicative of beneficial ownership for any other purpose. Each Selling
Stockholder has sole voting power and investment power with respect to all
shares of Common Stock listed as owned by such Selling Stockholder.
(2) It is unknown if, when or in what amounts the Selling Stockholders may
offer Shares for sale and there can be no assurance that the Selling
Stockholders will sell any or all of the Shares offered hereby. Because the
Selling Stockholders may offer all or some of the Shares pursuant to this
Offering, and because there are currently no agreements, arrangements or
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<PAGE>
understandings with respect to the sale of any of the Shares held by the
Selling Stockholders, no estimate can be given as to the amount of the
Shares that will be held by the Selling Stockholders after completion of
the Offering. However, for purposes of this table, the Company has assumed
that, after completion of the Offering, none of the Shares covered hereby
will be held by the Selling Stockholders. None of the Selling Stockholders
currently owns and, assuming the sale of the Shares registered hereby, none
of the Selling Stockholders will own, 1% or more of the outstanding Common
Stock.
-10-
<PAGE>
PLAN OF DISTRIBUTION
The Shares are being registered by the Company pursuant to the terms of the
Merger Agreement. In the Merger Agreement, the Company has agreed, among other
things, to bear all costs (excluding any brokerage fees, underwriting discounts
and selling commissions and expenses incurred by the Selling Stockholders for
legal services), fees and expenses incurred in effecting the registration of the
Shares covered by this Prospectus, including, without limitation, all
registration and filing fees required under federal and state securities laws,
fees and expenses of counsel for the Company and fees and expenses of
accountants for the Company.
The Selling Stockholders represented in the Merger Agreement that they were
acquiring the Shares for investment and with no present intention of
distributing any of such Shares. In recognition of the fact that investors, even
though purchasing shares of Common Stock without a view to distribution, may
wish to be legally permitted to sell publicly their shares of Common Stock when
they deem appropriate, the Company has filed with the Commission, under the
Securities Act, a Registration Statement on Form S-3, of which this Prospectus
forms a part, with respect to the resale of the Shares from time to time and has
agreed to prepare and file such amendments and supplements to the Registration
Statement as may be necessary to keep the Registration Statement effective until
the earlier of (i) September __, 2000 or (ii) the date on which all Shares
offered hereby have been sold by the Selling Stockholders.
The Company has been advised that the Shares covered hereby may be offered
and sold by the Selling Stockholders, or by purchasers, transferees, donees,
pledgees or other successors in interest, in private or public transactions,
directly or indirectly by or through broker-dealers, agents or underwriters who
may receive compensation in the form of underwriting discounts, concessions or
commissions from the Selling Stockholders and/or from purchasers of the Shares
for whom they may act as agent. Sales and transfers of the Shares may be
effected from time to time in one or more transactions on Nasdaq, in the over-
the-counter market, in negotiated transactions or otherwise, at fixed prices
which may be changed, at market prices prevailing at the time of sale, at
negotiated prices, without consideration, or by any other legally available
means. Any or all of the Shares may be sold or transferred from time to time by
means of (a) a block trade in which the broker or dealer so engaged will attempt
to sell the Shares as agent but may position and resell a portion of the block
as principal to facilitate the transaction; (b) purchases by a broker or dealer
as principal and resale by such broker or dealer for its account pursuant to
this Prospectus; (c) ordinary brokerage transactions and transactions in which
the broker solicits purchasers; (d) the writing of options on the Shares; (e)
pledges as collateral to secure loans, credit or other financing arrangements
and subsequent foreclosure, if any, thereunder; (f) gifts, donations and
contributions; and (g) any other legally available means. To the extent
required, the number of Shares to be sold or transferred, the purchase price,
the name of any such agent, broker-dealer or underwriter and any applicable
discounts, concessions, allowances, discounts or commissions and any other
required information with respect to a particular offer of the Shares will be
set forth in a Prospectus Supplement. The aggregate net proceeds to the Selling
Stockholders from the sale of the Shares will be the purchase price of such
Shares less any underwriting discounts, concessions or commissions. In addition,
any Shares covered by this Prospectus which qualify for sale under Rule 144 or
Section 4(1) under the Securities Act may be sold under Rule 144 or Section 4(1)
rather than pursuant to this Prospectus.
The Selling Stockholders and any broker-dealers who act in connection with
the sale of Shares hereunder may be deemed to be "underwriters" as the term is
defined in the Securities Act and any commissions received by them as profit or
any resale of the Shares as principal might be deemed to be underwriting
discounts or commissions under the Securities Act.
-11-
<PAGE>
The Company and the Selling Stockholders have agreed to indemnify each
other against certain liabilities, including certain liabilities under the
Securities Act.
The Offering will terminate on the earlier of (i) September __, 2000 or
(ii) the date on which all Shares offered hereby have been sold by the Selling
Stockholders.
LEGAL MATTERS
The validity of the Shares offered hereby will be passed upon for the
Company by Hale and Dorr LLP, counsel to the Company.
EXPERTS
The consolidated financial statements of Staples at January 31, 1998 and
February 1, 1997, and for each of the three years in the period ended January
31, 1998, incorporated in this Prospectus and Registration Statement by
reference to the Company's Current Report on Form 8-K dated July 1, 1998 have
been audited by Ernst & Young LLP, independent auditors, as set forth in their
report thereon incorporated by reference herein which, as to the years 1997,
1996, and 1995, are based in part on the reports of Kupferberg, Goldberg, &
Neimark, LLC, independent auditors. The financial statements referred to above
are incorporated by reference herein in reliance upon such reports given upon
the authority of such firms as experts in accounting and auditing.
-12-
<PAGE>
================================================================================
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR THE SELLING STOCKHOLDERS. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY TO ANY PERSON
IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION OF AN OFFER OR
SOLICITATION WOULD BE UNLAWFUL. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY
OFFER OR SALE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY DATE HEREOF.
_______________
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................... 2
Incorporation of Certain Documents
By Reference.......................... 2
Special Note Regarding Forward-Looking
Information........................... 3
The Company............................. 3
Risk Factors............................ 6
Use of Proceeds......................... 8
The Merger.............................. 8
Selling Stockholders.................... 9
Plan of Distribution.................... 11
Legal Matters........................... 12
Experts................................. 12
</TABLE>
================================================================================
================================================================================
STAPLES, INC.
129,045 SHARES OF
COMMON STOCK
______________
PROSPECTUS
______________
___________ __, 1998
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the various expenses to be incurred in connection
with the sale and distribution of the securities being registered hereby, all of
which will be borne by the Company (except expenses incurred by the Selling
Stockholders for brokerage fees, selling commissions, underwriting discounts and
selling commissions and expenses incurred by the Selling Stockholders for legal
services). All amounts shown are estimates except the Securities and Exchange
Commission registration fee.
<TABLE>
<S> <C>
Filing Fee - Securities and Exchange Commission.. $ 1,108
Legal fees and expenses of the Company........... $10,000
Miscellaneous expenses........................... $ 3,892
Total Expenses.............................. $15,000
=======
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Except as hereinafter set forth, there is no provision of the Company's
Certificate of Incorporation, or any contract, arrangement or statute under
which any director or officer of the Company is insured or indemnified in any
manner against any liability that he may incur in his capacity as such.
Section 145 of the General Corporation Law of the State of Delaware
provides that a corporation has the power to indemnify a director, officer,
employee or agent of the corporation and certain other persons serving at the
request of the corporation in related capacities against amounts paid and
expenses incurred in connection with an action or proceeding to which he is or
is threatened to be made a party by reason of such position, if such person
shall have acted in good faith and in a manner he reasonably believed to be in
or not opposed to the best interests of the corporation, and, in any criminal
proceeding, if such person had no reasonable cause to believe his conduct was
unlawful, provided that, in the case of actions brought by or in the right of
the corporation, no indemnification shall be made with respect to any matter as
to which such person shall have been adjudged to be liable to the corporation
unless and only to the extent that the adjudicating court determines that such
indemnification is proper under the circumstances. The Company's Certificate of
Incorporation provides that the Company shall indemnify its directors and
officers to the fullest extent permitted by the Delaware General Corporation
Law.
The Company's Certificate of Incorporation also provides that no director
shall be liable to the Company or its stockholders for monetary damages for
breach of his fiduciary duty as a director, except for liability (i) for any
breach of the director's duty of loyalty to the Company or its stockholders,
(ii) for acts or omissions not in good faith or which involve intentional
misconduct or a knowing violation of law, (iii) under Section 174 of the
Delaware General Corporation Law or (iv) for any transaction in which the
director derived an improper personal benefit.
The By-laws of the Company contain provisions to the effect that each
director, officer and employee of the Company shall be indemnified by the
Company against liabilities and expenses in connection with any legal
proceedings to which he may be made a party or with which he may become involved
or threatened by reason of having been an officer, director or employee of the
II-1
<PAGE>
Company or of any other organization at the request of the Company. The
provisions include indemnification with respect to matters covered by a
settlement. Any such indemnification shall be made only if the Board determines
by a majority vote of a quorum consisting of disinterested directors (or, if
such quorum is not obtainable, or if the Board of Directors directs, by
independent legal counsel) or by stockholders, that indemnification is proper in
the circumstances because the person seeking indemnification has met the
applicable standards of conduct. It must be determined that the director,
officer or employee acted in good faith with the reasonable belief that his
action was in or not opposed to the best interests of the Company, and, with
respect to any criminal action or proceeding, that he had no reasonable cause to
believe his conduct was unlawful.
The Company maintains directors and officers liability insurance for the
benefit of its directors and certain of its officers.
ITEM 16. EXHIBITS
EXHIBIT
NUMBER DESCRIPTION
- ------ -----------
5.1 Opinion of Hale and Dorr LLP
23.1 Consent of Ernst & Young LLP
23.2 Consent of Kupferberg, Goldberg & Neimark, LLC
23.3 Consent of Hale and Dorr LLP, included in Exhibit 5.1 filed herewith.
24.1 Power of Attorney (See page II-4 of this Registration Statement).
ITEM 17. UNDERTAKINGS.
The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this Registration Statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
Registration Statement. Notwithstanding the foregoing, any increase or
decrease in the volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
derivation from the low or high and of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective Registration Statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
II-2
<PAGE>
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included is a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Company pursuant
to Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), that are incorporated by reference in this
Registration Statement.
(2) That, for the purposes of determining any liability under the
Securities Act, each post-effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at the time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The Registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the Registrant's annual
report pursuant to Section 13(a) or 15(d) of the Exchange Act (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Exchange Act) that is incorporated by reference in this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein and the offering of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the indemnification provisions described herein, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the Registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the Town of Westborough, Commonwealth of Massachusetts on the 4th
day of September, 1998.
STAPLES, INC.
By: /s/ Thomas G. Stemberg
----------------------
Thomas G. Stemberg
President, Chief Executive
Officer and Chairman of the
Board of Directors
SIGNATURES AND POWER OF ATTORNEY
Each person whose signature appears below constitutes and appoints Thomas
G. Stemberg, John J. Mahoney and Mark G. Borden, each of them, his true and
lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution in each of them, for him and in his name, place and stead, and in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement on Form S-3 of Staples, Inc. and to
file the same, with all exhibits thereto, and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power of authority to do
and perform each and every act and thing requisite or necessary to be done in
and about the premises, hereby ratifying and confirming all that said attorneys-
in-fact and agents or any of them or their or his substitutes or substitute, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on the 4th day of September, 1998
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ Thomas G. Stemberg President, Chief Executive Officer and
- --------------------------- Chairman of the Board of Directors
Thomas G. Stemberg (Principal Executive Officer)
/s/ John J. Mahoney Executive Vice President--Finance and
- --------------------------- Chief Financial Officer (Principal
John J. Mahoney Financial Officer)
/s/ Robert K. Mayerson Senior Vice President and Corporate
- --------------------------- Controller (Principal Accounting Officer)
Robert K. Mayerson
/s/ Basil L. Anderson Director
- ---------------------------
Basil L. Anderson
</TABLE>
II-4
<PAGE>
/s/ Mary Elizabeth Burton Director
- ---------------------------
Mary Elizabeth Burton
/s/ W. Lawrence Heisey Director
- ---------------------------
W. Lawrence Heisey
/s/ James L. Moody, Jr. Director
- ---------------------------
James L. Moody, Jr.
/s/ Rowland T. Moriarty Director
- ---------------------------
Rowland T. Moriarty
/s/ Robert C. Nakasone Director
- ---------------------------
Robert C. Nakasone
/s/ W. Mitt Romney Director
- ---------------------------
W. Mitt Romney
/s/ Martin Trust Director
- ---------------------------
Martin Trust
/s/ Paul F. Walsh Director
- ---------------------------
Paul F. Walsh
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION PAGE
- ------ ----------- ----
<S> <C> <C>
5.1 Opinion of Hale and Dorr LLP -
23.1 Consent of Ernst & Young LLP -
23.2 Consent of Kupferberg, Goldberg & Neimark, LLC -
23.3 Consent of Hale and Dorr LLP (included in Exhibit 5.1 filed herewith). -
24.1 Power of Attorney (See page II-4 of this Registration Statement). -
</TABLE>
<PAGE>
Exhibit 5.1
[LETTERHEAD OF HALE AND DORR LLP APPEARS HERE]
September 4, 1998
Staples, Inc.
One Research Drive
Westborough, MA 01581
Ladies and Gentlemen:
We have assisted in the preparation of the Registration Statement on Form
S-3 (the "Registration Statement") filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, relating to the
registration of 129,045 shares of common stock, $0.0006 par value per share (the
"Shares"), of Staples, Inc., a Delaware corporation (the "Company"), held by
certain selling stockholders of the Company.
We have examined the Certificate of Incorporation and By-Laws of the
Company and all amendments thereto and have examined and relied on the
originals, or copies certified to our satisfaction, of such records of meetings,
written actions in lieu of meetings, or resolutions adopted at meetings, of the
directors of the Company and such other documents and instruments as in our
judgment are necessary or appropriate to enable us to render the opinions
expressed below.
In our examination of the foregoing documents, we have assumed (i) the
genuineness of all signatures and the authenticity of all documents submitted to
us as originals, (ii) the conformity to the originals of all documents submitted
to us as certified or photostatic copies, and (iii) the authenticity of the
originals of the latter documents.
Based upon and subject to the foregoing, we are of the opinion that the
Shares have been duly and validly authorized and issued and are fully paid and
non-assessable.
We hereby consent to the use of our name in the Registration Statement and
in the related Prospectus under the caption "Legal Matters" and to the filing of
this opinion as an exhibit to the Registration Statement.
Very truly yours,
/s/ Hale and Dorr LLP
HALE AND DORR LLP
<PAGE>
Exhibit 23.1
CONSENT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement on Form S-3 and related Prospectus of Staples, Inc. for
the registration of 129,045 shares of its common stock and to the incorporation
by reference therein of our report dated June 29, 1998 with respect to the
consolidated financial statements of Staples, Inc. included in its Current
Report on Form 8-K dated July 1, 1998, filed with the Securities and Exchange
Commission.
/s/ Ernst & Young LLP
September 3, 1998
Boston, Massachusetts
<PAGE>
Exhibit 23.2
CONSENT OF KUPFERBERG, GOLDBERG & NEIMARK, LLC, INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement on Form S-3 and related Prospectus of Staples, Inc. for
the registration of 129,045 shares of its common stock and to incorporation by
reference therein of our report dated February 24, 1998 with respect to the
consolidated financial statements of Quill Corporation and Subsidiary as of
December 31, 1997 and 1996, and for each of the three years in the period ended
December 31, 1997, included in the Current Report on Form 8-K dated July 1,
1998, of Staples, Inc., filed with the Securities and Exchange Commission.
/s/ Kupferberg, Goldberg & Neimark, LLC
September 3, 1998
Chicago, Illinois
