<PAGE> 1
PROSPECTUS
SALTON, INC.
Maximum of 957,304 Shares of Common Stock
---------------
This prospectus relates to a maximum of 957,304 shares of our common stock.
These shares may be offered and sold from time to time by the selling
stockholders named herein. The selling stockholders may offer their shares of
common stock through public or private transactions, on or off The New York
Stock Exchange, at prevailing market prices, or at privately negotiated prices.
The selling stockholders may include pledgees, donees, transferees, or other
successors in interest. We will provide specific terms of any offerings made
under this prospectus in prospectus supplements, if necessary.
We will not receive any of the proceeds from the sale of the common stock.
We will bear the costs relating to the registration of the common shares,
estimated to be approximately $50,000.
The common stock is traded on The New York Stock Exchange under the symbol
SFP. The closing sales price of the shares of common stock as reported on The
New York Stock Exchange on January 5, 2000 was $30 15/16 per share. The selling
stockholders will pay any sales commissions or underwriting discounts and fees
and expenses of their counsel incurred in connection with the sale of shares
through this prospectus.
----------------
These securities have not been approved or disapproved by
the securities and exchange commission nor has the
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 January 6, 2000
<PAGE> 2
TABLE OF CONTENTS
PAGE
The Company........................................................... 4
Unaudited Pro Forma Consolidated Financial Statements................. 4
Use of Proceeds....................................................... 10
Selling Stockholders.................................................. 11
Plan of Distribution.................................................. 12
Accounting Experts.................................................... 13
Special Note Regarding Forward-Looking Statements..................... 14
Where You Can Find More Information................................... 15
Incorporation of Certain Documents by Reference....................... 16
EXPLANATORY NOTES
We have not authorized anyone to provide you with information or to
represent anything not contained in this prospectus. You must not rely on any
unauthorized information or representations. The selling stockholders are
offering to sell, and seeking offers to buy, only the shares of common stock
where it is lawful to do so. The information contained in this prospectus is
prospectus or of any sale of the shares.
You should read carefully this entire prospectus, as well as the documents
incorporated by reference in this prospectus, before making an investment
decision. All references to "we," "our" or "Salton" in this prospectus mean
Salton, Inc. and its subsidiaries.
3
<PAGE> 3
THE COMPANY
We are a leading domestic designer, marketer and distributor of a broad
range of branded, high quality small appliances, tabletop products and personal
care products. We act as a marketing service provider by managing our brands and
product lines in a manner that allows our retail customers to differentiate
themselves to consumers. We have the leading domestic market share in toasters,
juice extractors, indoor grills, bread bakers, griddles, waffle makers and
buffet ranges/hotplates and a significant market share in other product
categories. We believe that our strong market share results from our well known
brand names, the breadth, quality and innovation of our product offerings and
our strong relationships and retailers and suppliers. We outsource most of our
production to independent manufacturers, primarily in the Far East.
Our portfolio of well-recognized owned and licensed brand names includes
Salton(R), Toastmaster(R), Maxim(R), Breadman(R), Juiceman(R), George Foreman
Grills(R), White-Westinghouse(R), Farberware(R), Melitta(R), Block(R),
Atlantis(R), Sasaki(R), Rejuvenique(R) and Ingraham(R). We are also a leading
designer and distributor of small appliances in the U.S. under such well-known
names as Kenmore(R) and Magic Chef(R).
We predominantly sell our products to mass merchandisers, department stores,
specialty stores and mail order catalogs. We also sell certain of our products
directly to consumers through paid half-hour television programs referred to as
"infomercials" and through our Internet website, www.salton/maxim.com. Our
customers include many premier domestic retailers, including Kmart, Dayton
Hudson (including Target and Mervyn's), Sears, Wal-Mart, Federated Department
Stores, May Company Department Stores, QVC, Bed Bath & Beyond, Saks Inc. and
Costco. We market and sell our products primarily in the U.S. through our own
sales force and a network of independent commissioned sales representatives.
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
The following unaudited pro forma consolidated financial statements give
effect to:
- the issuance of 109,090 shares of Salton common stock to the former
stockholders of TMI Acquisition Corp. in satisfaction of Salton's
obligation to pay TMI Acquisition Corp. certain amounts based on
future sales of Toastmaster(R) products; and
- Salton's pending acquisition of the right to use in perpetuity and
worldwide the name "George Foreman" in connection with the marketing and
sale of food preparation appliances for an aggregate purchase price of
$113,750,000 in cash, payable in five annual installments of $22,750,000
commencing on the closing date, and shares of Salton common stock valued
at $23,750,000 at the closing.
The unaudited pro forma condensed consolidated balance sheet data gives
effect to these transactions as if they had occurred on September 25, 1999. The
unaudited pro forma consolidated statements of operations data give effect to
these transactions as if they had occurred on (1) June 28, 1998 with respect to
the fiscal year ended June 26, 1999 and (2) June 27, 1999 with respect to the
thirteen weeks ended September 25, 1999.
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<PAGE> 4
The unaudited pro forma consolidated financial information set forth below
reflects pro forma adjustments that are based upon available information and
certain assumptions that Salton believes are reasonable. In particular, the
number of shares of Salton common stock to be issued in connection with the
George Foreman transaction is based on an assumed price of $28.00 per share at
the closing of that transaction. The pro forma financial information is for
informational purposes only and does not purport to represent what Salton's
results of operations or financial position would have actually been had the
transactions to which pro forma effect is given been consummated as of the dates
or for the periods indicated.
<TABLE>
<CAPTION>
SALTON, INC.
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
SEPTEMBER 25, 1999
(IN THOUSANDS)
-----------------------------------------------------------
HISTORICAL PRO FORMA
SALTON (1) ADJUSTMENTS AS ADJUSTED
---------- ------------------- -----------
<S> <C> <C> <C>
Total Assets:
$ 16,644 (2)
(22,750) (3)
Cash $ 8,336 (6,106) $ 2,230
Accounts Receivable, Net of Allowances 159,525 159,525
Inventories 155,965 155,965
Prepaid Expenses and Other Current Assets 8,521 8,521
Deferred Taxes 3,134 3,134
-------- ----------- --------
Total Current Assets $335,481 (6,106) 329,375
Property Plant and Equipment 46,520 46,520
Accumulated Depreciation (21,513) (21,513)
-------- ----------- --------
Net Property Plant and Equipment $ 25,007 25,007
(1,000) (4)
121,020 (3)
-----------
Intangibles, Net and Other Assets 42,500 120,020 162,520
Total Assets $402,988 $ 113,914 $516,902
======== =========== ========
Total Liabilities
Accounts Payable $ 53,732 50 (3) $ 53,782
Accrued Expenses 28,264 89 (4) 28,353
Income Taxes 6,144 $ 5,924 (2) 12,068
Revolving Line of Credit and Other Current
Debt 67,196 67,196
Deferred Income Taxes - - -
-------- ----------- --------
Total Current Liabilities 155,336 6,063 161,399
Non-current Deferred Tax Liability 157 - 157
(4,000) (4)
74,520 (3)
-----------
Long Term Debt $182,013 70,520 252,533
Total Liabilities 337,506 76,583 414,039
Stockholders Equity
Preferred Stock
Common Stock 134 - 134
11,790 (3)
1,516 (4)
-----------
Treasury Stock (43,308) 13,306 (30,002)
11,960 (3)
1,484 (4)
-----------
Additional Paid in Capital 45,317 13,444 58,761
Accumulated other comprehensive income (49) - (49)
Retained Earnings 63,388 10,581 (5) 73,969
-------- ----------- --------
Total Liabilities 65,482 37,331 102,813
-------- ----------- --------
Total Liabilities & Stockholders Equity $402,988 $ 113,914 $516,902
======== =========== ========
</TABLE>
See Notes to Unaudited Pro Forma Consolidated Financial Statements
5
<PAGE> 5
SALTON, INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS AND OTHER DATA
FISCAL YEAR ENDED JUNE 26, 1999
(IN THOUSANDS EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA PRO FORMA
SALTON (1) ADJUSTMENTS AS ADJUSTED
---------- ----------- -----------
<S> <C> <C> <C>
Net sales $506,116 $ 506,116
Cost of Goods sold 285,526 285,526
Distribution expenses 21,621 21,621
-------- ---------
Gross profit 198,969 - 198,969
$ 8,068 (6)
(25) (6)
Selling General, and Administrative expenses 129,588 (38,096) (6)
50 (9)
(536) (8) 99,049
-------- -------- ---------
Operating income 69,381 (30,539) 99,920
6,334 (7)
Interest expense 15,518 (173) (7) 22,025
-------- -------- ---------
Income before income taxes 53,863 (24,032) 77,895
Income taxes 19,320 8,553 (10) 27,873
-------- --------- ---------
Net income $ 34,543 $(15,479) $ 50,022
======== ========= =========
Earnings per share: Basic $ 3.21 $ 4.27
Earnings per share: Diluted $ 2.37 $ 3.22
Weighted average common shares outstanding 10,760 11,718
Weighted average common and
equivalent shares outstanding 14,562 15,519
EBITDA (11) $ 76,682 $ 115,264
EBITDA MARGIN (12) 15.2% 22.8%
Depreciation and amortization $ 7,301 $ 15,344
Capital Expenditures $ 5,390 $ 5,390
</TABLE>
See Notes to Unaudited Pro Forma Consolidated Financial Statements
6
<PAGE> 6
SALTON, INC.
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS AND OTHER DATA
THIRTEEN WEEKS ENDED SEPTEMBER 25, 1999
(IN THOUSANDS EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
HISTORICAL PRO FORMA PRO FORMA
SALTON (1) ADJUSTMENTS AS ADJUSTED
------------ --------------- -----------
<S> <C> <C> <C>
Net sales $ 196,340 $ 196,340
Cost of goods sold 110,401 110,401
Distribution expenses 7,120 7,120
----------- ---------
Gross profit 78,819 - 78,819
$ 2,017 (6)
(16,644) (6)
(6) (6)
50 (9)
Selling, general and administrative expenses 50,490 89 (8) 35,996
----------- ------- ---------
Operating income 28,329 (14,494) 42,823
1,584 (7)
Interest expense 5,477 7,061
----------- ---------
Income before income taxes 22,852 (12,910) 35,762
Income taxes 8,954 4,595 (10) 13,549
----------- --------- ---------
Net income $ 13,898 $ (8,315) $ 22,213
=========== ========= =========
Earnings per share: Basic $ 1.35 $ 1.98
Earnings per share: Diluted $ 0.95 $ 1.43
Weighted average common shares outstanding 10,290 11,247
Weighted average common and equivalent shares 14,574 15,531
outstanding
EBITDA (11) $ 30,609 $ 47,114
EBITDA MARGIN (12) 15.6% 24.0%
Depreciation and amortization $ 2,280 $ 4,291
Capital Expenditures $ 2,311 $ 2,311
</TABLE>
See Notes to Unaudited Pro Forma Consolidated Financial Statements
7
<PAGE> 7
SALTON, INC.
UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(DOLLARS IN THOUSANDS EXCEPT PER SHARE DATA)
The unaudited proforma consolidated financial statements have been adjusted for
the items set forth below.
(1) Represents the historical financial position of Salton as of September
25, 1999 and the consolidated results of operations for fiscal year ended
June 26, 1999 and the thirteen weeks ended September 25, 1999.
BALANCE SHEET
(2) Reflects the reversal of royalty payments of $16,644 on George Foreman
products, for the thirteen weeks ended September 25, 1999, and the
corresponding additional income taxes payable of $5,924 based upon an
assumed tax rate of 35.59%.
(3) Reflects the following in connection with Salton's pending acquisition
of the right to use in perpetuity and worldwide the name "George Foreman" in
connection with the marketing and sale of food preparation appliances (the
"Trademark"): (a) the first installment of cash payments of $22,750 due at
the closing date; (b) the recording of notes payable of $91,000 for the
remaining four annual cash installments, recorded at the aggregate present
value of $74,520 utilizing an 8.5% interest rate; (c) the issuance of
848,214 shares of common stock out of treasury shares at a carrying value of
$13.90 per share and the recording of additional paid-in-capital based on
the per share price of Salton common stock of $28 as of December 3, 1999;
(d) the recording of an intangible asset of $121,020 for the Trademark; and
(e) the estimated expenses of $50 for accounting, legal, printing and filing
fees. The actual aggregate number of shares to be issued will be determined
by dividing $23,750 by the average of the closing price of Salton common
stock on the NYSE for the twenty trading days ending on the third trading
day preceding the closing date, per the agreement.
(4) Reflects the following in connection with the satisfaction of Salton's
obligation to the TMI Acquisition Corp.: (a) the reduction of the original
obligation by $4,000 based on the terms of the new agreement and the related
reduction in goodwill of $1,000; (b) the issuance of 109,090 shares of
common stock out of treasury shares at a carrying value of $13.90 per share
and the recording of additional paid-in-capital based on the per share price
of $27.50 in accordance with the agreement; and (c) the recording of a
liability and expense of $89 to reflect the agreement by Salton to reimburse
the former stockholders of TMI Acquisition Corp. in cash to the extent that
the selling price of any of the shares sold by such stockholders during a
specified period of time is less than $27.50 per share and the agreement by
such stockholders to pay Salton in cash to the extent that such selling
price exceeds $27.50 per share (the "Stock Price Guarantee"), based on the
common stock price on September 24, 1999 of $26.6875.
(5) Reflects net impact on retained earnings of the aforementioned pro
forma adjustments.
STATEMENT OF OPERATIONS
(6) A. For fiscal year ended June 26, 1999:
(1) Reflects amortization of the Trademark of $8,068 on a straight-line
basis preliminarily over a 15-year useful life. The Company is in the
process of assessing the estimated useful life of the Trademark which is
not expected to be less than 10 years or greater than 20 years.
(2) Reflects the reduction in goodwill amortization expense of $25 (see note
(4)(a)).
(3) Reflects the reversal of royalty payments of $38,096 on George Foreman
products.
B. For the thirteen weeks ended September 25, 1999:
(1) Reflects amortization of the Trademark of $2,017 on a straight-line
basis preliminarily over a 15-year useful life. The Company is in the
process of assessing the estimated useful life of the Trademark which is
not expected to be less than 10 years or greater than 20 years.
(2) Reflects the reduction in goodwill amortization expense of $6 (see note
(4)(a)).
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<PAGE> 8
(3) Reflects the reversal of royalty payments of $16,644 on George Foreman
products.
(7) A. For fiscal year ended June 26, 1999:
(1) Reflects the imputed interest expense associated with the notes
payable of $6,334 (see note (3)).
(2) Reflects interest on additional borrowings of $173 for the initial
cash payment for the Trademark.
B. For the thirteen weeks ended September 25, 1999
(1) Reflects the imputed interest expense associated with the notes
payable of $1,584.
(8) A. For fiscal year ended June 26, 1999:
(1) Reflects the change in the fair value of the Stock Price Guarantee
that is included in the agreement for the issuance of 109,090 shares
of Salton common stock to the former stockholders of TMI Acquisition
Corp. of $536 based on the closing price of Salton common stock on
June 26, 1999 of $32.4167 per share.
B. For the thirteen weeks ended September 25, 1999:
(1) Reflects the change in the fair value of the Stock Price Guarantee
that is included in the agreement for the issuance of 109,090 shares
of Salton common stock to the former stockholders of TMI Acquisition
Corp. of $89 based on the closing price of Salton common stock on
September 24, 1999 of $26.6875.
(9) The estimated expenses of $50 for accounting, legal, printing and
filing fees.
(10) Income tax expense is adjusted to reflect the income tax effects of
pro forma adjustments based upon an assumed rate of 35.59%.
OTHER DATA
(11) EBITDA represents operating income plus depreciation and amortization.
EBITDA is presented because it is widely accepted measure to provide
information regarding a company's ability to pay interest, repay debt
or make capital expenditures. EBITDA should not be considered in
isolation or in accordance with generally accepted accounting
principles, or as a measure of a company's profitability or liquidity.
Additionally, Salton's calculation of EBITDA may differ from that
performed by other companies, and thus the amounts disclosed for
EBITDA may not be directly comparable to similarly titled measures
disclosed by other companies.
(12) EBITDA margin represents EBITDA as a percentage of net sales.
9
<PAGE> 9
USE OF PROCEEDS
We will not receive any proceeds from the sale of the common stock offered
by this prospectus, nor will such proceeds be available for our use or benefit.
SELLING STOCKHOLDERS
All of the shares of Salton common stock registered for sale under this
prospectus were issued, or are to be issued, to (1) the former stockholders of
TMI Acquisition Corp. and (2) George Foreman, Sam Perlmutter and Michael
Srednick (the persons identified in clauses (1) and (2) are collectively
referred to herein as the "selling stockholders").
The former stockholders of TMI Acquisition Corp. acquired the shares
specified below from Salton in satisfaction of Salton's obligations to pay TMI
Acquisition Corp. certain amounts based on future sales of Toastmaster(R)
products. Under the terms of the transaction, (1) Salton agreed that in the
event the "selling price" (the transaction price less reasonable and customary
brokerage commissions) of any share sold by the former stockholders of TMI
Acquisition Corp. during a specified period of time is less than $27.50 per
share, Salton will pay to such stockholders the difference between $27.50 and
the selling price with respect to each such share; and (2) the former
stockholders of TMI agreed that in the event the selling price of any share they
sell during a specified period of time exceeds $27.50 per share, they will pay
Salton the difference between the selling price and $27.50 with respect to each
such share. In addition, the former stockholders of TMI have agreed to pay
Salton the excess value (based on the average closing price of Salton common
stock over a specified period of time) over $27.50 per share with respect to
each share which they continue to own after a specified period of time. Salton
agreed to register for resale the shares of common stock received by the selling
stockholders in connection with the transaction.
George Foreman, Sam Perlmutter and Michael Srednick will acquire the shares
specified below from Salton as partial consideration for their sale to Salton of
the right to use in perpetuity and worldwide the name "George Foreman,"
including pictures and likeness of George Foreman, in connection with the
marketing and sale of food preparation appliances. The aggregate purchase price
payable by Salton in this transaction is $113,750,000 in cash, payable in five
annual installments of $22,750,000 commencing on the closing date, and shares of
Salton common stock valued at $23,750,000 at the closing. Under the terms of the
transaction, Salton agreed to register for resale the shares of common stock
received by the selling stockholders in connection with the transaction. The
closing of this transaction is expected to occur in the first calendar quarter
of 2000. Prior to this transaction, Salton paid George Foreman, Sam Perlmutter
and Michael Srednick royalties based on the sale of "George Foreman" products
marketed and sold by Salton.
The term "selling stockholders" also includes any transferees, pledgees,
donees, or other successors in interest to the selling stockholders named in the
table below. To the extent required, we will name any additional selling
stockholders in a supplement to this prospectus.
The following table sets forth certain information with respect to the
beneficial ownership of our common stock by the selling stockholders as of
December 9, 1999 before giving effect to the sale of shares of common stock in
this offering. The selling stockholders have not had any position or office with
us or any of our affiliates within the past three years. Except as described
10
<PAGE> 10
in the preceding paragraphs under "Selling Stockholders," there is no
relationship between the selling stockholders and us or our affiliates in the
last three years. All of the shares owned by the selling stockholders may be
offered by such stockholders in this offering. We cannot assure you, however,
that the selling stockholders will sell any of the shares of our common stock
covered by this prospectus. The selling stockholders do not hold one or more
percent of the outstanding shares of our common stock.
The information included in this section is based upon information provided
by the selling stockholders.
SHARES SHARES
BENEFICIALLY OWNED BENEFICIALLY OWNED
PRIOR TO AFTER THE
NAME THE OFFERING(1) OFFERING(1)(4)
---- ------------------ ------------------
0
Irwin Chafetz 3,927(2) 0
Irwin Chafetz Family Charitable Trust 105,163 0
George Foreman 357,142(3) 0
Sam Perlmutter 245,536(3) 0
Michael Srednick 245,536(3) 0
------- -
Total 957,304 0
======= =
(1) Unless otherwise noted, each person has sole voting and investment power
with respect to all shares listed opposite such person's name.
(2) Excludes the shares beneficially owned by the Irwin Chafetz Family
Charitable Trust. Mr. Chafetz is the trustee of the Trust and has sole
voting and investment power with respect to the shares owned by Trust.
(3) Based on the closing price of the shares of $28 on December 3, 1999. The
actual aggregate number of shares acquired by these persons will be
determined by dividing (x) $23,750,000 by (y) the average of the closing
prices of Salton common stock on the NYSE for the twenty trading days ending
on the third trading day preceding the closing date; provided that each of
Mr. Perlmutter and Mr. Srednick will in no event receive less than 237,069
shares.
(4) The shares may be offered from time to time by the selling stockholders. The
selling stockholders are not obligated to sell all or any portion of their
shares, nor are they obligated to sell any of their shares immediately
pursuant to this prospectus. Because the selling stockholders may sell all
or some of their shares, no estimate can be given as to the amount of common
stock actually to be offered for sale by the selling stockholders or as to
the amount of common stock that will be held by the selling stockholders
upon the termination of this offering.
11
<PAGE> 11
PLAN OF DISTRIBUTION
We are registering the shares of common stock covered by this prospectus for
the selling stockholders. To the extent required, we will identify any
additional selling stockholders in a supplement to this prospectus.
The selling stockholders will act independently of us in making decisions
with respect to the timing, manner and size of each sale. The selling
stockholders may sell the shares of common stock on The New York Stock Exchange,
in the over-the-counter market or in private transactions, at market prices
prevailing at the time of sale, at prices related to the prevailing market
prices, or at negotiated prices.
In addition, the selling stockholders may sell some or all of their shares
of common stock through:
- a block trade in which a broker-dealer may resell a portion of the
block, as principal, in order to facilitate the transaction;
- purchases by a broker-dealer, as principal, and resale by the
broker-dealers for its account; or
- ordinary brokerage transactions and transactions in which a broker
solicits purchasers.
The selling stockholders may enter into hedging transactions with respect to
their shares. For example, the selling stockholders may:
- enter into transactions involving short sales of the common shares by
broker-dealers;
- sell shares of common stock short and redeliver such shares to close out
short positions;
- enter into option or other types of transactions that require the
selling stockholders to deliver common shares to a broker-dealer, who
will then resell or transfer the common shares under this prospectus; or
- loan or pledge the shares of common stock to a broker-dealer, who may
sell the loaned shares or, in the event of default, sell the pledged
shares.
The selling stockholders may negotiate and pay broker-dealers commissions,
discounts or concessions for their services. Broker-dealers engaged by the
selling stockholders may allow other broker-dealers to participate in resales.
However, the selling stockholders and any broker-dealers involved in the sale or
resale of the common shares may qualify as "underwriters" within the meaning of
the Securities Act of 1933. In addition, the broker-dealers' commissions,
discounts or concession may qualify as underwriters' compensation under the
Securities Act of 1933. If the selling stockholders or any broker-dealers
qualify as "underwriters," they will be subject to the prospectus delivery
requirements of the Securities Act of 1933.
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<PAGE> 12
In addition to selling their shares of common stock under this prospectus,
the selling stockholders may:
- agree to indemnify any broker-dealer or agent against certain
liabilities related to the selling of the shares of common stock,
including liabilities arising under the Securities Act of 1933;
- transfer their shares of common stock in other ways not involving market
makers or established trading markets, including directly by gift,
distribution, or other transfer; or
- sell their shares of common stock under Rule 144 of the Securities Act of
1933 rather than under this prospectus, if the transaction meets the
requirements of Rule 144.
When a particular offering is made, if required, we will distribute to you a
prospectus supplement. This supplement will set forth the names of the selling
stockholders, the aggregate amount and type of shares being offered, the number
of such shares owned before and after the completion of any such offering, and,
to the extent required, the terms of the offering, including the name or names
of any underwriters, broker-dealers or agents, any discounts, commissions and
other terms constituting compensation from the selling stockholders and any
discounts, commissions or concessions allowed or reallowed or paid to
broker-dealers. Any underwriters, brokers, dealers or agents who participate in
any sale of the shares may also perform services for us or our affiliates.
All expenses of the registration of the shares will be paid by us,
including, without limitation, all registration and filing fees, printing
expenses, expenses of compliance with blue sky laws, fees and disbursements of
our counsel and expenses of any audits incidental to this registration. The
selling stockholders will pay expenses related to any sales commissions or
underwriting discounts and fees and expenses of its counsel incurred in
connection with the sale of shares through this prospectus.
We have agreed to indemnify the selling stockholders and anyone who controls
the selling stockholders against certain liabilities and expenses arising out of
or based upon the information contained in this document, including liabilities
under federal securities laws.
EXPERTS
The consolidated financial statements and financial statement schedules of
Salton, Inc. as of June 26, 1999 and June 27, 1998 and for each of the three
years in the period ended June 26, 1999 have been audited by Deloitte & Touche
LLP, independent auditors, as stated in their report with respect thereto and
are incorporated herein by reference from Salton, Inc.'s Annual Report on Form
10-K in reliance upon the report of such firm given upon their authority as
experts in accounting and auditing.
The financial statements of Toastmaster as of December 31, 1998 and for each
of the three years in the period ended December 31, 1998 have been incorporated
by reference in this prospectus and in the registration statement in reliance on
the report of KPMG LLP, independent auditors, included in Salton Inc.'s Annual
Report on Form 10-K for the fiscal year ended June 26, 1999 and incorporated by
reference in this prospectus.
13
<PAGE> 13
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This document contains or incorporates by reference a number of
forward-looking statements relating to Salton, Inc. within the meaning of the
Private Securities Litigation Reform Act of 1995 with respect to:
- our financial condition;
- our results of operations;
- our business plans;
- our business strategies, operating efficiencies or synergies, competitive
positions and growth opportunities for existing products;
- the plans and objectives of our management;
- the markets for our stock; and
- other matters.
We consider any statements that are not historical facts as "forward-looking
statements" for the purpose of the safe harbor provided by Section 21E of the
Securities Exchange Act of 1934 and Section 27A of the Securities Act of 1933.
These forward-looking statements are necessarily estimates reflecting the best
judgment of our senior management. They involve a number of risks and
uncertainties that could cause actual results to differ materially from those
suggested by the forward-looking statements. These differences could be
material; therefore, you should evaluate forward-looking statements in light of
various important factors, including those set forth or incorporated by
reference in this document.
Important factors that could cause actual results to differ materially from
estimates or forecasts contained in the forward-looking statements include,
among others:
- the integration of Toastmaster, including the failure to realize
anticipated revenue enhancements and cost savings;
- our relationship and contractual arrangements with key customers,
suppliers and licensors;
- the risks relating to pending legal proceedings
- cancellation or reduction of orders;
- the timely development, introduction and customer acceptance of our
products;
- dependence on foreign suppliers and supply and manufacturing constraints;
- competitive products and pricing;
- economic conditions and the retail environment;
- the availability and success of future acquisitions;
- our degree of leverage;
- the risks related to intellectual property rights;
- year 2000 issues; and
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- other factors both referenced and not reference in this prospectus.
Words such as "estimate," "project," "plan," "intend," "expect," "believe"
and similar expressions are intended to identify forward-looking statements.
These forward-looking statements are found at various places throughout this
document and the other documents incorporated by reference, including our Annual
Report on Form 10-K for the fiscal year ended June 26, 1999, including any
amendments, and our Quarterly Report on Form 10-Q for the quarterly period ended
September 25, 1999, including any amendments.
You should not place undue reliance on these forward-looking statements,
which speak only as of the date of such statements. We do not undertake any
obligation to publicly update or release any revisions to these forward-looking
statements to reflect events or circumstances after the date of this document or
to reflect the occurrence of unanticipated events.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the informational requirements of the Securities Exchange
Act of 1934 and in accordance with those requirements file annual, quarterly and
special reports, proxy statements and other information with the Securities and
Exchange Commission. You may read and copy any reports, statements or other
information that we file with the Securities and Exchange Commission at the
Commission's public reference rooms at the following locations:
<TABLE>
<CAPTION>
<S> <C> <C>
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. Seven World Trade Center Citicorp Center
Room 1024 Suite 1300 500 West Madison
Washington, D.C. 20549 New York, NY 10048 Suite 1400
Chicago, Illinois 60661-2511
</TABLE>
Please call the Commission at 1-800-SEC-0330 for further information on the
public reference rooms. These filings with the Commission are also available to
the public from commercial document retrieval services and at the Internet world
wide web site maintained by the Commission at "http://www.sec.gov." Reports,
proxy statements and other information concerning Salton are also available for
inspection at the offices of The Nasdaq National Market, which is located at
1735 K Street, N.W., Washington, D.C. 20006.
This prospectus is part of a registration statement we filed with the
Securities and Exchange Commission. As allowed by Commission rules, this
document does not contain all the information you can find in this registration
statement or the exhibits to the registration statement. You can get a copy of
the registration statement from the sources listed above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Commission allows us to "incorporate by reference" information into this
document, which means that we can disclose important information to you by
referring you to other documents filed separately with the Commission. The
information incorporated by reference is considered part of this document,
except for any information superseded by information contained directly in this
document or in later filed documents incorporated by reference in this document.
This document incorporates by reference the documents set forth below that
we have previously filed with the Commission. These documents contain important
business and financial information about Salton that is not included in or
delivered with this document.
PERIOD
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Annual Report on Form 10-K Fiscal year ended June 26, 1999.
Quarterly Reports on Form 10-Q Quarter ended September 25, 1999.
Current Reports on Form 8-K Dated December 9, 1999.
We also incorporate by reference additional documents that may be filed with
the Commission under Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act
prior to the termination of this offering. These include periodic reports, such
as Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current
Reports on Form 8-K, as well as proxy statements.
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You can obtain any of the documents incorporated by reference through the
Commission or the Commission's Internet web site as described above. You may
also obtain them by requesting them from us in writing or by telephone at the
following address or phone numbers:
SALTON, INC..
550 Business Center Drive
Mount Prospect, Illinois 60056
(847) 803-4600
Documents incorporated by reference are available from us without charge,
excluding all exhibits, except that if we have specifically incorporated by
reference an exhibit in this document, the exhibit will also be provided without
charge. You should rely only on the information contained or incorporated by
reference in this document. We have not authorized anyone to provide you with
information that is different from what is contained in this document. This
document is dated January 6, 2000. You should not assume that the information
contained in this document is accurate as of any date other than that date.
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