As filed with the Securities and Exchange Commission on February 12, 1997
Registration No. 333-
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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
Registration Statement
Under The Securities Act of 1933
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U.S. Home & Garden Inc.
(Exact Name of registrant as specified in its charter)
Delaware 77-0262908
(State or other (I.R.S. employer
jurisdiction of identification
incorporation or number)
organization)
655 Montgomery Street
Suite 830
San Francisco, California 94111
(415) 616-8111
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Robert L. Kassel, President
U.S. Home & Garden Inc.
655 Montgomery Street
Suite 830
San Francisco, California 94111
(415) 616-8111
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies to:
Robert J. Mittman, Esq.
Tenzer Greenblatt LLP
405 Lexington Avenue
New York, New York 10174
Telephone: (212) 885-5000
Telecopier: (212) 885-5001
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement.
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. | ]
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 [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. |_|
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CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
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Proposed Proposed
Title of Maximum Maximum
Shares Amount to Offering Aggregate Amount of
to be be Price Offering Registration
Registered Registered(1) Per Unit(2) Price(2) Fee(2)
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<S> <C> <C> <C> <C>
Common 2,167,829 Shares(3) $2.375 $5,148,594 $1,560.18
Stock
($.001 Par
Value)
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</TABLE>
(1) All of the shares of Common Stock being registered hereby are being
offered for the account of selling stockholders who acquired such
shares or options, warrants or other convertible securities to purchase
such shares from the Company in private transactions. No other shares
of the Company's Common Stock are being registered pursuant to this
offering.
(2) Estimated solely for the purpose of calculating the registration fee.
Pursuant to Rule 457(c) of the Securities Act of 1933, as amended, (the
"Act") the registration fee has been calculated based upon a price of
$2.375 per share, the average of the high and low prices as reported in
the consolidated reporting system (NASDAQ) for the registrant's Common
Stock on February 5, 1997.
(3) Pursuant to Rule 416 of the Act there are also being registered
hereunder such additional shares as may be issued to the selling
stockholders because of future stock dividends, stock distributions,
stock splits or similar capital readjustments or, in the case of the
holders of options, warrants or other convertible securities, the
operation of the anti-dilution provisions thereof.
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The Registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant 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, as amended, or until the Registration Statement shall
become effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.
<PAGE>
PRELIMINARY PROSPECTUS DATED FEBRUARY 12, 1997
SUBJECT TO COMPLETION
PROSPECTUS
2,167,829 Shares of Common Stock
U.S. HOME & GARDEN INC.
This Prospectus relates to an offering by certain selling stockholders of
an aggregate of up to 2,167,829 shares of the Company's common stock $.001 par
value (the "Common Stock"), of which 1,129,829 shares (the "Warrant Shares") are
issuable upon exercise of certain options, warrants and other convertible
securities which are owned by certain of the selling stockholders. Unless the
context otherwise requires, all of the foregoing shall be referred to
collectively as the "Selling Stockholders."
The Common Stock may be offered from time to time by the Selling
Stockholders through ordinary brokerage transactions in the over-the-counter
markets, in negotiated transactions or otherwise, at market prices prevailing at
the time of sale or at negotiated prices. The Company will not receive any of
the proceeds from the sale of Common Stock by the Selling Stockholders. See
"Selling Stockholders and Plan of Distribution."
The Common Stock is traded in the over-the-counter market and is quoted on
NASDAQ under the symbol "USHG". On February 5, 1997, the closing sale price of
the Common Stock as reported by NASDAQ was $2.375.
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THE SECURITIES OFFERED HEREBY INVOLVE A HIGH DEGREE
OF RISK AND SHOULD NOT BE PURCHASED BY INVESTORS
WHO CANNOT AFFORD THE LOSS OF THEIR ENTIRE INVESTMENT.
SEE "RISK FACTORS."
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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 _________, 1997
<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 filed by the Company can be inspected and
copied at the public reference facilities of the Commission located at 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices
at 500 West Madison Street, Suite 1400 Chicago, Illinois 60661 and 7 World Trade
Center, New York, New York 10048. Copies of such material can also be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. The Commission maintains a Website
that contains reports, proxy and information statements and other information
regarding registrants, such as the Company, that file electronically with the
Commission. The Commission's Website address is http://www.sec.gov.
INFORMATION INCORPORATED BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
(i) Annual Report on Form 10-KSB for the fiscal year ended June 30, 1996;
(ii) Quarterly Report on Form 10-Q for the quarterly period ended September 30,
1996; (iii) Form 10-Q/A, Amendment No. 1 to Form 10-Q for the quarterly period
ended September 30, 1996; (iv) Form 10-C dated July 24, 1996; (v) Form 10-C
dated August 9, 1996; (vi) Form 8-K for the event dated August 9, 1996; (vii)
Form 8-K/A, Amendment No. 1 to Form 8-K, for the event dated August 9, 1996; and
(viii) the description of the Company's Common Stock contained in its
Registration Statement on Form 8-A declared effective on March 26, 1992 and any
amendments or supplements thereto.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the Common Stock offered hereby shall be deemed
to be incorporated by reference herein and to be a part hereof on the date of
filing of such documents.
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The Company will furnish without charge to each person to whom this
Prospectus is delivered, on the written or oral request of such person, a copy
of any or all of the documents incorporated herein by reference, except for the
exhibits to such documents. Requests should be directed to Mr. Robert Kassel,
U.S. Home & Garden Inc., 655 Montgomery Street, Suite 830, San Francisco,
California 94111, telephone: (415) 616-8111.
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by reference to the more
detailed information and financial statements, including the notes thereto,
appearing elsewhere in or incorporated by reference into this Prospectus. Each
prospective investor is urged to read this Prospectus in its entirety.
The Company
U.S. Home & Garden Inc. (the "Company"), manufactures, converts, markets
and distributes through its wholly owned subsidiary, Easy Gardener Acquisition
Corp. ("Easy Gardener"), consumer lawn and garden care products for consumers
and agricultural users and, through its wholly-owned subsidiary, Golden West
Agri-Products, Inc. ("Golden West"), which it acquired in August 1992, a line of
products for agricultural use. In September 1994, the Company, through Easy
Gardener, acquired substantially all of the assets used in the business of Easy
Gardener, Inc., a Texas based manufacturer of a variety of home lawn and garden
care products. In August 1995, the Company, through Emerald Products
Corporation, a subsidiary of Easy Gardener, acquired the assets of Emerald
Products LLC. In August 1996, the Company, through Easy Gardener, acquired all
of the outstanding capital stock of Weatherly Consumer Products Group, Inc.
("Weatherly"), a Kentucky based manufacturer and distributor of home and outdoor
fertilizer spikes and other home, lawn and garden care products.
Easy Gardener markets and distributes a variety of home lawn and garden
care products, including among others, Weedblock(R), a landscape fabric used to
control weed growth in the garden. In addition to landscape fabrics, Easy
Gardener sells complementary lawn and garden products for use by the home
gardener such as Emerald Edge lawn edging and Shade Fabric(TM). With the
acquisition of Weatherly the Company has added to its product line, among other
things, a variety of home and outdoor fertilizer spikes sold under the Jobe's(R)
label, tree root feeders sold under the Ross(R) label and animal repellents for
plants sold under the XP-20(TM) label.
The Company's wholly-owned subsidiary, Golden West, is primarily engaged in
the manufacture and distribution of humic
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acid based agricultural products. The Company's principal agricultural products
consist of Energizer(R), a nutrient absorption enhancement formula for crops;
Penox(R), an agent that increases the effectiveness of certain agricultural
products; and Powergizer 45(R), a type of plant food. The Company, through
Golden West, sells its agricultural products to distributors who market such
products to commercial farmers.
The Company was organized under the laws of the State of California in
August 1990 under the name Natural Earth Technologies, Inc. and reincorporated
in the State of Delaware in January 1992. In July 1995 the Company changed its
corporate name to U.S. Home & Garden Inc. Unless the context otherwise requires,
all references in this Prospectus to the Company include the Company and its
wholly-owned subsidiaries Golden West and Easy Gardener. The Company's executive
offices are located at 655 Montgomery Street, Suite 830, San Francisco,
California 94111 and its telephone number is (415) 616-8111.
The Offering
Securities offered by 2,167,829 shares of
the Selling Stockholders. . . . Common Stock
Common Stock outstanding
prior to the offering (1) . . 13,958,016 shares
Common Stock to be outstanding
after the offering(2) . . . . 15,087,845 shares
Use of Proceeds . . . . . . . . The Company will not receive
any proceeds from any sales of
Common Stock by the Selling
Stockholders. Any proceeds
received by the Company from
time to time upon exercise of
options or warrants owned by
the Selling Stockholders will
be used for working capital
and general corporate
purposes.
Risk Factors . . . . . . . . . The securities offered hereby
involve a high degree of risk.
See "Risk Factors."
NASDAQ Symbol . . . . . . . . . Common Stock - USHG
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(1) Based on shares outstanding on the date of this Prospectus. Does not
include shares issuable upon exercise of (i)
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outstanding options and options available for grant under the Company's
1991 Stock Option Plan, (ii) outstanding options and options available for
grant under the Company's 1995 Stock Option Plan (iii) outstanding options
and options available for grant under the Company's Non-Employee Director
Stock Option Plan or (iv) other outstanding options and warrants.
(2) Assumes the issuance of the Warrant Shares upon exercise of options,
warrants and other convertible securities owned by the Selling Stockholders
but no exercise of any other outstanding options, warrants or convertible
securities.
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RISK FACTORS
The securities offered hereby involve a high degree of risk, including, but
not necessarily limited to, the risk factors described below. Prospective
investors, prior to making an investment in the Company should carefully
consider the risks and speculative factors inherent in and affecting the
business of the Company and this offering, including the following:
1. Possible Need for Additional Funds. From time to time, the Company has
experienced shortfalls in available working capital. Although at December 31,
1996, the Company had working capital of approximately $676,704, approximately
$9,661,344 of the Company's short term assets at such date consisted of
inventory. The Company may experience working capital shortfalls in the
foreseeable future, at least until the Company either obtains additional
financing or is able to generate additional working capital from operations. The
Company, other than in connection with the operations of Easy Gardener, does not
have any banking relationships or lines of credit available for working capital
purposes and no assurances can be given that additional funds, if required, will
be available at commercially reasonable terms, or at all.
2. Prior Losses; Uncertainty of Future Profitability. Although for its
fiscal years ended June 30, 1996 and 1995, the Company achieved net income of
approximately $2,524,000 and $1,575,000, respectively, it has incurred a net
loss of approximately $2,062,000 for the six months ended December 31, 1996. No
assurances can be given that the operations of Weatherly, which was acquired by
the Company in August 1996, will continue to generate income under the Company's
management. In addition, there can be no assurance that the Company will be
profitable in the future.
3. Substantial Outstanding Indebtedness. In connection with the acquisition
by Easy Gardener of Weatherly, the Company refinanced and executed various
financing arrangements with certain financial institutions (the "Lenders")
totalling approximately $25.25 million, which includes a warrant to certain of
the Lenders to purchase 400,000 shares of Common Stock at $2.50 per share. In
addition, the Lenders provided Easy Gardener with a $13 million revolving credit
facility to finance its working capital requirements. Under the terms of the new
loan agreement, two promissory notes were issued in the principal amount of
$23,000,000 and $2,250,000, respectively. The $23,000,000 note requires
quarterly principal payments ranging from $570,000 to $1,350,000 beginning
September 30, 1996 and continuing through June 30, 2002 and bears interest at
the lower of prime or LIBOR rates, as defined in the loan agreement. The
$2,250,000 note requires quarterly principal payments totaling $140,625
beginning September 30, 1998 and continuing through December 30, 1999, and bears
interest at prime plus 6%. The line of credit agreement calls
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for maximum borrowings totaling $13,000,000 with interest at the lower of prime
or LIBOR rates. As a result of this refinancing, the entire balance of deferred
finance costs at June 30, 1996, net of accumulated amortization, plus certain
prepayment penalties, was written off as an extraordinary expense during the
Company's fiscal quarter ended September 30, 1996. As a result, extraordinary
expense, net of $452,000 tax benefit, totaled approximately $1,007,000 for the
six months ended December 31, 1996. The loan agreement under which the
refinanced credit facilities are provided contains certain covenants which
require Easy Gardener to comply with certain financial ratios, and minimum net
worth requirements and restricts certain activities and transactions by Easy
Gardener. Such indebtedness to the Lenders is also secured by all of the assets
of Easy Gardener and a guaranty by the Company. The Company cannot predict the
effect that such covenants or restrictions will have on its future operations.
No assurances can be given that the operations of the Company will generate
sufficient cash flow to service such debt. In the event that Easy Gardener fails
to comply with any of its loan covenants or make required payments of principal
and interest, the Lenders could declare the indebtedness to be immediately due
and payable, and in certain cases, foreclose on Easy Gardener's assets and
require the Company to pay any unpaid balance on the loan pursuant to its
guaranty.
4. Financial Effects on the Company of the Recent Acquisition of Weatherly
Consumer Products Group, Inc. The Company will be required to amortize the
excess of costs over net assets acquired (an aggregate of approximately
$20,722,000) over a period of 30 years in connection with the acquisition of
Weatherly by Easy Gardener. The Company is already amortizing approximately
$600,000 per year of the excess of costs over net assets acquired relating to
prior acquisitions. Although such amortization does not have an effect on the
Company's available capital, it will be treated as an operating expense and with
the interest expense on the Company's debt service, will reduce the Company's
reported earnings.
5. Dependence on Third-Party Manufacturing and Supply Arrangements. Easy
Gardener purchases a majority of the material for its primary product,
Weedblock, from one source pursuant to an exclusive supply arrangement that can
be terminated by its supplier at any time. Easy Gardener purchases its basic
materials for its other products from a variety of suppliers on a non-exclusive
basis. Weatherly purchases its basic materials for its products from a variety
of suppliers on a non-exclusive basis. Golden West currently purchases
substantially all of its supply of ingredients used to manufacture its products
from two sources. There can be no assurance that future production capacity of
the Company's current suppliers, manufacturers and processors will be sufficient
to satisfy the Company's requirements or that alternate suppliers, manufacturers
and processors will be available on commercially reasonable terms, or at all.
The unavailability of certain products, the
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unavailability of manufacturing and processing sources or delays either in
manufacturing or in locating new manufacturing and processing sources could
adversely affect the Company's ability to deliver its products on a timely and
competitive basis. In addition, because the Company recognizes a significant
percentage of its yearly sales during a limited portion of the year, any delay
in the delivery or the unavailability of its products during such period could
materially adversely affect the Company's operations.
6. Dependence on Distributors; Dependence on Significant Customers,
Dependence on Product Line. Certain of the Company's products are marketed
primarily through a number of exclusive and non-exclusive independent
distributors and sales agents upon which the Company is substantially dependent
for the generation of revenues. The loss of any of its major distributors, in
the absence of substantially similar replacement arrangements, could have a
material adverse effect on the Company's business. For the fiscal year ended
June 30, 1996 sales by the Company to four customers, Home Depot, Lowe's Co.,
K-Mart and Builders Square accounted for approximately 28%, 9%, 7% and 5%,
respectively, of the Company's consolidated sales and sales to Home Depot,
Lowe's Co. and Builders Square accounted for approximately 27%, 10% and 7%,
respectively, of the Company's consolidated sales for the six months ended
December 31, 1996. In addition, following the acquisition of Weatherly, sales to
Central Garden have accounted for 7% of the Company's consolidated sales for the
six months ended December 31, 1996. The loss of such customers could have a
material adverse effect upon the Company.
Approximately 70% of Easy Gardener's sales for the six months ended
December 31, 1996 were attributed to the sales of landscape fabric. Any adverse
developments with respect to Easy Gardener's landscape fabric business as a
result of competitive factors, supply arrangements or other factors outside of
its control, would have a material adverse effect on Easy Gardener's operations.
7. Seasonality; Weather Conditions. Sales of the Company's agricultural
products and sales by Easy Gardener of its lawn and garden care products are
highly seasonal and shipments by the Company's subsidiaries of products are
heavily concentrated in the spring (third fiscal quarter) and, to a lesser
extent, the summer (fourth fiscal quarter). Most shipments of agricultural
products occur during the period from March through October (the agricultural
cultivation period). Unexpected production or transportation difficulties
occurring at a time of peak production or sales could cause sales losses which
could not readily be reversed before the following year. In addition, the
Company's results of operations may be severely adversely affected by poor
weather conditions. Poor weekend weather during the spring tends to depress
consumer purchases of do-it yourself lawn and garden care products. In addition,
prolonged periods of adverse weather may result in reduced agricultural
plantings and a corresponding decline in demand for the Company's agricultural
products.
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8. Competition. The consumer lawn and garden care market is highly
competitive and somewhat fractionalized, with no single dominant competitor.
Competition for the Company and Easy Gardener in this market arises from a
combination of national and regional companies ranging from large petrochemical
companies to garden catalog businesses and companies specializing in the
manufacture of lawn and garden care products. Several of such companies, such as
Solaris Group, a division of Monsanto Company and the Scotts Miracle Gro Company
have captured a significant share of such markets, and, in the aggregate,
control a significant proportion of the market. Many of the Company's
competitors have achieved significant national, regional and local brand name
and product recognition and engage in extensive advertising and promotional
programs, both generally and in response to efforts by additional competitors to
enter new markets to introduce new products. Many of these companies have
substantially greater financial, technical, marketing and other resources than
the Company. In addition, the lawn and garden care industry is characterized by
the frequent introduction of new products, accompanied by substantial
promotional campaigns. Large, dominant manufacturers, which manufacture and sell
lawn and garden products, such as the Solaris Group, have in the past,
manufactured and marketed landscape fabrics. Currently, few of such competitors
compete with Easy Gardener in this industry. Nevertheless, well capitalized
companies and smaller regional firms may develop and market landscape fabrics
and compete with Easy Gardener for customers that may purchase other lawn and
garden care products from such companies.
Golden West's competitors, many of which have substantially greater
financial and other resources than the Company, include other manufacturers of
products that are humic acid based but that utilize formulas that are different
from Golden West's. These competitors include American Colloid Company, Monterey
Chemical Corporation and Custom Chemicide Inc., all of which sell, in addition
to humic acid based products, other agricultural products. The use of these
other agricultural products by farms and orchards gives these competitors
greater name recognition among such purchasers. American Colloid Company markets
its products mainly in the eastern United States, while Monterey Chemical
Corporation and Custom Chemicide Inc. market their products mainly in the
western United States. No assurance can be given that the Company will be able
to compete successfully in the future.
9. Government Regulation. Products marketed, or which may be marketed, by
the Company as fertilizers or pesticides are subject to an extensive and
frequently evolving statutory and regulatory framework, at both the Federal and
state levels.
Federal Regulation - The Federal Hazardous Materials Transportation Act
("HazMat") regulates the transportation of products possessing characteristics
which have the potential to create a hazard to humans or the environment during
transport and
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imposes extensive manifesting, labelling and other requirements upon the
transportation of any products regulated by such act. Failure to comply with the
requirements of HazMat could result in the imposition of sanctions, including,
but not limited to, suspension or restriction of product transportation, civil
penalties and/or criminal sanctions. Although the Company believes that none of
the products presently manufactured by its subsidiaries are subject to HazMat,
other than one product manufactured by Weatherly, there can be no assurance that
products that the Company or its subsidiaries intend to market in the future
will not be subject to HazMat. The distribution and sale of pesticides is
subject to regulation by the U.S. Environmental Protection Agency ("EPA")
pursuant to the Federal Insecticide, Fungicide, and Rodenticide Act ("FIFRA"). A
substance is a pesticide under FIFRA if it is intended to prevent, destroy,
repel or mitigate pests or defoliate, desiccate or regulate the growth of
plants. Under FIFRA, all pesticides must be registered with the EPA and must be
approved for their intended use based upon an evaluation of the risks posed by
the product to human health and the environment. FIFRA also imposes stringent
labelling, packaging, reporting, and recordkeeping requirements on the marketing
of such products. Failure to comply with the requirements of FIFRA could result
in the imposition of sanctions, including, but not limited to, suspension or
restriction of product distribution, civil penalties and/or criminal sanctions.
Although the Company believes that except for certain animal repellants and
insecticide spikes none of the products sold by it or its subsidiaries are
pesticides under FIFRA, there can be no assurance that future products marketed
by the Company or its subsidiaries will not be subject to FIFRA.
Advertising relating to the Company's products is subject to the review of
the Federal Trade Commission and state agencies, pursuant to their general
authority to monitor and prevent unfair or deceptive trade practices.
State Regulation - Many states regulate pesticides in a manner similar to
Federal law. Moreover, many states also impose restrictions upon products
marketed for use as fertilizing materials (which are not typically regulated
under FIFRA). Accordingly, state requirements may be applicable to a broader
range of the Company's intended products than Federal law. Registration of
products on the state level essentially involves the filing with the appropriate
state agency of the labels used on the products, payment of registration fees
and the filing of reports in many states. In certain states, the manufacturer or
the distributor is required to be licensed, instead of or in addition to the
product registration. Products may be subject to state testing. In addition, if
a label makes any claims relating to the product's effectiveness, the accuracy
of the claims may have to be proven to the satisfaction of the state regulatory
authorities. The Company believes that it has obtained the required material
licenses and registrations of its material
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products in the states in which its products are sold. Should the number of
states in which the Company's products are sold increase, such products may have
to be registered in such states. Additionally, there can be no assurance that
the Company will be able to comply with, or continue to comply with, the current
or future regulations in every jurisdiction in which the Company's material
business operations are conducted without substantial cost or interruption of
their operations. In the event that the Company is unable to comply with such
requirements, they could be subject to substantial sanctions, including a recall
of, or a sales limitation placed on, one or more of its products, monetary
liability and/or criminal sanctions, if products are distributed and/or marketed
in violation of those requirements, any of which could have a material adverse
effect upon the Company's business.
10. Environmental Compliance-Manufacturing Facility. Certain manufacturing
operations involve the discharge of pollutants to the air or water. Federal and
state environmental laws and requlations often require manufacturers to obtain
permits for these discharges. The permits regulate the amount of pollutants that
can be discharged and impose certain sampling, recordkeeping and reporting
obligations on the permittees. Ownership and operation of manufacturing
facilities also involve handling and storage of hazardous substances, which are
regulated under various federal and state environmental laws. Failure to comply
with environmental laws or to obtain, or comply with, the necessary state and
federal permits can subject the manufacturer to substantial civil and criminal
penalties. Easy Gardener and Weatherly each own and operate one manufacturing
facility. Although the Company believes that Easy Gardener and Weatherly are in
substantial compliance with applicable material environmental laws concerning
their respective facilities there can be no assurance that they will be able to
continue to comply with the requirements of applicable environmental laws or
permits.
11. Potential Environmental Cleanup Liability. The Federal Comprehensive
Environmental Response, Compensation and Liability Act, as amended ("CERCLA"),
and many similar state statutes, impose liability for environmental damages and
cleanup costs on owners and operators of hazardous waste facilities, as well as
persons who generate, transport, or arrange for disposal of hazardous wastes at
a particular site. Easy Gardener and Weatherly each own and operate a
manufacturing facility and, as a result, could be subject to liability under
these statutes. The Company and its subsidiaries could incur liability under
CERCLA or similar state statutes for any damage caused as a result of the
mishandling or release of hazardous substances owned by the Company but
processed and manufactured by others on the Company's behalf. As a result, there
can be no assurance that the manufacture of the products sold by the Company and
its subsidiaries will not subject the Company or its subsidiaries to liability
pursuant to CERCLA or a similar state statute. Furthermore, there can be no
assurance that Easy Gardener or
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Weatherly will not be subject to liability relating to manufacturing facilities
owned and/or operated by them.
12. Product Liability. The Company, as a manufacturer of lawn and garden
care and pesticide products, may be exposed to significant product liability
claims by consumers. Although the Company has obtained product liability
insurance coverage for U.S. Home & Garden and Golden West in the aggregate
amount of $3,000,000, and for each of Easy Gardener and Weatherly in the
aggregate amount of $2,000,000 (with all policies limited to $1,000,000 per
occurrence), and has obtained three umbrella policies in the amounts of
$5,000,000, $10,000,000 and $10,000,000, respectively, there can be no assurance
that such insurance will be sufficient to cover all possible liabilities.
Although the Company has not incurred any product liability claims to date, in
the event a successful suit is brought against the Company, insufficiency of
insurance coverage could have a material adverse effect on the Company.
Moreover, any adverse publicity arising from claims made against the Company,
even if such claims were not successful, could adversely affect the reputation
and sales of the Company's products.
13. Patent Protection. Except for patents covering two lawn edge products
currently sold by Easy Gardener and certain products obtained as a result of the
acquisition of Weatherly, none of the Company's products are covered by patents.
The Company may not apply for any additional patent protection relating to its
current products. The Company regards the formulas and processes used to
manufacture certain of the products sold by it as proprietary and intends to
rely for protection upon trade secret laws and non-disclosure agreements with
its customers, suppliers, dealers, employees and sales representatives. Despite
these restrictions, it may be possible for competitors or customers to copy one
or more aspects of the products that contain formulas the Company believes are
proprietary to it or obtain information that the Company regards as proprietary.
Furthermore, there can be no assurance that others will not independently
develop products similar to those products sold or to be sold by the Company
that utilize information believed by the Company to be proprietary to it.
Although the Company believes that the products sold by it do not and will not
infringe upon the patents or violate the proprietary rights of others, it is
possible that such infringement or violation has or may occur. In the event that
products sold by the Company are deemed to infringe upon the patents or
proprietary rights of others, the Company could be required to modify its
products or obtain a license for the manufacture and sale of such products.
There can be no assurance that, in such an event, the Company would be able to
do so in a timely manner, upon acceptable terms and conditions, or at all, and
the failure to do any of the foregoing could have a material adverse effect upon
the Company. Moreover, there can be no assurance that the Company will have the
financial or other resources necessary to enforce or defend a patent
infringement or proprietary rights
-12-
<PAGE>
violation action. In addition, if the Company's products or proposed products
are deemed to infringe upon the patents or proprietary rights of others, the
Company could, under certain circumstances, become liable for damages, which
could also have a material adverse effect on the Company.
14. Dependence on Management. The success of the Company will be largely
dependent on the personal efforts of Robert Kassel, its President, and Richard
Raleigh, its Chief Operating Officer, both of whom devote their full time to the
affairs of the Company. Although the Company has entered into employment
agreements with Mr. Kassel and Mr. Raleigh which expire on March 31, 1997,
subject to certain automatic extension provisions, and has obtained "key man"
life insurance in the amount of $2,000,000 on the life of Mr. Kassel and
$1,000,000 on the life of Mr. Raleigh, the loss of the services of either Mr.
Kassel or Mr. Raleigh would have a material adverse effect on the Company's
business and prospects. In addition, Mr. Kassel's employment agreement provides
that Mr. Kassel will receive a significant severance payment from the Company
upon a change in control of the Company or the occurrence of certain other
events as described therein. In addition, the success of Easy Gardener is
dependent upon the continuing efforts of Joseph Owens and Richard Grandy, who
are both officers of Easy Gardener. Although Messrs. Owens and Grandy have each
entered into employment agreements with Easy Gardener which expire in September
1998, the loss of their services could have a material adverse affect on Easy
Gardener. The success of the Company may also be dependent in part, upon its
ability to hire and retain additional qualified sales and marketing personnel.
There can be no assurance that the Company will be able to hire or retain such
necessary personnel.
15. No Dividends. To date, the Company has not paid any cash dividends on
its Common Stock and does not expect to declare or pay any cash or other
dividends in the foreseeable future. In addition, certain agreements between
Easy Gardener and its primary lending institutions restrict the Company from
paying dividends on the Common Stock without the lender's consent.
16. Authorization of Preferred Stock. The Company's Certificate of
Incorporation authorizes the issuance of "blank check" preferred stock with such
designation, rights and preferences as may be determined from time to time by
the Board of Directors. Accordingly, the Board of Directors is empowered,
without stockholder approval, to issue preferred stock with dividend,
liquidation, conversion, voting or other rights which could adversely affect the
voting power or other rights of the holders of the Company's Common Stock. In
the event of issuance, the preferred stock could be utilized, under certain
circumstances, as a method of discouraging, delaying or preventing a change in
control of the Company. There can be no assurance that the Company will not
issue shares of preferred stock in the future.
-13-
<PAGE>
17. Delaware Anti-Takeover Law. The Company, a Delaware corporation, is
subject to the General Corporation Law of the State of Delaware, including
Section 203, an anti-takeover law enacted in 1988. In general, the law prohibits
a public Delaware corporation from engaging in a "business combination" with an
"interested stockholder" for a period of three years after the date of the
transaction in which the person became an interested stockholder unless: (i)
prior to such date, the board of directors approved the business combination; or
(ii) upon becoming an interested stockholder, the stockholder then owns at least
85% of the voting securities, as defined in Section 203; or (iii) subsequent to
such date, the business combination is approved by both the board of directors
and the stockholders. "Business combination" is defined to include mergers,
asset sales and certain other transactions with an "interested stockholder." An
"interested stockholder" is defined as a person who, together with affiliates
and associates, owns (or, within the prior three years, did own) 15% or more of
a corporation's voting stock. Although Section 203 permits the Company to elect
not to be governed by its provisions, the Company to date has not made this
election. As a result of the application of Section 203, potential acquirers of
the Company may be discouraged from attempting to effect an acquisition
transaction with the Company, thereby possibly depriving holders of the
Company's securities of certain opportunities to sell or otherwise dispose of
such securities at above-market prices pursuant to such transactions.
18 Influence by Management. Current officers and directors of the Company
beneficially owning, an aggregate of approximately 32.6% of the issued and
outstanding shares of Common Stock. Accordingly, they are in a position to
influence the outcome of matters requiring a vote of stockholders.
19. Common Stock Eligible for Future Sale; Registration Rights; Outstanding
Options. Approximately 2,500,000 of the 13,958,016 shares of Common Stock
outstanding as of the date of this Prospectus are "restricted securities," as
that term is defined under Rule 144 promulgated under the Act. These shares are
currently eligible for sale under Rule 144. In addition, the 2,167,829 shares of
Common Stock that may be sold pursuant to the registration statement of which
this Prospectus forms a part, which are either outstanding or issuable upon the
exercise of outstanding options, warrants and other convertible securities to
acquire 1,129,829 shares of Common Stock, subject to adjustment, will be,
eligible for sale under the Act and are not "restricted securities" absent
express agreement to the contrary. In addition, approximately 2,600,000 shares
of the Common Stock issuable upon exercise of outstanding warrants may be sold
under current effective registration statements and holders of certain other
options and warrants to acquire a significant number of additional shares of
Common Stock have certain registration rights with respect to such shares. No
prediction can be made as to the effect, if any, that sales of these securities
or shares of Common Stock issuable upon exercise of outstanding options,
warrants or convertible securities or the availability of such securities for
sale will have on the market
-14-
<PAGE>
prices of the Common Stck prevailing from time to time. Nevertheless, the
possibility that substantial amounts of securities may be sold in the public
market may adversely affect prevailing market prices for the Common Stock and
could impair the Company's ability to raise capital through the sale of its
equity securities. In addition, to the extent that the Company is required to
issue additional shares of Common Stock pursuant to the terms of the agreement
pursuant to which it acquired Weatherly, such issuances may have a dilutive
effect on the then current stockholders. See "Recent Developments."
20. Possible Adverse Effect on Liquidity of the Company's Securities
Associated with Possible Restrictions on Market Making Activities in the
Company's Securities. D.H. Blair & Co., Inc. currently makes, and the Company
believes that it intends in the future to continue to make, a market in the
Company's securities. Although there are other NASD members listed as market
makers of the Company's securities, the Company believes that D.H. Blair & Co.,
Inc. is currently responsible for a substantial portion of the market making
activities in such securities. Regulation M under the Exchange Act may prohibit
D.H. Blair & Co., Inc. from engaging in any market-making activities with regard
to the Company's securities for the period from one business day (or such other
applicable period as Regulation M may provide) prior to (i) any solicitation by
D.H. Blair & Co., Inc. of the exercise of outstanding publicly traded warrants
of the Company (the "Warrants") until the later of the termination of such
solicitation activity or the termination (by waiver or otherwise) of any right
that D.H. Blair & Co., Inc. may have to receive a fee for the exercise of
Warrants following such solicitation; and (ii) any period during which D.H.
Blair & Co., Inc., or any affiliated parties participate in a distribution of
any securities of the Company owned for their own account. As a result, D.H.
Blair & Co., Inc. may be unable to provide a market for the Company's securities
during certain periods, including while the Warrants are exercisable. Any
temporary cessation of such market-making activities could have an adverse
effect on the liquidity for the Company's securities.
21. Possible Adverse Effect on Liquidity of the Company's Securities Due to
the Investigation of a Principal Marketmaker by the Securities and Exchange
Commission. The Company has been advised that the Commission is conducting an
investigation concerning various business activities of D.H. Blair & Co., Inc.
An unfavorable resolution of the Commission's investigation could have the
effect of limiting D.H. Blair & Co. Inc.'s ability to make a market in the
Company's securities. Any temporary cessation of such market making activities
could have an adverse effect on the market prices of the Company's securities.
USE OF PROCEEDS
The Company will not receive any proceeds from the sale of Common Stock by
the Selling Stockholders. In the event that all
-15-
<PAGE>
of the Warrant Shares are issued pursuant to the cash exercise terms of the
options and warrants held by the Selling Stockholders, of which there can be no
assurance, the Company could realize up to approximately $2,300,000 in gross
proceeds. The net proceeds of such issuances will be considered as uncommitted
funds and may be used by the Company for, among other things, working capital
and general corporate purposes. The Company has agreed to pay certain expenses
in connection with this offering, currently estimated to be approximately
$35,000.
RECENT DEVELOPMENTS
On August 9, 1996, Easy Gardener acquired all of the outstanding capital
stock (the "Acquisition") of Weatherly. As consideration for the Acquisition,
the stockholders of Weatherly received (i) an aggregate of 1,000,000 shares (the
"Issued Shares") of the issued and outstanding Common Stock of the Company and
(ii) an aggregate sum of $22,937,321, less that amount required to discharge
certain outstanding indebtedness of Weatherly, as more particularly set forth in
the purchase agreement, dated August 9, 1996 (the "Purchase Agreement") and
adjusted dollar for dollar based upon the value of the net current assets (as
defined in the Purchase Agreement) of Weatherly.
The Issued Shares have been included in the registration statement of which
this prospectus forms a part.
The Company also agreed to issue pro ratably to the stockholders of
Weatherly who still possess the Company's shares at the one year anniversary of
the closing, additional shares of its Common Stock, as more particularly set
forth in the Purchase Agreement, in the event the average of the closing bid and
ask prices of the Common Stock, on the NASDAQ Small-Cap Market, for the ten
trading days preceding such anniversary is less than $3.00.
Each stockholder of Weatherly executed a Lock-Up Agreement, whereby each
such stockholder agreed not to transfer or dispose of more than an aggregate of
twenty-five percent of any securities of the Company acquired and beneficially
owned by such stockholder prior to the six (6) month anniversary of the closing
of the Acquisition and thereafter until the year anniversary of the closing, of
no more than an aggregate of fifty percent of any such securities.
DESCRIPTION OF SECURITIES
General
The Company is authorized to issue 30,000,000 shares of Common Stock, $.001
par value per share and 1,000,000 shares of Preferred Stock, $.001 par value per
share. As of the date of
-16-
<PAGE>
this Prospectus, there are 13,958,016 shares of Common Stock outstanding and no
shares of Preferred Stock outstanding.
Common Stock
The holders of Common Stock are entitled to one vote for each share held of
record on all matters to be voted on by stockholders. There is no cumulative
voting with respect to the election of directors, with the result that the
holders of more than 50% of the shares voting for the election of directors can
elect all of the directors. The holders of Common Stock are entitled to receive
dividends when, as and if declared by the Board of Directors out of funds
legally available therefor. In the event of liquidation, dissolution or winding
up of the Company, the holders of Common Stock are entitled to share ratably in
all assets remaining available for distribution to them after payment of
liabilities and after provision has been made for each class of stock, if any,
having liquidation preference over the Common Stock. Holders of shares of Common
Stock, as such, have no conversion, preemptive or other subscription rights, and
there are no redemption or sinking fund provisions applicable to the Common
Stock. All of the outstanding shares of Common Stock are, and the shares of
Common Stock offered hereby, when issued against the consideration set forth in
this Prospectus, will be, fully paid and nonassessable.
SELLING STOCKHOLDERS AND PLAN OF DISTRIBUTION
An aggregate of up to 2,167,829 shares of Common Stock (including the
1,129,829 Warrant Shares) may be offered and sold pursuant to this Prospectus by
the Selling Stockholders. Messrs. Molinsky, Palagonia, Biele and Abbatte are
employed by D.H. Blair & Co., Inc. and received their securities in connection
with D.H. Blair Investment Banking Corp. acting as placement agent for an
offering of the Company's securities consummated in August 1994. Messrs. Hills,
Jackson, Metz and Arnold were the sole stockholders of Weatherly who received
their shares in connection with the Acquisition. The Provident Bank, LaSalle
National Bank and Antares Leverage Capital Corp. provided financing to Easy
Gardener (guaranteed by the Company) in connection with its acquisition of
Weatherly. Mr. Berman is counsel to Tenzer Greenblatt LLP, which firm renders
legal advice to the Company with respect to certain matters.
-17-
<PAGE>
The following table sets forth certain information with respect to the
Selling Stockholders:
<TABLE>
<CAPTION>
Beneficial Shares
Ownership of Beneficially
Shares of Common Owned
Stock Prior Shares to be Sold After the
Selling Stockholder to Sale (1) in the Offering (2) Offering (3)
------------------- ---------------- ------------------- ------------
<S> <C> <C> <C>
Richard Molinsky 87,720 87,720 0
Alfred S. Palagonia 263,160 263,160 0
Richard Biele 87,720 87,720 0
William Abbatte 87,720 87,720 0
E.H. Arnold 570,000 570,000 0
James R. Hills 200,000 200,000 0
Laban P. Jackson, Jr. 200,000 200,000 0
Emanuel M. Metz 30,000 30,000 0
Continental Capital & Equity 38,000 38,000 0
Corp.
Herbert Berman 203,509(4) 203,509 0
The Provident Bank 149,020 149,020 0
La Salle National Bank 117,647 117,647 0
Antares Leverage 133,333 133,333 0
Capital Corp.
</TABLE>
(1) Includes shares of Common stock issuable upon exercise of options, warrants
and other convertible securities which are exercisable at the date of this
Prospectus. Unless otherwise noted, the Company believes that all of the
persons named in the above table have sole voting power with respect to all
shares of Common Stock beneficially owned by them.
(2) Includes shares issuable upon exercise of options, warrants and other
convertible securities.
(3) Assumes all of the shares of Common Stock offered hereby are sold by the
Selling Stockholders.
(4) Represents shares issuable upon exercise of a convertible promissory note
and warrants.
The Common Stock held by the Selling Stockholders, and the Common Stock
issuable to the Selling Stockholders upon exercise of various options, warrants
and other convertible securities may be offered and sold from time to time as
market conditions permit in the over-the-counter market, or otherwise, at prices
and terms then prevailing or at prices related to the then-current market price,
or in negotiated transactions. The shares offered hereby may be sold by one or
more of the following methods, without limitation: (a) a block trade in which a
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;
and (d) face-to-face transactions between sellers and purchasers without a
broker-dealer. In effecting sales, brokers or dealers engaged by the Selling
Stockholders may arrange for other brokers or dealers to participate. Such
brokers or dealers may receive commissions or discounts from Selling
Stockholders in amounts to be negotiated. Such brokers and dealers and any other
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<PAGE>
participating brokers or dealers may be deemed to be "underwriters" within the
meaning of the Act, in connection with such sales.
LEGAL MATTERS
The legality of the securities offered hereby will be passed upon for the
Company by Tenzer Greenblatt LLP, New York, New York. A partner of Tenzer
Greenblatt is the beneficial owner of shares of Common Stock and options and
warrants to purchase shares of Common Stock. Certain other partners of Tenzer
Greenblatt LLP also own shares of Common Stock and/or options to purchase Common
Stock.
EXPERTS
The consolidated financial statements of U.S. Home & Garden Inc.
incorporated by reference in this Prospectus have been audited by BDO Seidman,
LLP, independent certified public accountants, to the extent and for the periods
set forth in their report incorporated herein by reference, and are incorporated
herein in reliance upon such report upon the authority of said firms as experts
in auditing and accounting.
The consolidated financial statements of Weatherly Consumer Products Group,
Inc. incorporated by reference in this prospectus, have been audited by Arthur
Andersen LLP, independent public accountants, as indicated in their report with
respect thereto, and are included herein in reliance upon the authority of said
firm as experts in giving said report.
ADDITIONAL INFORMATION
The Company has filed with the Commission, a registration statement (the
"Registration Statement"), under the Act with respect to the securities offered
by this Prospectus. This Prospectus, filed as part of such Registration
Statement, does not contain all of the information set forth in, or annexed as
exhibits to, the Registration Statement, certain portions of which have been
omitted in accordance with the rules and regulations of the Commission. For
further information with respect to the Company and this offering, reference is
made to the Registration Statement, including the exhibits filed therewith,
which may be inspected without charge at the Office of the Commission, 450 Fifth
Street, N.W., Washington, D.C. 20549. Copies of the Registration Statement may
be obtained from the Commission at its principal office upon payment of
prescribed fees. Statements contained in this Prospectus as to the contents of
any contract or other document are not necessarily complete and, where the
contract or other document has been filed as an exhibit to the Registration
Statement, each statement is qualified in all respects by reference to the
applicable document filed with the Commission.
-19-
<PAGE>
================================================================================
No dealer, salesperson or other 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, the Selling
Stockholders or any Underwriter. This Prospectus does not constitute an offer to
sell or the solicitation of an offer to buy any security other than the Common
Stock offered by this Prospectus, or an offer to sell or a solicitation of an
offer to buy any security by any person in any jurisdiction in which such offer
or solicitation would be unlawful. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, imply that the
information in this Prospectus is correct as of any time subsequent to the date
of this Prospectus.
-----------------
TABLE OF CONTENTS
Page
Available Information...................................... 2
Information Incorporated by Reference...................... 2
Prospectus Summary......................................... 3
Risk Factors............................................... 6
Use of Proceeds............................................ 15
Recent Developments........................................ 16
Description of Securities.................................. 16
Selling Stockholders and Plan of
Distribution............................................. 17
Legal Matters.............................................. 18
Experts.................................................... 18
Additional Information..................................... 18
================================================================================
================================================================================
----------
2,167,829 Shares of
Common Stock
----------
U.S. HOME & GARDEN INC.
----------
PROSPECTUS
----------
______,1997
================================================================================
<PAGE>
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
Expenses payable in connection with the issuance and distribution of the
securities being registered (estimated except in the case of the registration
fee) are as follows:
Amount
------
Registration Fee $1,727.69
Printing 3,000.00
Legal Fees and Expenses +
Accounting Fees and Expenses +
Transfer Agents and Registrars Fees +
Miscellaneous +
----------
TOTAL $35,000.00
==========
- ----------
+ To be provided by amendment.
The above fees will be paid by the Company.
Item 15. Indemnification of Directors and Officers
Section 145 of the General Corporation Law of the State of Delaware
provides for the indemnification of officers and directors under certain
circumstances against expenses incurred in successfully defending against a
claim and authorizes Delaware corporations to indemnify their officers and
directors under certain circumstances against expenses and liabilities incurred
in legal proceedings involving such persons because of their being or having
been an officer or director.
Section 102(b) of the Delaware General Corporation Law permits a
corporation, by so providing in its certificate of incorporation, to eliminate
or limit director's liability to the corporation and its stockholders for
monetary damages arising out of certain alleged breaches of their fiduciary
duty. Section 102(b)(7) provides that no such limitation of liability may affect
a director's liability with respect to any of the following: (i) breaches of the
director's duty of loyalty to the corporation or its stockholders; (ii) acts or
omissions not made in good faith or which involve intentional misconduct or
knowing violations of law; (iii) liability for dividends paid or stock
repurchased or redeemed in violation of the Delaware General Corporation Law; or
(iv) any transaction from which the director
II-1
<PAGE>
derived an improper personal benefit. Section 102(b)(7) does not authorize any
limitation on the ability of the corporation or its stockholders to obtain
injunctive relief, specific performance or other equitable relief against
directors.
Article Ninth of the Company's Certificate of Incorporation and Article
XVIII of the Company's By-laws provide that all persons who the Company is
empowered to indemnify pursuant to the provisions of Section 145 of the General
Corporation law of the State of Delaware (or any similar provision or provisions
of applicable law at the time in effect), shall be indemnified by the Company to
the full extent permitted thereby. The foregoing right of indemnification shall
not be deemed to be exclusive of any other rights to which those seeking
indemnification may be entitled under any by-law, agreement, vote of
stockholders or disinterested directors, or otherwise.
Article Tenth of the Company's Certificate of Incorporation provides that
no director of the Company shall be personally liable to the Company or its
stockholders for any monetary damages for breaches of fiduciary 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 General Corporation of Law of the state of Delaware; or
(iv) for any transaction from which the director derived an improper personal
benefit.
Sections 7 and 8 of the Underwriting Agreement dated March 26, 1992 between
the Company and Paragon Capital Corporation and Sections 9 and 10 of the
Underwriting Agreement dated August 5, 1993 between the Company and D.H. Blair
Investment Banking Co. provides for the indemnification of the Company's
officers, directors and control persons under certain circumstances.
Insofar as indemnification for liabilities under the Act may be permitted
to directors, officers or persons controlling the Company pursuant to the
foregoing provisions, the Company has been informed that in the opinion of the
Commission, such indemnification is against public policy as expressed in the
Act and is therefore unenforceable.
Item 16. Exhibits
(a) Exhibits
Exhibit No.
4(a) Form of certificate evidencing Common Stock, $.001 par
value, of the Company, incorporated by reference to
Exhibit 4(a) of the Company's Registration Statement on
Form S-1 (Registration No. 33-45428).
II-2
<PAGE>
5 Opinion of Tenzer Greenblatt LLP, regarding legality of
securities being registered.*
23(a) Consent of BDO Seidman, LLP.
23(b) Consent of Arthur Andersen LLP
23(c) Consent of Tenzer Greenblatt LLP (included in Exhibit
5).*
- -----------
* To be filed by amendment
Item 17. Undertakings
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which it offers or sells securities, a
post-effective amendment to this registration statement to:
(i) Include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) Reflect in the Prospectus any facts or events arising after the
effective date of the prospectus (or the most recent post-effective
amendments thereto) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration
statement; and
(iii) Include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the information required to be filed with a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished
to the Commission by the registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That for determining any liability under the Securities Act of 1933,
each such post-effective amendment shall be deemed to be a new registration of
the securities offered, and the offering of the securities at that time to be
the initial bona fide offering thereof.
(3) To remove by registration by means of a post-effective amendment any of
the securities that remain unsold at the termination of the offering.
II-3
<PAGE>
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers, and controlling persons of the
registrant pursuant to the foregoing provisions, 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 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-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements of 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 City of San Francisco, State of California, on the 6th day
of February, 1997.
U.S. Home & Garden Inc.
By:/s/ Robert Kassel
-----------------------------
Robert Kassel, President
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates stated:
Signature Title Date
--------- ----- ----
/s/ Robert Kassel Chairman of the February 6, 1997
- ---------------------- Board of Directors,
Robert Kassel President and Treasurer
(Chief Executive,
Accounting and Financial
Officer)
/s/ Maureen Kassel Vice-President, February 6, 1997
- ---------------------- Secretary and Director
Maureen Kassel
/s/ Richard Raleigh Chief Operating Officer February 6, 1997
- ---------------------- and Director
Richard Raleigh
/s/ Jon Schulberg Director February 6, 1997
- ----------------------
Jon Schulberg
/s/ Fred Heiden Director February 6, 1997
- ----------------------
Fred Heiden
II-5
<PAGE>
Exhibit No. Description Page No.
- ----------- ----------- --------
4(a) Form of certificate evidencing Common Stock, $.001 par value,
of the Company, incorporated by reference to Exhibit 4(a) of
the Company's Registration Statement on Form S-1 (Registration
No. 33-45428).
5 Opinion of Tenzer Greenblatt LLP, regarding legality of
securities being registered.*
23(a) Consent of BDO Seidman, LLP.
23(b) Consent of Arthur Andersen LLP
23(c) Consent of Tenzer Greenblatt LLP (included in Exhibit 5).*
- ------------
*To be filed by amendment
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
U.S. Home & Garden Inc.
San Francisco, California
We hereby consent to the incorporation by reference in the Prospectus
consitituting a part of this Registration Statement of our report dated August
29, 1996, relating to the consolidated financial statements of U.S. Home &
Garden Inc. which are not contained in that Prospectus.
We also consent to the reference to us under the caption "Experts" in the
Prospectus.
/s/ BDO SEIDMAN, LLP
BDO Seidman, LLP
San Francisco, California
February 6, 1997
EXHIBIT 23(b)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-3 of our report dated
September 26, 1996 on the consolidated financial statements of Weatherly
Consumer Products Group, Inc., included in the U.S. Home & Garden Inc. Form 8-K
and to all references to our Firm included in this registration statement.
/s/ ARTHUR ANDERSEN LLP
Cincinnati, Ohio
February 6, 1997
