As filed with the Securities and Exchange Commission on April 27, 1999
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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THE HAIN FOOD GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 22-3240619
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
50 Charles Lindbergh Boulevard
Uniondale, New York 11553
(516) 237-6200
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
Irwin D. Simon
President and Chief Executive Officer
The Hain Food Group, Inc.
50 Charles Lindbergh Boulevard
Uniondale, New York 11553
(516) 237-6200
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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copies to:
Roger Meltzer, Esq. Kenneth W. Miller, Esq.
Cahill Gordon & Reindel Walter Weinberg, Esq.
80 Pine Street Katten Muchin & Zavis
New York, New York 10005 525 West Monroe Street, Suite 1600
(212) 701-3000 Chicago, IL 60661
(312) 902-5200
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Approximate date of commencement of proposed sale to the public: From time
to time after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered to
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
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Title of Securities to be Amount to be Proposed Maximum Proposed Maximum Amount of
Registered Registered(1) Offering Price Per Share (2) Aggregate Offering Price (2) Registration Fee
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<S> <C> <C> <C> <C>
Common Stock, par value 991,736 shares $18.0625 $17,913,232 $4,980
$.01 per share
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(1) The amount to be registered consists of 991,736 shares to be issued upon
conversion of our 7% subordinated convertible notes due 2004 assuming
conversion of such notes into the number of shares of common stock equal to
150% of the number of shares issuable upon such conversion based upon the
lowest closing price of our common stock since January 1, 1999. The lowest
closing price for such period was $15.125 per share, on March 22, 1999.
(2) Estimated pursuant to Rule 457(c) solely for the purpose of calculating the
amount of the registration fee based on the average of the high and low
prices of the Company's Common Stock as reported on the Nasdaq National
Market System on April 15, 1999.
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 this Registration Statement
shall become effective on such date as the Commission, acting pursuant to
Section 8(a), may determine.
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<PAGE>
The information in this prospectus is not complete and may be changed. The
selling stockholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting
offers to buy these securities in any state where the offer or sale is not
permitted.
SUBJECT TO COMPLETION, DATED APRIL 27, 1999
PROSPECTUS
THE HAIN FOOD GROUP, INC.
Common Stock
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The selling stockholders identified in this prospectus are offering for
resale under this prospectus shares of our common stock to be issued upon
conversion of our 7% subordinated convertible notes due 2004.
These shares may be offered from time to time by the selling stockholders
through public or private transactions, on or off the Nasdaq National Market, at
prevailing market prices or at privately negotiated prices. The selling
stockholders will receive all of the proceeds from the sale of the shares and
will pay all underwriting discounts and selling commissions, if any, applicable
to the sale of the shares. We will pay the expenses of registration of the sale
of the shares.
The exact number of shares to be issued pursuant to the notes will depend
upon the average market price of our common stock during the ten trading days
prior to any conversion of the notes. See "Terms of the Offering."
Our common stock is listed on the Nasdaq National Market under the symbol
"HAIN." On April 22, 1999, the last reported sales price of our common stock on
the Nasdaq National Market was $18.0625 per share.
Investing in our common stock involves risks. See "Risk Factors" beginning
on page 6.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is a
criminal offense.
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Prospectus dated , 1999
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TABLE OF CONTENTS
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Page Page
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TERMS OF THE OFFERING....................................2 SELLING STOCKHOLDERS .................................14
PROSPECTUS SUMMARY.......................................3 PLAN OF DISTRIBUTION....................................16
RISK FACTORS.............................................6 DESCRIPTION OF CAPITAL STOCK............................17
USE OF PROCEEDS.........................................12 LEGAL MATTERS...........................................19
DETERMINATION OF OFFERING PRICE.........................12 EXPERTS.................................................19
PRICE RANGE OF COMMON STOCK AND WHERE YOU CAN FIND MORE
DIVIDEND POLICY......................................13 INFORMATION .........................................21
</TABLE>
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You should rely only on the information contained or incorporated by
reference in this prospectus or to which we have referred you. We have not
authorized anyone to provide you with information that is different. This
prospectus may be used only where it is legal to sell these securities. The
information contained or incorporated by reference in this prospectus may be
accurate only on the date of this prospectus.
This prospectus contains certain forward-looking statements regarding our
future financial condition and results of operations and our business
operations. These statements involve risks, uncertainties and assumptions,
including industry and economic conditions and customer actions and the other
factors discussed in this prospectus (including under the caption "Risk
Factors") and in our filings with the Securities and Exchange Commission. If one
or more of these risks or uncertainties materialize, or if the underlying
assumptions prove incorrect, actual outcomes may vary materially from those
indicated. The words "expect," "estimate," "anticipate," "predict" and similar
expressions are intended to identify forward-looking statements.
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TERMS OF THE OFFERING
The number of shares of common stock to be issued upon conversion of any
note issued to a selling stockholder under the merger agreement dated as of
April 6, 1999 among us, Hain Acquisition Corp., our wholly-owned subsidiary, and
Natural Nutrition Group, Inc., will be based upon the conversion price equal to
the average of the closing prices of our common stock for the ten (10) trading
days prior to any conversion of that note. For illustrative purposes, the number
of shares of common stock which may be issued upon conversion of all the notes
at various conversion prices is set forth in the table below.
The conversion of notes into shares of common stock is subject to a minimum
conversion price of $22.00 per share until the date six months after the closing
of the acquisition of Natural Nutrition Group. Thereafter, the notes will be
convertible at any time at the option of the holders of the notes at a
conversion price determined as set forth above. The actual number of shares of
common stock which may be issued cannot be stated with certainty and is
dependent upon a fluctuating market price of common stock (see "Risk Factors").
The table provides a historical basis for an estimate of the number of shares of
common stock which may be issued. Since January 1, 1999, the market price of our
common stock obtained a high last closing price of $23.5625 on January 7, 1999
and a low last closing price of $15.125 on March 22, 1999. Although the
historical record of stock prices is no assurance of future performance, we
believe it creates a reasonable basis for a range of the possible number of
shares which may be issued pursuant to the notes.
<TABLE>
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Number of Shares of Common
Stock Issued
if all Notes were Fully
Conversion Price Converted
<S> <C> <C>
150% of number of shares
issuable at the lowest closing
price since January 1, 1999............................... $10.08 991,736
Lowest closing price since
January 1, 1999........................................... $15.125 661,157
Closing price on April 15, 1999........................... $16.9375 590,406
First six months minimum
conversion price.......................................... $22.00 454,545
Highest closing price since
January 1, 1999........................................... $23.5625 424,403
</TABLE>
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PROSPECTUS SUMMARY
To understand this offering fully, you should read the entire prospectus
carefully, including the risk factors and the information incorporated by
reference in this prospectus.
The Hain Food Group, Inc.
We market, distribute and sell natural and specialty food products under
brand names which we sell as "better for you" products. Our product categories
encompass natural and organic foods, medically directed foods, weight management
and portion control foods, snack foods and kosher foods. These products are sold
primarily to specialty and natural food distributors and are marketed nationally
to supermarkets, natural food stores, and other retail classes of trade. Except
for our Nile Spice(R) soup brand, the product lines of our subsidiaries AMI
Operations Inc., Deboles Nutritional Foods, Inc. and Dana Alexander, Inc., the
maker of Terra(R) chips, our products are produced by independent food
processors, or co-packers, using proprietary specifications which we control. In
addition, we will manufacture products under the Health Valley(R),
Breadshop's(R) and Casbah(R) brands in the soon to be acquired Irwindale,
California facility operated by Natural Nutrition Group.
Since our formation in 1993, we have completed a number of acquisitions of
companies and brands. In July 1998, we acquired:
o Arrowhead Mills, Inc., a natural foods company;
o Dana Alexander, Inc., the maker of Terra Chips natural vegetable
chips;
o Garden of Eatin', Inc., a natural snack products company; and
o DeBoles Nutritional Foods, Inc., a natural pasta products company.
Our other principal acquisitions and agreements include:
o Earth's Best(R)natural baby foods products, which we sell under a
license from H.J. Heinz Company granted April 1, 1999;
o Nile Spice Soups, which we acquired from a subsidiary of The Quaker
Oats Company in December 1998;
o Westbrae Natural, Inc., through which we sell natural foods under the
Westbrae(R), Westsoy(R), Little Bear Organic Foods(R) and Bearitos(R)
labels, acquired in October 1997;
o Boston Better Snacks, a snack foods producer, acquired in May 1997;
o Weight Watchers(R)dry and refrigerated products, which we sell under a
license from H.J. Heinz Company granted in March 1997;
o The Estee Corporation, a maker of sugar-free, medically directed food
products, acquired in November 1995;
o Hain Pure Food Co., Inc., a natural food product company, including
Hollywood Foods, a maker of cooking oils, condiments and vegetable
juice, acquired in April 1994; and
o Kineret Foods Corporation, a kosher foods company, acquired in
November 1993.
In addition, we own the Nile Spice(R), Farm Foods(R), Harry's Premium
Snacks(R), Featherweight(R), and Alba(R) brands.
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As a leading natural and organic food company, we sell a full line of
products under our Hain Pure Foods(R), Westbrae(R), Westsoy(R), Little Bear
Organic Foods(R), Bearitos(R), Arrowhead Mills(R), Terra(R), DeBoles(R), Garden
of Eatin(R) and Farm Foods(R) brands. Our specialty food products include:
o Cooking oil and condiment products under our Hollywood(R) brand;
o Sugar-free, medically directed food products under our Estee(R)brand,
all of which carry the logo of the American Diabetes Association;
o Low-sodium food products under our Featherweight(R) brand;
o Weight management and portion-control foods under the Weight
Watchers(R) brand;
o Frozen kosher food products under our Kineret(R) and Kosherific(R)
brands;
o Regular and reduced fat snack products under our Boston Better Snacks
brand; and
o Dry milk products under the Alba(R) brand.
Our brand names are well-recognized in the various market categories they
serve. We acquired these brands over the past five years and seek to grow
through internal expansion, as well as the acquisition of complementary brands.
Our mission is to be the leading marketer and seller of specialty food
products, with a strong commitment to total quality management in all
departments. We intend to increase sales and improve operating results by
investing in product development and building brand equity. Key elements of our
business strategy are:
o continue growth through mergers and acquisitions;
o invest in brands and consumer awareness;
o outsource manufacturing;
o leverage economies of scale in production and logistics; and
o develop export opportunities.
Recent Developments
On April 6, 1999, we announced that we had executed a merger agreement
pursuant to which we would acquire the stock of privately-held Natural Nutrition
Group, Inc., a manufacturer and marketer of premium natural and organic food
products sold under the Health Valley(R), Breadshop's(R) and Casbah(R) brands.
Under the terms of the merger agreement, the purchase price consists of $70
million in cash and a $10 million convertible note.
In connection with the acquisition, we will enter into a new $160 million
senior secured loan facility with our senior lenders, which provides for a $30
million revolving credit facility and $130 million of term loans. This facility
will be used to finance the acquisition, refinance the Company's existing
indebtedness and provide for ongoing working capital needs.
In April 1999, we announced an agreement with Heinz regarding the sale and
distribution of the Earth's Best(R) line of organic baby food products in the
U.S. retail grocery and natural food channels, which expanded the companies'
current business relationships, first concluded in May 1998, to include U.S.
retail grocery customers. The new agreement transfers responsibilities to us for
the sale
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and distribution of the existing Earth's Best(R) line, as well as new product
development and introduction utilizing the Earth's Best trademark for infant and
toddler feeding products.
The Offering
Pursuant to the merger agreement, shares of our common stock are obtainable
by the selling stockholders upon conversion of the notes at a conversion price
equal to the average closing price of the common stock for the ten (10) trading
days immediately preceding the conversion date.
The selling stockholders acquired the notes in accordance with the merger
agreement. Upon conversion of the notes, the selling stockholders may offer for
sale, by use of this prospectus, the shares of common stock issuable under such
notes. See "Plan of Distribution."
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RISK FACTORS
Prospective investors should carefully consider the following factors and
the other information contained in this prospectus before purchasing any shares
of our common stock.
Our Business Is Dependent Upon Our Ability To Successfully Integrate Our
Acquisitions Into Our Existing Operations
We cannot be certain that we can effectively integrate newly acquired
businesses into our operations. Since our formation, we have acquired several
companies. Our future success may be dependent upon our ability to effectively
integrate these companies and brands, including our ability to realize
potentially available marketing opportunities and cost savings, some of which
may involve operational changes. We cannot be certain:
o as to the timing or number of marketing opportunities or amount of
cost savings that may be realized as the result of our integration of
these companies and brands;
o that these acquisitions will enhance our competitive position and
business prospects;
o that our combination or integration of these acquisitions will be
successful; or
o that we will not experience difficulties with customers, personnel or
other parties as a result of these acquisitions.
In addition, we cannot be certain that we will be successful in:
o integrating our distribution channels with those of the acquired
companies;
o coordinating sales force activities of or in selling the products of
the acquired companies to our customer base; or
o integrating the acquired companies into our management information
systems or in integrating the acquired companies' products.
The shares of common stock included in this prospectus will be issued upon
the conversion of notes which are to be issued to stockholders of Natural
Nutrition Group in connection with our acquisition of Natural Nutrition Group
and its subsidiaries Health Valley Company and Sahara Natural Foods, Inc. Our
other recent acquisitions include Arrowhead Mills, Terra, Garden of Eatin' and
DeBoles in July 1998 and Westbrae in October 1997. We have also acquired several
individual brands, including:
o Nile Spice(R), which we acquired from Quaker Oats in December 1998;
o Alba(R), which we acquired from Heinz in July 1997; and
o Boston Better Snacks, which we acquired in May 1997.
Further, we have entered into a number of licensing agreements under which
we use the brands of others, including licensing agreements with:
o Heinz U.S.A., a division of Heinz, for use of the Earth's Best(R)line
of baby food products in the United States in April 1999; and
o Golden Grain Company, a subsidiary of Quaker Oats, for use of the Near
East(R)brand in the United States in December 1998;
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o Weight Watchers, a subsidiary of Heinz, pursuant to which we
manufacture, market and sell Weight Watchers(R)dry and refrigerated
products in March 1997.
Integrating these businesses will require management resources and may
divert our management from our day-to-day operations.
Our Acquisition Strategy Exposes Us To Risk
Our acquisition strategy is based on identifying and acquiring businesses
with products and/or brands that complement our existing product mix. We will
evaluate specific acquisition opportunities based on prevailing market and
economic conditions. We cannot be certain that we will be able to:
o successfully identify suitable acquisition candidates;
o obtain necessary financing;
o complete acquisitions; or
o integrate acquired businesses into our operations.
Our completed or future acquisitions may not achieve acceptable levels of
operating results or otherwise perform as expected. These acquisitions also
involve special risks, including:
o risks associated with unanticipated problems, liabilities and
contingencies;
o diversion of management attention and possible adverse effects on
earnings resulting from increased goodwill amortization, increased
interest costs and the issuance of additional securities; and
o difficulties related to the integration of the acquired business.
We may encounter increased competition for acquisitions in the future,
which could result in acquisition prices we do not consider acceptable. In
addition, our credit facility with our lending banks contains restrictions that
limit our ability to make acquisitions. We are unable to predict whether or when
any prospective acquisition candidate will become available or the likelihood
that any acquisition will be completed.
Our Customers' Preferences For Our Products May Change
A significant shift in consumer demand away from our products or our
failure to maintain our current market position would have a material adverse
effect on our business, results of operations and financial condition. While we
continue to diversify our product offerings, we cannot be certain that demand
for our products will continue at current levels or increase in the future. Our
business is limited to specialty food products in niche markets geared to
consumers of natural foods, medically-directed and weight management food
products, kosher foods and other specialty food items. We are subject to
evolving consumer preferences for these products. We have other significant
product categories, such as cooking oils and non-dairy beverages, which, if
consumer demand for such categories were to decrease, could have a material
adverse effect on our business, results of operations and financial condition.
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The Markets In Which We Sell Our Products Are Competitive
We operate in highly competitive geographic and product markets, and some
of our markets are dominated by competitors with greater resources than ours. We
cannot be certain that we can successfully compete for sales to distributors or
stores that purchase from larger, more established companies that have greater
financial, managerial, sales and technical resources. Larger competitors also
may be able to benefit from economies of scale, pricing advantages or the
introduction of new products that compete with our products. There can be no
assurance that we will achieve the market penetration that we seek in order to
implement our business strategy. We cannot be certain that competitors will not
introduce other products in the future that compete with our products or that
such competitive products will not have an adverse effect on our business,
results of operations and financial condition.
Our Competitive Positions Depends On Our Ability To Attract And Retain Key
Personnel
We are highly dependent upon the services of Irwin D. Simon, our President
and Chief Executive Officer. The loss of the services of Mr. Simon could have a
material adverse effect on our business, results of operations and financial
condition. In addition, our ability to develop and market our products and to
achieve and maintain a competitive position depends, in large part, on our
ability to attract and retain qualified operations, sales and marketing
personnel.
We Rely On Independent Distributors And Brokers For A Substantial Portion Of Our
Sales
We rely upon sales efforts made by or through non-affiliated food brokers
to distributors and other customers. The loss of, or business disruption at, one
or more of these distributors or brokers may have a material adverse effect on
our business, results of operations and financial condition. If we were required
to obtain additional or alternative distribution and food brokerage agreements
or arrangements in the future, we cannot be certain that we will be able to do
so on satisfactory terms or in a timely manner. Two distributors, United Natural
Foods and Tree of Life, accounted for approximately 23% and 14%, respectively,
of our pro forma (prior to the acquisition of Natural Nutrition Group) calendar
year 1998 sales. Our inability to enter into satisfactory brokerage agreements
may inhibit our ability to implement our business plan or to establish markets
necessary to develop our products successfully. The success of our business
depends, in large part, upon the establishment of a strong distribution network.
Food brokers act as selling agents representing specific brands on a
non-exclusive basis under oral or written agreements generally terminable at any
time on 30 days notice and receive a percentage of net sales as compensation.
Distributors purchase directly for their own account for resale.
We Rely On Independent Manufacturers And Co-Packers To Produce A Substantial
Number Of Our Products
The loss of one or more manufacturers, co-packers or suppliers, or our
failure to retain manufacturers, co-packers and suppliers for newly acquired
products or brands, could have a material adverse effect on our business,
results of operations and financial condition until such time as an alternate
source of supply could be secured, which may be on less favorable terms. Failure
to obtain in a timely manner and on comparable terms other suppliers if a
present supplier terminated its relation-
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ship with us could have a material adverse effect on our business, results of
operations and financial condition. Except for our Nile Spice soup brand and the
product lines of Arrowhead, Deboles and Terra, we do not manufacture, produce or
package any of the products or brands which we currently market, although we
develop and own the formulas and recipes, and we design the packaging for our
products. Accordingly, we are dependent upon independent manufacturers and
co-packers to produce and package a majority of our products. In addition, we
will manufacture products under the Health Valley(R), Breadshop's(R) and
Casbah(R) brands in the soon to be acquired Irwindale California facility
operated by Natural Nutrition Group.
Also, we obtain several of our products and the raw materials for several
of our products from a limited number of suppliers, the loss of any of which
could materially impact our business.
Our Ownership Of Our Trademarks Is Critical To The Success Of Our Business
Our inability to use our trademarks could have a material adverse effect on
our business, results of operations and financial condition. We own the
principal trademarks for our products. We believe that such trademarks are
important to the marketing of our products. In connection with our licensing
agreements, we have the right to use the Weight Watchers(R), Earth's Best(R),
and certain other trademarks.
Our Products Are Subject To Government Regulation
We cannot be certain that we or our manufacturers, distributors and
co-packers will be able to comply with the various federal, state and local laws
and regulations governing production, sale, safety, advertising, labeling and
ingredients to which our specialty food products are subject in the future or
that new governmental laws and regulations will not be introduced which could
result in additional compliance costs, seizures, confiscation, recall or
monetary fines, any of which could prevent or inhibit the development,
distribution and sale of our products or have a material adverse effect on our
business, results of operations and financial condition. In addition, product
recalls could adversely affect sales of our products. In addition, our kosher
food products are subject to additional regulation and inspection.
Product Liability Suits, If Brought, Could Have A Material Negative Effect On
Our Business
If a product liability claim exceeding our insurance coverage were to be
successfully asserted against us, it could have a material adverse effect on our
business, results of operations and financial condition. There is no assurance
that such coverage will be sufficient to insure against claims which may be
brought against us, or that we will be able to maintain such insurance or obtain
additional insurance covering existing or new products. As a marketer of food
products, we are subject to the risk of claims for product liability. We
maintain product liability insurance and generally require that our co-packers
maintain product liability insurance with us as a co-insured.
Some Of Our Products Require Certification
The loss of any independent certifications or permissions could adversely
affect the marketing position and goodwill afforded products that currently have
such certifications, which could have a
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material adverse effect on our business, results of operations and financial
condition. We must comply with the requirements of independent organizations or
certification authorities in order to make certain statements on the labels of
our products. For example, for our Estee products to carry the logo of the
American Diabetes Association, or ADA, the packaging must meet the standards of
the ADA. In addition, our kosher foods are certified kosher.
Certain Stockholders May Be Able To Control Our Actions
Mr. Simon, our President and Chief Executive Officer, together with the
other officers and directors of Hain beneficially owns an aggregate of
approximately 15.7% of our common stock (prior to the acquisition of Natural
Nutrition Group). Accordingly, our officers and directors will be in a position
to influence the election of our directors and otherwise influence stockholder
action. In addition, according to a Schedule 13D amendment filed with the
Commission dated January 12, 1999, certain unaffiliated holders of our common
stock beneficially own, prior to this offering, an aggregate of up to 23.7% of
our outstanding common stock.
We Are Authorized To Issue Preferred Stock To Deter Takeover Attempts
Our board of directors is empowered to issue, without stockholder approval,
preferred stock with dividends, liquidation, conversion, voting or other rights
which could decrease the amount of earnings and assets available for
distribution to holders of our common stock and adversely affect the relative
voting power or other rights of the holders of our common stock. In the event of
issuance, the preferred stock could be used, under certain circumstances, as a
method of discouraging, delaying or preventing a change in control. Our
certificate of incorporation authorizes the issuance of up to 5,000,000 shares
of "blank check" preferred stock with such designations, rights and preferences
as may be determined from time to time by our board of directors. Although we
have no present intention to issue any shares of our preferred stock, we may do
so in the future under appropriate circumstances. See "Description of Capital
Stock."
We Do Not Pay Dividends
We have not paid any dividends on our common stock to date and do not
anticipate declaring or paying any dividends in the foreseeable future. Our
ability to pay dividends is currently restricted by our credit facility with our
lending banks. See "Price Range of Common Stock and Dividend Policy."
The Market Price Of Our Common Stock Has Fluctuated In The Past And Could
Fluctuate Significantly
Our operating results have fluctuated in the past and will fluctuate in the
future based on many factors. These factors, many of which are outside our
control, include:
o failure to adequately integrate acquired companies;
o fluctuations in the general economy;
o increased competition;
o changes in operating expenses;
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o expenses related to acquisitions;
o the potential adverse effect of acquisitions;
o the size and timing of customer orders;
o new product introductions;
o changes in customer preferences; and
o market acceptance of new products.
Due to these and other unforeseen factors, it is likely that in some future
quarter our operating results will be below the expectations of public market
analysts and investors. In such event, the price of our common stock would
likely be materially adversely affected.
Our Computer Systems, And Those Of Others On Whom We Rely, May Not Achieve Year
2000 Readiness
Certain systems of our recently acquired businesses are not Year 2000
compliant. We cannot be certain that Year 2000 issues will not have a material
adverse impact on our business, results of operations or financial condition. We
plan to integrate the computer functions of such businesses into our Year 2000
compliant systems prior to the end of 1999. The "Year 2000" issue is the result
of computer systems that were programmed in prior years using a two digit
representation for the year. Consequently, in the Year 2000, date sensitive
computer programs may interpret the date "00" as 1900 rather than 2000. We have
completed an assessment of our systems affected by the Year 2000 issue and have
found only minor issues to be addressed. We believe our current business
operation computer programs and systems are Year 2000 compliant.
We have initiated formal communications with all of our significant
suppliers and large customers to determine the extent to which our interface
systems are vulnerable to those third parties' failure to remediate their own
Year 2000 issues. While we believe that the Year 2000 issue will not have a
material adverse effect on our business, results of operations or financial
condition, we cannot be certain that the systems of other companies on which our
systems rely will be timely converted and would not have an adverse effect on
our systems.
Effect Upon Market Price Of Shares To Be Issued Upon Conversion
Pursuant to the merger agreement, we issued notes to the selling
stockholders as part of the merger consideration. Subject to certain
restrictions, the selling stockholders may convert the notes into shares of
common stock at a conversion price equal to the average closing price of the
common stock for the ten (10) trading days immediately preceding the date the
notes are presented for conversion.
Under the foregoing conversion formula for the notes, the number of shares
of common stock issuable upon conversion will increase if the market price of
the common stock decreases. We cannot determine accurately the number of shares
which may be issued to the holders of the Notes as such number is based upon the
market price of the common stock prior to the conversion date.
To the extent the selling stockholders convert a portion of the notes and
then sell the shares of common stock received upon conversion, the market price
of the common stock may decrease even
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further due to the additional shares in the market which would allow the selling
stockholders to convert other portions of the notes into greater amounts of
common stock and further depress the price of the common stock.
Sales in the public market of substantial amounts of common stock,
including sales of shares issued upon conversion of the notes or the perception
that such sales could occur, could depress prevailing market prices for the
common stock. The existence of the notes and any other options, may prove to be
a hindrance to future equity financing by us. Further, the holders of such
options may exercise them at a time when we would otherwise be able to obtain
additional equity capital on terms more favorable to us.
USE OF PROCEEDS
We will not receive any of the proceeds from the sale of shares by the
selling stockholders. All of the proceeds from the sale of shares of common
stock by the selling stockholders will be received by the selling stockholders.
DETERMINATION OF OFFERING PRICE
The common stock offered by this prospectus may be offered for sale by the
selling stockholders from time to time in transactions on the over-the-counter
market, in negotiated transactions, or otherwise, or by a combination of these
methods, at fixed prices which may be changed, at market prices at the time of
sale, at prices related to market prices or at negotiated prices. As such, the
offering price is indeterminate as of the date of this prospectus. See "Plan of
Distribution."
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<PAGE>
PRICE RANGE OF COMMON STOCK AND DIVIDEND POLICY
Our common stock is traded on the Nasdaq National Market under the symbol
"HAIN." The following table sets forth, for the fiscal periods indicated, the
high and low closing prices per share of our common stock on the Nasdaq National
Market.
Price
Period High Low
Year Ended June 30, 1997
First quarter................................... $4 $3 1/16
Second quarter.................................. 4 3 1/4
Third quarter................................... 5 3/4 3 3/8
Fourth quarter.................................. 5 5/16 4 1/8
Year Ended June 30, 1998
First quarter................................... $11 15/16 $4 27/32
Second quarter.................................. 12 3/4 8 5/8
Third quarter................................... 19 13/16 9 1/16
Fourth quarter.................................. 27 1/4 17 11/16
Year Ending June 30, 1999
First quarter................................... $27 3/4 $14 7/8
Second quarter ................................. 25 12 1/8
Third quarter................................... 23 9/16 15 1/8
Fourth quarter (through April 15, 1999)........ 17 1/16 16 1/6
On April 22, 1999 the closing price of the common stock on the Nasdaq
National Market was $18.0625 per share.
We have not paid any dividends on our common stock to date. We intend to
retain all future earnings for use in the development of our business and do not
anticipate declaring or paying any dividends in the foreseeable future. The
payment of all dividends will be at the discretion of our board of directors and
will depend on, among other things, future earnings, operations, capital
requirements, contractual restrictions, our general financial condition and
general business conditions. Our ability to pay dividends is currently
restricted by our credit facility with our senior lenders.
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<PAGE>
SELLING STOCKHOLDERS
The selling stockholders are the holders of the 7% convertible notes due
2004 issued pursuant to the merger agreement (for more information about the
notes, see "Description of Capital Stock--Notes"). The shares are obtainable
upon conversion of the notes. The following table sets forth certain information
regarding ownership of the shares of common stock issuable upon conversion of
the notes.
<TABLE>
<CAPTION>
Shares of Common Stock Registered for Resale
Conversion Price of
Conversion Percent of Shares 150% of Shares Percent of Shares
Price of Beneficially Issuable at Lowest Beneficially
$22.00 Owned 1999 Closing Price Owned
------ ----- ------------------ -----
<S> <C> <C> <C> <C>
Chance Bahadur 327 * 714 *
Diane Beardsley 3,580 * 7,810 *
John Calfas 8,055 * 17,574 *
Frontenac VI Limited Partnership 210,050 1.5% 458,293 3.2%
Timothy J. Healy 327 * 714 *
George J. Mateljan, Jr. 22,919 * 50,006 *
Mark Smith 327 * 714 *
Cados Family Trust 7,160 * 15,621 *
Wasserstein Perella & Co. 1,528 * 3,334 *
State of Wisconsin Investment Board 176,370 1.3% 384,808 2.7%
William R. Voss 23,902 * 52,149 *
</TABLE>
- -----------------------
* Less than 1%.
The selling stockholders are deemed to beneficially own the shares of
common stock into which the notes held by them are convertible. As discussed in
greater detail under "Terms of the Offering" of this prospectus, the number of
shares of common stock which may be issued upon the conversion of the notes is
dependent upon the market price of our stock on the ten (10) trading days prior
to the conversion of each note. The number of shares listed in the table above
is the total of the estimated shares which may be acquired by the selling
stockholders pursuant to the notes and which are being registered pursuant to
the Form S-3 registration statement, of which this prospectus is a part,
assuming (a) conversion by all the selling stockholders at a conversion price of
$22.00 per share and (b) conversion of the notes by the selling stockholders
into the number of shares of common stock equal to 150% of the number of shares
issuable based on the lowest closing price of our common stock since January 1,
1999 of $15.125. The information set forth above may have no relationship to the
market price of our stock at the conversion dates of any of the notes.
Total shares of common stock outstanding for the purpose of the calculation
of percentage of beneficial ownership consists of 13,970,790 shares of our
common stock outstanding as of April 16,
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<PAGE>
1999 plus, for each selling stockholder, the number of shares into which that
selling stockholders notes are convertible, but does not include shares of
common stock issuable to the other selling stockholders or upon exercise of
warrants or outstanding stock options that may be granted under our stock
options plans.
The selling stockholders have represented to us that they will acquire the
notes for their own account for investment only and not with a view towards the
public sale or distribution thereof, except pursuant to sales registered under
the Securities Act or exemptions therefrom. In recognition of the fact that the
selling stockholders, even though purchasing the notes for investment, may wish
to be legally permitted to sell their shares when they deem appropriate, we
agreed with the selling stockholders to file with the Commission under the
Securities Act the registration statement with respect to the sale of the shares
from time to time in transactions in the over-the-counter market, in privately
negotiated transactions, or through a combination of these methods of sale, and
have agreed to prepare and file such amendments and supplements to the
registration statement as may be necessary to keep the registration statement
effective until the shares are no longer required to be registered for the sale
thereof by the selling stockholders. In the event the registration of additional
shares is necessary, we will prepare and file such additional registration
statements as may be necessary to allow the selling stockholders to sell all of
the shares.
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<PAGE>
PLAN OF DISTRIBUTION
All of the shares offered hereby may be sold from time to time by the
selling stockholders or by their registered assigns. The shares offered hereby
may be sold by one or more of the following methods: (a) a block trade in which
a broker or dealer so engaged will attempt to sell the shares as agent but may
purchase and resell a portion of the block as principal to facilitate the
transaction; (b) purchases by a broker or dealer as principal and resale by such
broker or dealer for its account pursuant to this prospectus; (c) ordinary
brokerage transactions and transactions in which the broker solicits purchasers;
(d) privately negotiated transactions; and (e) face-to-face transactions between
sellers and purchasers without a broker-dealer.
Any of the selling stockholders may be deemed to be a statutory underwriter
under the Securities Act. Also any broker-dealers who act in connection with the
sale of the shares hereunder may be deemed to be "underwriters" within the
meaning of Section 2(11) of the Securities Act, and any commissions received by
them and profit on any resale of the shares as principal may be deemed to be
underwriting discounts and commissions under the Securities Act.
In effecting sales, brokers or dealers engaged by the selling stockholders
may arrange for other brokers or dealers to participate. Such broker or dealers
may receive commissions or discounts from the selling stockholders in amounts to
be negotiated by the selling stockholders. The selling stockholders may enter
into hedging transactions with broker-dealers and the broker-dealers may engage
in short sales of the common stock in the course of hedging the positions they
assume with the selling stockholders (including, in connection with the
distribution of the common stock by such broker-dealers). The selling
stockholders may also engage in short sales of the common stock and may enter
into option or other transactions with broker-dealers that involve the delivery
of the common stock to the broker-dealers, who may then resell or otherwise
transfer such common stock. Such broker-dealers and any other participating
broker-dealers may, in connection with such sales, be deemed to be underwriters
within the meaning of the Securities Act. Any discounts or commissions received
by any such broker-dealers may be deemed to be underwriting discounts and
commissions under the Securities Act.
The selling stockholders may also sell shares in accordance with Rule 144
under the Securities Act, if Rule 144 is then available.
In order to comply with the securities laws of certain states, if
applicable, the shares will be sold in such jurisdictions only through
registered or licensed broker-dealers.
We will pay all of the expenses incident to the filing of this registration
statement, estimated to be $100,000. These expenses include legal and accounting
fees in connection with the preparation of the registration statement of which
this prospectus is a part, legal and other fees in connection with the
qualification of the sale of the shares under the laws of certain states (if
any), registration and filing fees and other expenses. The selling stockholders
will pay all other expenses incident to the offering and sale of the shares to
the public, including commissions and discounts of underwriters, brokers,
dealers or agents, if any. We have agreed to keep the registration of the shares
offered hereby effective until the earlier of the date when all of the shares
offered by the selling stockholders have been sold or two years from the date
the merger is consummated. In the event we fail to keep a registration statement
effective, interest on the notes will temporarily increase.
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<PAGE>
DESCRIPTION OF CAPITAL STOCK
General
As of April 16, 1999, our authorized capital stock is 40,000,000 shares of
common stock, $.0l par value per share, of which 13,970,790 shares are
outstanding, and 5,000,000 shares of preferred stock, $.0l par value per share,
none of which had been issued.
The following description is qualified in all respects by reference to our
certificate of incorporation and the bylaws.
Common Stock
Each share of common stock entitles the holder thereof to one vote on all
matters submitted to a vote of the stockholders. Since the holders of common
stock do not have cumulative voting rights, holders of more than 50% of the
outstanding shares can elect all of our directors then being elected and holders
of the remaining shares by themselves cannot elect any directors. The holders of
common stock do not have preemptive rights or rights to convert their common
stock into other securities. Holders of common stock are entitled to receive
ratably such dividends as may be declared by our board of directors out of funds
legally available therefor. In the event of our liquidation, dissolution or
winding up, holders of the common stock have the right to a ratable portion of
the assets remaining after payment of liabilities. All outstanding shares of
common stock are fully paid and nonassessable.
Preferred Stock
We are authorized by our certificate of incorporation to issue a maximum of
5,000,000 shares of preferred stock, in one or more series and containing such
rights, privileges and limitations including voting rights, dividend rates,
conversion privileges, redemption rights and terms, redemption prices and
liquidation preferences, as our board of directors may, from time to time,
determine.
The issuance of shares of preferred stock pursuant to our board of
directors' authority described above could decrease the amount of earnings and
assets available for distribution to holders of common stock, and otherwise
adversely affect the rights and powers, including voting rights, of such holders
and may have the effect of delaying or preventing us from being subject to a
change in control. See Risk Factors -- "We Are Authorized To Issue Preferred
Stock To Deter Takeover Attempts." We are not required by the Delaware General
Corporation Law, or the DGCL, to seek stockholder approval prior to any issuance
of authorized but unissued stock and our board of directors does not currently
intend to seek stockholder approval prior to any issuance of authorized but
unissued stock, unless otherwise required by law.
Warrants
As of April 16, 1999, warrants to purchase an aggregate of 822,717 shares
of common stock were outstanding. Each warrant entitles the holder to purchase
one share of common stock, subject to anti-dilution adjustments, at an exercise
price ranging from $3.25 to $12.69 per share. The warrants have expiration dates
ranging from January 27, 2000 to October 14, 2004.
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<PAGE>
Notes
The 7% convertible subordinated notes, are convertible at any time after
our consummation of the acquisition of Natural Nutrition Group, Inc. The
conversion price for the notes is the average closing price of the common stock
for the ten (10) trading days prior to the date on which the notes are presented
for conversion. The conversion of the notes into shares is subject to a minimum
conversion price of $22.00 per share until the date which is six months after
the closing of the acquisition of Natural Nutrition Group.
The notes contain provisions that protect the holder against dilution by
adjustment of the exercise price. Such adjustments will occur in the event,
among others, of a merger, stock split or reverse stock split, stock dividend or
recapitalization. The holder of the notes will not possess any rights as a
stockholder of us until such holder converts the notes.
Certificate of Incorporation and Bylaws
Pursuant to the DGCL, the power to adopt, amend and repeal bylaws is
conferred solely upon the stockholders unless the corporation's certificate of
incorporation also confers such power upon the board of directors. Under our
certificate of incorporation, our board of directors is granted the power to
amend our bylaws. Our bylaws provide that each director has one vote on each
matter for which directors are entitled to vote. Our certificate of
incorporation and/or bylaws also provide that (1) from time to time, by
resolution, our board of directors has the power to change the number of
directors, (2) the directors will hold office until the next annual meeting of
stockholders and until their respective successors are elected and qualified,
and (3) special meetings of stockholders may only be called by our board of
directors or our officers. These provisions, in addition to the existence of
authorized but unissued capital stock, may have the effect, either alone or in
combination with each other, of making more difficult or discouraging
unsolicited third parties from an acquisition of us deemed undesirable by our
board of directors. Our board of directors currently has seven members and one
vacancy.
Section 203 of the Delaware Law
Section 203 of the DGCL prohibits a publicly held 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 (1) prior to the date of the business
combination, the transaction is approved by the board of directors of the
corporation; (2) upon consummation of the transaction which resulted in the
stockholder becoming an interested stockholder, the interested stockholder owns
at least 85% of the outstanding voting stock, or (3) on or after such date the
business combination is approved by the board of directors and by the
affirmative vote of at least 66-2/3% of the outstanding voting stock that is not
owned by the interested stockholder. A "business combination" includes mergers,
asset sales and other transactions resulting in a financial benefit to the
stockholder. An "interested stockholder" is a person, who, together with
affiliates and associates, owns (or within three years, did own) 15% or more of
the corporation's voting stock. This provision of law could discourage, prevent
or delay a change in management or stockholder control of us, which could have
the effect of discouraging bids and thereby prevent stockholders from receiving
the maximum value for their shares, or a premium for their shares in a hostile
takeover situation.
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<PAGE>
Transfer Agent and Registrar
The Transfer Agent and Registrar for the common stock is Continental Stock
Transfer & Trust Company, New York, New York.
LEGAL MATTERS
Certain legal matters with respect to the validity of the common stock
offered hereby will be passed upon for the Company by Cahill Gordon & Reindel (a
partnership including a professional corporation), New York, New York.
EXPERTS
The consolidated financial statements of The Hain Food Group Inc. appearing
in our Annual Report (Form 10-K) for the year ended June 30, 1998, have been
audited by Ernst & Young LLP, independent auditors, as set forth in their report
thereon included therein and incorporated herein by reference. Such consolidated
financial statements are incorporated herein by reference in reliance upon such
report given on the authority of such firm as experts in accounting and
auditing.
The consolidated financial statements of Westbrae Natural, Inc. (formerly
Vestro Natural Foods, Inc.) incorporated in this prospectus by reference to the
Annual Report on 10-K for the year ended December 31, 1996, have been so
incorporated in reliance on the report of Pricewaterhouse Coopers LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting.
The financial statements of: (1) AMI Operating, Inc. incorporated by
reference herein for the fiscal year ended July 31, 1997 and as of July 31,
1997; (2) Terra incorporated by reference herein for the period from January 1,
1997 through July 31, 1997 and as of July 31, 1997; and (3) Garden of Eatin'
incorporated by reference herein for the period from January 1, 1997 through
December 23, 1997 and as of December 23, 1997 have been audited by McGladrey &
Pullen, LLP, independent auditors, as set forth in their reports thereon
incorporated by reference herein. Such financial statements are incorporated by
reference herein in reliance upon such reports given upon the authority of such
firm as experts in accounting and auditing.
The financial statements of Arrowhead incorporated by reference herein for
the fiscal years ended July 31, 1996 and 1995 and the balance sheet as of July
31, 1996 have been audited by McGinty & Associates, independent auditors, as set
forth in their report thereon included herein. Such financial statements are
incorporated by reference herein in reliance upon such reports given upon the
authority of such firm as experts in accounting and auditing.
The financial statements of Terra incorporated by reference herein for the
years ended December 31, 1996 and 1995 and the balance sheet as of December 31,
1996 have been audited by Katz & Bloom, LLC, independent auditors, as set forth
in their report thereon included herein. Such financial statements are
incorporated by reference herein in reliance upon such reports given upon the
authority of such firms as experts in accounting and auditing.
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<PAGE>
The consolidated financial statements of Natural Nutrition Group, Inc.
(formerly known as Intrepid Food Holdings, Inc.) as of December 31, 1997 and
1998 and for each of the three years in the period ended December 31, 1998,
incorporated in this prospectus by reference from the Current Report on Form 8-K
have been audited by Deloitte & Touche LLP, independent auditors, as stated in
their report, which is incorporated herein by reference, and have been so
incorporated in accounting and auditing.
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<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Commission. You can receive copies of such reports, proxy
and information statements, and other information, at prescribed rates, from the
Commission by addressing written requests to the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549.
In addition, you can read such reports, proxy and information statements, and
other information at the public reference facilities and at the regional offices
of the Commission, Washington, D.C., New York, New York and Chicago, Illinois.
Please call the Commission at 1-800-SEC-0330 for further information on the
public reference rooms. The Commission also maintains a Web site that contains
reports, proxy and information statements and other information regarding
registrants such as us that file electronically with the Commission. The address
of the Commission's Web site is http://www.sec.gov.
This prospectus is part of a registration statement on Form S-3 we filed
with the Commission to register the shares that the selling stockholders will
sell in this offering. This prospectus does not include all of the information
contained in the registration statement. For further information about us and
the securities offered in this prospectus, you should review the registration
statement and the information incorporated by reference therein. You can inspect
or copy the registration statement, at prescribed rates, at the Commission's
public reference facilities at the address listed above.
The Commission allows us to "incorporate by reference" information into the
prospectus, which means that we can disclose important information to you by
referring you to those documents filed separately with the Commission. The
information incorporated by reference is considered part of this prospectus, and
information that we file later with the Commission will automatically update and
supersede this information.
This prospectus incorporates by reference the documents listed below that
we previously filed with the Commission. These documents contain important
information about us and our finances:
(1) The description of our common stock contained in our Registration
Statement on Form 8-A/A dated November 12, 1993 and any amendment or
report filed for the purpose of updating such description;
(2) Westbrae's annual report on Form 10-K filed with the Commission (under
Westbrae's prior name of "Vestro Natural Foods, Inc.") for the fiscal
year ended December 31, 1996;
(3) Westbrae's quarterly reports on Form 10-Q filed with the Commission
(under Westbrae's prior name of Vestro Natural Foods, Inc.) for the
three month periods ended March 31, 1997 and June 30, 1997;
(4) Our annual report on Form 10-K filed with the Commission for the
fiscal year ended June 30, 1998;
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(5) Our quarterly reports on Form 10-Q filed with the Commission for the
three month periods ended September 30, 1998 and December 31, 1998;
and
(6) Our current reports on Form 8-K dated July 14, 1998, as amended on
Form 8-K/A dated July 23, 1998, April 6, 1999 and April 27, 1999.
We also incorporate by reference additional documents that we may file with
the Commission between the date of this prospectus and the completion of the
offering. These additional documents 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. Upon request, we will provide without charge
to each person to whom a prospectus is delivered, including any beneficial
owner, a copy of any or all of the information that has been incorporated by
reference in this prospectus. If you would like to obtain this information from
us, please direct your request, either in writing or by telephone, to the
President, The Hain Food Group, Inc., 50 Charles Lindbergh Boulevard, Uniondale,
New York, 11553, (516) 237-6200.
<PAGE>
=============================================================================
The Hain Food Group, Inc.
Common Stock
---------------
PROSPECTUS
----------------
, 1999
=============================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the costs and expenses, other than
underwriting discounts and commissions, incurred in connection with the sale of
common stock being registered (all amounts are estimated except the SEC
registration fee and the Nasdaq National Market listing fee). We will bear all
expenses incurred in connection with the sale of the common stock being
registered hereby, and the selling stockholders will not bear any portion of
such expenses other than underwriters' commissions and discounts relating to the
shares to be sold by each selling stockholders and certain "blue sky" filing,
registration and qualification fees, as provided in such agreement.
SEC Registration Fee...................................... $4,980
Nasdaq National Market Listing Fee........................ 19,835
Legal Fees and Expenses................................... 50,000
Accounting Fees and Expenses.............................. 20,000
Miscellaneous............................................. 5,185
---------
Total............................................ $100,000
========
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* To be completed by amendment.
II-1
<PAGE>
Item 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article Tenth of the certificate of incorporation of the registrant
eliminates the personal liability of directors to the Company or its
stockholders for monetary damages for breach of fiduciary duty as a director,
provided that such elimination of the personal liability of a director of the
registrant does not apply to (a) any breach of the director's duty of loyalty to
the registrant or its stockholders, (b) acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (c) actions
prohibited under Section 174 of the Delaware General Corporation Law (the
"DGCL") (i.e., liabilities imposed upon directors who vote for or assent to the
unlawful payment of dividends, unlawful repurchase or redemption of stock,
unlawful distribution of assets of the Issuer to the stockholders without the
prior payment or discharge of the registrant's debts or obligations, or unlawful
making or guaranteeing of loans to directors), or (d) any transaction from which
the director derived an improper personal benefit.
Section 145 of the DCGL provides, in summary, that directors and officers
of Delaware corporations such as the registrant are entitled, under certain
circumstances, to be indemnified against all expenses and liabilities (including
attorneys' fees) incurred by them as a result of suits brought against them in
their capacity as a director or officer, if they acted in good faith and in a
manner they reasonably believed to be in or not opposed to the best interests of
the corporation, and, with respect to any criminal action or proceeding, if they
had no reasonable cause to believe their conduct was unlawful; provided, that no
indemnification may be made against expenses in respect of any claim, issue or
matter as to which they shall have been adjudged to be liable to the
corporation, unless and only to the extent that the court in which such action
or suit was brought shall determine upon application that despite the
adjudication of liability but in view of all the circumstances of the case, they
are fairly and reasonably entitled to indemnify for such expenses which such
court shall deem proper. Any such indemnification may be made by the corporation
only as authorized in each specific case upon a determination by stockholders or
disinterested directors that indemnification is proper because the indemnitee
has met the applicable standard of conduct. In addition, Article Eleventh of the
registrant's certificate of incorporation and Article VI of the registrant's
by-laws provide for the registrant to indemnify its corporate personnel,
directors and officers to the full extent permitted by Section 145 of the DGCL,
as the same may be supplemented or amended from time to time.
II-2
<PAGE>
Item 16. EXHIBITS.
The following exhibits are filed as part of this Registration Statement:
Exhibit No. Description
2.1 Agreement and Plan of Merger dated April 6, 1999 by and among Hain
Acquisition Corp., The Hain Food Group, Inc. and National Nutrition
Group, Inc. (Incorporated by reference to Exhibit 2.1 of the
Registrant's Current Report on Form 8-K dated April 27, 1999 (the
"Hain 8-K")).
4.1 Form of Convertible Note (Incorporated by reference to Exhibit 4.1 to
the Hain 8-K).
5* Opinion of Cahill Gordon & Reindel regarding the legality of the
securities being registered.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of PricewaterhouseCoopers LLP, Independent Auditors.
23.3 Consent of McGladrey & Pullen, LLP, Independent Auditors.
23.4 Consent of McGinty & Associates, Independent Auditors.
23.5 Consent of Katz & Bloom, LLC, Independent Auditors.
23.6 Consent of Deloitte & Touche LLP, Independent Auditors.
23.7* Consent of Cahill Gordon & Reindel (included in Exhibit 5).
24 Powers of Attorney authorizing execution of Registration Statement on
Form S-3 on behalf of certain directors of Registrant (included on
signature pages to this Registration Statement).
- ---------------------
* To be filed by amendment
II-3
<PAGE>
Item 17. UNDERTAKINGS.
(A) 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 section 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; and
(B) 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
Securities Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
(C) The undersigned registrant hereby undertakes that:
1. For purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in
the form of prospectus filed by the registrant pursuant to Rule 424(b)(1)
or (4) or 497(h) under the Securities Act shall be deemed to be part of
this registration statement as of the time it was declared effective.
2. For the purpose of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Uniondale, State of New York, on this 27th day of
April, 1999.
THE HAIN FOOD GROUP, INC.
By: /s/ Irwin D. Simon
--------------------------------
Name: Irwin D. Simon
Title: President and Chief Executive Officer
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<PAGE>
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints
Irwin D. Simon, the President and Chief Executive Officer of the Registrant, and
Gary M. Jacobs, the Chief Financial Officer, Treasurer and Secretary of the
Registrant, or either of them, acting alone, as his true and lawful
attorney-in-fact, with full power and authority to execute in the name, place
and stead of each such person in any and all capacities and to file, an
amendment or amendments to the Registration Statement (and all exhibits thereto)
and any documents relating thereto, which amendments may make such changes in
the Registration Statement as said officer or officers so acting deem(s)
advisable.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Andrew R. Heyer Chairman of the Board of Directors April 27, 1999
- -------------------------
Andrew R. Heyer
/s/ Irwin D. Simon President, Chief Executive April 27, 1999
- -------------------------
Irwin D. Simon Officer and Director
/s/ Gary M. Jacobs Chief Financial Officer, Treasurer and April 27, 1999
- ------------------------- Secretary (Principal Financial Officer)
Gary M. Jacobs
- -------------------------
Beth L. Bronner Director April 27, 1999
/s/ Willam J. Fox Director April 27, 1999
- -------------------------
William J. Fox
- -------------------------
Jack Futterman Director April 27, 1999
/s/ James S. Gold Director April 27, 1999
- -------------------------
James S. Gold
/s/ Kenneth J. Daley Director April 27, 1999
- -------------------------
Kenneth J. Daley
</TABLE>
II-6
<PAGE>
INDEX TO EXHIBITS
Exhibit Description
2.1 Agreement and Plan of Merger dated April 6, 1999 by and among Hain
Acquisition Corp., The Hain Food Group, Inc. and National Nutrition
Group, Inc. (Incorporated by reference to Exhibit 2.1 of the
Registrant's Current Report on Form 8-K dated April 27, 1999 (the
"Hain 8-K")).
4.1 Form of Convertible Note (Incorporated by reference to Exhibit 4.1 to
the Hain 8-K).
5* Opinion of Cahill Gordon & Reindel regarding the legality of the
securities being registered.
23.1 Consent of Ernst & Young LLP, Independent Auditors.
23.2 Consent of PricewaterhouseCoopers LLP, Independent Auditors.
23.3 Consent of McGladrey & Pullen, LLP, Independent Auditors.
23.4 Consent of McGinty & Associates, Independent Auditors.
23.5 Consent of Katz & Bloom, LLC, Independent Auditors.
23.6 Consent of Deloitte & Touche LLP, Independent Auditors.
23.7* Consent of Cahill Gordon & Reindel (included in Exhibit 5).
24 Powers of Attorney authorizing execution of Registration Statement on
Form S-3 on behalf of certain directors of Registrant (included on
signature pages to this Registration Statement).
- --------------------
* To be filed by amendment.
II-7
Exhibit 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of The Hain Food Group,
Inc. for the registration of 991,736 shares of its common stock and to the
incorporation by reference therein of our report dated September 10, 1998, with
respect to the consolidated financial statements and schedule of The Hain Food
Group, Inc. included in its Annual Report (Form 10-K) for the year ended June
30, 1998, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
Melville, New York
April 23, 1999
II-8
Exhibit 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of The Hain Food
Group, Inc. of our report dated March 25, 1997 appearing on page F-1 of the
Westbrae Natural, Inc. (formerly Vestro Natural Foods, Inc.) Annual Report on
Form 10-K for the year ended December 31, 1996. We also consent to the reference
to us under the heading "Experts" in such Prospectus.
/s/ PRICEWATERHOUSECOOPERS LLP
Costa Mesa, California
April 23, 1999
II-9
Exhibit 23.3
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation of our reports, relating to the
consolidated financial statements of AMI Operating, Inc. and subsidiaries dated
May 27, 1998 and the financial statements of Dana Alexander, Inc., dated May 22,
1998 and the financial statements of Garden of Eatin', Inc., dated May 8, 1998,
included in the Form 8-K/A dated July 23, 1998 and incorporated by reference in
the previously filed Registration Statement of The Hain Food Group, Inc., on
Form S-4/S-3 (No. 333-57343) and incorporated by reference in the Prospectus
constituting part of this Registration Statement of The Hain Food Group, Inc. on
Form S-3 filed on or about April 23, 1999. We also consent to the reference to
us under the heading "Experts" in such Prospectus.
/s/ MCGLADREY & PULLEN, LLP
Anaheim, California
April 22, 1999
II-10
Exhibit 23.4
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation of our reports, relating to the
consolidated financial statements of Arrowhead Mills, Inc., dated October 4,
1996, except for Note 10, as to which the date is June 1, 1998, for the years
ended July 31, 1996 and 1995 included in the Form 8-K/A dated July 23, 1998 and
incorporated by reference in the previously filed Registration Statement of The
Hain Food Group, Inc., on Form S-4/S-3 (No. 333-57343) and incorporated by
reference in the Prospectus constituting part of this Registration Statement of
The Hain Food Group, Inc. on Form S-3 filed on or about April 22, 1999. We also
consent to the reference to us under the heading "Experts" in such Prospectus.
/s/ MCGINTY & ASSOCIATES
April 22, 1999
II-11
Exhibit 23.5
CONSENT OF INDEPENDENT AUDITORS
We hereby consent to the incorporation of our report, relating to the
financial statements of Dana Alexander, Inc., dated March 19, 1997, except for
Note L, as to which the date is June 2, 1997, for the years ended December 31,
1996 and 1995 included in the Form 8-K/A dated July 23, 1998 and incorporated by
reference in the previously filed Registration Statement of The Hain Food Group,
Inc., on Form S-4/S-3 (No. 333-57343) and incorporated by reference in the
Prospectus constituting part of this Registration Statement of The Hain Food
Group, Inc. on Form S-3 filed on or about April 22, 1999. We also consent to the
reference to us under the heading "Experts" in such Prospectus.
/s/ KATZ & BLOOM, LLC
April 22, 1999
II-12
Exhibit 23.6
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement
of The Hain Food Group, Inc. on Form S-3 of our report dated February 18, 1999
except for Note 7, as to which the date is March 30, 1999 on the consolidated
financial statements of Natural Nutrition Group, Inc., appearing in the Current
Report on Form 8-K of The Hain Food Group, Inc. dated April 27, 1999 and to the
reference to us under the heading "Experts" in the Prospectus, which is part of
this Registration Statement.
/s/ DELOITTE & TOUCHE
Costa Mesa, California
April 27, 1999
II-13
