HOLLAND & KNIGHT LLP
One Independent Drive, Suite 2000
P. O. Box 1559 (ZIP 3201-1559)
Jacksonville, Florida 32202
(904) 354-4141
(904) 358-2199 Fax
August 31, 1998 T. MALCOLM GRAHAM
904-798-7320
Internet Address:
[email protected]
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Wickes Inc./Registration
Statement on Form S-3
Dear Ladies and Gentlemen:
On behalf of Wickes Inc., a Delaware corporation (the "Company"),
we enclose herewith for filing with the Commission, pursuant to the
Securities Act of 1933, as amended (the "Securities Act"), the Company's
Registration Statement on Form S-3 (the "Registration Statement") for the
shelf registration under the Securities Act of 1,000,000 shares of the
Company's Common Stock, $.01 par value, on behalf of Riverside Group, Inc.,
the Company's majority stockholder, as selling shareholder.
The applicable $1,217 registration fee has been previously paid
by the Company to the Commission's "lock box" account at Mellon Bank.
Please contact the undersigned with any questions or comments.
Very truly yours,
T. Malcolm Graham
C: Steven C. Duvall
TMG/jmm
Enclosure
As filed with the Securities and Exchange Commission on August 31,
1998
Registration No. 33 -
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
--------------------------
WICKES INC.
(Exact name of registrant as specified in charter)
Delaware 36-3554758
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) Identification Number)
706 North Deerpath Drive
Vernon Hills, Illinois 60061
Telephone: (847) 367-3400
(Address and telephone number of registrant's principal executive
offices)
Kenneth M. Kirschner, Esq.
706 North Deerpath Drive
Vernon Hills, Illinois 60061
Telephone: (847) 367-3400
(Name, address and telephone number of agent for service)
Copy to:
T. Malcolm Graham, Esq.
Holland & Knight LLP
50 North Laura Street, Suite 3900
Post Office Box 52687 (ZIP 32201-2687)
Jacksonville, Florida 32202
Telephone: (904) 354-4141
Approximate date of commencement of proposed sale to public:
From time to time after the Registration Statement becomes effective.
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<PAGE> 2
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. _
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Proposed Proposed
Each Class of Amount Maximum Maximum Amount of
Securities to to be Offering Aggregate Registration
be Registered Registered Price Offering Fee
Per Share(1) Price (1)
- ---------------- ----------- ------------ ---------- ------------
<S> <C> <C> <C> <C>
Common Stock, 1,000,000 $4.125 $4,125,000 $1,217
$.01 par value
</TABLE>
(1) Calculated pursuant to Rule 457(c). The Proposed Maximum Offering
Price Per Share for the 1,000,000 shares of Common Stock being registered
hereunder is equal to the average of the high and low prices ($4.25 and
$4.00 respectively) of the Common Stock reported on the NASDAQ National
Stock Market on August 26, 1998.
The registrant hereby amends this Registration Statement on such date
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or dates as may be necessary to delay its effective date until the
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registrant shall file a further amendment which specifically states that
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this Registration Statement shall thereafter become effective in accordance
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with Section 8(a) of the Securities Act of 1933 or until the Registration
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Statement shall become effective on such date as the Commission, acting
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pursuant to said Section 8(a), may determine.
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Information contained herein is subject to completion or amendment. A
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registration statement relating to these securities has been filed with the
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Securities and Exchange Commission. These securities may not be sold nor
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may offers to buy be accepted prior to the time the registration statement
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becomes effective. This prospectus shall not constitute an offer to sell
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or the solicitation of an offer to buy nor shall there be any sale of these
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securities in any State in which such offer, solicitation or sale would be
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unlawful prior to registration or qualification under the securities laws
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of any such State.
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SUBJECT TO COMPLETION, DATED AUGUST 31, 1998
PROSPECTUS
----------
1,000,000 Shares of Common Stock
WICKES INC.
THESE SECURITIES INVOLVE A HIGH DEGREE OF RISK. SEE "RISK FACTORS."
This Prospectus relates to 1,000,000 shares of common stock, par value
$.01 per share (the "Common Stock"), of Wickes Inc. ("Wickes" or the
"Company") by a shareholder of the Company (the "Selling Shareholder").
The Company will not receive any of the proceeds from the sale of the
shares being sold by the Selling Shareholder. See "Selling Shareholder"
and "Use of Proceeds."
The Selling Shareholder either directly, through agents designated or
to be designated from time to time by it, or through underwriters or
dealers, may sell the shares of Common Stock offered hereby from time to
time on terms to be determined by the Selling Shareholder at the time of
sale. To the extent required by applicable laws, the specific amount of
the shares to be sold, the respective purchase price and public offering
price, the names of such agents, underwriters or dealers, and any
applicable commission or discount with respect to a particular offer will
be set forth as appropriate in a Prospectus Supplement or an amendment to
the Registration Statement of which this Prospectus is a part. The Selling
Shareholder may also seek, to the extent permitted by applicable laws, to
sell the Shareholder's Securities in transactions under Rule 144 of the
Securities Act of 1933, as amended (the "Securities Act").
All expenses of the offering, other than commissions or discounts of
broker-dealers, will be borne by the Company. It is estimated that such
expenses to be borne by the Company, including accounting and legal fees,
will approximate $30,217.
The Selling Shareholder and any broker-dealers, agents, underwriters
or dealers that participate with the Selling Shareholder in the
distribution of the shares of Common Stock offered hereby may be deemed to
be "underwriters" within the meaning of the Securities Act, and any
commissions received by them and any profit on the resale of the
Shareholder's Securities purchased by them may be deemed to be underwriting
commissions or discounts under the Securities Act.
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The Common Stock is currently traded on the NASDAQ National Stock
Market under the symbol WIKS. The closing bid price of the Common Stock on
______________, 1998 was $_________per share.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF
THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
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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"). The
reports, proxy statements and other information filed by the Company with
the Commission can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the Commission's Regional Offices at Seven
World Trade Center, Suite 1300, New York, New York 10048, and Suite 1400,
Northwestern Atrium Center, 500 West Madison Street, Chicago, Illinois
60661. Copies of such material also can 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 Web site that
contains reports, proxy statements and other information regarding
registrants (including the Company) that file electronically with the
Commission. The address of this site is http://www.sec.gov.
The Company has filed with the Commission a Registration Statement on
Form S-3 (together with any amendments thereto, the "Registration
Statement") under the Securities Act, with respect to the Common Stock
offered hereby. As permitted by the rules and regulations of the
Commission, this Prospectus does not contain all of the information set
forth in the Registration Statement and exhibits thereto. Statements
contained in this Prospectus or in any document incorporated by reference
in this Prospectus as to the contents of any contract or other document
referred to herein or therein are not necessarily complete, and in each
instance where such contract or document has been filed as an exhibit to
the Registration Statement, each such statement being qualified in all
respects by such reference. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any such statement so modified or
superseded, except as so modified or superseded, shall not be deemed to
constitute a part of this Prospectus.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates herein by reference the following documents
(the "Incorporated Documents") filed with the Commission under the Exchange
Act:
(a) Annual Report on Form 10-K for the fiscal year ended
December 27, 1997;
(b) Quarterly Report on Form 10-Q for the fiscal quarter ended
March 28, 1998;
(c) Quarterly Report on Form 10-Q for the fiscal quarter ended
June 27, 1998;
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(d) The description of the Company's Common Stock contained in
the Company's Registration Statement on Form 8-A dated September
24, 1993, filed pursuant to Section 12 of the Exchange Act and
any amendment or report filed for the purpose of updating that
description; and
(e) All documents and reports subsequently 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 termination of
the offering of the securities offered hereby shall be deemed to
be incorporated by reference in this Prospectus and to be a part
hereof from the date of filing of such documents or reports.
The Company will provide without charge to each person to whom a copy
of this Prospectus has been delivered, on the written or oral request of
such person, a copy of any or all of the documents incorporated herein by
reference, other than exhibits to such documents unless they are
specifically incorporated by reference into such documents. Requests for
such copies should be directed to: Investor Relations, Wickes Inc., 706
Deerpath Drive, Vernon Hills, Illinois 60061, telephone: (847) 367-3400.
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RISK FACTORS
In evaluating the Company's business, prospective investors should
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carefully consider the following risk factors in addition to the other
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information set forth herein or incorporated herein by reference.
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Statements in this "Risk Factors" section regarding expectations or future
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events and in certain sections of the Incorporated Documents (identified
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with more particularity in such Incorporated Documents) may contain forward-
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looking statements within the meaning of Section 27A of the Securities Act
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of 1933, as amended, and Section 21E of the Securities Exchange Act of
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1934, as amended. All forward-looking statements included in this document
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are based on information available to the Company on the date hereof, and
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the Company assumes no obligation to update any such forward-looking
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statements. Actual results could differ materially from those projected in
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theforward- forward-looking statements as a result of the factors set forth
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below and elsewhere in this document and in the Incorporated Documents.
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Cyclicality and Seasonality
- ---------------------------
Wickes' operations, as well as those of the building materials
industry generally, have reflected substantial fluctuations from period to
period as a consequence of various factors, including levels of new
residential construction, general regional and local economic conditions,
prices of commodity wood products, interest rates and the availability of
credit, all of which are cyclical in nature. Wickes anticipates that
fluctuations from period to period will continue in the future. Because a
substantial percentage of Wickes' sales are attributable to building
professionals, certain of these factors may have a more significant impact
on Wickes than on companies more heavily focused on consumers. In
addition, Wickes' first and occasionally its fourth quarters historically
are adversely affected by weather patterns in the Northeast and Midwest,
which result in seasonal decreases in levels of building and construction
activity. The extent of such decreases in activity is a function of the
severity of winter conditions.
Highly Competitive Industry
- ---------------------------
The building materials industry is highly competitive. Wickes'
building and distribution facilities compete primarily with a large
number of local independent lumber yards as well as regional building
materials chains, and, to a lesser extent, with national building materials
chains and large warehouse and home center retailers, many of which have
substantially greater resources than Wickes. The consumer sales of certain
of Wickes' sales and distribution facilities have been adversely affected
in markets in which a warehouse or home center has been opened. Although
warehouse and home center retailers historically have focused their sales
efforts on consumers, there can be no assurance that they will not in the
future intensify their marketing efforts to building professionals. In
addition, reduced levels of new residential construction have in the past
resulted in intense price competition among building materials suppliers
that has at times adversely affected Wickes' gross margins.
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Substantial Leverage; Pledge of Assets
- --------------------------------------
Wickes is and will continue to be, highly leveraged.
As of June 27, 1998, total long-term indebtedness of Wickes was
$215.4 million and the stockholders' equity of Wickes was $20.1
million. In addition, Wickes' ratio of earnings to fixed charges was 0.7
for the twelve months ended on June 27, 1998.
Wickes' substantial indebtedness and high level of fixed charges could
have important consequences to holders of Common Stock, including; (i) a
substantial portion of Wickes' cash flow from operations must be dedicated
to debt service and will not be available for other purposes; (ii) Wickes'
ability to obtain additional debt financing in the future for working
capital, capital expenditures or acquisitions may be limited; and (iii)
Wickes' level of indebtedness could limit its flexibility in reacting to
changes in its industry and economic conditions generally. Wickes is more
leveraged than certain of its competitors, which may place Wickes at a
competitive disadvantage to such competitors.
Wickes' ability to make scheduled payments or to refinance its
obligations with respect to its indebtedness depends on its financial and
operating performance, which, in turn, is subject to prevailing industry
and economic conditions and to financial, business and other factors beyond
its control. There can be no assurance that Wickes' operating results will
continue to be sufficient for payment of Wickes' indebtedness.
All indebtedness of Wickes under its bank revolving credit facility
(the "Credit Facility") is secured by a pledge of all of the accounts
receivable, inventory, general intangibles and certain machinery and
equipment of Wickes. All assets not subject to a lien in favor of the
lenders are subject to a negative pledge, with certain exceptions. In
addition, the revolving credit facility requires that all cash received by
Wickes be deposited daily in bank accounts controlled by the lenders and
applied to pay down outstanding revolving credit loans.
Debt Restrictions; Compliance with Certain Covenants
- ----------------------------------------------------
The indenture (the "Indenture") related to Wickes' 11-5/8%
subordinated notes due 2003 (the "Wickes Notes") and Wickes' revolving
credit facility will impose restrictions that affect, among other things,
the ability of Wickes to incur debt, pay dividends, sell assets, create
liens, make capital expenditures and investments and otherwise enter into
certain transactions outside the ordinary course of business. The
revolving credit facility also requires Wickes to maintain specified
financial ratios and meet certain financial tests. In connection with the
revolving credit facility, Wickes granted the lenders thereunder a first
priority lien on its inventory, accounts receivable, general intangibles
and certain machinery and equipment. Although Wickes is currently in
compliance with covenants and restrictions contained in the revolving
credit facility, the ability of Wickes to continue to comply may be
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affected by events beyond its control. The Company anticipates that it may
need to obtain modifications of certain of these covenants and restrictions
to remain in compliance at September 26, 1998, but anticipates that it will
be able to obtain such modifications. The breach of any of these covenants
or restrictions could result in a default under the revolving credit
facility. In the event of any such default, the lenders under the
revolving credit facility could elect to declare all amounts borrowed
thereunder, together with accrued interest, to be due and payable, or cease
making additional revolving credit loans. If Wickes was unable to repay
such amounts, the lenders could foreclose upon the assets of Wickes.
In November 1995, Wickes' revolving credit agreement was amended to
increase the rate of interest it charges Wickes, to eliminate a $15 million
increase in the maximum borrowing limit previously scheduled to take effect
formfrom April 1 through August 31, 1996 and to modify certain financial
covenants. The amendment required the Company to issue to Riverside Group,
Inc. of newly-issued shares of Common Stock for $10 million; this
transaction was completed in June 1996. Prior to this amendment, as a
result of lower than anticipated net income during the first nine months of
1995, Wickes had since September 30, 1995 not been in compliance with the
interest coverage covenant contained in the agreement at thethat time.
In addition, Wickes' restructurings in 1995 and 1998 required
modifications to its revolving credit agreement.
Losses; Accumulated Deficit
- ---------------------------
Wickes experienced a net loss of approximately $4.0 million for the
six months ended June 27, 1998, and a net loss of $1.6 million for the
year ended December 27, 1997. The loss for the first six months of
1998 results primarily from a $5.4 million pre-tax restructuring charge
taken in the first quarter of 1998 as well as seasonal factors. See
"Restructurings and Restructuring Charges." The restructuring charge
related to the closing or consolidation of eight building centers and two
component manufacturing facilities, the sale of two additional building
centers, and reductions in headquarters staff. The loss for 1997 resulted
primarily from increased selling, general and administrative expense
associated with an increase in sales and distribution facility employees in
an effort to increase sales and market share, expenses associated with
showroom remerchandisings, and expenses associated with expansion of the
Company's Major Market Program, as well as net losses of approximately $7.5
million generated by programs and operations that were discontinued in late
1997 and early 1998.
As of June 27, 1998, Wickes had an accumulated deficit of $66.8
million, resulting primarily from losses 1995prior to 1993. The Company
also incurred net losses in 1995, 1997 and the first six months of 1998.
Wickes' operating performance is subject to industry, economic and other
factors beyondin its control. There can be no assurance that Wickes will
be able to maintain or improve its current operating performance.
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Restructurings and Restructuring Charges
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Since 1993 Wickes has effected various operational and financial
restructurings and recorded significant charges to its results of
operations related to these restructuring. In 1994, Wickes implemented a
headquarters cost reduction plan, for which it recorded a $2.0 million pre-
tax charge. In December 1995, Wickes developed and began implementing a
restructuring plan to reduce the number of underperforming facilities and
the related overhead, as well as to strengthen Wickes' capital structure.
With respect to this restructuring plan, Wickes recorded pre-tax charges of
$17.8 million in 1995, $0.7 million in 1996 and a $0.6 million
credit in 1997. In the first quarter of 1998, Wickes recorded a
$5.4 million pre-tax charge related to additional facilities closings and
staffing reductions. There can be no assurance that Wickes will not
implement additional restructurings in the future that may result in
significant additional related charges.
Environmental and Product Liability Matters
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At June 27, 1998, Wickes had accrued $500,000 for remediation of
certain environmental and product liability matters, principally
underground storage tank removal. Many of the sales and distribution
facilities presently and formerly operated by Wickes contained underground
storage tanks. Although Wickes has not expended material amounts in the
recent past in respect of the foregoing, there can be no assurances that
these matters will not give rise to additional compliance and other costs
that could have a material adverse effect on Wickes.
The Company is one of many defendants in approximately 80 actions,
each of which seeks unspecified damages, brought since 1993, in various
Michigan state courts against manufacturers and building material retailers
by individuals who claim to have suffered injuries from products containing
asbestos. All of the plaintiffs in these actions are represented by one of
two law firms. The Company is aggressively defending these actions, but no
assurance can be given that these actions will not have a material adverse
effect on the Company.
Influence of Principal Stockholder; Potential Conflicts of Interest;
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Potential Changes of Control
- ----------------------------
Ownership and Certain Relationships
-----------------------------------
J. Steven Wilson beneficially owns approximately 50.4% of the
outstanding shares of common stock of the Selling Shareholder, Riverside
Group, Inc. ("Riverside"), a public company that owns approximately
50.6% of the outstanding shares of the Company's Common Stock. Mr.
Wilson is also Chairman, President and Chief Executive Officer of Riverside
and Chairman and Chief Executive Officer of Wickes. Kenneth M. Kirschner
is Vice Chairman and Secretary of Riverside and Vice Chairman and Chief
Administrative Officer of Wickes. Mr. Kirschner beneficially owns
approximately 8.2% of the outstanding shares of Riverside's common stock.
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Mr. Wilson, Mr. Kirschner and Frederick H. Schultz are directors of each of
Riverside and Wickes. Mr. Schultz beneficially owns approximately 6.3% of
the outstanding shares of Riverside's common stock.
Potential Conflicts of Interest
-------------------------------
Wickes and Messrs. Wilson, Kirschner and Schultz, through their
aggregate 64.9% ownership of Riverside's voting securities, may have
conflicts of interest with respect to certain transactions affecting the
Company, such as business dealings between Wickes and Riverside,
acquisition opportunities, the issuance of additional securities of Wickes
and other matters involving conflicts which cannot be foreseen. The
Indenture and Wickes' revolving credit facility require that transactions
between Wickes and its affiliates (including Mr. Wilson and Riverside) be
on an arms'-length basis. Since 1993, Wickes has engaged in a variety of
transactions with Riverside and its affiliates, including (i) the
reimbursement by Wickes and Riverside to each other for services provided
by employees of the other and the reimbursement by Wickes for use of an
aircraft owned by an affiliate of Mr. Wilson, (ii) the sale of insurance
and mortgage products by Riverside to and through customers of Wickes and
the reimbursement by Wickes of certain related costs, (iii) the receipt by
Riverside of commissions with respect to premiums paid by Wickes for
certain basic insurance coverages, (iv) the issuances in June 1996 of
2,000,000 shares of Common Stock to Riverside for $10,000,000 in cash, (v)
the sale in February 1998 of Wickes' internet and utilities marketing
operations to Riverside, and (vi) marketing arrangements between Wickes and
Riverside with respect to electronic commerce conducted by Riverside on the
internet.
Potential Changes of Control
----------------------------
Substantially all of the voting securities of Riverside beneficially
owned by Mr. Wilson are pledged to secure indebtedness of Mr. Wilson and
his affiliates. Riverside has indicated that it may need to sell shares of
Common Stock in addition to those offered hereby in order to fund its
operations or to repay all or part of $10 million of its indebtedness that
matures September 30, 1999. A default by Mr. Wilson or his affiliates or
Riverside under their respective indebtedness, or sales of Riverside's
voting securities by Mr. Wilson and his affiliates, could result in a
"change of control" under the Indenture or Credit Facility. A "change of
control" under the Indenture would require Wickes to offer to repurchase
all of its 11-5/8% Senior Subordinated Notes ("Wickes Notes") for cash at
101% of the principal amount thereof. As of September ___, 1998, $100
million of Wickes Notes were outstanding. There can be no assurance that
Wickes would be able to arrange satisfactory financing for such repurchase.
A "change of control" under the Credit Facility would constitute an event
of default, which could result in the Credit Facility's being terminated
and all amounts thereunder being declared immediately due and payable. As
of September ___ , 1998, $ _____ million was outstanding under the Credit
Facility. There can be no assurance that Wickes would be able to repay the
amount due under the Credit Facility or to arrange satisfactory replacement
financing if the Credit Facility were so terminated.
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Mr. Wilson and his affiliates have in the past sought and obtained
from their respective bank lenders various other extensions of scheduled
debt maturities and waivers of various other loan agreement provisions,
although there can be no assurances that they will obtain any necessary or
desired extensions or waivers in the future.
Key Personnel
- -------------
Wickes is dependent upon the services of certain key executives,
including J. Steven Wilson, its Chairman and Chief Executive Officer,
Kenneth M. Kirschner, its Vice Chairman and Chief Administrative Officer,
and David T. Krawczyk, its President and Chief Operating Officer. Wickes
believes that the loss of the services of any of Messrs. Wilson, Kirschner
or Krawczyk could have an adverse effect on Wickes' business and its future
operations.
Year 2000
- ---------
In response to the "Year 2000" issue, the Company initiated a project
in early 1997 to identify, evaluate and implement changes to its existing
computerized business systems. The Company is addressing the issue through
a combination of modifications to existing programs and conversions to Year
2000 compliant software. In addition, the Company is communicating with
its customers, suppliers, and other service providers to determine whether
they are actively involved in projects to ensure that their products and
business systems will be Year 2000 compliant. If modifications and
conversions by the Company, and those it conducts business with, are not
made in a timely manner, the Year 2000 issue may have a material adverse
effect on the Company's business, financial condition, and results of
operations. The total cost associated with the required modifications is
not expected to be material to the Company's consolidated results of
operations and financial position, and is being expensed as incurred.
Certain Anti-Takeover Effects
- -----------------------------
The Wickes Certificate of Incorporation provides for, among other
things, a classified board of directors serving staggered terms of three
years, the prohibition of stockholder action by written consent, the
affirmative vote of at least 80% of all outstanding shares of Wickes Common
Stock to approve the removal of directors from office, which may be
effected only for cause, and the authority of the board of directors
without further action by stockholders to determine the principal rights,
preferences and privileges of authorized but unissued preferred stock.
These provisions, together with the level of ownership of the outstanding
Wickes Common Stock by J. Steven Wilson after the Mergerand Riverside may
have the effect of making more difficult or discouraging, absent the
support of the Wickes board of directors, transactions that could give
stockholders of Wickes the opportunity to realize a premium over the then
prevailing market price for their shares of Wickes Common Stock.
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Shares Eligible for Future Sale
- -------------------------------
Upon completion of the sale of 1,000,000 shares of Common Stock
offered hereby, J. Steven Wilson and Riverside will beneficially own
approximately 3,100,000 shares of Common Stock (representing approximately
37.8% of the outstanding shares of Common Stock). In addition, according
to their public filings with the Commission, Wellington Management Company
and Dimensional Fund Advisors, Inc. beneficially own approximately 790,000
and 470,000 shares of Common Stock, respectively (representing
approximately 9.6% and 5.8% of the outstanding shares of Common
Stock, respectively). No prediction can be made as to the effect,
if any, that future sales of Common Stock, or the availability of Common
Stock for future sale, will have on the market price of the Common Stock
prevailing from time to time. Sales of substantial amounts of Common Stock
or the perception that sales could occur could adversely affect prevailing
market prices for Common Stock. In addition, the timing and amount of
sales of any additional shares of Wickes Common Stock by stockholders may
have an adverse affect on Wickes' ability to raise additional equity
capital. All shares beneficially owned by Mr. Wilson and Riverside and
other significant holders of Common Stock are eligible for sale in the
public market either without meaningful limitations or subject to the
volume limitations and other requirements of Rule 144 promulgated under the
Securities Act of 1933, as amended (the "Securities Act"). In addition,
Wickes has granted Riverside certain rights to have all of their shares
registered for resale pursuant to the Securities Act. The shares of Common
Stock offered hereby are registered under the Securities Act for resale
pursuant to such rights.
Restrictions on Payment of Dividends
- ------------------------------------
Wickes has not paid dividends on its common stock and has no current
plans to pay any such dividends in the future. Wickes' revolving credit
agreement and the indenture related to the Wickes Notes contain certain
provisions that restrict Wickes' ability to pay dividends. There can be no
assurance as to the amount of funds, if any, that will be available for the
declaration and payment of dividends.
THE COMPANY
Wickes is a major supplier and distributor of building materials. The
Company sells its products and services primarily to residential and
commercial building professionals, repair and remodeling ("R&R")
contractors and, to a lesser extent, project do-it-yourselfers ("DIYers")
involved in major home improvement projects. At August 11, 1998,
the Company operated 101 sales and distribution facilities in 23
states in the Midwest, Northeast, and South and 10 component
manufacturing facilities that produce and distribute pre-hung door units,
roof and floor trusses, and framed wall panels.
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USE OF PROCEEDS
The Company will receive none of the proceeds from the sale of the
shares of Common Stock by the Selling Shareholder.
PRICE RANGE OF COMMON STOCK
The Company's Common Stock is authorized for trading on the NASDAQ
National Market System under the trading symbol "WIKS." As of __________,
1998, there were ___________ shares outstanding held by approximately ___
shareholders of record and the last sale price for Common Stock was
$_______.
The following table sets forth for the periods indicated the high and
low last sale prices for the Company's Common Stock as reported on the
NASDAQ National Market System. Prices do not include retail markups,
markdowns or commissions.
<TABLE>
<CAPTION>
Three Months Ended High Low
------------------ ---- ---
<S> <C> <C>
Fiscal 1998
-----------
March 28 $4.50 $3.063
June 27 9.875 4.00
Fiscal 1997
-----------
March 29 $6.50 $3.125
June 28 6.25 3.00
September 27 6.25 4.00
December 27 5.125 3.00
Fiscal 1996
-----------
March 30 $6.625 $4.00
June 29 5.50 4.75
September 28 5.25 4.00
December 28 4.875 3.375
</TABLE>
DIVIDENDS
The Company has not declared or paid any dividends on Common Stock in
the past three years and has no present intention to pay cash dividends on
Common Stock in the foreseeable future. The Company's revolving credit
facility prohibits cash dividends on Common Stock, and the trust indenture
related to the Company's 11-5/8% senior subordinated notes restricts cash
dividends on Common Stock.
14
<PAGE> 15
PLAN OF DISTRIBUTION
The Common Stock offered hereby may be sold from time to time to
purchasers directly by the Selling Shareholder, or, alternatively, the
Selling Shareholder may from time to time offer the Common Stock offered
hereby through dealers or agents, who may receive compensation in the form
of underwriting discounts, concessions or commissions from the Selling
Shareholder and/or the purchasers of the Common Stock offered hereby for
whom they may act as agent. Any discounts, commissions or concessions
received by any such dealers or agents and any profits on the sale of
Common Stock offered hereby by them may be deemed to be underwriting
discounts and commissions under the Securities Act. At any time a
particular offer of Common Stock offered hereby is made, if required by
applicable law or regulations, a Prospectus Supplement will be distributed
which will set forth the amount of shares being offered and the terms of
the offering, including the name or names of any dealers or agents, any
discounts, commissions and other items constituting compensation from the
Selling Shareholder and any discounts, commissions or concessions allowed
or re-allowed or paid to dealers. Guidelines adopted by the National
Association of Securities Dealers, Inc. ("NASD") set forth the maximum
commission that any NASD member firm can receive in connection with a
distribution of any of the Common Stock offered hereby without further
clearance from the NASD. If required by applicable law or regulations, a
Prospectus Supplement and/or a post-effective amendment to the Registration
Statement of which this Prospectus is a part will be filed with the
Commission to reflect the disclosure of additional information with respect
to the distribution of the Common Stock offered hereby, including, if
applicable, the factors used to determine the price of the Common Stock
then being offered.
Subject to the preceding paragraph, the Common Stock offered hereby
may be sold from time to time in one or more transactions at a fixed
offering price, which may be changed at varying prices determined at the
time of sale, or at negotiated prices. Such prices will be determined by
the Selling Shareholder or by agreement between the Selling Shareholder
and/or dealers. The Common Stock is listed on the NASDAQ National Stock
Market and may also be sold in transactions on the NASDAQ National Stock
Market. In addition, the Common Stock offered hereby may be sold, to the
extent permitted, from time to time in transactions effected in accordance
with the provisions of Rule 144 under the Securities Act.
Under applicable rules and regulations under the Exchange Act, any
person engaged in a distribution of the Common Stock offered hereby may not
bid for or purchase Common Stock until after such person has completed his
or her participation in such distribution, including the period of nine
business days prior to the commencement of such distribution. In addition
to and without limiting the foregoing, the Selling Shareholder and any
other person participating in such distribution will be subject to other
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including without limitation Regulation M, which provisions may
affect the timing of purchases and sales of any of the Common Stock offered
hereby by the Selling Shareholder and any such other person. All of the
foregoing may affect the marketability of the Common Stock offered hereby
and the ability of any person or entity to engage in market making
activities with respect to the Common Stock offered hereby.
14
<PAGE> 15
Pursuant to prior agreements entered into with the Selling
Shareholder, the Company will pay substantially all of the expenses
incident to the registration, offering and sale of the Common Stock offered
hereby to the public, other than commissions and discounts of dealers or
agents.
SELLING SHAREHOLDER
The following table lists the name of the Selling Shareholder whose
shares of Common Stock are covered by this Prospectus, and the number of
shares beneficially owned at the commencement of this offering, the number
of shares being offered for sale and the number of shares to be
beneficially owned after the offering.
<TABLE>
<CAPTION>
Number of Number Number of
Shares Owned of Shares Shares
at Commencement Being After
Selling Shareholder of Offering Offered Offering
- ------------------- --------------- --------- ---------
<S> <C> <C> <C>
Riverside Group, Inc. 4,099,113 1,000,000 3,099,113
</TABLE>
Riverside is controlled by J. Steven Wilson, Wickes' Chairman and
Chief Executive Officer as well as Riverside's Chairman, President and
Chief Executive Officer. For more information concerning the relationships
between Riverside and Wickes, see "Risk Factors - Influence and Potential
Changes in Control of Principal Stockholders; Potential Conflicts of
Interest."
LEGAL MATTERS
The validity of the securities offered hereby will be passed upon for
the Company by Holland & Knight LLP, Jacksonville, Florida.
EXPERTS
The consolidated balance sheets as of December 27, 1997 and
December 28, 1996 and the statements of operations, changes in
stockholders' equity and cash flows of Wickes Inc. for each of the three
years in the period ended December 27, 1997, incorporated by reference in
this Prospectus, have been included herein in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority
of that firm as experts in accounting and auditing.
16
<PAGE> 17
No dealer, salesperson or other individual has been authorized to give
----------------------------------------------------------------------
any information or to make any representations not contained in this
- ---------------------------------------------------------------------------
Prospectus in connection with the offering covered by this Prospectus. If
- ---------------------------------------------------------------------------
given or made, such information or representations must not be relied upon
- ---------------------------------------------------------------------------
as having been authorized by the Company or the Underwriters. This
- ---------------------------------------------------------------------------
Prospectus does not constitute an offer to sell, or solicitation of an
- ---------------------------------------------------------------------------
offer to buy, the Common Stock in any jurisdiction where, or to any person
- ---------------------------------------------------------------------------
to whom, it is unlawful to make such offer or solicitation. Neither the
- ---------------------------------------------------------------------------
delivery of this Prospectus nor any sale made hereunder shall, under any
- ---------------------------------------------------------------------------
circumstances, create any implication that there has not been any change in
- ---------------------------------------------------------------------------
the facts set forth in this Prospectus or in the affairs of the Company
- ---------------------------------------------------------------------------
since the date hereof.
- ----------------------
<TABLE>
<CAPTION>
-----------------
TABLE OF CONTENTS
Item Page
<S> <C>
AVAILABLE INFORMATION
INCORPORATION OF CERTAIN
DOCUMENTS BY REFERENCE
RISK FACTORS
THE COMPANY
USE OF PROCEEDS
PRICE RANGE OF COMMON STOCK
DIVIDENDS
PLAN OF DISTRIBUTION
SELLING ShareholderSHAREHOLDER
LEGAL MATTERS
EXPERTS
</TABLE>
17
<PAGE> 18
---------------------------
WICKES INC.
1,000,000 Shares of Common Stock
---------------------------
PROSPECTUS
---------------------------
____________, 1998
18
<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the estimated expenses payable by the
Registrant in connection with this Registration Statement.
<TABLE>
<S> <C>
Registration Fee $ 1,217
Accounting Fees 4,000
Legal Fees 20,000
Miscellaneous Expenses 5,000
-------
Total $ 30,217
=======
</TABLE>
_______________
All of the amounts shown above are estimates, except for the fees
payable to the Securities and Exchange Commission.
Item 15. Indemnification of Directors and Officers.
(a) Section 145 of the Delaware General Corporation Law (the "DGCL")
provides that a corporation may indemnify any person who was or is a party
or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or
investigative, except an action by or in the right of the corporation, by
reason of the fact that he is or was a director, officer, employee, or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust or other enterprise, against
expenses, including attorneys' fees, judgments, fines and amounts paid in
settlement actually and reasonably incurred by him in connection with the
action, suit, or proceeding, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful. The termination of
any action, suit or proceeding by judgment, order, settlement, conviction,
or upon plea of nolo contendere or its equivalent, does not, of itself,
create a presumption that the person did not act in good faith and in a
manner which he reasonably believed to be in or not opposed to the best
interests of the corporation, and that, with respect to any criminal action
or proceeding, that he had reasonable cause to believe that his conduct was
unlawful.
Section 145 of the DGCL also provides that a corporation may indemnify
any person who was or is a party or is threatened to be made a party to any
threatened, pending, or completed action or suit by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that
he is or was a director, officer, employee, or agent of the corporation, or
is or was serving at the request of the corporation as a director, officer,
employee, or agent of another corporation, partnership, joint venture,
trust or other enterprise against expenses, including amounts paid in
19
<PAGE> 20
settlement and attorneys' fees, actually and reasonably incurred by him in
connection with the defense or settlement of such action or suit, if he
acted in good faith and in a manner which he reasonably believed to be in
or not opposed to the best interests of the corporation and except that no
indemnification shall be made in respect of any claim, issue or matter as
to which such person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Court of Chancery or the
court in which such action or suit was brought shall determine upon
adjudication that, despite the adjudication of liability but in view of all
the circumstances of the case, such person is fairly and reasonably
entitled to indemnity for such expenses which the court deems proper.
Any such indemnification (unless ordered by a court) shall be made by
the corporation only as authorized in the specific case upon a
determination that indemnification of the director, officer, employee or
agent is proper in the circumstances because such person has met the
applicable standard of conduct set forth above. Such determination shall
be made:
(1) by the Board of Directors by a majority vote of a quorum
consisting of directors who were not parties to the act, suit or
proceeding;
(2) if such a quorum is not obtainable, or, even if obtainable, a
quorum of disinterested directors so directs, by independent legal counsel
in a written opinion; or
(3) by the stockholders.
Section 145 of the DGCL permits a Delaware corporation to purchase and
maintain insurance on behalf of any person who is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against any liability asserted against such person and incurred by him in
any such capacity, or arising out of his status as such, whether or not the
corporation has the authority to indemnify him against such liability and
expenses.
(b) Article V of the Company's By-laws, as amended, provides that the
Company shall, to the fullest extent to which it is empowered to do so by
the DGCL or any other applicable law, as may from time to time be in
effect, indemnify any person who was or is a party or is threatened to be
made a party to any threatened pending or completed action, suit or
proceeding, whether civil, criminal, administrative or investigative, by
reason of the fact that such person is or was a member of the board of
directors or an officer of the Company or controller of the Company, or is
or was serving at the request of the Company as a member of the board of
directors or an officer of another corporation, partnership, joint venture,
trust or other enterprise, against all expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and
reasonably incurred by such person in connection with such action, suit or
proceeding. Article V also provides that expenses incurred by an officer
or director or controller of the Company in defending a civil or criminal
20
<PAGE> 21
action, suit or proceeding shall be paid by the Company in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director, officer or controller to
repay such amount if it shall be ultimately determined that he or she is
not entitled to be indemnified as authorized by the DGCL. Persons who are
not officers, directors or the controller of the Company and who are or
were employees or agents of the Company, or are or were serving at the
request of the Company as employees or agents of another corporation,
partnership, joint venture, trust or other enterprise, may be indemnified
to the extent authorized at any time or from time to time by the board of
directors. The right to indemnification provided by Article V of the
Company's By-laws is not exclusive of any other rights to which those
indemnified may be entitled by law or otherwise, and shall continue as to a
person who has ceased to be a director, officer, controller, employee or
agent and shall inure to the benefit of the heirs, executors and
administrators of such person.
(c) Article Five of the Company's Amended and Restated
Certificate of Incorporation contains provisions relating to
indemnification similar to the provisions contained in Article V of the
Company's By-laws which are described above.
(d) The Company has purchased a directors' and officers' insurance
policy which provides coverage for certain liabilities that directors and
officers of the Company may incur in their capacity as such.
(e) Reference is also made to the last Undertaking contained in Item
17 of this Registration Statement.
Item 16. Exhibits.
- -------------------
<TABLE>
<CAPTION>
Exhibit
Number Description
- -------- -----------
<S> <C>
3.1 (a)* Amended and Restated Certificate of Incorporation of the
Registrant (incorporated by reference to Exhibit 3.1 to the
registrant's Registration Statement on Form S-1 (the "Form S-1"),
Commission File No. 2-67334).
(b)* First Amendment to Second Amended and Restated Certificate of
Incorporation (incorporated by reference to Exhibit 3.01 to the
registrant's Quarterly Report on Form 10-Q for the period ended
June 1994).
(c)* Second Amendment to Second Amended and Restated Certificate of
Incorporation (incorporated by reference to Exhibit 3.1 to the
registrant's Quarterly Report on Form 10-Q for the period ended
June 1997 (the "June 1997 Form 10-Q").
3.2* By-laws of the Registrant, as amended and restated (incorporated
by reference to Exhibit 3.2 to the Registrant's Annual Report on
Form 10-K (the "1993 Form 10-K") for the year ended December 25,
1993).
4.1 (a)* Second Amended and Restated Credit Agreement dated April 11,
1997, among the Registrant, as Borrower, each of the financial
institutions signatory thereto, BT Commercial Corporation, as
Agent, Nations Bank of Georgia N.A. as Syndication Agent, and
Bankers Trust Company, as Issuing Bank (incorporated by reference
to Exhibit 4.1 to the registrant's Quarterly Report on Form 10-Q
for the period ended March 1997).
(b)* First Amendment to Second Amended and Restated Credit Agreement
(incorporated by reference to Exhibit 4.1 to the June 1997 Form
10-Q).
(c)* Second Amendment to Second Amended and Restated Credit Agreement
(incorporated by reference to Exhibit 4.1 to the registered's
Annual Report on Form 10-K (the "1997 Form 10-K) for the year
ended December 27, 1997).
(d)* Third Amendment to Credit Agreement (incorporated by referenced
to Exhibit 4.1 to the 1997 Form 10-K).
5.1*** Opinion of Holland & Knight LLP
23.1** Consent of PricewaterhouseCoopers LLP
23.2*** Consent of Holland & Knight LLP (to be included in Exhibit 5.1).
24.1** Power of Attorney relating to subsequent amendments (included on
the signature page of this Registration Statement).
</TABLE>
___________________
* Incorporated by reference.
** Filed herewith.
*** To be filed by amendment.
Item 17. Undertakings.
- ----------------------
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
22
<PAGE> 23
(ii) to reflect in the prospectus any facts or events
arising after the effective date of the registration statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represents a fundamental change
in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume
of securities offered (if the total dollar value of securities
offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of a prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective
registration statement;
(iii) to 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 included in 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 Section 15(d)
of the Exchange Act that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment 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.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The 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(b) of the
Exchange Act 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
23
<PAGE> 24
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 Act and will be governed by the final
adjudication of such issue.
24
<PAGE> 25
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 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 Vernon Hills, State of
Illinois, on August 31, 1998.
WICKES INC.
By: /s/ David T. Krawczyk
----------------------------
David T. Krawczyk, President
Each person whose signature appears below constitutes and appoints
David T. Krawczyk and John M. Lawrence his or her lawful attorney-in-fact
and agent, each acting alone, with full power of substitution and
resubstitution, for him or her and in his or her name, place and stead, in
any and all capacities, to sign any or all Amendments (including, post-
effective Amendments) to this Registration Statement and to file the same,
with all exhibits thereto, and other documents, in connection therewith,
with the Securities and Exchange Commission, granting unto said attorneys-
in-fact and agents, each acting alone, full power and authority to do and
perform each and every act and thing requisite and necessary to be done in
and about the premises, as fully to all intents and purposes as he or she
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, each acting alone, or his or her substitute
or substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ J. Steven Wilson
- -------------------- Director; Chairman August 31, 1998
J. Steven Wilson and Chief Executive
Officer
(Principal Executive Officer)
/s/ Kenneth M. Kirschner
- ------------------------ Director; Vice Chairman August 31, 1998
Kenneth M. Kirschner and Chief Administrative
Officer
(Principal Financial Officer)
25
<PAGE> 26
Signature Title Date
- --------- ----- ----
/s/ Albert Ernest, Jr. Director August 31, 1998
Albert Ernest, Jr.
/s/_William H. Luers Director August 31, 1998
William H. Luers
/s/ Robert E. Mulcahy, III Director August 31, 1998
Robert E. Mulcahy, III
/s/ Frederick H. Schultz Director August 31, 1998
Frederick H. Schultz
/s/ Claudia B. Slacik Director August 31, 1998
Claudia B. Slacik
/s/ John M. Lawrence Controller August 31, 1998
John M. Lawrence (Principal Accounting
Officer)
</TABLE>
26
<PAGE> 27
Exhibit 23.1
------------
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement
on Form S-3 of our report dated February 23, 1998, on our audits of the
consolidated financial statements and the financial statement schedule of
Wickes Inc. which report is included in the Annual Report on Form 10-K. We
also consent to the reference of our Firm under the caption "Experts."
PricewaterhouseCoopers LLP
Chicago, Illinois
August 28, 1998
27
