As Filed with the Securities and Exchange Commission on June 21 1996.
Registration No. ___________
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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
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WEITZER HOMEBUILDERS INCORPORATED
(Exact name of registrant as specified in its charter)
Florida
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5901 N.W. 151st Street, Suite 120
Miami Lakes, Florida 33014
(305) 819-4663
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(Address, including zip code, and telephone
number, including area code, of
registrant's principal executive offices)
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Harry Weitzer,
Chief Executive Officer
5901 N.W. 151st Street, Suite 120
Miami Lakes, Florida 33014
(305) 819-4663
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(Name, address, including zip code, and telephone number, including
area code, of agent for service)
Copies to:
Joel D. Mayersohn, Esq.
Atlas, Pearlman, Trop & Borkson, P.A.
200 East Las Olas Boulevard, Suite 1900
Fort Lauderdale, Florida 33301
(954) 763-1200
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(Name, address, including zip code, and telephone number, including
area code, of agent for service)
Approximate date of commencement of proposed sale to the public: From
time to time after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection
with dividend or interest reinvestment plans, check the following box. [X]
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CALCULATION OF REGISTRATION FEE
================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF AMOUNT OFFERING AGGREGATE AMOUNT OF
SHARES TO BE TO BE PRICE PER OFFERING REGISGRATION
REGISTERED REGISTERED SHARE (1) PRICE (1) FEE
- --------------------------------------------------------------------------------
Common Stock,
$.01 par value
per share 432,663 $2.375(2) $1,027,575(2) $354.34
================================================================================
(1) Estimated solely for the purpose of calculating the
registration fee pursuant to Rule 457(b).
(2) The maximum price is estimated based on the closing price
on June 14, 1996.
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 said
Section 8(a), may determine.
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Subject to Completion, dated June 21 1996
PROSPECTUS
432,663 SHARES
WEITZER HOMEBUILDERS, INCORPORATED
COMMON STOCK, PAR VALUE $.01 PER SHARE
The 432,663 shares (the "Shares") of Class A Common Stock, $.01 par
value per share ("Common Stock"), offered hereby are being sold by certain
selling shareholders (the "Selling Shareholders") of Weitzer Homebuilders
Incorporated (the "Company"), if at all, on a delayed basis. The 432,663 Shares
of Class A Common Stock were issued to the Selling Shareholders upon exercise of
warrants of the Company which were issued to the Selling Shareholders as part of
a private placement of 75 Units of the Company on October 7, 1994 (the "Private
Placement"). Each Unit consisted of (i) a ten percent (10%) bond due June 30,
1998 in the principal amount of $50,000, and (ii) a warrant, exercisable at a
price of $0.10 per share, to purchase such number of Shares of Class A Common
Stock as shall equal $37,500 in value.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
THE CLASS A COMMON STOCK OFFERED HEREBY INVOLVES A
SIGNIFICANT DEGREE OF RISK. SEE "RISK FACTORS."
---------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is June 21 1996.
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[Front Cover Page Continues]
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The Selling Shareholders have advised the Company that they propose to
sell the Shares, from time to time in one or more transactions that may take
place on the over-the-counter market, including ordinary brokerage transactions,
privately negotiated transactions or through sales to one or more dealers for
resale of such securities as principals, at market prices prevailing at the time
of sale, at prices related to such prevailing market prices or at negotiated
prices. Usual and customary or specifically negotiated brokerage fees or
commissions may be paid by the Selling Shareholders.
The Company will not receive any of the proceeds from the sale of the
Shares offered hereby by the Selling Shareholders. Expenses of this offering,
other than fees and expenses of counsel to the Selling Shareholders and selling
commissions, will be paid by the Company. See "Plan of Distribution."
The Class A Common Stock is listed on the NASDAQ National Market under
the symbol "WTZRA."
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"). Reports, proxy
statements and other information filed with the Commission can be inspected and
copied at the public reference facilities of the Commission at 450 Fifth Street,
N.W., Washington, D.C. 20549. Copies of this material can also be obtained at
prescribed rates from the Public Reference Section of the Commission at its
principal office at 450 Fifth Street, N.W., Washington, D.C. 20549. The
Company's Common Stock is traded on the NASDAQ National Market under the symbol
"WTZRA."
The Company has filed with the Commission a Registration Statement on
Form S-3 (the "Registration Statement") under the Securities Act of 1933, as
amended (the "Act"), with respect to the resale of the Shares. This Prospectus,
which is Part I of the Registration Statement, omits certain information
contained in the Registration Statement. For further information with respect to
the Company and the Shares of the Class A Common Stock offered by this
Prospectus, reference is made to the Registration Statement, including the
exhibits thereto. Statements in this Prospectus as to any document are not
necessarily complete, and where any such document is an exhibit to the
Registration Statement or is incorporated by reference herein, each such
statement is qualified in all respects by the provisions of such exhibit or
other document, to which reference is hereby made, for a full statement of the
provisions thereof. A copy of the Registration Statement, with exhibits, may be
obtained from the Commission's office in Washington, D.C. (at the above address)
upon payment of the fees
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prescribed by the rules and regulations of the Commission, or examined there
without charge.
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TABLE OF CONTENTS
PAGE
----
AVAILABLE INFORMATION..................................................... 2
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE......................... 5
RISK FACTORS.............................................................. 7
THE COMPANY...............................................................13
SELLING SHAREHOLDERS .....................................................16
PLAN OF DISTRIBUTION......................................................18
DESCRIPTION OF SECURITIES.................................................19
LEGAL MATTERS.............................................................23
EXPERTS...................................................................23
INDEMNIFICATION...........................................................23
The Class A Common Stock of the Company is traded on the NASDAQ
National Market ("NMS") under the symbol "WTZRA." The closing price of the
Common Stock as reported on the NMS on June 14, 1996 was $2.375 per share.
No person has been authorized to give any information or to make any
representations not contained in this Prospectus in connection with the offer
contained in this Prospectus, and if given or made, such information or
representations must not be relied upon as having been authorized by the Company
or the Selling Shareholders. This Prospectus does not constitute an offer to
sell or a solicitation of an offer to buy the securities offered hereby in any
jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction. Neither the delivery of this Prospectus nor
any sale hereunder shall under any circumstances create any implication that
there has been no change in the affairs of the Company since the date hereof.
The Company will not receive any proceeds from the sale of Common Stock
for the account of the Selling Shareholders. The Company has informed the
Selling Shareholders that the anti-manipulative rules under the Securities
Exchange Act of 1934, Rules 10b-6 and 10b-7, may apply to their sales in the
market. The Company has also informed the Selling Shareholders of the need for
delivery of copies of this Prospectus in connection with any sale of securities
registered hereunder.
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THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OF ANY SECURITIES OTHER
THAN THOSE TO WHICH IT RELATES OR AN OFFER TO SELL, OR A SOLICITATION OF AN
OFFER TO BUY, IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE
SUCH AN OFFER IN SUCH JURISDICTION. THE DELIVERY OF THIS PROSPECTUS AT ANY TIME
DOES NOT IMPLY THAT THE INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT
TO ITS DATE.
---------------
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934 and, in accordance therewith, files reports and
other information with the Securities and Exchange Commission.
The Company has previously and intends to furnish its shareholders with
annual reports containing audited financial statements and distributes quarterly
reports containing unaudited summary financial information for each of the first
three quarters of each fiscal year.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed with the Commission are incorporated
herein by reference:
(a) Annual Report of the Company on Form 10-K for the
fiscal year ended September 30, 1995.
(b) Quarterly Reports of the Company on Form 10-Q for the quarters
ended December 31, 1995 and March 31, 1996.
(c) All reports and documents filed by the Company
pursuant to Section 13, 14 or 15(d) of the Exchange Act, prior
to the filing of a post-effective amendment which
indicates that all securities offered hereby have been
sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated
by reference herein and to be a part hereof from the
respective date of filing of such documents. Any
statement incorporated by reference herein shall be
deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement
contained herein or in any other subsequently filed
document, which also is or is deemed to be
incorporated by reference herein, modifies or
supersedes such statement. Any statement modified or
superseded shall not be deemed, except as so modified
or superseded, to constitute part of this Prospectus;
and
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a copy of the Prospectus has been
delivered, on the written or oral request of any such person, a copy of any or
all of the documents referred to
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above which have been or may be incorporated by reference in this Prospectus,
other than exhibits to such documents. Written requests for such copies should
be directed to Corporate Secretary, Weitzer Homebuilders Incorporated at the
Company's principal executive office, 5901 N.W. 151st Street, Suite 120, Miami
Lakes, Florida 33014, Telephone (305) 819-4663.
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RISK FACTORS
An investment in the Shares of Class A Common Stock offered hereby
involves a high degree of risk. Prospective investors should consider carefully
the following risk factors, as well as the other information set forth in the
Prospectus, in connection with an investment in the Class A Common Stock offered
hereby.
GENERAL REAL ESTATE, ECONOMIC AND OTHER CONDITIONS. The homebuilding
industry is cyclical and affected by changes in general and local economic
conditions, including availability of financing, inflation, interest rates and
employment levels, consumer confidence and housing demand. A significant
increase in prevailing interest rates may result in a decrease in demand for
homes or in cancellations of sales contracts, including contracts with respect
to homes included in the Company's backlog, and could have a material adverse
effect on the Company. Although the Company has not experienced a sharp decline
in the demand for homes, increases in interest rates could result in such a
decline. In addition, homebuilders are subject to various risks such as
competitive overbuilding, availability and cost of land, materials and qualified
labor, construction delays, cost overruns, environmental risks, lack of
infrastructure (e.g., roads, water, sewage facilities and utilities), government
regulation and increases in real estate taxes and other local government fees.
FINANCING AND LEVERAGE. In general, homebuilders are subject to
significant up-front expenditures for land development and construction costs
and therefore require substantial equity or debt financing. At March 31, 1996,
the Company had borrowings from banks and third parties aggregating
approximately $29.3 million. In addition, the Company will require additional
financing for certain of its future planned projects. The ability to make
principal and interest payments on the indebtedness will be dependent on future
operations which may be affected by financial, economic and other factors beyond
the control of the Company, and there can be no assurance that the current level
of operations will continue or that the Company will be able to make principal
and interest payments when due.
The availability of borrowed funds, especially for the acquisition of
land, has been reduced significantly in recent years, and there can be no
assurance that any such additional financing will be available to the Company
or, if available, be on favorable terms. Although Harry Weitzer, the Company's
Chairman ("Weitzer") has personally guaranteed certain of the Company's existing
bank borrowings, there can be no assurance he will continue to guarantee new
borrowings or on what terms he would guarantee new borrowings. The Company has
an indemnification agreement with Weitzer pursuant to which the Company will
indemnify him against any cost or expense he may incur after September 30, 1994
arising from the personal guaranty by Weitzer and his wife of
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any indebtedness or any other obligation of the Company or any Weitzer
Subsidiary.
The Company is required in connection with any additional sales of
equity securities in an amount in excess of $1,600,000 to repay the $3,750,000
principal amount of the Company's 10% Bonds due June 30, 1998 (the "10% Bonds"),
with accrued and unpaid interest thereon. While the 10% Bonds are outstanding,
this prepayment obligation will materially adversely affect the Company's
ability to finance its activities through the sale of its equity securities.
In March, April and May 1996, the Company issued an aggregate of
$1,970,000 of convertible debentures in two offerings of $500,000 and
$1,470,000, respectively. To date, convertible debentures in an aggregate
principal amount of $785,000 have been converted. $885,000 additional principal
amount of convertible debentures may presently be converted and the remaining
principal amount may be converted on or about June 30, 1996. The Company, on
advice from counsel, has taken the position that the convertible debentures at
the time of issuance are not equity securities and accordingly the 10% Bonds are
not repayable. There can be no assurance that upon conversion of convertible
debentures having a principal amount in excess of $1,600,000 that the Company
will not be required to repay the 10% Bonds. If such repayment is required there
is no assurance that the Company will have the funds available to make such
repayment or obtain financing on terms reasonably acceptable to meet such
repayment obligations.
In addition, it is an "event of default" under certain of the Company's
bank loan agreements if (a) Weitzer or his heirs fail to control at least 35% of
the voting power of the outstanding voting stock of the Company, (b) during his
lifetime Weitzer fails to serve as Chairman of the Board and Chief Executive
Officer of the Company with responsibility for the day-to-day operations of the
Company and its subsidiaries, or (c) certain other events constituting a "change
of control" under such bank loan agreements shall occur. If an event of default
should occur under such bank loan agreements, the lender would have the
immediate right to accelerate the loan and there is no assurance that the
Company would be able to repay or refinance such borrowings which would have a
material adverse effect on the Company.
AVAILABILITY OF MORTGAGE FINANCING; CUSTOMER FINANCING. The ability to
sell homes is dependent upon the availability and cost of mortgage financing to
home buyers. Most of the Company's buyers finance their purchases through
Federal Housing Administration ("FHA") insured or Veterans Administration ("VA")
guaranteed mortgages or through mortgages provided by savings and loan
associations and other conventional sources. There is no assurance that the
federal mortgage programs will be continued in their present form, if at all.
Even if financing is available, increases
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in home mortgage interest rates may make permanent mortgage financing less
affordable to the Company's customers. In addition, changes in federal income
tax laws which have been proposed in the past seeking to limit the deductibility
of mortgage interest or the tax-free rollover treatment where proceeds of the
sale of a principal residence are reinvested in a new principal residence could
make acquiring or selling a home less attractive to the Company's customers. The
Company could be materially and adversely affected if mortgage financing from
traditional sources does not remain readily available, changes in tax laws make
acquiring a home less desirable or interest rates or other financing costs
become unattractive to home buyers.
GOVERNMENT REGULATION; BUILDING MORATORIUMS. The Company is subject to
Federal, state and local laws, ordinances and regulations concerning, among
other things, environmental matters, zoning, building design and density levels.
In developing a project and building homes, the Company must obtain the approval
of numerous governmental authorities regulating such matters as water and waste
disposal, the dedication of acreage for open space, parks, schools, and the
construction design, methods and materials used. Environmental laws and
regulations, among other things, may result in delays, cause the Company to
incur substantial compliance, mitigation and other costs, and can prohibit or
severely restrict homebuilding activities in certain environmentally sensitive
regions. Several governmental authorities have imposed impact fees as a means of
defraying the cost of providing certain government services to developing areas,
which fees have increased significantly during recent years.
Although the Company has not encountered any extraordinary or unusual
delays in obtaining the required governmental approvals for its projects, the
Company may be subject to delays or may be precluded from developing certain
projects because of building moratoriums or changes in statutes or rules that
could be imposed in the future. The State of Florida and various counties,
including Dade County and Broward County, may declare moratoriums on the
issuance of building permits and impose restrictions in areas where the
infrastructure (e.g., roads, schools, parks, water and sewage treatment
facilities and other public facilities) does not reach minimum standards. Dade
County has denied certain other homebuilders zoning approval for residential
construction projects in areas not previously zoned for residential construction
due to the County's problems with school overcrowding. The issue is not
anticipated to affect any of the Company's current projects or projects planned
for future development as such properties are already zoned for residential
construction. Pending resolution of the school overcrowding issue, management of
the Company does not intend to acquire any land in Dade County which is not
already zoned for residential construction. In addition, as a result of
Hurricane Andrew, Dade County and Broward County have recently enacted new, more
stringent building codes which will result in
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increased costs of construction. Although management intends to increase the
sales prices of its homes to cover the additional costs, there can be no
assurance that the Company will be able to pass through its increased
development and construction costs to home buyers or that existing or new
governmental regulations will not have a material adverse effect on the business
of the Company.
COMPETITION. The homebuilding industry is highly competitive and
fragmented. Homebuilders compete for desirable properties, financing, raw
materials and skilled labor, as well as for the sale of their homes. The Company
competes with a significant number of national, regional and local homebuilding
companies, some of which have substantially greater financial, marketing, sales
and other resources. Additionally, the Company competes with individual sales of
existing homes and available rental housing. In addition, the Company may
compete with sales of homes at deeply discounted prices by competitors
(principally for financial reasons), lenders, the Resolution Trust Corporation
and other similar institutions within their housing market.
AVAILABILITY AND COST OF HOMEOWNERS' INSURANCE. Primarily as a result
of Hurricane Andrew, several insurance carriers have opted not to write
homeowners' insurance in Florida and a significant number of other insurance
carriers have opted only to renew existing policies and not to write new
insurance policies. These practices have resulted in a widespread shortage of
available private insurance for homeowners in the State of Florida and the
creation of a state joint underwriting association. The state- provided
insurance coverages generally afford homeowners less protection than typically
provided by private insurance carriers at greater costs. The continued inability
of homeowners to obtain cost effective homeowners' insurance may have an adverse
effect on demand for new homes and, as a result, on the Company's homebuilding
business.
DEPENDENCE ON FLORIDA MARKET; EXPANSION INTO NEW MARKETS. To date, all
of the Company's homebuilding activities have been conducted in markets within
Southeast Florida, principally in Dade and Broward Counties, and it is likely
that the Company's activities will continue to be concentrated in Florida in the
near future. Accordingly, the Company's business and earnings are likely to be
dependent upon economic and other conditions in Florida and the Company's
ability to achieve growth in that market. The Company is evaluating future
homebuilding projects in other areas of Florida where the Company has not
previously conducted homebuilding operations, and the Company may also expand
into areas outside of Florida. The success of the Company's expansion in other
areas within and outside of Florida will be dependent upon a number of factors,
including the Company's ability to hire, train and retain qualified management
personnel and subcontractors, the cost of land and construction and the demand
for and acceptance of the Company's new home designs in these markets. There can
be no
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assurance that the Company will be successful in its efforts to expand into
other areas of Florida or any other new markets.
CONTROL BY WEITZER. Harry Weitzer, the Company's Chief Executive
Officer, owns Shares of Class B Common Stock representing approximately 38% of
the outstanding Common Stock of the Company, which will represent effective
control of the Company. Weitzer's ownership interest makes it probable that he
will be able to elect the entire Board of Directors of the Company (the
"Board"), and to control and direct the management and affairs of the Company
without the concurrence of the Company's other shareholders. Such control could
prevent a change in control of the Company without the consent of Weitzer. The
Company's Articles of Incorporation (the "Articles") exempt the Company from the
provisions of Florida's "control-share acquisition" and "affiliated
transactions" statutes. The practical effect of such exemptions will be to
permit Weitzer (if the Board authorizes it) to acquire Shares of Common Stock
without having the other shareholders determine his right to vote such Shares
and to permit the Company (if the Board and, in certain instances the holders of
a majority of the outstanding voting stock of the Company, authorize it) to
engage in the following transactions with Weitzer or affiliates of Weitzer
(collectively, the "Interested Shareholders") without the statutory requirements
of approval of a majority vote of the disinterested directors of the Company or
a two-thirds vote of the voting Shares of the other shareholders of the Company:
Mergers; consolidations; leases, sales, mortgages, pledges, transfers and
dispositions of assets; transfers of Shares of stock by the Company with an
aggregate fair market value of at least five percent of the aggregate fair
market value of all outstanding Shares of the Company to the Interested
Shareholders; adoption of plans for liquidation or dissolution of the Company
pursuant to an agreement between the Company and the Interested Shareholders;
reclassifications of securities or recapitalization of the Company such that the
Interested Shareholders increase their ownership interest in the voting
securities of the Company; and receipt by the Interested Shareholders of loans,
advances, guaranties, pledges, or other financial assistance or tax credits or
tax advantages provided by or through the Company. The Company and Weitzer do
not have any present intention to enter into any such transaction and intend
that any transactions in the future between the Company and Weitzer will be
approved by the Board of Directors and will be on terms no less favorable to the
Company than would be available in a comparable arm's length transaction with an
independent third party. Certain of the Weitzer Homebuilding Partnerships' bank
loan agreements provide that an "event of default" under such agreements shall
be deemed to have occurred if Weitzer or his heirs fail to control at least 35%
of the voting power of the outstanding voting stock of the Company.
DEPENDENCE ON KEY PERSONNEL. The success of the Company will be highly
dependent upon the performance of its senior management
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and, in particular, Weitzer, the Chairman of the Board and Chief Executive
Officer of the Company and its subsidiaries. Weitzer has a five-year employment
agreement with the Company whereby he has agreed to devote substantially all of
his business time to the affairs of the Company. The Company has an employment
agreement with William Rattazzi, the Company's President. In addition, it is an
"event of default" under certain of the Company's bank loan agreements if,
during his lifetime, Weitzer fails to serve as Chairman of the Board and Chief
Executive Officer of the Company with responsibility for the day-to-day
operations of the Company and its subsidiaries. The loss of key personnel or an
inability to attract and retain additional key personnel could have a material
adverse effect on the Company's business.
EFFECT OF NATURAL DISASTERS; HURRICANE ANDREW RELATED LITIGATION. The
State of Florida is in an area of the country which may be affected by tropical
storms as evidenced by Hurricane Andrew which struck the southeast coast of
Florida on August 24, 1992, damaging or destroying thousands of homes and
business structures, primarily in southern Dade County. The occurrence of
another tropical storm such as Hurricane Andrew could have a material adverse
effect on the Company's business including the incurrence of uninsured losses,
delays in construction, and shortages and increased costs of labor and building
materials.
VARIABILITY OF OPERATING RESULTS. The Company has experienced, and
expects to continue to experience, significant variability in sales and net
income on a quarterly basis as a result of, among other things, the stage of
development of its projects, the timing of settlements on home sales, the
cyclical nature of the homebuilding industry, changes in prevailing interest
rates, changes in the costs of materials and labor and other economic factors.
The Company's new sales contracts and home closings typically vary from quarter
to quarter depending primarily on the stages of development of its projects. In
the early stages of a project's development, the Company incurs significant
start-up costs associated with, among other things, project design, land
acquisition and development, zoning and permitting, construction and marketing
expenses. Since revenues are recognized only upon the transfer of title at the
closing of a sale of a home, there are no revenues during the early stages of a
project. During the later stages of a project, however, costs are lower in
relation to the revenues recognized. Accordingly, the Company's historical
financial performance is not necessarily a meaningful indicator of future
results and, in general, management expects that financial results will vary
significantly from period to period.
UNCERTAINTY OF FUTURE DIVIDENDS ON COMMON STOCK. Prior to the Earnings
Achievement Date (as hereinafter defined), the Company will pay dividends, to
the extent funds are legally available therefor, if, when and as declared by the
Board of Directors, on the Class A Common Stock at the rate of $.325 per share
per annum,
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and on the Class B Common Stock at the rate of $.001 per share per annum.
Following the Earnings Achievement Date, the payment of dividends on the Common
Stock will be determined by the Board, in its sole discretion, but the Company
does not presently intend to declare cash dividends on the Common Stock
following such date. See "Dividend Policy" and "Description of Securities -
Common Stock."
SHARES ELIGIBLE FOR FUTURE SALES. Sales of substantial numbers of
additional Shares of Class A Common Stock or of Class B Common Stock, or the
perception that such sales could occur, could adversely affect prevailing market
prices for the Class A Common Stock. 2,360,254 Shares of Class A Common Stock
are outstanding. Of the outstanding Shares, 1,927,591 Shares are tradeable in
the public market without restriction under the Securities Act of 1933, as
amended (the "Securities Act"), except for any Shares purchased by an
"affiliate" of the Company (as that term is defined under the rules and
regulations of the Securities Act), which will be subject to the resale
limitations of Rule 144 under the Securities Act. Weitzer owns 1,500,000 Shares
of Class B Common Stock. The Shares of Common Stock owned by Weitzer will be
"restricted securities" as that term is defined under Rule 144 and have not been
registered. Should Weitzer sell Shares of Common Stock pursuant to Rule 144
under the Securities Act or through another exemption under the Securities Act
or through registration of his Shares under the Securities Act, the sale of any
portion of Weitzer's Common Stock could have an adverse impact on the market
price of the Class A Common Stock.
THE COMPANY
GENERAL
Weitzer Homebuilders Incorporated (the "Company"), organized in Florida
in 1994, is engaged, through its subsidiaries, primarily in the design,
construction and sale of single-family homes and townhomes in Dade and Broward
Counties located in Southeast Florida. Prior to May 1995, the Company conducted
substantially all of its homebuilding operations through general partnerships
(the "Weitzer Homebuilding Partnerships"), in which one general partner was a
subsidiary of the Company and the other general partner was a subsidiary of an
unaffiliated third party (the "Financial Partner"). Each general partnership was
involved in the development of one specific homebuilding project. In May 1995,
with a portion of the net proceeds of the Company's initial public offering, the
Company acquired the capital stock of the then existing Financial Partner
affiliates (the "Partnership Acquisition"). Since that time, the Company
consolidates the operations of the Weitzer Homebuilding Partnerships with the
financial statements of the Company.
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The Company offers a wide variety of moderately-priced homes that are
designed to appeal to the entry level and first time move- up buyers. The
Company has delivered approximately 1,318 homes in the past five fiscal years,
including 296 in the fiscal year ended September 30, 1995. Sales prices of the
Company's homes range from approximately $75,000 to $285,000 and the average
sales price of homes delivered during the fiscal year ended September 30, 1995,
was approximately $127,000. At present, the Company has nine communities in
various stages of planning and development, including seven communities in which
the Company is currently offering homes for sale. At September 30, 1995, the
Company had 1,006 available for sale and 1,125 available lots under option and
contract, compared to 226 available lots for sale and 1,810 available lots under
option and contract at September 30, 1994. There is no assurance that all lots
available for home construction will in fact be used for construction of homes
since the acquisition of land and the construction and sales of homes are
subject to a variety of factors, including, without limitation, general and
local economic conditions, availability of financing, interest rates and
government regulation.
The Company's principal executive offices are located at 5901 N.W.
151st Street, Suite 120, Miami Lakes, Florida 33014.
OPERATING STRATEGY
The operating strategy of the Company emphasizes the following
elements:
AFFORDABLE HOUSING AND VALUE PRICING. The Company offers a wide variety
of moderately-priced homes that are designed to appeal to the entry-level and
first-time move-up buyers. The Company strives to deliver superior value to home
buyers by pricing homes competitively while consistently providing innovative
designs including architectural details and amenities in several of its projects
typically found in more expensive homes such as cathedral ceilings, recessed
lighting, glass block and security intercom systems. The Company's models afford
prospective home buyers a variety of options and features so that they may
customize their designs to suit their needs.
COMMITMENT TO QUALITY AND CUSTOMER SERVICE. Based on homebuyer surveys
conducted by the Company, the Company believes that its commitment to quality
construction and customer service has afforded it a favorable reputation among
home buyers and developers and led to repeat and referral business. The Company
acts as the general contractor for its projects and requires that its
subcontractors and suppliers use high quality, durable materials in the
construction of its homes. The Company generally provides home buyers with at
least a one-year warranty on workmanship and building materials and, in certain
instances such
14
<PAGE>
as when financing is provided through a government loan or where city codes
requires, a ten-year structural warranty.
COST CONTROLS. In general, the Company attempts to reduce certain risks
in the homebuilding industry and maximize its financial resources by: (i)
acquiring land for development through seller financing (which generally allows
for more favorable payment terms and lower closing costs); (ii) utilizing
options and other similar agreements whereby the Company provides a relatively
small deposit to obtain the right to purchase a specified number of lots over
some period of time so long as it exercises a certain number of options pursuant
to a periodic takedown schedule; (iii) obtaining required zoning entitlements
prior to purchase land; (iv) beginning construction of a home only after
execution of a sales contract, receipt of a down payment and, where applicable,
the buyer's receipt of mortgage approval; (v) using subcontractors on a fixed
price basis; (vi) minimizing inventory of land and unsold homes by building
speculative units on a limited basis; and (vii) obtaining volume discounts on
construction materials.
SOUTHEAST FLORIDA MARKET. Although the Company is continuously
evaluating locations for new residential communities and is exploring the
possibility of expanding into areas outside of its primary market in Southeast
Florida, management of the Company anticipates that in the near term its
business and earnings will continue to be derived principally from the Southeast
Florida market. Based on management's knowledge of the Southeast Florida
homebuilding market, the Company believes it has certain competitive advantages
in this market, including senior management's understanding of, and experience
with the local market; controls and cost savings that result from the Company's
centralized operations; and an experienced sales force that is employed on a
long-term rather than project-by-project basis.
LAND ACQUISITION AND DEVELOPMENT.
The Company acquires both improved building lots ready for
construction, and tracts of land that require site improvements prior to
construction. Generally, the Company attempts to acquire or control at least 100
lots in a development to achieve economies of scale in its marketing activities.
When contemplating the purchase of land for development, the Company considers
the cost of the land, the desirability of the proposed project to targeted home
buyers, population growth patterns, competitive conditions and available
financing. The Company's land purchase agreements are typically subject to
numerous conditions, including, but not limited to, the Company's ability to
obtain or verify the necessary zoning and other governmental approvals for the
proposed subdivision. During the investigation period, the Company also confirms
the availability of utilities, conducts hazardous waste and other environmental
analyses, arranges construction financing and completes its marketing
feasibility studies. As a result, the
15
<PAGE>
Company is generally able to begin development activities immediately after
closing the land purchase.
The Company attempts to reduce the financial risks and capital
requirements associated with maintaining its own inventory of lots by utilizing
options and other similar agreements pursuant to which the Company provides a
deposit and obtains the right to purchase a specified number of lots over a
period of time so long as it exercises a certain number of its options pursuant
to a periodic takedown schedule. These agreements are generally on a non-
recourse basis, so that if the Company does not meet the takedown schedule, its
only financial risk is forfeiture of a deposit. Generally, the options are
exercised only after prospective home buyers have executed a sales contract and
made a down payment; however, the options may be exercised without having
pre-sold the lots in order for the Company to preserve its option to purchase
the remaining lots.
SELLING SHAREHOLDERS
The following table sets forth the name of each Selling Shareholder,
the amount of Shares of Common Stock directly or indirectly owned by the Selling
Shareholders on the date hereof, the amount of Shares of Class A Common Stock to
be offered by the Selling Shareholders, the amount to be owned by the Selling
Shareholders following sale of such Shares of Class A Common Stock. As of June
12, 1996, there were outstanding 2,360,254 Shares of Class A Common Stock of the
Company.
<TABLE>
<CAPTION>
NUMBER OF SHARES SHARES BENEFICIALLY
SHARES BENEFICIALLY BEING OFFERED OWNED AFTER
NAME(1) OWNED FOR SALE THIS OFFERING(2)
- ------- ------------------- ---------------- -------------------
<S> <C> <C> <C>
Ramesh K. and Vilma Agarwal............................ 1,442 1,442 0
Morton L. Bennett...................................... 2,884 2,884 0
Karl B. Berger......................................... 5,769 5,769 0
Alvin Bojar, Trustee, Teejay American Pension Plan
u/a 12/01/97....................................... 2,884 2,884 0
Carafe Investment Co. Ltd.............................. 11,538 11,538 0
Alan Cohen............................................. 5,769 5,769 0
Lynnia A. Cohen........................................ 5,769 5,769 0
Morris and Selma Cohen(3).............................. 1,442 1,442 0
Richard D. Cohen....................................... 2,884 2,884 0
Robert Cohen........................................... 5,769 5,769 0
First Comet Corporation................................ 34,614 34,614 0
Leon Eisenberg......................................... 5,769 5,769 0
Daniel and Tina Flohr(3)............................... 5,769 5,769 0
Daniel A. Gooze........................................ 5,769 5,769 0
Mark E. Halloran....................................... 5,769 5,769 0
Douglas W. Harmon...................................... 5,769 5,769 0
Khalid and Souhad Hassan(3)............................ 1,442 1,442 0
Mohammad A. and Hasina Hossain(3)...................... 1,442 1,442 0
16
<PAGE>
Barbara Hurwitz........................................ 2,884 2,884 0
Ralph D. Jones......................................... 5,769 5,769 0
Kahn Profit Sharing.................................... 11,538 11,538 0
Raj. G. Kansal......................................... 1,442 1,442 0
Lenore Katz............................................ 5,769 5,769 0
MLPFS FBO IRA Felix Kaufman............................ 2,884 2,884 0
Kenneth Kaufman........................................ 2,884 2,884 0
Jay Kestenbaum......................................... 5,769 5,769 0
Kids Associates........................................ 5,769 5,769 0
Ronald Koenig.......................................... 2,884 2,884 0
Bruce E. Larson
d/b/a Larson Chemical Specialties.................. 5,769 5,769 0
Robert T. Lempert DMD PA
Profit Sharing Account............................. 2,884 2,884 0
Robert T. Lempert...................................... 5,769 5,769 0
Robert T. Lempert DMD PA Pension Account 2,884 2,884 0
Harry Levine........................................... 5,769 5,769 0
Sandy E. Mayerson IRA BSCC Custodian................... 2,884 2,884 0
Morgan Steel LTD....................................... 11,538 11,538 0
Richard G. Morris...................................... 5,769 5,769 0
Raleigh Revocable Trust Alan and
Meryl Cohen Trustees............................... 5,769 5,769 0
Robert H. Rosner IRA................................... 5,769 5,769 0
Alan J. Rubin.......................................... 5,769 5,769 0
Jeffrey Rubin.......................................... 2,884 2,884 0
Muhammad and Qamar Saleem(3)........................... 2,884 2,884 0
Keith G. Salmi......................................... 1,442 1,442 0
Laina Savory and Barry Levine(3)....................... 5,769 5,769 0
Nelson M. Schneider.................................... 5,769 5,769 0
Harlan B. Smith........................................ 5,769 5,769 0
Steiner Family Uni-Trust u/a Dtd 6/5/91................ 5,769 5,769 0
W.E. Stephens, Jr...................................... 5,769 5,769 0
Sterling Investment Co................................. 5,769 5,769 0
Universal Partners, L.P................................ 5,769 5,769 0
The J. C. Warren Co., Inc.............................. 5,769 5,769 0
Mark Wattles........................................... 5,769 5,769 0
Jack A. Weaver Rev. Trust DTD 7/23/89.................. 2,884 2,884 0
Dr. Lawrence S. Weisman MD IRA Rollover 5,769 5,769 0
Lawrence S. Weisman and
Shonette K. Weisman(3)............................. 5,769 5,769 0
Weston Investors P/S Trust FBO Gerald R. Appel 5,769 5,769 0
David M. Weiner........................................ 2,884 2,884 0
Andrea Wood............................................ 5,769 5,769 0
Neal E. Young.......................................... 1,442 1,442 0
New Valley Corporation................................. 122,588 122,588 0
<FN>
(1) None of such persons owned one percent or more of the outstanding Class A
Common Stock.
(2) Assumes all of the Shares being registered will be sold.
(3) Held as joint tenants with rights of survivorship.
</FN>
</TABLE>
17
<PAGE>
PLAN OF DISTRIBUTION
The Company will not receive any of the proceeds from the sale of any
of the Shares by the Selling Shareholders. The sale of the Shares may be
effected by the Selling Shareholders from time to time in transactions in the
over-the-counter market, on the NASDAQ National Market, in negotiated
transactions, or a combination of such methods of sale, at fixed prices which
may be changed, at market prices prevailing at the time of sale, at prices
related to prevailing market prices or at negotiated prices. The Selling
Shareholders may effect such transactions by selling the Shares to or through
underwriters, who may receive compensation in the form of discounts, concessions
or commissions from the Selling Shareholders and/or the purchasers of the Shares
for whom they may act as agent or to whom they sell as principal, or both (which
compensation might be in excess of customary commissions).
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 brokers or dealers. In addition, in certain states the
Shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption form the registration or qualification
requirement is available and is complied with by the Company and the Selling
Shareholders.
The Selling Shareholders and any broker-dealers, agents or underwriters
that participate with the Selling Shareholders in the distribution of the Shares
may be deemed to be "underwriters" within the meaning of Section 2(11) of the
Securities Act, and any Shares purchased by them may be deemed to be
underwriting commissions or discounts under the Securities Act.
Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the Shares may not simultaneously engage
in market-making activities with respect to the Class A Common Stock for a
period of two business days prior to the commencement of such distribution. In
addition and without limiting the foregoing, each Selling Shareholder will be
subject to applicable provisions of the Exchange Act and the rules and
regulations thereunder, including without limitation, Rules 10b-6, 10b-6A and
10b-7, which provisions may limit the timing of the purchases and sales of
Shares of Class A Common Stock by the Selling Shareholders.
The Company has agreed to pay all fees and expenses incident to the
registration of the Shares, except selling commissions and fees and expenses of
counsel or any other professionals or other advisors, if any, to the Selling
Shareholders.
18
<PAGE>
DESCRIPTION OF SECURITIES
The Company is currently authorized to issue up to 40,000,000 Shares of
Class A Common Stock, $.01 par value per share, of which 2,360,254 Shares were
outstanding as of June 12, 1996. The Company is authorized to issue 1,500,000
Shares of Class B Common Stock all of which are outstanding as of June 12, 1996.
The Company is authorized to issue up to 5,000,000 Shares of Preferred Stock,
$.01 par value per share, none of which were outstanding as of March 31, 1996.
CLASS A COMMON STOCK
The Company's Class A Common Stock, $.01 par value, has been traded
since April 26, 1995, on the NASDAQ National Market System under the symbol
"WTZRA." Prior to that time, there was no public market for the Class A Common
Stock. There is no established public trading market for the Company's Class B
Common Stock, $.01 par value ("Class B Common Stock"), all of the Shares of
which are held by Mr. Harry Weitzer. The following sets forth the range of high
and low bid prices for the Class A Common Stock as reported on the NASDAQ
National Market System during each of the quarters presented. The quotations set
forth below are inter-dealer quotations, without retail mark-ups, mark-downs or
commissions and may not necessarily represent actual transactions.
CLASS A COMMON STOCK
QUARTERLY PERIOD ENDED HIGH BID LOW BID
---------------------- -------- -------
March 31, 1996 $4.25 $3.125
December 31, 1995 $5.00 $3.75
September 30, 1995 $7.1250 $5.7500
June 30, 1995 commencing $7.1250 $6.4675
April 26, 1995
As of December 18, 1995, there were 136 holders of record of the
Company's Class A Common Stock. This number does not include beneficial owners
of the Class A Common Stock whose Shares are held in the names of various
dealers, clearing agencies, banks, brokers and other fiduciaries.
DIVIDENDS
Prior to the Earnings Achievement Date (as hereinafter defined), the
holders of the Common Stock are entitled to receive, if, when and as declared by
the Board of Directors to the extent
19
<PAGE>
funds are legally available therefor, dividends at the rate of (i) $.325 per
share per annum, with respect to the Class A Common Stock, and (ii) $.001 per
share per annum, with respect to the Class B Common Stock, payable quarterly on
the 15th day of February, May, August and November of each year. Dividends on
the Class A Common Stock are cummulative. The Company's Board of Directors
declared a quarterly cash dividend of $.08125 on the Class A Common Stock
payable on August 15, 1995, November 15, 1995, February 15, 1996 and May 15,
1996. No other cash dividends have been declared or paid. For periods following
the Earnings Achievement Date, holders of the Class A Common Stock and the Class
B Common Stock are entitled to receive such dividends, in equal amounts per
share, as may be declared from time to time by the Board of Directors out of
funds legally available therefor.
The Earnings Achievement Date is a date which is 10 business days
following the filing by the Company with the Securities and Exchange Commission
of the first Form 10-Q or Form 10-K, as the case may be (the "SEC Report"),
which reflects that, as of the last day of the period to which such SEC Report
relates, the Company has had an aggregate of $7,500,000 of Operating Income
earned since April 1, 1995 (the "Earnings Achievement"). "Operating Income" of
the Company for any fiscal period means the Consolidated Net Income for such
period, (x) increased or decreased by all income tax expense or benefit for such
period, and (y) decreased by all dividends paid or accrued during such period.
"Consolidated Net Income" of the Company for any period means the consolidated
income or loss of the Company and its subsidiaries as set forth on the Company's
consolidated statement of income for any such fiscal period and as determined in
accordance with generally accepted accounting principles consistently applied,
provided that (i) the results of operations of any person acquired in a pooling
of interests transaction for any period prior to the date of such acquisition
shall be excluded, and (ii)(a) any gains or losses from assets sales or reserves
related thereto (other than a disposition of housing inventory in the ordinary
course of business), (b) any gains or losses upon the extinguishment of
indebtedness, including the write-off of unamortized deferred loan costs and
unamortized original issue discount in connection with the retirement of the
Company's 10% Bonds due June 30, 1998 ("10% Bonds"), or any amortization
relating to original issue discount and deferred loan costs in connection with
such 10% Bonds, and (c) any extraordinary gains or losses, shall be excluded. No
later than (i) 45 days after the end of the Company's fiscal quarter which is
not the year-end or (ii) 90 days after the fiscal year-end, as the case may be,
the Chief Financial Officer of the Company shall determine if the Earnings
Achievement has occurred. On the day of the filing of the SEC Report with the
Commission, the Company shall make a public announcement that the Earnings
Achievement has occurred.
Under the terms of the Company's 10% Bonds, the Company may not declare
or pay any dividend or make any other distribution on any equity securities of
the Company (except dividends or
20
<PAGE>
distributions payable in equity securities of the Company), or purchase, redeem
or otherwise acquire, or permit a subsidiary to purchase, redeem or otherwise
acquire, any equity security of the Company (other than equity securities
acquired in exchange for securities of the Company and certain equity securities
issued to employees, directors or consultants), if, upon giving effect to such
dividend, distribution, redemption or other acquisition, the net worth of the
Company would be reduced to less than an amount equal to 120% of the remaining
indebtedness outstanding under the 10% Bonds. As of March 31, 1996, the
indebtedness outstanding under the Company's 10% Bonds was approximately
$3,750,000, including accrued interest thereon, and the consolidated net worth
of the Company as of March 31, 1996, was $9,533,222.
Under the terms of the Company's loan agreement with Residential
Funding Corporation, the Company may not declare or pay any dividend or make any
other distribution on any shares of capital stock of the Company (other than for
the dividends on the Class A Common Stock and Class B Common Stock set forth in
the Company's Articles of Incorporation prior to the Earnings Achievement Date)
in an amount which exceeds 50% of the previous fiscal year's audited pre tax
profits to the extent that the same would cause an event of default under the
agreement.
VOTING RIGHTS
Holders of Shares of Class A Common Stock and Class B Common Stock vote
as a single class on all matters submitted to a vote of shareholders (except as
otherwise required by law or in the Company's Articles). Each share of Class A
Common Stock and Class B Common Stock is entitled to one vote. The holders of
Shares of Class A Common Stock and Class B Common Stock are not entitled to
cumulative voting rights. The terms of the Class A Common Stock may not be
amended by the affirmative vote of the holders of at least the majority of the
then-outstanding Shares of the Class A Common Stock voting together as a
separate class. Under existing Florida law, the holders of the outstanding
Shares of Class A Common Stock will be entitled to vote as a separate class upon
a proposed amendment of the articles if it would change the rights, preferences
or limitations of the Class A Common Stock, and in certain other circumstances
provided by statute. Prior to the Earnings Achievement Date having occurred and
all accumulated and unpaid dividends on the Class A Common Stock and the Class B
Common Stock having been declared and paid in full, the Company will not create
and issue any class or series of stock, including a series of preferred stock,
ranking equal or prior to the Class A Common Stock and Class B Common Stock with
respect to the payment of dividends if the distribution of assets and
liquidation, dissolution or winding up without the affirmative vote of the
holders of at least a majority of the then-outstanding Shares of Class A Common
Stock voting together as a separate class taken in advance of any such actions.
21
<PAGE>
Upon liquidation, dissolution or winding up of a company, company
distributions to holders of any class of common stock would only be made after
payment in full of creditors and provision for the preference of any preferred
stock having preference over the common stock. Thereafter, so long as any Shares
of Class B Common Stock are outstanding, the holders of Class A Common Stock are
entitled to receive $6.50 per share and the holders of Class B Common Stock are
to entitled to receive $.01 per share. After such amounts are paid, the holders
of the Class B Common Stock are entitled to $6.50 per share and the holders of
the Class A Common Stock are entitled to receive $.01 per share. Any remaining
amount would then be shared pro ratably by both classes.
The holders of the Class A Common Stock and Class B Common Stock are
not entitled to pre-emptive rights or subscription or redemption privileges.
Class A Common Stock is not convertible.
The Class B Common Stock is convertible share for share into the Class A Common
Stock if the Earnings Achievement Date has occurred and all accumulated and
unpaid dividends in the Class A Common Stock have been declared and paid in
full. If all the Shares of Class B Common Stock are so converted, the Board of
Directors shall have the right, without further shareholder action, to change
the designation of the Class A Common Stock to Common Stock.
PREFERRED STOCK
The Board of Directors is authorized, subject to the voting rights, if
any, of the Class A Common Stock, to issue the authorized and unissued preferred
stock in one or more series, to fix or alter the rights, preferences, privileges
and restrictions, including the dividend rights, dividend rate, conversion
rights, voting rights and terms of redemption, liquidation preferences and
sinking fund of any series of preferred stock which is authorized and unissued.
No Shares of Preferred Stock have been issued or are outstanding as of the date
hereof.
OVER-THE-COUNTER MARKET
The Company's Class A Common Stock is traded on the NASDAQ National
Market System under the symbol "WTZRA."
TRANSFER AGENT
The Transfer Agent for the Shares of Common Stock is Continental Stock
Transfer & Trust Company, 2 Broadway, New York, New York 10004.
LEGAL MATTERS
Certain legal matters in connection with the securities being offered
hereby will be passed upon for the Company by Atlas, Pearlman, Trop & Borkson,
P.A., Special Counsel for the Company, Fort Lauderdale, Florida.
22
<PAGE>
EXPERTS
The consolidated balance sheets as of September 30, 1995 and 1994 and
the consolidated statements of income, shareholders' equity, and cash flows for
each of the three years in the period ended September 30, 1995, incorporated by
reference in this prospectus, have been incorporated herein in reliance on the
report of Coopers & Lybrand L.L.P., independent accountants, given on the
authority of that firm as experts in accounting and auditing.
INDEMNIFICATION
The Company has authority under Section 607.0850 of the Florida
Business Corporation Act (the "FBCA") to indemnify its directors and officers to
the extent provided for in such Statute. The Company's by-laws provide that, to
the fullest extent permitted by applicable law, as amended from time to time,
the Company will indemnify any person who was or is a party or is threatened to
be made a party to any action, suit or proceeding (whether civil, criminal,
administrative or investigative) by reason of the fact that such person is or
was a director or officer of the Company or serves in such capacity with any
other enterprise at the request of the Company. The Company may also indemnify
employees or agents of the Company if the Company's Board so approves. This
indemnification includes the right to advancement of expenses when allowed
pursuant to applicable law.
The provision of the FBCA authorizes the Company to indemnify its
officers and directors in connection with actions, suits and proceedings brought
against them if the person acted in good faith and in a manner which the person
reasonably believed to be in, or not opposed to, the best interest of the
Company and, with respect to any criminal actions, had no reasonable cause to
believe the person's conduct was unlawful. Unless pursuant to a determination by
a court, the determination of whether a director, officer or employee has acted
in accordance with the applicable standard of conduct must be made by (i) a
majority vote of the directors who were not parties to the proceeding or a
committee consisting solely of two or more directors not party to the
proceedings, (ii) independent legal counsel selected by a majority vote of the
directors who were parties to the proceeding or committee of directors (or
selected by the full board if a quorum or committee cannot be obtained), or
(iii) the affirmative vote of the majority of the Company's shareholders were
not parties to the proceeding.
The FBCA further provides that the Company may make any other further
indemnity by resolution, by-law, agreement, vote of shareholders, disinterested
directors or otherwise, except with the respect to certain enumerated acts or
omissions of such persons. Florida law prohibits indemnification or advancement
of expenses if a judgement or other final adjudication establishes that the
actions of a director, officer or employee constitute (i) a violation of
criminal law, unless the person had reasonable cause
23
<PAGE>
to believe his conduct was unlawful, (ii) a transaction from which such person
derived an improper personal benefit, (iii) wilful misconduct or conscious
disregard for the best interest of the Company in the case of a derivative
action by a shareholder, or (iv) in the case of a director, a circumstance under
which a director would be liable for improper distributions under Section
607.0384 of the FBCA. The FBCA does not affect a director's responsibilities
under any other law, such as federal securities laws.
The Company maintains directors and officers liability insurance, which
covers the Company's subsidiaries and the respective directors and officers.
24
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the estimated expenses, all of which are
being paid by the Company, in connection with this offering.
Registration fee........................ $ 354.34
Legal fees and expenses................. 10,000.00*
Accounting fees and expenses............ 3,500.00*
Printing expenses....................... 500.00*
Miscellaneous........................... 1,645.66*
----------
Total $16,000.00*
===========
- -------------
*Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company has authority under Section 607.0850 of the Florida
Business Corporation Act (the "FBA") to indemnify its directors and officers to
the extent provided for in such Statute. The Company's by-laws provide that, to
the fullest extent permitted by applicable law, as amended from time to time,
the Company will indemnify any person who was or is a party or is threatened to
be made a party to any action, suit or proceeding (whether civil, criminal,
administrative or investigative) by reason of the fact that such person is or
was a director or officer of the Company or serves in such capacity with any
other enterprise at the request of the Company. The Company may also indemnify
employees or agents of the Company if the Company's Board so approves. This
indemnification includes the right to advancement of expenses when allowed
pursuant to applicable law.
The provision of the FBCA authorizes the Company to indemnify its
officers and directors in connection with actions, suits and proceedings brought
against them if the person acted in good faith and in a manner which the person
reasonably believed to be in, or not opposed to, the best interest of the
Company and, with respect to any criminal actions, had no reasonable cause to
believe the person's conduct was unlawful. Unless pursuant to a determination by
a court, the determination of whether a director, officer or employee has acted
in accordance with the applicable standard of conduct must be made by (i) a
majority vote of the directors who were not parties to the proceeding or a
committee consisting solely of two or more directors not party to the
proceedings, (ii) independent legal counsel selected by a majority vote of the
directors who were parties to the proceeding or committee of
II-1
<PAGE>
directors (or selected by the full board if a quorum or committee cannot be
obtained), or (iii) the affirmative vote of the majority of the Company's
shareholders were not parties to the proceeding.
The FBCA further provides that the Company may make any other further
indemnity by resolution, by-law, agreement, vote of shareholders, disinterested
directors or otherwise, except with the respect to certain enumerated acts or
omissions of such persons. Florida law prohibits indemnification or advancement
of expenses if a judgement or other final adjudication establishes that the
actions of a director, officer or employee constitute (i) a violation of
criminal law, unless the person had reasonable cause to believe his conduct was
unlawful, (ii) a transaction from which such person derived an improper personal
benefit, (iii) wilful misconduct or conscious disregard for the best interest of
the Company in the case of a derivative action by a shareholder, or (iv) in the
case of a director, a circumstance under which a director would be liable for
improper distributions under Section 607.0384 of the FBA. The FBCA does not
affect a director's responsibilities under any other law, such as federal
securities laws.
The Company maintains that directors and officers liability insurance,
which covers the Company's subsidiaries and the respective directors and
officers.
ITEM 16. EXHIBITS.
EXHIBIT DESCRIPTION
- ------- -----------
3.1** Amended and Restated Articles of Incorporation of
the Company, dated April 27, 1995
3.2* By-laws of the Company
4.1* Form of Class A Common Stock Certificate of the
Company
4.2* Form of 10% Bond
4.3** Representatives' Warrant Agreement dated April
26, 1995, between the Company, Josephthal Lyon &
Ross Incorporation ("Josephthal") and Southeast
Research Partners, Inc. ("Southeast")
4.4* Unit Construction Revolving Loan Agreement dated
as of August 14, 1992, and Amendment dated
November 30, 1993, between Weitzer Chapel Trail
Homes, Harry Weitzer, Trudy Weitzer and Ohio
Savings Bank, and related Consolidated Revolving
Mortgage Note
II-2
<PAGE>
4.5* Development Loan Agreement dated as of August 14,
1992, between Weitzer Chapel Trail Homes, Harry
Weitzer, Trudy Weitzer and Ohio Savings Bank
4.6* First Mortgage and Security Agreement dated as of
August 14, 1992, between Weitzer Chapel Trail
Homes and Ohio Savings Bank
4.7* Future Advance, Mortgage and Loan Modification
Agreement dated as of November 30, 1993, between
Weitzer Chapel Trail Homes, Harry Weitzer, Trudy
Weitzer and Ohio Savings Bank, and related
Revolving Future Advance Mortgage Note
4.8* Building Loan Agreement dated as of August 3,
1993, between Weitzer Serena Lakes Homes II and
Barnett Bank of South Florida, N.A., and related
Promissory Notes and form of Guaranties
4.9* First Mortgage and Security Agreement dated as of
August 3, 1993, between Weitzer Serena Lakes
Homes II and Barnett Bank of South Florida, N.A.
4.10* Notice of Future Advance and First Modification
of First Mortgage and Security Agreement dated as
of May 20, 1994, between Weitzer Serena Lakes Homes
II and Barnett Bank of South Florida, N.A., and
related Consolidating and Renewal Revolving
Promissory Note
4.11* Building Loan Agreement dated as of August 9,
1994, between Weitzer Serena Lakes Townhomes I
and Barnett Bank of South Florida, N.A., and related
Promissory Notes
4.12* First Mortgage and Security Agreement dated as of
August 9, 1994, between Weitzer Serena Lakes
Townhomes I and Barnett Bank of South Florida,
N.A.
4.13* Purchase Money Mortgage and Security Agreement
dated as of October 25, 1994, between Weitzer at
Harmony Lakes, Inc. and Harmony Lakes Development
Corp., and related Promissory Note and Guaranty
of Payment
4.14* Notice of Future Advance and Modification of
Purchase Money Mortgage and Security Agreement
dated as of February 24, 1995 between Weitzer at
Harmony Lakes, Inc. and Harmony Lakes Development
Corp., and related Promissory Note and Guaranty
of Payment
II-3
<PAGE>
4.15** Loan Agreement dated as of June 30, 1995, between the
Company and Residential Funding Corporation
4.16*** Construction Loan Agreement dated as of June 30,
1995, between Weitzer at Deerfield Beach, Inc.,
and Residential Funding Corporation and related
Promissory Note and Guaranty of the Company
4.17*** Construction Mortgage, Security Agreement and
Fixture Filing with Assignment of Rent Proceeds
and Agreements dated as of June 30, 1995, between
Weitzer at Deerfield Beach, Inc., and Residential
Funding Corporation
4.18*** Loan Agreement dated as of August 3, 1995,
between Weitzer Serena Lakes Homes II, Inc., Weitzer
Serena Lakes Townhomes, Inc., and Barnett Bank of
South Florida, N.A., and related Promissory Notes
and Guaranties of the Company and Harry and Trudy
Weitzer
4.19*** First Mortgage and Security Agreement dated as of
August 3, 1995, between Weitzer Serena Lakes
Homes II, Inc., Weitzer Serena Lakes Townhomes, Inc.,
and Barnett Bank of South Florida, N.A.
4.20***** First Amendment Agreement dated as of January 24,
1996, by and between the Company, Residential
Funding Corporation and Webster, Grant & Land
Company.
4.21****** Construction Loan Agreement dated February 28,
1996 between Weitzer Forest Lakes Villas, Inc.
and Residential Funding Corporation and related
promissory notes and guaranty of the Company.
4.22****** Construction Mortgage, Security Agreement and
fixture following with assignment of rents,
proceeds and agreements dated as of February 28,
1996 between Weitzer Forest Lakes Villas, Inc.
and Residential Funding Corporation.
5.1 Opinion of Atlas, Pearlman, Trop & Borkson, P.A.
10.1* Employment Agreement dated as of November 1,
1994, between the Company and Harry Weitzer
10.2* Form of Subscription Agreement and Supplemental
Subscription Letter executed by investors in
connection with the Company's October 1994
private placement
II-4
<PAGE>
10.3* Indemnification Agreement dated as of September
30, 1994, between the Company and Harry Weitzer
10.4* Performance Incentive Plan
10.5* Purchase and Sale Agreement dated as of October
20, 1994, between Harmony Lakes Development Corp.
and Webster Grant Land Company (including form of
Note and Guarantee of Payment)
10.6* Option Agreement for the Purchase of Common Stock
dated as of March 22, 1994 between the Company
and Harry Weitzer
10.7* Letter Agreement dated January 9, 1995, among the
Company, Harry Weitzer, Weitzer Pine Glenn Homes,
Inc., Weitzer Serena Lakes Homes II, Inc., Weitzer
Serena Lakes Townhomes, Inc., and Barnett Bank of
South Florida, N.A.
10.8* Letter Agreement dated January 31, 1995, among
the Company, Harry Weitzer, Weitzer Chapel Trail
Homes, Inc., and Ohio Savings Bank
10.9* Pledge Agreement dated as of October 25, 1994,
between the Company and Josephthal, as agent on
behalf of the holders of the 10% Bonds, of the
stock of Weitzer at Harmony Lakes, Inc. relating
to the Company's October 1994 private placement
10.10* Agreement dated as of January 30, 1992, between
Broward Management Company and Webster Grant Land
Company, as amended
10.11*** Agreement for Purchase and Sale dated as of June
14, 1995, between Chapel Trail Associates, Ltd.
and Webster Grant Land Company
10.12*** Agreement for Purchase and Sale dated June 14,
1995, between Dade Residential Developers, Inc.
and Webster Grant Land Company
10.13**** Agreement for Services dated as of November 30,
1995, between the Company and National Business
Solutions, Inc.
21.1**** Subsidiaries of the Company
23.01 Consent of Coopers & Lybrand L.L.P.
24.02 Consent of Atlas, Pearlman, Trop & Borkson, P.A.
(included in the opinion filed as Exhibit 5.1
hereto)
II-5
<PAGE>
- --------------
* Incorporated herein by reference to the exhibit filed as a part of the
Company's Registration Statement on Form S-1 (Registration No.
33-89076).
** Incorporated herein by reference to the exhibit filed as a part of the
Company's report on Form 10- Q for the three months ended March 31, 1995
*** Incorporated herein by reference to the exhibit filed as a part of the
Company's report on Form 10- -Q for the three months ended June 30, 1995
**** Incorporated herein by reference to the exhibit filed as a part of the
Company's report on Form 10- K for the year ended September 30, 1995.
***** Incorporated herein by reference to the exhibit filed as a part of the
Company's report on Form 10- Q for the three months ended December 31,
1995
****** Incorporated herein by reference to the exhibit filed as part of the
Company's report on Form 10-Q for the three months ended March 31, 1996.
- --------------
ITEM 17. UNDERTAKINGS.
(1) The undersigned Registrant hereby undertakes:
(a) to file, during any period in which it offers or sells
securities, a post-effective amendment to this Registration Statement to include
any additional or changed material information on the plan of distribution;
(b) that, for determining any liability under the Securities
Act, treat each such post-effective amendment as a new Registration Statement of
the securities offered at that time shall be deemed to be the initial bona fide
offering thereof; and
(c) to file a post-effective amendment to remove from
registration any of the securities that remain unsold at the end of the
offering.
(2) Insofar as indemnification for liabilities arising under the Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification
II-6
<PAGE>
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a Director, officer of 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.
II-7
<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 Miami Lakes and the State of Florida, on the
19th day of June, 1996.
WEITZER HOMEBUILDERS INCORPORATED
By: /s/ HARRY WEITZER
Harry Weitzer
Chairman of the Board
and Chief Executive Officer
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 dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
Chairman of the Board
and Chief Executive
Officer (Principal
/s/ HARRT WEITZER Executive Officer) June 21 1996
- ----------------------
Harry Weitzer
Controller (Principal
/s/ TIMOTHY S. HART Accounting Officer) June 21 1996
- ----------------------
Timothy S. Hart
/s/ JOSEPH B. ROSE Director June 21 1996
- ----------------------
Joseph B. Rose
/s/ MICHAEL A. AMBROSIO Director June 21 1996
- -----------------------
Michael A. Ambrosio
/s/ LAWRENCE HELLRING Director June 21 1996
- ---------------------
Lawrence Hellring
/s/ BRIAN A. KAHAN Director June 21 1996
- ---------------------
Brian A. Kahan
II-8
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference, in this registration statement of
Weitzer Homebuilders Incorporated on Form S-3 of our report dated November 22,
1995, on our audits of the consolidated financial statements of Weitzer
Homebuilders Incorporated as of September 30, 1995 and 1994, and for the years
ended September 30, 1995, 1994, and 1993, which report is included in the
Company's Annual Report on Form 10-K for the fiscal year ended September 30,
1995, filed with the Securities and Exchange Commission pursuant to the
Securities Act of 1934 and incorporated by reference in this registration
statement. We also consent to the reference to our firm under the caption
"Experts".
COOPERS & LYBRAND L.L.P.
Miami, Florida
June 18, 1996
Exhibit 24.02
ATLAS, PEARLMAN, TROP & BORKSON, P.A.
[LETTERHEAD]
June 21, 1996
WEITZER HOMEBUILDERS INCORPORATED
5901 N.W. 151 Street, Suite 120
Miami Lakes, Florida 33014
RE: REGISTRATION STATEMENT ON FORM S-3; WEITZER HOMEBUILDERS INCORPORATED
(THE "COMPANY"); 432,663 SHARES OF COMMON STOCK
Gentlemen:
This opinion is submitted pursuant to the applicable rules of the
Securities and Exchange Commission with respect to the registration by the
Company of the resale of an aggregate of 432,663 shares of Common Stock, par
value $.01 per share (the "Common Stock") to be sold by the Selling Shareholders
designated in the Registration Statement. The shares of Common Stock to be sold
consist of 432,663 shares of Common Stock which were issued to the Selling
Shareholders upon exercise of the Warrants of the Company which were issued to
the Selling Shareholders as part of an October 7, 1994 private placement.
In our capacity as counsel to the Company, we have examined the original,
certified, conformed, photostat or other copies of the Company's Certificate of
Incorporation, By-Laws, corporate minutes provided to us by the Company and
such other documents and instruments as we deemed necessary. In all such
examinations, we have assumed the genuineness of all signatures on original
documents, and the conformity to originals or certified documents of all copies
submitted to us as conformed, photostat or other copies. In passing upon certain
corporate records and documents of the Company, we have necessarily assumed the
correctness and completeness of the statements made or included therein by the
Company, and we express no opinion thereon.
<PAGE>
Weitzer Homebuilders Incorporated
June 21, 1996
Page 2
Based upon and in reliance of the foregoing, we are of opinion that the
Common Stock is validly issued, fully paid and non-assessable.
We hereby consent to the use of this opinion in the Registration
Statement on Form S-3 to be filed with the Commission.
Very truly yours,
ATLAS, PEARLMAN, TROP & BORKSON, P.A.
JMD/ldm
