As filed with the Securities and Exchange Commission on August 1, 1997
REGISTRATION NO. 333-_____
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-3
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
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<CAPTION>
<S> <C>
WILLAMETTE INDUSTRIES, INC. WILLAMETTE CAPITAL I
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) WILLAMETTE CAPITAL II
(EXACT NAME OF REGISTRANTS AS SPECIFIED IN TRUST CERTIFICATES))
OREGON DELAWARE
(STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION) (STATE OR OTHER JURISDICTION OF INCORPORATION OR ORGANIZATION OF EACH
REGISTRANT)
93-0312940 Applied For
(I.R.S. EMPLOYER IDENTIFICATION NO.) (I.R.S. EMPLOYER IDENTIFICATION NOS.)
</TABLE>
1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201
(503) 227-5581
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF PRINCIPAL EXECUTIVE OFFICES OF EACH REGISTRANT)
J. A. Parsons
Executive Vice President
and Chief Financial Officer,
Secretary and Treasurer
1300 S.W. Fifth Avenue, Suite 3800
Portland, Oregon 97201
(503) 227-5581
(NAME AND ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING
AREA CODE, OF AGENT FOR SERVICE OF EACH REGISTRANT)
Copies to:
Miller, Nash, Wiener, Hager & Carlsen LLP Sullivan & Cromwell
111 S.W. Fifth Avenue, Suite 3500 444 S. Flower Street, Suite 1200
Portland, Oregon 97204-3699 Los Angeles, California 90071
Attention: John J. DeMott Attention: Alison S. Ressler
Telephone: (503) 224-5858 Telephone: (213) 955-8000
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after this Registration Statement becomes effective
depending upon market conditions and other factors.
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<PAGE>
If the only securities being registered on this Form are to be offered pursuant
to dividend or interest reinvestment plans, please check the following box: [ ]
If any of the securities being registered on this Form are being offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [X]
If this Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PER SHARE (1) OFFERING PRICE REGISTRATION FEE
<S> <C> <C> <C> <C>
Debt Securities of Willamette Industries,
Inc. (2)
Preferred Stock of Willamette Industries,
Inc., $.50 par value (3)
Common Stock of Willamette Industries,
Inc., $.50 par value (3)(4)
Warrants or Purchase Contracts of
Willamette Industries, Inc. (5)
Stock Purchase Units of Willamette
Industries, Inc. (6)
Preferred Securities of Willamette
Capital I
Preferred Securities of Willamette
Capital II
Guarantees by Willamette Industries, Inc.
with respect to Preferred Securities of
Willamette Capital I and Willamette
Capital II(7)
Total............................ $500,000,000(9) 100% $500,000,000(8)(9) $151,515.15
</TABLE>
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<PAGE>
(1) Estimated for the sole purpose of computing the registration fee
pursuant to Rule 457(o).
(2) Also includes such indeterminate principal amount of Debt Securities
issuable upon exercise of or conversion of, or exchange for, any other
securities registered hereunder.
(3) Also includes such indeterminate number of shares of Common Stock or
Preferred Stock as may be issued upon exercise or conversion of, or
exchange for, any other securities registered hereunder.
(4) Includes preferred stock purchase rights issuable with shares of Common
Stock. Prior to the occurrence of certain events, such rights will not
be exercisable or evidenced separately from the Common Stock.
(5) Warrants or contracts to purchase other securities registered hereby
may be sold separately or with any of the other securities registered
hereunder.
(6) Stock Purchase Units represent ownership of Stock Purchase Contracts
together with Debt Securities, Preferred Securities or debt obligations
of third parties, including U.S. Treasury securities.
(7) This Registration Statement is deemed to include the obligations of the
Registrants under the Indentures, the Trust Agreements, the Preferred
Securities, and the Guarantees as described in the Registration
Statement.
(8) Such amount represents the aggregate principal amount of Debt
Securities issued at their principal amount, the aggregate issue price
(rather than the principal amount) of any Debt Securities issued at an
original issue discount, the aggregate liquidation preference of any
Preferred Stock, the aggregate amount used when computing the
registration fee pursuant to Rule 457(c) for any Common Stock, the
aggregate issue price of any Warrants, the aggregate exercise price of
any securities issuable upon the exercise of Warrants, and the initial
public offering price of any Preferred Securities. Any securities
registered hereunder may be sold separately or as units with other
securities registered hereunder.
(9) No separate consideration will be received for the Common Stock, if
any, issuable upon conversion of or in exchange for Preferred Stock. No
separate consideration will be received for any Debt Securities if
issued to evidence a loan by Willamette Capital I or Willamette Capital
II, or for any related Guarantee.
The registrants hereby amend this registration statement on such date or dates
as may be necessary to delay its effective date until the registrants 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 1993 or until the registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
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Explanatory note: This registration statement contains two forms of
basic prospectus:
1. A prospectus of all registrants relating to all types
of securities that may be offered hereunder.
2. A prospectus of Willamette Industries, Inc., relating
solely to its senior debt securities registered hereunder.
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<PAGE>
$500,000,000
WILLAMETTE INDUSTRIES, INC.
Senior Debt Securities
Subordinated Debt Securities
Cumulative Preferred Stock
Common Stock
Stock Purchase Contracts
Stock Purchase Units
-----------------
WILLAMETTE CAPITAL I
WILLAMETTE CAPITAL II
Trust Preferred Securities
guaranteed to the extent set forth herein by
WILLAMETTE INDUSTRIES, INC.
-----------------
Willamette Industries, Inc. (the "Company") may offer, from time to
time, (i) unsecured senior debt securities ("Senior Debt Securities") consisting
of debentures, notes or other unsecured evidences of indebtedness, (ii)
unsecured subordinated debt securities ("Subordinated Debt Securities")
consisting of debentures, notes and other unsecured evidences of indebtedness
(item (i) or (ii) above being referred to herein as the "Debt Securities"),
(iii) cumulative preferred stock, $.50 par value ("Preferred Stock"), (iv)
common stock, $.50 par value ("Common Stock"), (v) stock purchase contracts or
warrants ("Stock Purchase Contracts") to purchase Preferred Stock or Common
Stock, or (vi) stock purchase units ("Stock Purchase Units"), each representing
ownership of a Stock Purchase Contract together with Debt Securities or Trust
Preferred Securities (as defined below) or debt obligations of third parties,
including U.S. Treasury Securities, securing the holder's obligation to purchase
Common Stock or Preferred Stock under the Stock Purchase Contract, in each case
in one or more series and in amounts, at prices and on terms to be determined at
or prior to the time of sale.
(Continued on next page)
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is August 1, 1997.
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<PAGE>
(Continued from cover)
Willamette Capital I and Willamette Capital II (each, a "Willamette
Trust"), each a statutory business trust formed under the laws of the State of
Delaware, may offer, from time to time, preferred securities representing
undivided beneficial interests in the assets of the respective Willamette Trust
("Trust Preferred Securities"). The payment of periodic cash distributions
("distributions") with respect to Trust Preferred Securities of each of the
Willamette Trusts out of moneys held by each of the Willamette Trusts, and
payment on liquidation, redemption or otherwise with respect to such Trust
Preferred Securities, will be guaranteed by the Company to the extent described
herein (each a "Guarantee"). See "Description of the Trust Preferred Securities
Guarantees" below. The Company's obligations under the Trust Preferred
Securities Guarantees are subordinate and junior in right of payment to all
other liabilities of the Company and rank pari passu with the most senior
preferred stock, if any, issued from time to time by the Company. Subordinated
Debt Securities may be issued and sold from time to time in one or more series
to a Willamette Trust, or a trustee of such Willamette Trust, in connection with
the investment of the proceeds from the offering of Trust Preferred Securities
and Common Securities (as defined herein) of such Willamette Trust. The
Subordinated Debt Securities purchased by a Willamette Trust may be subsequently
distributed pro rata to holders of Trust Preferred Securities and Common
Securities in connection with the dissolution of such Willamette Trust upon the
occurrence of certain events as may be described in an accompanying Prospectus
Supplement.
Specific terms of the particular Senior Debt Securities, Subordinated
Debt Securities, Trust Preferred Securities and related Trust Preferred
Securities Guarantees, Stock Purchase Contracts, Stock Purchase Units, Common
Stock or Preferred Stock, in respect of which this Prospectus is delivered (the
"Offered Securities") will be set forth in an accompanying Prospectus Supplement
or Supplements, together with the terms of the offering of the Offered
Securities, the initial price thereof and the estimated net proceeds from the
sale thereof. The Prospectus Supplement will set forth with regard to the
particular Offered Securities, without limitation, the following: (i) in the
case of Debt Securities, the designation, aggregate principal amount,
denomination, maturity, premium, if any, any exchange, conversion, redemption or
sinking fund provisions, interest rate (which may be fixed or variable), the
time and method of calculating interest payments, the right of the Company, if
any, to defer payment or interest on the Subordinated Debt Securities and the
maximum length of such deferral period, put options, if any, public offering
price, ranking as senior or subordinated debt, and other specific terms of the
offering, (ii) in the case of Preferred Stock, the designation of the series of
Preferred Stock to be offered, the number of shares, the rate and frequency of
dividends thereon, the amount of any liquidation preference, any conversion or
exchange rights, the terms of any optional or mandatory redemption provisions,
any other preferences, limitations, and rights of Preferred Stock of such
series, the public offering price, and other terms of offering, (iii) in the
case of Common Stock, the number of shares, the public offering price, and other
specific terms of the offering, (iv) in the case of Trust Preferred Securities,
the designation, number of securities, liquidation preference per security,
initial public offering price, dividend rate (or method of calculation thereof),
dates on which dividends shall be payable and dates from which dividends shall
accumulate, any voting rights, any redemption, exchange or sinking fund
provisions, any other rights, preferences, privileges, limitations or
restrictions relating to the Trust Preferred Securities of a specific series and
the terms upon which the proceeds of the sale of the Trust Preferred Securities
will be used to purchase a specific series of Subordinated Debt Securities of
the Company, (v) in the case of Stock Purchase Contracts, the designation and
number of shares of Common Stock or Preferred Stock issuable thereunder, the
purchase price of Common Stock or Preferred Stock, the date or dates on which
the Common Stock or Preferred Stock is required or permitted to be purchased by
the holders of the Stock Purchase Contracts, any periodic payments required to
be made by the Company to the holders of the Stock Purchase Contract or visa
versa, the other terms upon which the Common Stock or Preferred Stock shall be
or may be purchased and sold thereunder, and the terms of the offering and sale
of the Stock Purchase Contracts, and (vi) in the case of Stock Purchase Units,
the number and designation of the Stock Purchase Contracts and any Debt
Securities, Trust Preferred Securities or debt obligations of third parties
securing
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<PAGE>
the holder's obligation to purchase the Common Stock or Preferred Stock under
the Stock Purchase Contracts, and the terms of the offering and sale thereof.
The Company's Common Stock is traded on the New York Stock Exchange
("NYSE") under the symbol "WLL." See "Description of Willamette Capital Stock --
Price Range of Willamette Common Stock and Common Stock Dividends."
Willamette and/or each of the Willamette Trusts may sell the Offered
Securities directly, through agents designated from time to time or through
underwriters or dealers. See "Plan of Distribution." If any agents of Willamette
and/or any Willamette Trust or any underwriters or dealers are involved in the
sale of the Offered Securities, the names of such agents, underwriters or
dealers and any applicable commissions and discounts will be set forth in the
related Prospectus Supplement.
This Prospectus may not be used to consummate sales of Offered
Securities unless accompanied by a Prospectus Supplement.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, ANY ACCOMPANYING
PROSPECTUS SUPPLEMENT OR THE DOCUMENTS INCORPORATED OR DEEMED INCORPORATED BY
REFERENCE HEREIN, AND ANY INFORMATION OR REPRESENTATIONS NOT CONTAINED HEREIN OR
THEREIN MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE
WILLAMETTE TRUSTS OR BY ANY AGENT, DEALER OR UNDERWRITER. THIS PROSPECTUS AND
ANY ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY CIRCUMSTANCES IN WHICH
SUCH OFFER OR SOLICITATION IS UNLAWFUL. THE DELIVERY OF THIS PROSPECTUS OR ANY
PROSPECTUS SUPPLEMENT AT ANY TIME DOES NOT IMPLY THAT THE INFORMATION HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act") and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "SEC"). Reports, proxy statements and
other information concerning the Company can be inspected and copied at the
SEC's Public Reference Room, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, DC 20549, as well as the Regional Offices of the SEC at 7 World
Trade Center, Suite 1300, New York, New York 10048 and Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511.
Copies of such material can be obtained from the Public Reference Section of the
SEC at Judiciary Plaza, 450 Fifth Street, N.W., Washington, DC 20549, at
prescribed rates. The SEC also maintains a Web site that contains reports, proxy
and information statements and other information regarding registrants that file
electronically with the SEC. The address of such site is http://www.sec.gov.
Such reports, proxy statements and other information may also be inspected at
the offices of the NYSE, on which Common Stock is traded, at 20 Broad Street,
New York, New York 10005.
This Prospectus constitutes a part of a Registration Statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") filed by the Company and the Willamette Trusts with the SEC under
the Securities Act of 1933, as amended (the "Securities Act") with respect to
the Offered Securities. This Prospectus does not contain all of the information
set forth in such Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the SEC. Reference is made to such
Registration
- 3 -
<PAGE>
Statement and to the exhibits relating thereto for further information with
respect to the Company, the Willamette Trusts, and the Offered Securities. Any
statements contained herein concerning the provisions of any document filed as
an exhibit to the Registration Statement or otherwise filed with the SEC or
incorporated by reference herein are not necessarily complete, and in each
instance reference is made to the copy of such document so filed for a more
complete description of the matter involved. Each such statement is qualified in
its entirety by such reference.
No separate financial statements of any of the Willamette Trusts have
been included herein. The Company does not consider that such financial
statements would be material to holders of the Trust Preferred Securities
because (i) all of the voting securities of each of the Willamette Trusts will
be owned, directly or indirectly, by the Company, a reporting company under the
Exchange Act, (ii) each of the Willamette Trusts has no independent operations
but exists for the sole purpose of issuing securities representing undivided
beneficial interests in the assets of such Willamette Trust and investing the
proceeds thereof in Subordinated Debt Securities issued by the Company, and
(iii) the Company's obligations described herein and in any accompanying
prospectus supplement under the Declarations of each Trust, the Guarantee issued
with respect to Trust Preferred Securities issued by that Trust, the
Subordinated Debt Securities purchased by that Trust and the related Indenture,
taken together, constitute a full and unconditional guarantee of payments due on
the Trust Securities. See "Particular Terms of the Subordinated Debt Securities"
and "Description of the Trust Preferred Securities Guarantees."
The Willamette Trusts are not currently subject to the information
reporting requirements of the 1934 Act. The Willamette Trusts will become
subject to such requirements upon the effectiveness of the Registration
Statement, although they intend to seek and expect to receive exemptions
therefrom.
The Company will send to all registered holders of the Offered
Securities such annual and other reports as are sent to its shareholders in
conformity with the requirements of the 1934 Act.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the SEC pursuant to
the 1934 Act are incorporated by reference herein and made a part hereof:
1. Annual Report on Form 10-K for the year ended December 31,
1996.
2. The Company's quarterly report on Form 10-Q for the quarter
ended March 31, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the 1934 Act subsequent to the date hereof and prior to the
termination of the offering of the Offered Securities pursuant hereto shall be
deemed to be incorporated by reference in this Prospectus or in any Prospectus
Supplement and to be a part hereof from the date of filing of such documents.
Any statement contained herein or in a document incorporated or deemed
to be incorporated by reference in this Prospectus or in any Prospectus
Supplement shall be deemed to be modified or superseded for purposes of this
Prospectus or any Prospectus Supplement to the extent that a statement contained
in this Prospectus or in any Prospectus Supplement or in any other subsequently
filed document which also is or is deemed to be incorporated by reference in
this Prospectus or in any Prospectus Supplement modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus or any
Prospectus Supplement.
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<PAGE>
The Company undertakes to provide without charge to each person to whom
a copy of this Prospectus has been delivered, upon the written or oral request
of any such person, a copy of any or all of the foregoing documents incorporated
herein by reference, other than exhibits to such documents (unless such exhibits
are specifically incorporated by reference into such documents). Such requests
should be directed to: Willamette Industries, Inc., 1300 S.W. Fifth Avenue,
Suite 3800, Portland, Oregon 97201, Telephone: (503) 227-5581, Attention:
Investor Relations.
THE COMPANY
The Company is a diversified, integrated forest products company which
manufactures unbleached paper products, white paper products, and wood-based
building materials at 97 locations located throughout the United States and in
Ireland. The Company owns or controls approximately 1.8 million acres of
timberland in Arkansas, Louisiana, Missouri, North Carolina, Oregon, South
Carolina, Tennessee, Texas, and Washington.
The Company was incorporated in Oregon in 1906. Its executive offices
are located at 1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201, and
its telephone number is (503) 227-5581.
THE WILLAMETTE TRUSTS
Each of Willamette Capital I and Willamette Capital II is a statutory
business trust formed under Delaware law in 1997 pursuant to (i) a separate
declaration of trust (each a "Declaration") executed by the Company, as sponsor
for such trust (the "Sponsor"), and the Willamette Trustees (as defined herein)
for such trust and (ii) the filing of a certificate of trust with the Delaware
Secretary of State. Each Willamette Trust exists for the exclusive purposes of
(i) issuing the Trust Preferred Securities and common securities representing
undivided beneficial interests in the assets of such Trust (the "Common
Securities" and, together with the Trust Preferred Securities, the "Trust
Securities"), (ii) investing the gross proceeds of the Trust Securities in Debt
Securities and (iii) engaging in only those other activities necessary or
incidental thereto. All of the Common Securities will be directly or indirectly
owned by the Company. The Common Securities will rank pari passu, and payments
will be made thereon pro rata, with the Trust Preferred Securities except that
upon an event of default under the Declaration, the rights of the holders of the
Common Securities to payment in respect of distributions and payments upon
liquidation, redemption and otherwise will be subordinated to the rights of the
holders of the Trust Preferred Securities. The Company will, directly or
indirectly, acquire Common Securities of each Willamette Trust. Each Willamette
Trust's business and affairs will be conducted by the trustees (the "Willamette
Trustees") appointed by the Company, as the direct or indirect holder of all the
Common Securities. The holder of the Common Securities will be entitled to
appoint, remove or replace any of, or increase or reduce the number of, the
Willamette Trustees of a Willamette Trust. The duties and obligations of the
Willamette Trustees shall be governed by the Declaration of such Willamette
Trust. A majority of the Willamette Trustees (the "Regular Trustees") of each
Willamette Trust will be persons who are employees or officers of or affiliated
with the Company. In certain limited circumstances set forth in a Prospectus
Supplement, the holders of a majority of the Trust Preferred Securities will be
entitled to appoint one Trustee, who need not be an employee or officer of or
otherwise affiliated with the Company. One Willamette Trustee of each Willamette
Trust will be a financial institution which will be unaffiliated with the
Company and which shall act as property trustee and as indenture trustee for
purposes of the Trust Indenture Act of 1939 (the "Trust Indenture Act"),
pursuant to the terms set forth in a Prospectus Supplement (the "Property
Trustee" or the "Institutional Trustee"). In addition, unless the Property
Trustee maintains a principal place of business in the State of Delaware, and
otherwise meets the requirements of applicable law, one Willamette Trustee of
each Willamette Trust will have its principal place of business or reside in the
State of Delaware (the "Delaware Trustee"). The Company will pay all fees and
expenses related to the Willamette Trusts and the offering of Trust Securities,
the payment of which will be guaranteed by the Company. The office of the
Delaware Trustee for each Willamette Trust in the State of
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<PAGE>
Delaware is Chase Manhattan Bank Delaware, 1201 North Market Street, Wilmington,
Delaware 19801. The principal place of business of each Willamette Trust shall
be c/o Willamette Industries, Inc., Attention: Chief Financial Officer, 1300
S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201, telephone: (503)
227-5581.
USE OF PROCEEDS
Unless otherwise indicated in a Prospectus Supplement with respect to
the proceeds from the sale of the particular Offered Securities to which such
Prospectus Supplement relates, the Company intends to add the net proceeds
received by it from the sale of Offered Securities to its general funds, to be
used for general corporate purposes, including capital expenditures, working
capital, and repayment of debt. Each Willamette Trust will use the net proceeds
received by it from the sale of Trust Preferred Securities to purchase Debt
Securities from the Company.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's ratio of earnings to fixed
charges for the periods indicated.
<TABLE>
<CAPTION>
Three Months
Ended March 31, Year Ended December 31,
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<S> <C> <C> <C> <C> <C> <C> <C>
1997 1996 1996 1995 1994 1993 1992
Ratio of Earnings to Fixed
Charges (1)(2)................. 1.51 7.38 3.68 10.83 4.25 3.06 2.56
</TABLE>
(1) The Company has authority to issue up to 5,000,000 shares of Preferred
Stock; there are currently no shares outstanding and the Company
currently does not have a Preferred Stock dividend obligation.
Therefore, the Ratio of Combined Earnings to Fixed Charges and
Preferred Stock Dividends is equal to the Ratio of Earnings to Fixed
Charges and is not disclosed separately.
(2) For purposes of computing the ratio, "earnings" consist of income
before income taxes, plus fixed charges. "Fixed charges" consist of
interest expense plus one-third of rent expense (which is deemed
representative of an interest factor).
DESCRIPTION OF THE COMPANY'S DEBT SECURITIES
The particular terms of the Debt Securities offered by any Prospectus
Supplement and the extent, if any, to which such general provisions may apply to
the Debt Securities so offered will be described in the Prospectus Supplement
relating to such Debt Securities.
The Debt Securities may be issued, from time to time, in one or more
series and will constitute either Senior Debt Securities or Subordinated Debt
Securities. Senior Debt Securities will be issued under an Indenture dated
January 30, 1993 (the "Senior Debt Securities Indenture"), between the Company
and The Chase Manhattan Bank, as trustee (the "Senior Debt Securities Trustee").
The Subordinated Debt Securities will be issued under an Indenture (the
"Subordinated Debt Securities Indenture") to be entered into between the Company
and the Subordinated Debt Securities Trustee.
The Senior Debt Securities Indenture and the Subordinated Debt
Securities Indenture are referred to herein individually as an "Indenture" and,
collectively, as the "Indentures," and the Senior Debt Securities Trustee and
the Subordinated Debt Securities Trustee are referred to herein as the
"Trustee."
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<PAGE>
The following summaries of certain provisions of the Debt Securities
and the Indentures do not purport to be complete and are subject to, and are
qualified in their entirety by express reference to, all the provisions of the
Indentures, including the definitions therein of certain terms. Certain
capitalized terms herein are defined in the Indentures.
GENERAL
The Debt Securities will be unsecured obligations of the Company. The
Indentures do not limit the aggregate principal amount of Debt Securities which
may be issued thereunder and provide that Debt Securities may be issued
thereunder, from time to time, in one or more series.
The Prospectus Supplement relating to the Debt Securities being offered
(the "Offered Debt Securities") will specify, among other things: (1) the title
of the Offered Debt Securities; (2) any limit on the aggregate principal amount
of the Offered Debt Securities; (3) the date or dates on which the Offered Debt
Securities will mature; (4) the rate or rates (which may be fixed or variable)
per annum at which the Offered Debt Securities will bear interest or the method
by which such rate or rates shall be determined and the date from which such
interest will accrue or the method by which such date shall be determined; (5)
the dates on which any such interest will be payable and the Regular Record
Dates for such Interest Payment Dates; (6) the dates, if any, on which, and the
price or prices at which, the Offered Debt Securities may, pursuant to any
mandatory or optional sinking fund provisions, be redeemed by the Company and
other detailed terms and provisions of such sinking funds; (7) the date, if any,
after which, and the price or prices at which, the Offered Debt Securities may,
pursuant to any optional redemption provisions, be redeemed at the option of the
Company or of the Holder thereof and other detailed terms and provisions of such
optional redemption; (8) the right of the Company, if any, to defer payment of
interest on the Offered Debt Securities and the maximum length of any such
deferral period; (9) the right of Holders, if any, to put the Offered Debt
Securities to the Company; (10) the currency unit, if other than United States
dollars, of payment of principal, and premium and interest, if any, on the
Offered Debt Securities; (11) the applicability of certain provisions of the
Indentures as described under "Defeasance and Covenant Defeasance"; and (12) any
other terms of the Offered Debt Securities (which terms shall not be
inconsistent with the Indenture).
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the principal of, and any premium or interest, if any, on, the Offered
Debt Securities will be payable, and the Offered Debt Securities will be
exchangeable and transfers thereof will be registrable, at the Place of Payment,
provided that, at the option of the Company, payment of interest may be made by
check mailed to the address of the person entitled thereto as it appears in the
Security Register.
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the Offered Debt Securities will be issued in United States dollars in
fully registered form, without coupons, in denominations of $1,000 or any
integral multiple thereof. No service charge will be made for any transfer or
exchange of the Offered Debt Securities, but the Company may require payment of
a sum sufficient to cover any tax or other governmental charge payable in
connection therewith.
CERTAIN COVENANTS OF THE COMPANY
For purposes of the descriptions of both the Senior Debt Securities and
the Subordinated Debt Securities, certain defined terms have the following
meanings:
"Subsidiary" of the Company is defined as a corporation more than 50%
of the outstanding voting stock of which is owned, directly or indirectly, by
the Company and/or one or more Subsidiaries of the Company.
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"Restricted Subsidiary" is defined as a Subsidiary of the Company substantially
all the property of which is located, or substantially all the business of which
is carried on, within the present 50 states of the United States or in Canada
and which owns a Principal Property, excluding, however, any Subsidiary of the
Company which is primarily engaged in the development and sale or financing of
real property. "Principal Property" is defined as (i) any mill, converting
plant, or manufacturing plant owned by the Company or a Restricted Subsidiary
which is located within the present 50 states of the United States or in Canada
and the gross book value of which (without deduction of any depreciation
reserves) on the date as of which the determination is made exceeds 1% of
Consolidated Net Tangible Assets, and (ii) Timberlands other than those being
held primarily for development or sale; such property, however, will exclude (a)
any property which in the opinion of the Board of Directors of the Company is
not of material importance to the total business conducted by the Company and
its Restricted Subsidiaries as an entirety or (b) any portion of a particular
property which is similarly found not to be of material importance to the use or
operation of such property or (c) any oil, gas or other minerals or mineral
rights. "Attributable Debt" is defined as the total net amount of rent required
to be paid during the remaining primary term of certain leases, discounted at
the rate of 15% per annum. "Consolidated Net Tangible Assets" is defined as the
aggregate amount of assets after deducting (i) all liabilities, other than
deferred income taxes, Funded Debt and shareholders' equity, and (ii) goodwill
and like intangibles, of the Company and its consolidated Subsidiaries. "Funded
Debt" is defined as all indebtedness for money borrowed having a maturity of
more than 12 months from the date as of which the determination is made (or
being renewable beyond such period) and rental obligations (at the amount
capitalized) payable more than 12 months from such date under capitalized
leases.
Restrictions on Secured Debt
The Indentures provide that the Company may not, nor may it permit any
Restricted Subsidiary to, create, assume or guarantee any loan or evidence of
indebtedness for money borrowed ("Debt") secured by a mortgage, pledge or lien
("Mortgage") on any Principal Property of the Company or any Restricted
Subsidiary, or on any share of Capital Stock or Debt of any Restricted
Subsidiary, without securing or causing such Restricted Subsidiary to secure the
Debt Securities equally and ratably with (or, at the Company's option, prior to)
such secured Debt, unless the aggregate amount of all such secured Debt,
together with all Attributable Debt with respect to sale and leaseback
transactions involving Principal Properties (with the exception of such
transactions which are excluded as described in "Restrictions on Sale of
Leaseback Transactions" below), would not exceed 10% of Consolidated Net
Tangible Assets.
This restriction does not apply to, and there shall be excluded from
secured Debt in any computation under such restriction, Debt secured by: (a)
Mortgages on property of, or on any shares of Capital Stock of or Debt of, any
corporation existing at the time such corporation becomes a Restricted
Subsidiary, (b) Mortgages in favor of the Company or a Restricted Subsidiary,
(c) Mortgages in favor of governmental bodies to secure progress or advance
payments, (d) Mortgages on property, shares of stock or Debt existing at the
time of acquisition thereof (including acquisition through merger or
consolidation) and purchase money and construction Mortgages which are entered
into within specified time limits, (e) Mortgages securing industrial revenue or
pollution control bonds, and (f) any extension, renewal or refunding of any
Mortgages referred to in the foregoing clauses (a) through (e), inclusive.
Restrictions on Sale and Leaseback Transactions
The Indentures provide that neither the Company nor any Restricted
Subsidiary may enter into any sale and leaseback transaction involving any
Principal Property, unless the aggregate amount of all Attributable Debt with
respect to such sale and leaseback transactions, plus all secured Debt (with the
exception of secured Debt
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which is excluded as described in "Restrictions on Secured Debt" above), would
not exceed 10% of Consolidated Net Tangible Assets.
This restriction does not apply to, and there shall be excluded from
Attributable Debt in any computation under such restriction, any sale and
leaseback transaction if (a) the lease is for a period, including renewal
rights, of not in excess of three years, (b) the sale or transfer of the
Principal Property is made within a specified period after its acquisition or
construction, (c) the lease secures or relates to industrial revenue or
pollution control bonds, (d) the transaction is between the Company and a
Restricted Subsidiary or between Restricted Subsidiaries or (e) the Company or
such Restricted Subsidiary, within 180 days after the sale is completed, applies
to the retirement of Funded Debt of the Company or a Restricted Subsidiary, or
the purchase of other property which will constitute Principal Property of a
value at least equal to the value of the Principal Property leased, an amount
not less than the greater of (i) the net proceeds of the sale of the Principal
Property leased or (ii) the fair market value of the Principal Property leased;
provided that the amount of proceeds to be applied to the retirement of Funded
Debt shall be reduced by an amount, if any, equal to the principal amount of
debentures or notes (including the Debt Securities) of the Company or a
Restricted Subsidiary surrendered for cancellation to the applicable trustee
thereof and the principal amount of other Funded Debt voluntarily retired, in
each case within 180 days after such sale.
Restrictions on Funded Debt of Restricted Subsidiaries
The Indentures provide that the Company may not permit any Restricted
Subsidiary to create, assume or guarantee any Funded Debt except (i) Funded Debt
owed to the Company or a Restricted Subsidiary, (ii) Funded Debt secured by
Mortgages permitted as described under "Restrictions on Secured Debt," (iii)
Funded Debt of any corporation outstanding at the time such corporation became a
Restricted Subsidiary, (iv) Funded Debt of any person outstanding at the time of
its acquisition, or the acquisition of substantially all its properties, by such
Restricted Subsidiary, (v) Funded Debt incurred in connection with certain
refundings, (vi) Funded Debt constituting Attributable Debt permitted as
described under "Restrictions on Sale and Leaseback Transactions" and (vii) any
other Funded Debt if the aggregate principal amount of all Funded Debt of all
Restricted Subsidiaries permitted under this clause (vii) does not exceed 10% of
Consolidated Net Tangible Assets.
EVENTS OF DEFAULT
The following are Events of Default under the Indentures with respect
to the Debt Securities of any series: (a) default in the payment of principal of
or any premium on any Debt Security of that series when due; (b) default in the
payment of any interest on any Debt Security of that series when due continued
for 30 days; (c) default in the deposit of any sinking fund payment, when due,
in respect of any Debt Security of that series; (d) default in the performance
of any other covenant of the Company in the Indentures (other than a covenant
included in the Indentures solely for the benefit of a series of the Debt
Securities other than that series), continued for 90 days after written notice
as provided in the Indenture; (e) certain events in bankruptcy, insolvency or
reorganization; and (f) any other Event of Default provided with respect to Debt
Securities of a particular series. No Event of Default with respect to the Debt
Securities of a particular series necessarily constitutes an Event of Default
with respect to the Debt Securities of any other series.
If an Event of Default with respect to the Debt Securities of any
series at the time Outstanding occurs and is continuing, either the Trustee or
the Holders of at least 25% in aggregate principal amount of the Outstanding
Debt Securities of that series may declare the principal amount (or, if the Debt
Securities of that series are original issue discount Debt Securities, such
portion of the principal amount as may be specified in the terms of that series)
of all the Debt Securities of that series to be due and payable immediately. At
any time after a declaration of acceleration with respect to the Debt Securities
of any series has been made, but before a judgment
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or decree based on acceleration has been obtained, the Holders of a majority in
principal amount of the Outstanding Debt Securities of that series may, under
certain circumstances, rescind and annul such acceleration.
The Indentures provide that, subject to the duty of the Trustee during
the continuance of an Event of Default to act with the required standard of
care, the Trustee will be under no obligation to exercise any of its rights or
powers under the Indenture at the request or direction of any of the Holders,
unless such Holders shall have offered to the Trustee reasonable indemnity.
Subject to such provisions for the indemnification of the Trustee, the Holders
of a majority in principal amount of the Outstanding Debt Securities of any
series will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee, with respect to the Debt Securities of that
series. The right of a Holder of any Debt Security to institute a proceeding
with respect to the Indenture is subject to certain conditions precedent, but
each Holder has an absolute right to receive payment of principal or premium and
interest, if any, when due and to institute suit for the enforcement of any such
payment.
The Company is required to furnish to the Trustee annually a statement
as to the performance by the Company of its obligations under the Indentures and
as to any default in such performance.
The Debt Securities may be issued under the Indentures as Original
Issue Discount Securities to be offered and sold at a substantial discount below
their principal amount. Special federal income tax, accounting and other
considerations applicable to any such Original Issue Discount Securities will be
described in any Prospectus Supplement relating thereto. "Original Issue
Discount Security" means any security which provides for an amount less than the
principal amount thereof to be due and payable upon a declaration of
acceleration of the maturity thereof as a result of the occurrence of an Event
of Default and the continuation thereof.
BOOK-ENTRY DEBT SECURITIES
The Debt Securities of a series may be issued in whole or in part in
the form of one or more Global Securities (as such term is defined below) that
will be deposited with, or on behalf of, a Depositary ("Depositary") or its
nominee identified in the applicable Prospectus Supplement. In such a case, one
or more Global Securities will be issued in a denomination or aggregate
denomination equal to the portion of the aggregate principal amount of
outstanding Debt Securities of the series to be represented by such Global
Security or Global Securities. Unless and until it is exchanged in whole or in
part for Debt Securities in registered form, a Global Security may not be
registered for transfer or exchange except as a whole by the Depositary for such
Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any nominee to a successor Depositary or a nominee of such
successor Depositary and except in the circumstances described in the applicable
Prospectus Supplement. The term "Global Security", when used with respect to any
series of Debt Securities, means a Debt Security that is executed by the Company
and authenticated and delivered by the Trustee to the Depositary or pursuant to
the Depositary's instruction, which shall be registered in the name of the
Depositary or its nominee and which shall represent, and shall be denominated in
an amount equal to the aggregate principal amount of, all of the Outstanding
Debt Securities of such series or any portion thereof, in either case having the
same terms, including, without limitation, the same original issue date, date or
dates on which principal is due, and interest rate or method of determining
interest.
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
will be described in the applicable Prospectus Supplement. The Company expects
that the following provisions will apply to depositary arrangements. Unless
otherwise specified in the applicable Prospectus Supplement, Debt Securities
which are to be represented by a Global Security to be deposited with or on
behalf of a Depositary will be represented by a Global Security registered in
the name of
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such Depositary or its nominee. Upon the issuance of such Global Security, and
the deposit of such Global Security with or on behalf of the Depositary for such
Global Security, the Depositary will credit, on its book-entry registration and
transfer system, the respective principal amounts of the Debt Securities
represented by such Global Security to the accounts of institutions that have
accounts with such Depositary or its nominee ("participants"). The accounts to
be credited will be designated by the underwriters or agents of such Debt
Securities or, if such Debt Securities are offered and sold directly by the
Company, by the Company. Ownership of beneficial interests in such Global
Security will be limited to participants or Persons that may hold interests
through participants. Ownership of beneficial interests by participants in such
Global Security will be shown on, and the transfer of that ownership interest
will be effected only through, records maintained by the Depositary or its
nominee for such Global Security. Ownership of beneficial interests in such
Global Security by Persons that hold through participants will be shown on, and
the transfer of that ownership interest within such participant will be effected
only through, records maintained by such participant. The laws of some
jurisdictions require that certain purchasers of securities take physical
delivery of such securities in certificated form. The foregoing limitations and
such laws may impair the ability to transfer beneficial interests in such Global
Securities.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or Holder of the Securities
represented by such Global Security for all purposes under the Indenture. Unless
otherwise specified in the applicable Prospectus Supplement, owners of
beneficial interests in such Global Security will not be entitled to have Debt
Securities of the series represented by such Global Security registered in their
names, will not receive or be entitled to receive physical delivery of Debt
Securities of such series in certificated form and will not be considered the
Holders thereof for any purposes under the Indenture. Accordingly, each Person
owning a beneficial interest in such Global Security must rely on the procedures
of the Depositary and, if such Person is not a participant, on the procedures of
the participant through which such Person owns its interest, to exercise any
rights of a Holder under the Indenture. The Company understands that under
existing industry practices, if the Company requests any action of Holders or an
owner of a beneficial interest in such Global Security desires to give any
notice or take any action a Holder is entitled to give or take under the
Indenture, the Depositary would authorize the participants to give such notice
or take such action, and participants would authorize beneficial owners owning
through such participants to give such notice or take such action or would
otherwise act upon the instructions of beneficial owners owning through them.
Principal of and any premium and interest on a Global Security will be
payable in the manner described in the applicable Prospectus Supplement.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the
Outstanding Debt Securities under the Indentures, may consolidate with or merge
into, or transfer its assets substantially as an entirety to, any corporation
organized under the laws of any domestic jurisdiction, and any other person may
consolidate with, or merge into, or transfer its assets substantially as an
entirety to the Company provided that (i) the successor corporation (if any)
assumes the Company's obligations on the Debt Securities and under the
Indentures, (ii) after giving effect to the transaction and treating any
indebtedness which becomes an obligation of the Company or a Subsidiary as a
result of such transaction as having been incurred by the Company or the
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time, would become an Event of Default, shall
have occurred and be continuing, (iii) if as a result of the transaction a
Principal Property would become subject to a Mortgage which would not be
permitted by the Indentures, the Debt Securities shall be secured equally with
(or prior to) the indebtedness secured thereby, and (iv) certain other
conditions are met.
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DEFEASANCE AND COVENANT DEFEASANCE
The Indentures provide, if such provision is made applicable to the
Debt Securities of any series (which will be indicated in the Prospectus
Supplement) that the Company may elect either (a) to defease and be discharged
from any and all obligations in respect of the Debt Securities of such series
(except for certain obligations to register the transfer or exchange of Debt
Securities of such series, to replace mutilated, destroyed, lost or stolen Debt
Securities of such series, to maintain paying agencies and to hold moneys for
payment in trust) ("defeasance") or (b) to be released from its obligations with
respect to the Debt Securities of such series under certain restrictive
covenants of the Indenture, including those described under "Certain Covenants
of the Company," and "Consolidation, Merger and Sale of Assets" ("covenant
defeasance") and the occurrence of an event described in clause (d) under
"Events of Default" shall no longer be an Event of Default with respect to the
Debt Securities of such series, in each case, if the Company deposits, in trust,
with the Trustee money and/or Government Obligations, which through the payment
of interest thereon and principal thereof in accordance with their terms will
provide money in an amount sufficient, without reinvestment, to pay the
principal of and any premium and interest on the Outstanding Debt Securities of
such series and any mandatory sinking fund payments or analogous payments in
accordance with the terms of the Outstanding Debt Securities of such series and
the Indentures. Such a trust may only be established if, among other things, (i)
no Event of Default or event which with the giving of notice or lapse of time,
or both, would become an Event of Default with respect to such series under the
Indentures shall have occurred and be continuing on the date of such deposit,
(ii) such deposit will not cause the Trustee to have any conflicting interest
with respect to other securities of the Company and (iii) the Company shall have
delivered an Opinion of Counsel to the effect that the Holders will not
recognize income, gain or loss for federal income tax purposes as a result of
such defeasance and will be subject to federal income tax on the same amounts,
in the same manner, and at the same times as if such defeasance had not
occurred. In the event the Company exercises its covenant defeasance option with
respect to the Debt Securities of any series and the Debt Securities of such
series are declared due and payable because of the occurrence of any Event of
Default, the amount of money and Government Obligations on deposit with the
Trustee will be sufficient to pay amounts due on the Debt Securities of such
series at the time of their Stated Maturity but may not be sufficient to pay
amounts due on the Debt Securities of such series at the time of the
acceleration resulting from such Event of Default. However, the Company will
remain liable with respect to such payments.
MODIFICATION AND WAIVER
Modifications and amendments of the Indentures may be made by the
Company and the Trustee with the consent of the Holders of a majority in
principal amount of the Outstanding Debt Securities of each series affected by
such modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Debt
Security affected thereby, (a) change the stated maturity date of the principal
of, or any installment of principal of or interest, if any, on, any Debt
Security, (b) reduce the principal amount of, or premium or rate of interest, if
any, on, any Debt Security, (c) reduce the amount of principal of an original
issue discount Debt Security payable upon acceleration of the maturity thereof,
(d) change the place or currency of payment of principal of, or premium or
interest, if any, on, any Debt Security, (e) impair the right to institute suit
for the enforcement of any payment on or with respect to any Debt Security, (f)
change the provisions for defeasance or covenant defeasance (each as defined
below) made applicable to any Debt Security, or (g) reduce the percentage in
principal amount of Outstanding Debt Securities of any series, the consent of
whose Holders is required for modification or amendment of the Indentures or for
waiver of compliance with certain provisions of the Indenture or for waiver of
certain defaults.
The Holders of a majority in principal amount of the Outstanding Debt
Securities of each series may, on behalf of all Holders of the Debt Securities
of that series, waive, insofar as that series is concerned, compliance by the
Company with certain restrictive provisions of the Indentures. The Holders of a
majority in aggregate
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principal amount of the Outstanding Debt Securities of each series may, on
behalf of all Holders of the Debt Securities of that series, waive any past
default under the Indentures with respect to the Debt Securities of that series,
except a default in the payment of principal, or premium or interest, if any, or
in respect of a covenant or condition which cannot be waived without the consent
of each Holder of the Debt Securities of that series.
REGARDING THE TRUSTEE
The Company maintains deposit accounts and conducts other banking
transactions with The Chase Manhattan Bank in the ordinary course of the
Company's business. The Chase Manhattan Bank serves as trustee under another
indenture with respect to certain of the Company's other senior debt securities.
PARTICULAR TERMS OF THE SENIOR DEBT SECURITIES
The particular terms of the Senior Debt Securities offered by any
Prospectus Supplement and the extent, if any, to which the general provisions
applicable to Debt Securities as described above may apply to the Senior Debt
Securities so offered will be described in the Prospectus Supplement relating to
such Senior Debt Securities.
PARTICULAR TERMS OF THE SUBORDINATED DEBT SECURITIES
The particular terms of the Subordinated Debt Securities offered by any
Prospectus Supplement and the extent, if any, to which the general provisions
applicable to Debt Securities as described above may apply will be described in
the Prospectus Supplement relating to such Subordinated Debt Securities.
For purposes of the description of the Subordinated Debt Securities,
certain defined terms have the following meanings:
"Senior Indebtedness" means the principal of and premium, if any, and
interest on the following, whether outstanding on the date of execution of the
Subordinated Debt Securities Indenture or thereafter incurred or created: (i)
indebtedness of the Company for money borrowed by the Company (including
purchase money obligations with an original maturity in excess of one year) or
evidenced by debentures (other than the Subordinated Debt Securities), notes,
bankers' acceptances or other corporate debt securities or similar instruments
issued by the Company; (ii) obligations with respect to letters of credit; (iii)
indebtedness of the Company constituting a guarantee of indebtedness of others
of the type referred to in the preceding clauses (i) and (ii); or (iv) renewals,
extensions or refundings of any of the indebtedness referred to in the preceding
clauses (i), (ii) and (iii) unless, in the case of any particular indebtedness,
renewal, extension or refunding, under the express provisions of the instrument
creating or evidencing the same, or pursuant to which the same is outstanding,
such indebtedness or such renewal, extension or refunding thereof is not
superior in right of payment to the Subordinated Debt Securities.
SUBORDINATION
The payment of the principal of, premium, if any, and interest on the
Subordinated Debt Securities will be subordinated in right of payment to the
prior payment in full of all Senior Indebtedness of the Company. No payment on
account of principal of, premium, if any, or interest on the Subordinated Debt
Securities and no acquisition of, or payment on account of any sinking fund for,
the Subordinated Debt Securities may be made unless full payment of amounts then
due for principal, premium, if any, and interest then due on all Senior
Indebtedness by reason of the maturity thereof (by lapse of time, acceleration
or otherwise) has been made or duly provided for in cash or in a manner
satisfactory to the Holders of such Senior Indebtedness. In addition, the
Subordinated Debt Securities Indenture provides that if a default has occurred
giving the holders of such Senior
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Indebtedness the right to accelerate the maturity thereof, or an event has
occurred which, with the giving of notice, or lapse of time, or both, would
constitute such an event of default, then unless and until such event shall have
been cured or waived or shall have ceased to exist, no payment on account of
principal, premium, if any, or interest on the Subordinated Debt Securities and
no acquisition of, or payment on account of a sinking fund for, the Subordinated
Debt Securities may be made. The Company shall give prompt written notice to the
Trustee of any default under any Senior Indebtedness or under any agreement
pursuant to which Senior Indebtedness may have been issued. The Subordinated
Debt Securities Indenture provisions described in this paragraph, however, do
not prevent the Company from making a sinking fund payment with Subordinated
Debt Securities acquired prior to the maturity of Senior Indebtedness or, in the
case of default, prior to such default and notice thereof. Upon any distribution
of its assets in connection with any dissolution, liquidation or reorganization
of the Company, all Senior Indebtedness must be paid in full before the Holders
of the Subordinated Debt Securities are entitled to any payments whatsoever. As
a result of these subordination provisions, in the event of the Company's
insolvency, holders of the Subordinated Debt Securities may recover ratably less
than senior creditors and other creditors of the Company.
In the case of Subordinated Debt Securities issued to a Willamette
Trust, if an Event of Default has occurred and is continuing and such event is
attributable to the failure of the Company to pay interest or principal, then a
holder of Trust Preferred Securities of such Willamette Trust may directly
institute a proceeding against the Company for payment.
DESCRIPTION OF PREFERRED STOCK AND COMMON STOCK
The authorized capital stock of the Company consists of 5,000,000
shares of Preferred Stock issuable in series, and 150,000,000 shares of Common
Stock.
The board of directors of the Company is authorized to divide the
Preferred Stock into series and to determine the preferences, limitations and
relative rights of each series. The preferences, limitations, and relative
rights of any series of Preferred Stock offered by any Prospectus Supplement
(including, without limitation, the designation and seniority and number of
shares, the rate and time of payment of dividends, if any, thereon (or method of
computing the same), the amount of any liquidation preference, any rights of
conversion or exchange, voting rights, if any, and any optional or mandatory
redemption provisions) will be described in the applicable Prospectus
Supplement.
The board of directors has established a series of Preferred Stock
designated as Series A Junior Participating Preferred Stock ("Series A Preferred
Stock"), comprising 500,000 shares of Preferred Stock. Subject to superior
rights of any other outstanding Preferred Stock, each share of Series A
Preferred Stock is entitled to receive, in preference to the Common Stock,
quarterly cumulative dividends equal to 200 times the quarterly dividend paid
with respect to each share of Common Stock, but not less than $1.00. Each share
of Series A Preferred Stock is entitled to 200 votes on all matters submitted to
a vote of the shareholders. In the event of liquidation of the Company, each
share of Series A Preferred Stock is entitled to receive, in preference to the
Common Stock, a liquidation payment of the greater of (i) $1.00 plus all accrued
and unpaid dividends and distributions and (ii) an amount equal to 200 times the
aggregate amount to be distributed per share of Common Stock. In the event of
any merger or other transaction in which Common Stock is to be exchanged, each
share of Series A Preferred Stock shall be entitled to receive 200 times the
amount received per share of Common Stock. The rights of holders of the Series A
Preferred Stock are subject to adjustment under certain circumstances to prevent
dilution. Series A Preferred Stock is not redeemable.
Shares of Common Stock and Series A Preferred Stock vote together as a
single class on all corporate matters (except for certain matters affecting the
Series A Preferred Stock or as otherwise required by law).
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Shares of Common Stock are entitled to one vote per share. Voting for directors
is not cumulative. The board of directors is divided into three classes serving
staggered three-year terms.
Holders of Common Stock are entitled to dividends when, as, and if
declared by the board of directors out of funds legally available therefor
(subject to the rights of holders of any Preferred Stock). Common Stock is not
convertible into any other class of security, is not entitled to the benefit of
any sinking fund provision, and does not have any preemptive rights. All
outstanding shares of Common Stock are fully paid and nonassessable. Upon
liquidation of the Company, after payment or provision for all liabilities and
payment of any preferential amount in respect of Preferred Stock, holders of
Common Stock are entitled to receive liquidating distributions of any remaining
assets on a pro rata basis.
Article VI of the Company's articles of incorporation provides that
certain business combinations involving the Company and any shareholder which,
together with its affiliates, is the beneficial owner of 20 percent or more of
the Company's outstanding shares of capital stock, require the affirmative vote
of the holders of at least 80 percent of the outstanding shares of capital
stock. The 80 percent voting requirement does not apply (i) in the case of a
business combination which provides for conversion of Common Stock into cash,
securities or property having a fair market value not less than the highest
per-share price paid by such shareholder and its affiliates within one year
prior to the date of the vote, (ii) if the vote is required by the statutory
Business Combination provisions discussed below or (iii) under certain
circumstances, if the transaction is approved by the board of directors. The
articles of incorporation also provide that directors of the Company may be
removed at a meeting called expressly for that purpose by the affirmative vote
of the holders of not less than 80 percent of the outstanding shares of capital
stock.
The Company has distributed to holders of Common Stock, rights to
purchase shares of Series A Preferred Stock ("Rights") which are held on the
basis of .5 Right for each share of Common Stock held. The Rights are not
exercisable and are attached to and trade with shares of Common Stock until the
earlier of (i) 10 days following a public announcement that a person or group
has acquired beneficial ownership (as defined) of 20 percent or more of the
outstanding Common Stock (other than the Company, any subsidiary of the Company,
any employee benefit plan of the Company or any subsidiary of the Company, any
entity holding shares of Common Stock for or pursuant to the terms of any such
plan, or a person who acquires shares in a tender offer sanctioned by the board
of directors) and (ii) 10 business days following the commencement or
announcement of certain offers to acquire beneficial ownership of 30 percent or
more of the outstanding Common Stock. Upon such an event, the Rights will trade
separately and will become exercisable. Until a Right is exercised, the holder
thereof will have no rights as a shareholder of the Company, including, without
limitation, the right to vote or to receive dividends.
When the Rights first become exercisable, one Right will entitle the
holder to buy from the Company one one-hundredth of a share of Series A
Preferred Stock at a price of $175. Upon acquisition of beneficial ownership of
20 percent or more of the outstanding Common Stock by a person or group
described above, each Right will entitle the holder (other than such person or
group) to buy from the Company for $175 shares of Common Stock having a market
value of $350. If the Company is acquired in a business combination, or a
majority of its assets is acquired, after a person or group described above
acquires beneficial ownership of 20 percent or more of the outstanding Common
Stock, each Right will thereafter entitle the holder (other than such person or
group) to acquire for $175 shares of common stock of the acquiring or surviving
person with a market value of $350. Following the occurrence of any of the
events described in the preceding two sentences, any Rights that are or (under
certain circumstances) were beneficially owned by any such person or group shall
immediately become null and void. The purchase price for Series A Preferred
Stock and the number of Series A Preferred Stock shares or other securities
issuable upon exercise of Rights are subject to adjustment to prevent dilution.
- 15 -
<PAGE>
Outstanding Rights will expire at the close of business on February 25,
2000. The Rights will also expire upon consummation of a business combination
with a person who acquires shares of Common Stock in a tender offer sanctioned
by the board of directors if shareholders receive the same consideration as was
paid in the tender offer. Until the close of business on the tenth day following
public announcement that a person or group described above has acquired
beneficial ownership of 20 percent or more of the outstanding shares of Common
Stock, the Rights may be redeemed, in whole but not in part, at the Company's
election at a price of $.01 per right. After a person or group described above
acquires beneficial ownership of 20 percent or more of the outstanding Common
Stock, but before the person or group acquires beneficial ownership of 50
percent or more of the outstanding Common Stock, the Company may exchange some
or all of the then outstanding Rights for one share of Common Stock per Right,
subject to adjustment in certain circumstances.
Before the Rights become exercisable, the Company may amend the Rights
Agreement in any manner without the approval of the holders of Common Stock and
thereafter the Company may, subject to certain limitations, amend the Rights
Agreement without the approval of the holders of Rights.
The Company is subject to the Oregon Control Share Act (the "Control
Share Act"). The Control Share Act provides in essence that a person (an
"Acquiring Person") who acquires voting stock in a transaction which results in
its holding more than 20 percent, 33-1/3 percent or 50 percent of the total
voting power of the Company (a "Control Share Acquisition") cannot vote the
shares it acquires in the Control Share Acquisition ("control shares") unless
voting rights are accorded to such control shares by the holders of a majority
of the outstanding voting shares, excluding the Acquiring Person and the
Company's officers and inside directors. The term Acquiring Person is broadly
defined to include persons acting as a group.
An Acquiring Person may, but is not required to, submit to the Company
an "Acquiring Person Statement" which delineates certain information about the
Acquiring Person and its plans for acquiring the Company's stock and requests
the Company to call a special meeting of shareholders to act on the question of
its voting rights. If an Acquiring Person does not request a special meeting of
shareholders, the matter shall be considered at the next annual or special
meeting of shareholders otherwise held. If an Acquiring Person's control shares
are accorded voting rights and its shares represent a majority or more of all
voting power, shareholders who do not vote in favor of the restoration of voting
rights will have the right to receive the appraised "fair value" for their
shares, which may not be less than the highest price paid per share by the
Acquiring Person for its shares in the Control Share Acquisition.
The Company is also subject to provisions of the Oregon Business
Corporation Act (the "Business Combination Provisions) which restrict the
ability of an Oregon corporation to engage in any business combination with an
interested shareholder ("Interested Shareholder"), as defined, for three years
after the shareholder becomes an Interested Shareholder, with certain
exceptions. An Interested Shareholder is defined to include a shareholder owning
15 percent or more of a corporation's stock. "Business combination" is defined
to include any merger with, any transfer of assets to and certain transactions
involving the issuance of shares to, the Interested Shareholder. A corporation
may, however, engage in a business combination with an Interested Shareholder if
(i) the corporation's board of directors approved the combination or the
transaction by which the shareholder became an Interested Shareholder before the
shareholder became an Interested Shareholder, (ii) the Interested Shareholder
acquired at least 85 percent of the voting stock (excluding shares held by
directors, officers, or certain employee share plans) when becoming an
Interested Shareholder, or (iii) the board of directors and shareholders holding
66-2/3 percent of the voting stock not owned by the Interested Shareholder
approve the business combination. A corporation's articles of incorporation may
not require a greater vote of shareholders than that specified in the Business
Combination Provisions for any vote required by the Business Combination
Provisions.
- 16 -
<PAGE>
PRICE RANGE OF THE COMPANY'S COMMON STOCK AND COMMON STOCK DIVIDENDS
The Company's Common Stock began trading on the NYSE on December 31,
1996. Before that date, the Common Stock traded on the NASDAQ National Market
System. The high and low closing sales prices of the Common Stock of the
Company, as reported in such markets, and the dividends declared on the Common
Stock, have been as follows:
<TABLE>
<CAPTION>
Per Share
-----------------------------------------------------------------
HIGH LOW CASH DIVIDENDS PAID
1995--
<S> <C> <C> <C>
First Quarter............................. $55.00 $46.75 $0.27
Second Quarter............................ 56.25 48.25 0.27
Third Quarter............................. 72.37 55.50 0.30
Fourth Quarter............................ 66.50 54.25 0.30
1996--
First Quarter............................. 60.25 49.25 0.31
Second Quarter............................ 64.25 57.50 0.31
Third Quarter............................. 68.00 56.50 0.31
Fourth Quarter............................ 70.50 62.50 0.31
1997--
First Quarter............................. 69.62 60.87 .32
Second Quarter............................ 76.87 60.12 .32
Third Quarter through July 29,
1997...................................... 77.37 70.50
</TABLE>
The closing price of Common Stock on July 29, 1997, was $76.44 per
share. The book value of the Company's Common Stock on December 31, 1996, was
$35.70 per share.
The timing and amount of future cash dividends will depend on the
earnings, capital requirements, and financial condition of the Company, and
other factors deemed relevant by the Company's Board of Directors.
DESCRIPTION OF THE WILLAMETTE TRUST PREFERRED SECURITIES
Each Willamette Trust may issue, from time to time, only one series of
Trust Preferred Securities having terms described in the Prospectus Supplement
relating thereto. The Declaration of each Willamette Trust authorizes the
Regular Trustees of such Willamette Trust to issue on behalf of such Willamette
Trust one series of Trust Preferred Securities. The Declaration will be
qualified as an indenture under the Trust Indenture Act. An independent trustee
(the "Institutional Trustee") will act as indenture trustee for the Trust
Preferred Securities, to be issued by each Willamette Trust, for the purposes of
compliance with the provisions of the Trust Indenture Act. The Trust Preferred
Securities will have such terms, including distributions, redemption, voting,
liquidation rights and such other preferred, deferred or other special rights or
such restrictions as shall be set forth in the Declaration or made part of the
Declaration by the Trust Indenture Act, and which will mirror the terms of the
Subordinated Debt Securities held by the Willamette Trust and as described in
the Prospectus Supplement related
- 17 -
<PAGE>
thereto. The Prospectus Supplement relating to any series of Trust Preferred
Securities will describe the specific terms thereof, including (i) the
distinctive designation of such Trust Preferred Securities; (ii) the number of
Trust Preferred Securities issued by such Willamette Trust; (iii) the annual
distribution rate (or method of determining such rate) for Trust Preferred
Securities issued by such Willamette Trust and the date or dates upon which such
distributions shall be payable; provided, however, that distributions on such
Trust Preferred Securities shall be payable on a periodic basis to holders of
such Trust Preferred Securities as of a record date in each period during which
such Trust Preferred Securities are outstanding; (iv) whether distributions on
Trust Preferred Securities issued by such Willamette Trust shall be cumulative,
and, in the case of Trust Preferred Securities having such cumulative
distribution rights, the date or dates or method of determining the date or
dates from which distributions on Trust Preferred Securities issued by such
Willamette Trust shall be cumulative; (v) the amount or amounts which shall be
paid out of the assets of such Willamette Trust to the holders of Trust
Preferred Securities of such Willamette Trust upon voluntary or involuntary
dissolution, winding-up or termination of such Willamette Trust; (vi) the
obligation, if any, of such Willamette Trust to purchase or redeem Trust
Preferred Securities issued by such Willamette Trust and the price or prices at
which, the period or periods within which, and the terms and conditions upon
which, Trust Preferred Securities issued by such Willamette Trust shall be
purchased or redeemed, in whole or in part, pursuant to such obligation (with
such redemption price to be determined through negotiations among the Company
and the Underwriters based on, among other factors, redemption prices of
securities similar to the Trust Preferred Securities and market conditions
generally); (vii) the voting rights, if any, of Trust Preferred Securities
issued by such Willamette Trust in addition to those required by law, including
the number of votes per Preferred Security and any requirement for the approval
by the holders of Trust Preferred Securities, or of Trust Preferred Securities
issued by one or more Willamette Trusts, or of both, as a condition to specified
action or amendments to the Declaration of such Willamette Trust; (viii) the
terms and conditions, if any, upon which the Subordinated Debt Securities held
by such Willamette Trust may be distributed to holders of Trust Preferred
Securities; (ix) if applicable, any securities exchange upon which the Trust
Preferred Securities shall be listed; and (x) any other relevant rights,
preferences, privileges, limitations or restrictions of Trust Preferred
Securities issued by such Willamette Trust not inconsistent with the Declaration
of such Willamette Trust or with applicable law. All Trust Preferred Securities
offered hereby will be guaranteed by the Company to the extent set forth below
under "Description of the Trust Preferred Securities Guarantees." The Trust
Preferred Securities Guarantee of the Company, when taken together with the
Company's obligations under the Subordinated Debt Securities and the relevant
Supplemental Indenture, and its obligations under each Declaration, including
obligations to pay costs, expenses, debts and liabilities of the Willamette
Trust (other than with respect to the Trust Securities), would provide a full
and unconditional guarantee of amounts due on Trust Preferred Securities issued
by each Willamette Trust. Certain United States federal income tax
considerations applicable to any offering of Trust Preferred Securities will be
described in the Prospectus Supplement relating thereto.
In connection with the issuance of Trust Preferred Securities, each
Willamette Trust will issue one series of Common Securities. The Declaration of
each Willamette Trust authorizes the Regular Trustees of such trust to issue on
behalf of such Willamette Trust one series of Common Securities having such
terms including distributions, redemption, voting, liquidation rights or such
restrictions as shall be set forth therein. The terms of the Common Securities
issued by a Willamette Trust will be substantially identical to the terms of the
Trust Preferred Securities issued by such trust and the Common Securities will
rank pari passu, and payments will be made thereon pro rata, with the Trust
Preferred Securities except that, upon an event of default under the
Declaration, the rights of the holders of the Common Securities to payment in
respect of distributions and payments upon liquidation, redemption and otherwise
will be subordinated to the rights of the holders of the Trust Preferred
Securities. Except in certain limited circumstances, the Common Securities will
also carry the right to vote to appoint, remove or replace any of the Willamette
Trustees of a Willamette Trust. All of the Common Securities of each Willamette
Trust will be directly or indirectly owned by the Company.
- 18 -
<PAGE>
If an Event of Default under the Declaration of a Willamette Trust
occurs and is continuing, then the holders of Trust Preferred Securities of such
Willamette Trust would rely on the enforcement by the Institutional Trustee of
its rights as a holder of the applicable series of Subordinated Debt Securities
against the Company. In addition, the holders of a majority in liquidation
amount of the Trust Preferred Securities of such a Willamette Trust will have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Institutional Trustee or to direct the exercise of
any trust or power conferred upon the Institutional Trustee under the applicable
Declaration, including the right to direct the Institutional Trustee to exercise
the remedies available to it as a holder of the Subordinated Debt Securities. If
the Institutional Trustee fails to enforce its rights under the applicable
series of Subordinated Debt Securities, a holder of Trust Preferred Securities
of such Willamette Trust may institute a legal proceeding directly against the
Company to enforce the Institutional Trustee's rights under the applicable
series of Subordinated Debt Securities without first instituting any legal
proceeding against the Institutional Trustee or any other person or entity.
Notwithstanding the foregoing, if an Event of Default under the applicable
Declaration has occurred and is continuing and such event is attributable to the
failure of the Company to pay interest or principal on the applicable series of
Subordinated Debt Securities on the date such interest or principal is otherwise
payable (or in the case of redemption, on the redemption date), then a holder of
Trust Preferred Securities of such Willamette Trust may directly institute a
proceeding for enforcement of payment to such holder of the principal of or
interest on the applicable series of Subordinated Debt Securities having a
principal amount equal to the aggregate liquidation amount of the Trust
Preferred Securities of such holder (a "Direct Action") on or after the
respective due date specified in the applicable series of Subordinated Debt
Securities. In connection with such Direct Action, the Company will be
subrogated to the rights of such holder of Trust Preferred Securities under the
applicable Declaration to the extent of any payment made by the Company to such
holder of Trust Preferred Securities in such Direct Action.
DESCRIPTION OF THE TRUST PREFERRED SECURITIES GUARANTEES
Each Trust Preferred Securities Guarantee will be qualified as an
indenture under the Trust Indenture Act. An independent trustee will act as
indenture trustee under each Trust Preferred Securities Guarantee (the
"Preferred Guarantee Trustee") for the purposes of compliance with the
provisions of the Trust Indenture Act. The following summary does not purport to
be complete and is subject in all respects to the provisions of, and is
qualified in its entirety by reference to, the form of Trust Preferred
Securities Guarantee, which is filed as an exhibit to the Registration Statement
of which this Prospectus forms a part, and the Trust Indenture Act. Each Trust
Preferred Securities Guarantee will be held by the Preferred Guarantee Trustee
for the benefit of the holders of the Trust Preferred Securities of the
applicable Willamette Trust.
Pursuant to each Trust Preferred Securities Guarantee, the Company will
irrevocably and unconditionally agree, to the extent set forth therein, to pay
in full, to the holders of the Trust Preferred Securities issued by a Willamette
Trust, the Guarantee Payments (as defined herein) (except to the extent paid by
such Willamette Trust), as and when due, regardless of any defense, right of
set-off or counterclaim which such Willamette Trust may have or assert. The
following payments or distributions with respect to Trust Preferred Securities
issued by a Willamette Trust to the extent not paid by such Willamette Trust
(the "Guarantee Payments"), will be subject to the Trust Preferred Securities
Guarantee thereon (without duplication): (i) any accrued and unpaid
distributions which are required to be paid on such Trust Preferred Securities,
to the extent such Willamette Trust shall have funds available therefore; (ii)
the redemption price (the "Redemption Price") and all accrued and unpaid
distributions to the date of redemption to the extent such Willamette Trust has
funds available therefore with respect to any Trust Preferred Securities called
for redemption by such Willamette Trust and (iii) upon a voluntary or
involuntary dissolution, winding-up or termination of such Willamette Trust
(other than in connection with the distribution of Subordinated Debt Securities
to the holders of Trust Preferred Securities or the redemption of all of the
Trust Preferred Securities), the lesser of (a) the aggregate of the liquidation
amount and all accrued and unpaid distributions on such Trust Preferred
Securities to the date of payment, to the extent such Willamette
- 19 -
<PAGE>
Trust has funds available therefore and (b) the amount of assets of such
Willamette Trust remaining available for distribution to holders of such Trust
Preferred Securities in liquidation of such Willamette Trust. The Company's
obligation to make a Guarantee Payment may be satisfied by direct payment of the
required amounts by the Company to the holders of Trust Preferred Securities or
by causing the applicable Willamette Trust to pay such amounts to such holders.
Each Trust Preferred Securities Guarantee will be a guarantee with
respect to the Trust Preferred Securities issued by the applicable Willamette
Trust, but will not apply to any payment of distributions except to the extent
such Willamette Trust shall have funds available therefore. If the Company does
not make interest payments on the Subordinated Debt Securities purchased by a
Willamette Trust, such Willamette Trust will not pay distributions on the Trust
Preferred Securities issued by such Willamette Trust and will not have funds
available therefore. The Trust Preferred Securities Guarantee, when taken
together with the Company's obligations under the Subordinated Debt Securities,
the Subordinated Debt Securities Indenture, and the Declaration will provide a
full and unconditional guarantee on a subordinated basis by the Company of
payments due on the Trust Preferred Securities.
The Company has also agreed separately to irrevocably and
unconditionally guarantee the obligations of the Willamette Trusts with respect
to the Common Securities (the "Common Securities Guarantees") to the same extent
as the Trust Preferred Securities Guarantee, except that upon an event of
default under the Subordinated Debt Securities Indenture, holders of Trust
Preferred Securities shall have priority over holders of Common Securities with
respect to distributions and payments on liquidation, redemption or otherwise.
CERTAIN COVENANTS OF THE COMPANY
In each Trust Preferred Securities Guarantee, the Company will covenant
that, so long as any Trust Preferred Securities issued by the applicable
Willamette Trust remain outstanding, if there shall have occurred any event that
would constitute an event of default under such Trust Preferred Securities
Guarantee or the Declaration of such Willamette Trust, then (a) the Company
shall not declare or pay any dividend on, make any distributions with respect
to, or redeem, purchase, acquire or make liquidation payment with respect to,
any of its capital stock (other than (i) purchases or acquisitions of shares of
Common Stock in connection with the satisfaction by the Company of its
obligations under any employee benefit plans or the satisfaction by the Company
of its obligations pursuant to any contract or security outstanding on the date
of such event requiring the Company to purchase shares of Common Stock, (ii) as
a result of a reclassification of the Company's capital stock or the exchange or
conversion of one class or series of the Company's capital stock for another
class or series of the Company's capital stock or, (iii) the purchase of
fractional interests in shares of the Company's capital stock pursuant to the
conversion or exchange provisions of the Company's capital stock or the security
being converted or exchanged), (b) the Company shall not make any payment of
interest, principal or premium, if any, on or repay, repurchase or redeem any
debt securities (including guarantees) issued by the Company which rank pari
passu with or junior to such Subordinated Debt Securities and (c) the Company
shall not make any guarantee payments with respect to the foregoing (other than
pursuant to a Trust Preferred Securities Guarantee).
MODIFICATION OF THE TRUST PREFERRED SECURITIES GUARANTEES; ASSIGNMENT
Except with respect to any changes which do not adversely affect the
rights of holders of Trust Preferred Securities (in which case no vote will be
required), each Trust Preferred Securities Guarantee may be amended only with
the prior approval of the holders of not less than a majority in liquidation
amount of the outstanding Trust Preferred Securities issued by the applicable
Willamette Trust. The manner of obtaining any such approval of holders of such
Trust Preferred Securities will be as set forth in an accompanying Prospectus
Supplement. All guarantees and agreements contained in a Trust Preferred
Securities Guarantee shall bind the successors,
- 20 -
<PAGE>
assigns, receivers, trustees and representatives of the Company and shall inure
to the benefit of the holders of the Trust Preferred Securities of the
applicable Willamette Trust then outstanding.
TERMINATION
Each Trust Preferred Securities Guarantee will terminate as to the
Trust Preferred Securities issued by the applicable Willamette Trust (a) upon
full payment of the Redemption Price of all Trust Preferred Securities of such
Willamette Trust, (b) upon distribution of the Subordinated Debt Securities held
by such Willamette Trust to the holders of the Trust Preferred Securities of
such Willamette Trust or (c) upon full payment of the amounts payable in
accordance with the Declaration of such Willamette Trust upon liquidation of
such Willamette Trust. Each Trust Preferred Securities Guarantee will continue
to be effective or will be reinstated, as the case may be, if at any time any
holder of Trust Preferred Securities issued by the applicable Willamette Trust
must restore payment of any sums paid under such Trust Preferred Securities or
such Trust Preferred Securities Guarantee.
EVENTS OF DEFAULT
An event of default under a Trust Preferred Securities Guarantee will
occur upon the failure of the Company to perform any of its payment or other
obligations thereunder.
The holders of a majority in liquidation amount of the Trust Preferred
Securities to which such Trust Preferred Securities Guarantee relates have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the Preferred Guarantee Trustee in respect of the Trust
Preferred Securities Guarantee or to direct the exercise of any trust or power
conferred upon the Preferred Guarantee Trustee under such Trust Preferred
Securities Guarantee. If the Preferred Guarantee Trustee fails to enforce such
Trust Preferred Securities Guarantee, any holder of Trust Preferred Securities
to which such Trust Preferred Securities Guarantee relates may institute a legal
proceeding directly against the Company to enforce such holder's rights under
such Trust Preferred Securities Guarantee, without first instituting a legal
proceeding against the relevant Willamette Trust, the Preferred Guarantee
Trustee or any other person or entity. Notwithstanding the foregoing, if the
Company has failed to make a guarantee payment, a holder of Trust Preferred
Securities may directly institute a proceeding against the Company for
enforcement of the Trust Preferred Securities Guarantee for such payment. The
Company waives any right or remedy to require that any action be brought first
against such Willamette Trust or any other person or entity before proceeding
directly against the Company.
STATUS OF THE TRUST PREFERRED SECURITIES GUARANTEES
The Trust Preferred Securities Guarantees will constitute unsecured
obligations of the Company and will rank (i) subordinate and junior in right of
payment to all other liabilities of the Company, (ii) pari passu with the most
senior preferred or preference stock now or hereafter issued by the Company and
with any guarantee now or hereafter entered into by the Company in respect of
any preferred or preference stock of any affiliate of the Company; and (iii)
senior to the Company's Common Stock. The terms of the Trust Preferred
Securities provide that each holder of Trust Preferred Securities issued by the
applicable Willamette Trust by acceptance thereof agrees to the subordination
provisions and other terms of the Trust Preferred Securities Guarantee relating
thereto.
The Trust Preferred Securities Guarantees will constitute a guarantee
of payment and not of collection (that is, the guaranteed party may institute a
legal proceeding directly against the guarantor to enforce its rights under the
guarantee without instituting a legal proceeding against any other person or
entity).
- 21 -
<PAGE>
INFORMATION CONCERNING THE PREFERRED GUARANTEE TRUSTEE
The Preferred Guarantee Trustee, prior to the occurrence of a default
with respect to a Trust Preferred Securities Guarantee, undertakes to perform
only such duties as are specifically set forth in such Trust Preferred
Securities Guarantee and, after default, shall exercise the same degree of care
as a prudent individual would exercise in the conduct of his or her own affairs.
Subject to such provisions, the Preferred Guarantee Trustee is under no
obligation to exercise any of the powers vested in it by a Trust Preferred
Securities Guarantee at the request of any holder of Trust Preferred Securities,
unless offered reasonable indemnity against the costs, expenses and liabilities
which might be incurred thereby; but the foregoing shall not relieve the
Preferred Guarantee Trustee, upon the occurrence of an event of default under
such Trust Preferred Securities Guarantee, from exercising the rights and powers
vested in it by such Trust Preferred Securities Guarantee.
EFFECT OF OBLIGATIONS UNDER THE SUBORDINATED
DEBT SECURITIES AND THE GUARANTEE
As set forth in the Declaration, the sole purpose of each of the
Willamette Trusts is to issue the Trust Securities evidencing undivided
beneficial interests in the assets of each of the Willamette Trusts, and to
invest the proceeds from such issuance and sale in the Subordinated Debt
Securities.
As long as payments of interest and other payments are made when due on
the Subordinated Debt Securities, such payments will be sufficient to cover
distributions and payments due on the Trust Securities because: (i) the
aggregate principal amount of Subordinated Debt Securities will be equal to the
sum of the aggregate stated liquidation amount of the Trust Securities; (ii) the
interest rate and the interest and other payment dates on the Subordinated Debt
Securities will match the distribution rate and distribution and other payment
dates for the Trust Preferred Securities; (iii) the Company shall pay, and the
applicable Willamette Trust shall not be obligated to pay, directly or
indirectly, all costs, expenses, debt, and obligations of the applicable
Willamette Trust (other than with respect to the Trust Securities); and (iv) the
Declaration further provides that the Willamette Trustees shall not take or
cause or permit the applicable Willamette Trust to engage in any activity that
is not consistent with the purposes of the applicable Willamette Trust.
Payments of distributions (to the extent funds therefore are available)
and other payments due on the Trust Preferred Securities (to the extent funds
therefore are available) are guaranteed by the Company as and to the extent set
forth under "Description of the Trust Preferred Securities Guarantees." If the
Company did not make interest payments on the Subordinated Debt Securities
purchased by the applicable Willamette Trust, it is expected that the applicable
Willamette Trust would not have sufficient funds to pay distributions on the
Trust Preferred Securities. The Guarantee does not apply to any payment of
distributions unless and until the applicable Willamette Trust has sufficient
funds for the payment of such distributions. The Guarantee covers the payment of
distributions and other payments on the Trust Preferred Securities only if and
to the extent that the Company has made a payment of interest or principal on
the Subordinated Debt Securities held by the applicable Willamette Trust as its
sole asset. The Guarantee, when taken together with the Company's obligations
under the Subordinated Debt Securities and the Indenture and its obligations
under the Declaration, including its obligations to pay costs, expenses, debts
and liabilities of the applicable Willamette Trust (other than with respect to
the Trust Securities), provide a full and unconditional guarantee of amounts on
the Trust Preferred Securities.
- 22 -
<PAGE>
DESCRIPTION OF STOCK PURCHASE CONTRACTS,
WARRANTS, AND STOCK PURCHASE UNITS
The Company may issue Stock Purchase Contracts, representing contracts
obligating holders to purchase from the Company, and the Company to sell to the
holders, a specified number of shares of Common Stock or Preferred Stock at a
future date or dates or representing warrants entitling a holder at its option
to purchase a specified number of shares of Common Stock or Preferred Stock for
the Company. The Company may also issue warrants to purchase shares of Common
Stock or Preferred Stock. The price per share of Common Stock or Preferred Stock
may be fixed at the time the warrants or other Stock Purchase Contracts are
issued or may be determined by reference to a specific formula set forth in the
Stock Purchase Contracts. The Stock Purchase Contracts may be issued separately
or as a part of units ("Stock Purchase Units") consisting of a Stock Purchase
Contract and Debt Securities or Trust Preferred Securities or debt obligations
of third parties, including U.S. Treasury securities, securing the holders'
obligations to purchase the Common Stock or Preferred Stock under the Purchase
Contracts. The Stock Purchase Contracts may require the Company to make periodic
payments to the holders of the Stock Purchase Units or visa versa, and such
payments may be unsecured or prefunded on some basis. The Stock Purchase
Contracts may require holders to secure their obligations thereunder in a
specified manner.
The applicable Prospectus Supplement will describe the terms of any
Stock Purchase Contracts or Stock Purchase Units, including, without limitation,
the number of shares to be purchased, the price per share or method of computing
such price, the date or dates of purchase, the terms and conditions of purchase,
the amount of any periodic payments required to be made by the holders thereof
or by the Company, and any required security for a purchase thereunder.
PLAN OF DISTRIBUTION
The Company and/or any Willamette Trust may sell the Offered Securities
(i) to or through underwriters or dealers; (ii) directly to purchasers; or (iii)
through agents. The Prospectus Supplement with respect to the Offered Securities
will set forth the terms of the offering of the Offered Securities, including
the name or names of any underwriters, dealers or agents; the purchase price of
the Offered Securities and the proceeds to the Company and/or a Willamette Trust
from such sale; any underwriting discounts and commissions or agency fees and
other items constituting underwriters' or agents' compensation; any initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers and any securities exchange on which such Offered Securities may
be listed. Any initial public offering price, discounts or concessions allowed
or reallowed or paid to dealers may be changed from time to time.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The Offered Securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or directly by one
or more firms acting as underwriters. The underwriter or underwriters with
respect to a particular underwritten offering of Offered Securities will be
named in the Prospectus Supplement relating to such offering and, if an
underwriting syndicate is used, the managing underwriter or underwriters will be
set forth on the cover of such Prospectus Supplement. Unless otherwise set forth
in the Prospectus Supplement relating thereto, the obligations of the
underwriters to purchase the Offered Securities will be subject to certain
conditions precedent, and the underwriters will be obligated to purchase all the
Offered Securities if any are purchased.
If dealers are utilized in the sale of Offered Securities, the Company
and/or the applicable Willamette Trust will sell such Offered Securities to the
dealers as principals. The dealers may then resell such Offered
- 23 -
<PAGE>
Securities to the public at varying prices to be determined by such dealers at
the time of resale. The names of the dealers and the terms of the transaction
will be set forth in the Prospectus Supplement relating thereto.
The Offered Securities may be sold directly by the Company and/or a
Willamette Trust or through agents designated by the Company and/or such
Willamette Trust from time to time. Any agent involved in the offer or sale of
the Offered Securities in respect to which this Prospectus is delivered will be
named, and any commissions payable by the Company and/or the applicable
Willamette Trust to such agent will be set forth, in the Prospectus Supplement
relating thereto. Unless otherwise indicated in the Prospectus Supplement, any
such agent will be acting on a best efforts basis for the period of its
appointment.
The Offered Securities may be sold directly by the Company and/or a
Willamette Trust to institutional investors or others, who may be deemed to be
underwriters within the meaning of the Securities Act with respect to any resale
thereof. The terms of any such sales will be described in the Prospectus
Supplement relating thereto.
Agents, dealers and underwriters may be entitled under agreements with
the Company and/or a Willamette Trust to indemnification by the Company and/or
the applicable Willamette Trust against certain civil liabilities, including
liabilities under the Securities Act, or to contribution with respect to
payments which such agents, dealers or underwriters may be required to make in
respect thereof. Agents, dealers and underwriters may be customers of, engage in
transactions with, or perform services for the Company and/or a Willamette Trust
in the ordinary course of business.
Each series of Offered Securities other than Common Stock will be a new
issue of securities and will have no established trading market. Any
underwriters to whom Offered Securities are sold for public offering and sale
may make a market in such Offered Securities, but such underwriters will not be
obligated to do so and may discontinue any market making at any time without
notice.The Offered Securities may or may not be listed on a national securities
exchange. No assurance can be given that there will be a market for the Offered
Securities.
VALIDITY OF OFFERED SECURITIES
The validity of the Offered Securities will be passed upon for the
Company by Miller, Nash, Wiener, Hager & Carlsen LLP, Portland, Oregon.
EXPERTS
The consolidated financial statements of the Company included in the
Company's annual report on Form 10-K for the year ended December 31, 1996, have
been audited by KPMG Peat Marwick LLP, independent auditors, as set forth in
their report included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report and upon the authority of such firm as experts in
accounting and auditing.
- 24 -
<PAGE>
$500,000,000
WILLAMETTE INDUSTRIES, INC.
Senior Debt Securities
-----------------
Willamette Industries, Inc. (the "Company") may offer, from time to
time, unsecured senior debt securities ("Debt Securities") consisting of
debentures, notes or other unsecured evidences of indebtedness, in one or more
series and in amounts, at prices and on terms to be determined at or prior to
the time of sale.
Specific terms of the particular Debt Securities in respect of which
this Prospectus is delivered (the "Offered Securities") will be set forth in an
accompanying Prospectus Supplement or Supplements, together with the terms of
the offering of the Offered Securities, the initial price thereof and the
estimated net proceeds from the sale thereof. The Prospectus Supplement will set
forth with regard to the particular Offered Securities, without limitation, the
designation, aggregate principal amount, denomination, maturity, premium, if
any, exchange, conversion, redemption or sinking fund provisions, if any,
interest rate (which may be fixed or variable), the time and method of
calculating interest payments, put options, if any, public offering price, and
other specific terms of the offering.
The Company may sell the Offered Securities directly, through agents
designated from time to time or through underwriters or dealers. See "Plan of
Distribution." If any agents, underwriters, or dealers are involved in the sale
of the Offered Securities, the names of such agents, underwriters, or dealers
and any applicable commissions and discounts will be set forth in the related
Prospectus Supplement.
This Prospectus may not be used to consummate sales of Offered
Securities unless accompanied by a Prospectus Supplement.
--------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is August 1, 1997.
- 1 -
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, ANY ACCOMPANYING
PROSPECTUS SUPPLEMENT OR THE DOCUMENTS INCORPORATED OR DEEMED INCORPORATED BY
REFERENCE HEREIN, AND ANY INFORMATION OR REPRESENTATIONS NOT CONTAINED HEREIN OR
THEREIN MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE
WILLAMETTE TRUSTS OR BY ANY AGENT, DEALER OR UNDERWRITER. THIS PROSPECTUS AND
ANY ACCOMPANYING PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A
SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY CIRCUMSTANCES IN WHICH
SUCH OFFER OR SOLICITATION IS UNLAWFUL. THE DELIVERY OF THIS PROSPECTUS OR ANY
PROSPECTUS SUPPLEMENT AT ANY TIME DOES NOT IMPLY THAT THE INFORMATION HEREIN OR
THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "1934 Act") and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "SEC"). Reports, proxy statements and
other information concerning the Company can be inspected and copied at the
SEC's Public Reference Room, Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, DC 20549, as well as the Regional Offices of the SEC at 7 World
Trade Center, Suite 1300, New York, New York 10048 and Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511.
Copies of such material can be obtained from the Public Reference Section of the
SEC at Judiciary Plaza, 450 Fifth Street, N.W., Washington, DC 20549, at
prescribed rates. The SEC also maintains a Web site that contains reports, proxy
and information statements and other information regarding registrants that file
electronically with the SEC. The address of such site is http://www.sec.gov.
Such reports, proxy statements and other information may also be inspected at
the offices of the NYSE, on which Common Stock is traded, at 20 Broad Street,
New York, New York 10005.
This Prospectus constitutes a part of a Registration Statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") filed by the Company and the Willamette Trusts with the SEC under
the Securities Act of 1933, as amended (the "Securities Act") with respect to
the Offered Securities. This Prospectus does not contain all of the information
set forth in such Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the SEC. Reference is made to such
Registration Statement and to the exhibits relating thereto for further
information with respect to the Company and the Offered Securities. Any
statements contained herein concerning the provisions of any document filed as
an exhibit to the Registration Statement or otherwise filed with the SEC or
incorporated by reference herein are not necessarily complete, and in each
instance reference is made to the copy of such document so filed for a more
complete description of the matter involved. Each such statement is qualified in
its entirety by such reference.
The Company will send to all registered holders of the Offered
Securities such annual and other reports as are sent to its shareholders in
conformity with the requirements of the 1934 Act.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the SEC pursuant to
the 1934 Act are incorporated by reference herein and made a part hereof:
1. Annual Report on Form 10-K for the year ended December 31,
1996.
- 2 -
<PAGE>
2. The Company's quarterly report on Form 10-Q for the quarter
ended March 31, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the 1934 Act subsequent to the date hereof and prior to the
termination of the offering of the Offered Securities pursuant hereto shall be
deemed to be incorporated by reference in this Prospectus or in any Prospectus
Supplement and to be a part hereof from the date of filing of such documents.
Any statement contained herein or in a document incorporated or deemed
to be incorporated by reference in this Prospectus or in any Prospectus
Supplement shall be deemed to be modified or superseded for purposes of this
Prospectus or any Prospectus Supplement to the extent that a statement contained
in this Prospectus or in any Prospectus Supplement or in any other subsequently
filed document which also is or is deemed to be incorporated by reference in
this Prospectus or in any Prospectus Supplement modifies or supersedes such
statement. Any statement so modified or superseded shall not be deemed, except
as so modified or superseded, to constitute a part of this Prospectus or any
Prospectus Supplement.
The Company undertakes to provide without charge to each person to whom
a copy of this Prospectus has been delivered, upon the written or oral request
of any such person, a copy of any or all of the foregoing documents incorporated
herein by reference, other than exhibits to such documents (unless such exhibits
are specifically incorporated by reference into such documents). Such requests
should be directed to: Willamette Industries, Inc., 1300 S.W. Fifth Avenue,
Suite 3800, Portland, Oregon 97201, Telephone: (503) 227-5581, Attention:
Investor Relations.
THE COMPANY
The Company is a diversified, integrated forest products company which
manufactures unbleached paper products, white paper products, and wood-based
building materials at 97 locations located throughout the United States and in
Ireland. The Company owns or controls approximately 1.8 million acres of
timberland in Arkansas, Louisiana, Missouri, North Carolina, Oregon, South
Carolina, Tennessee, Texas, and Washington.
The Company was incorporated in Oregon in 1906. Its executive offices
are located at 1300 S.W. Fifth Avenue, Suite 3800, Portland, Oregon 97201, and
its telephone number is (503) 227-5581.
USE OF PROCEEDS
Unless otherwise indicated in a Prospectus Supplement with respect to
the proceeds from the sale of the particular Offered Securities to which such
Prospectus Supplement relates, the Company intends to add the net proceeds
received by it from the sale of Offered Securities to its general funds, to be
used for general corporate purposes, including capital expenditures, working
capital, and repayment of debt.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's ratio of earnings to fixed
charges for the periods indicated.
<TABLE>
<CAPTION>
Three Months
Ended March 31, Year Ended December 31,
-------------------- -------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1997 1996 1996 1995 1994 1993 1992
Ratio of Earnings to Fixed
Charges (1)(2)................. 1.51 7.38 3.68 10.83 4.25 3.06 2.56
</TABLE>
- 3 -
<PAGE>
(1) The Company has authority to issue up to 5,000,000 shares of Preferred
Stock; there are currently no shares outstanding and the Company
currently does not have a Preferred Stock dividend obligation.
Therefore, the Ratio of Combined Earnings to Fixed Charges and
Preferred Stock Dividends is equal to the Ratio of Earnings to Fixed
Charges and is not disclosed separately.
(2) For purposes of computing the ratio, "earnings" consist of income
before income taxes, plus fixed charges. "Fixed charges" consist of
interest expense plus one-third of rent expense (which is deemed
representative of an interest factor).
DESCRIPTION OF THE DEBT SECURITIES
The particular terms of the Debt Securities offered by any Prospectus
Supplement and the extent, if any, to which such general provisions may apply to
the Debt Securities so offered will be described in the Prospectus Supplement
relating to such Debt Securities.
Debt Securities may be issued, from time to time, in one or more
series. Debt Securities will be issued under an Indenture dated January 30, 1993
(the "Indenture"), between the Company and The Chase Manhattan Bank, as trustee
(the "Trustee").
The following summary of certain provisions of the Debt Securities and
the Indenture do not purport to be complete and are subject to, and are
qualified in their entirety by express reference to, all the provisions of the
Indenture, including the definitions therein of certain terms. Certain
capitalized terms herein are defined in the Indenture.
GENERAL
The Debt Securities will be unsecured obligations of the Company. The
Indenture does not limit the aggregate principal amount of Debt Securities which
may be issued thereunder and provides that Debt Securities may be issued
thereunder, from time to time, in one or more series.
The Prospectus Supplement relating to the Offered Securities will
specify, among other things: (1) the title of the Offered Securities; (2) any
limit on the aggregate principal amount of the Offered Securities; (3) the date
or dates on which the Offered Securities will mature; (4) the rate or rates
(which may be fixed or variable) per annum at which the Offered Securities will
bear interest or the method by which such rate or rates shall be determined and
the date from which such interest will accrue or the method by which such date
shall be determined; (5) the dates on which any such interest will be payable
and the Regular Record Dates for such Interest Payment Dates; (6) the dates, if
any, on which, and the price or prices at which, the Offered Securities may,
pursuant to any mandatory or optional sinking fund provisions, be redeemed by
the Company and other detailed terms and provisions of such sinking funds; (7)
the date, if any, after which, and the price or prices at which, the Offered
Securities may, pursuant to any optional redemption provisions, be redeemed at
the option of the Company or of the Holder thereof and other detailed terms and
provisions of such optional redemption; (8) the right of the Company, if any, to
defer payment of interest on the Offered Securities and the maximum length of
any such deferral period; (9) the right of Holders, if any, to put the Offered
Securities to the Company; (10) the currency unit, if other than United States
dollars, of payment of principal, and premium and interest, if any, on the
Offered Securities; (11) the applicability of certain provisions of the
Indentures as described under "Defeasance and Covenant Defeasance"; and (12) any
other terms of the Offered Securities (which terms shall not be inconsistent
with the Indenture).
- 4 -
<PAGE>
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the principal of, and any premium or interest, if any, on, the Offered
Securities will be payable, and the Offered Securities will be exchangeable and
transfers thereof will be registrable, at the Place of Payment, provided that,
at the option of the Company, payment of interest may be made by check mailed to
the address of the person entitled thereto as it appears in the Security
Register.
Unless otherwise indicated in the Prospectus Supplement relating
thereto, the Offered Securities will be issued in United States dollars in fully
registered form, without coupons, in denominations of $1,000 or any integral
multiple thereof. No service charge will be made for any transfer or exchange of
the Offered Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
CERTAIN COVENANTS OF THE COMPANY
For purposes of the descriptions of the Debt Securities, certain
defined terms have the following meanings:
"Subsidiary" of the Company is defined as a corporation more than 50%
of the outstanding voting stock of which is owned, directly or indirectly, by
the Company and/or one or more Subsidiaries of the Company. "Restricted
Subsidiary" is defined as a Subsidiary of the Company substantially all the
property of which is located, or substantially all the business of which is
carried on, within the present 50 states of the United States or in Canada and
which owns a Principal Property, excluding, however, any Subsidiary of the
Company which is primarily engaged in the development and sale or financing of
real property. "Principal Property" is defined as (i) any mill, converting
plant, or manufacturing plant owned by the Company or a Restricted Subsidiary
which is located within the present 50 states of the United States or in Canada
and the gross book value of which (without deduction of any depreciation
reserves) on the date as of which the determination is made exceeds 1% of
Consolidated Net Tangible Assets, and (ii) Timberlands other than those being
held primarily for development or sale; such property, however, will exclude (a)
any property which in the opinion of the Board of Directors of the Company is
not of material importance to the total business conducted by the Company and
its Restricted Subsidiaries as an entirety or (b) any portion of a particular
property which is similarly found not to be of material importance to the use or
operation of such property or (c) any oil, gas or other minerals or mineral
rights. "Attributable Debt" is defined as the total net amount of rent required
to be paid during the remaining primary term of certain leases, discounted at
the rate of 15% per annum. "Consolidated Net Tangible Assets" is defined as the
aggregate amount of assets after deducting (i) all liabilities, other than
deferred income taxes, Funded Debt and shareholders' equity, and (ii) goodwill
and like intangibles, of the Company and its consolidated Subsidiaries. "Funded
Debt" is defined as all indebtedness for money borrowed having a maturity of
more than 12 months from the date as of which the determination is made (or
being renewable beyond such period) and rental obligations (at the amount
capitalized) payable more than 12 months from such date under capitalized
leases.
Restrictions on Secured Debt
The Indenture provides that the Company may not, nor may it permit any
Restricted Subsidiary to, create, assume or guarantee any loan or evidence of
indebtedness for money borrowed ("Debt") secured by a mortgage, pledge or lien
("Mortgage") on any Principal Property of the Company or any Restricted
Subsidiary, or on any share of Capital Stock or Debt of any Restricted
Subsidiary, without securing or causing such Restricted Subsidiary to secure the
Debt Securities equally and ratably with (or, at the Company's option, prior to)
such secured Debt, unless the aggregate amount of all such secured Debt,
together with all Attributable Debt with respect to sale and leaseback
transactions involving Principal Properties (with the exception of such
transactions
- 5 -
<PAGE>
which are excluded as described in "Restrictions on Sale of Leaseback
Transactions" below), would not exceed 10% of Consolidated Net Tangible Assets.
This restriction does not apply to, and there shall be excluded from
secured Debt in any computation under such restriction, Debt secured by: (a)
Mortgages on property of, or on any shares of Capital Stock of or Debt of, any
corporation existing at the time such corporation becomes a Restricted
Subsidiary, (b) Mortgages in favor of the Company or a Restricted Subsidiary,
(c) Mortgages in favor of governmental bodies to secure progress or advance
payments, (d) Mortgages on property, shares of stock or Debt existing at the
time of acquisition thereof (including acquisition through merger or
consolidation) and purchase money and construction Mortgages which are entered
into within specified time limits, (e) Mortgages securing industrial revenue or
pollution control bonds, and (f) any extension, renewal or refunding of any
Mortgages referred to in the foregoing clauses (a) through (e), inclusive.
Restrictions on Sale and Leaseback Transactions
The Indenture provides that neither the Company nor any Restricted
Subsidiary may enter into any sale and leaseback transaction involving any
Principal Property, unless the aggregate amount of all Attributable Debt with
respect to such sale and leaseback transactions, plus all secured Debt (with the
exception of secured Debt which is excluded as described in "Restrictions on
Secured Debt" above), would not exceed 10% of Consolidated Net Tangible Assets.
This restriction does not apply to, and there shall be excluded from
Attributable Debt in any computation under such restriction, any sale and
leaseback transaction if (a) the lease is for a period, including renewal
rights, of not in excess of three years, (b) the sale or transfer of the
Principal Property is made within a specified period after its acquisition or
construction, (c) the lease secures or relates to industrial revenue or
pollution control bonds, (d) the transaction is between the Company and a
Restricted Subsidiary or between Restricted Subsidiaries or (e) the Company or
such Restricted Subsidiary, within 180 days after the sale is completed, applies
to the retirement of Funded Debt of the Company or a Restricted Subsidiary, or
the purchase of other property which will constitute Principal Property of a
value at least equal to the value of the Principal Property leased, an amount
not less than the greater of (i) the net proceeds of the sale of the Principal
Property leased or (ii) the fair market value of the Principal Property leased;
provided that the amount of proceeds to be applied to the retirement of Funded
Debt shall be reduced by an amount, if any, equal to the principal amount of
debentures or notes (including the Debt Securities) of the Company or a
Restricted Subsidiary surrendered for cancellation to the applicable trustee
thereof and the principal amount of other Funded Debt voluntarily retired, in
each case within 180 days after such sale.
Restrictions on Funded Debt of Restricted Subsidiaries
The Indenture provides that the Company may not permit any Restricted
Subsidiary to create, assume or guarantee any Funded Debt except (i) Funded Debt
owed to the Company or a Restricted Subsidiary, (ii) Funded Debt secured by
Mortgages permitted as described under "Restrictions on Secured Debt," (iii)
Funded Debt of any corporation outstanding at the time such corporation became a
Restricted Subsidiary, (iv) Funded Debt of any person outstanding at the time of
its acquisition, or the acquisition of substantially all its properties, by such
Restricted Subsidiary, (v) Funded Debt incurred in connection with certain
refundings, (vi) Funded Debt constituting Attributable Debt permitted as
described under "Restrictions on Sale and Leaseback Transactions" and (vii) any
other Funded Debt if the aggregate principal amount of all Funded Debt of all
Restricted Subsidiaries permitted under this clause (vii) does not exceed 10% of
Consolidated Net Tangible Assets.
- 6 -
<PAGE>
EVENTS OF DEFAULT
The following are Events of Default under the Indenture with respect to
the Debt Securities of any series: (a) default in the payment of principal of or
any premium on any Debt Security of that series when due; (b) default in the
payment of any interest on any Debt Security of that series when due continued
for 30 days; (c) default in the deposit of any sinking fund payment, when due,
in respect of any Debt Security of that series; (d) default in the performance
of any other covenant of the Company in the Indenture (other than a covenant
included in the Indenture solely for the benefit of a series of the Debt
Securities other than that series), continued for 90 days after written notice
as provided in the Indenture; (e) certain events in bankruptcy, insolvency or
reorganization; and (f) any other Event of Default provided with respect to Debt
Securities of a particular series. No Event of Default with respect to the Debt
Securities of a particular series necessarily constitutes an Event of Default
with respect to the Debt Securities of any other series.
If an Event of Default with respect to the Debt Securities of any
series at the time Outstanding occurs and is continuing, either the Trustee or
the Holders of at least 25% in aggregate principal amount of the Outstanding
Debt Securities of that series may declare the principal amount (or, if the Debt
Securities of that series are original issue discount Debt Securities, such
portion of the principal amount as may be specified in the terms of that series)
of all the Debt Securities of that series to be due and payable immediately. At
any time after a declaration of acceleration with respect to the Debt Securities
of any series has been made, but before a judgment or decree based on
acceleration has been obtained, the Holders of a majority in principal amount of
the Outstanding Debt Securities of that series may, under certain circumstances,
rescind and annul such acceleration.
The Indenture provides that, subject to the duty of the Trustee during
the continuance of an Event of Default to act with the required standard of
care, the Trustee will be under no obligation to exercise any of its rights or
powers under the Indenture at the request or direction of any of the Holders,
unless such Holders shall have offered to the Trustee reasonable indemnity.
Subject to such provisions for the indemnification of the Trustee, the Holders
of a majority in principal amount of the Outstanding Debt Securities of any
series will have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred on the Trustee, with respect to the Debt Securities of that
series. The right of a Holder of any Debt Security to institute a proceeding
with respect to the Indenture is subject to certain conditions precedent, but
each Holder has an absolute right to receive payment of principal or premium and
interest, if any, when due and to institute suit for the enforcement of any such
payment.
The Company is required to furnish to the Trustee annually a statement
as to the performance by the Company of its obligations under the Indenture and
as to any default in such performance.
The Debt Securities may be issued as Original Issue Discount Securities
to be offered and sold at a substantial discount below their principal amount.
Special federal income tax, accounting and other considerations applicable to
any such Original Issue Discount Securities will be described in any Prospectus
Supplement relating thereto. "Original Issue Discount Security" means any
security which provides for an amount less than the principal amount thereof to
be due and payable upon a declaration of acceleration of the maturity thereof as
a result of the occurrence of an Event of Default and the continuation thereof.
BOOK-ENTRY DEBT SECURITIES
The Debt Securities of a series may be issued in whole or in part in
the form of one or more Global Securities (as such term is defined below) that
will be deposited with, or on behalf of, a Depositary ("Depositary") or its
nominee identified in the applicable Prospectus Supplement. In such a case, one
or more Global Securities will be issued in a denomination or aggregate
denomination equal to the portion of the aggregate
- 7 -
<PAGE>
principal amount of outstanding Debt Securities of the series to be represented
by such Global Security or Global Securities. Unless and until it is exchanged
in whole or in part for Debt Securities in registered form, a Global Security
may not be registered for transfer or exchange except as a whole by the
Depositary for such Global Security to a nominee of such Depositary or by a
nominee of such Depositary to such Depositary or another nominee of such
Depositary or by such Depositary or any nominee to a successor Depositary or a
nominee of such successor Depositary and except in the circumstances described
in the applicable Prospectus Supplement. The term "Global Security", when used
with respect to any series of Debt Securities, means a Debt Security that is
executed by the Company and authenticated and delivered by the Trustee to the
Depositary or pursuant to the Depositary's instruction, which shall be
registered in the name of the Depositary or its nominee and which shall
represent, and shall be denominated in an amount equal to the aggregate
principal amount of, all of the Outstanding Debt Securities of such series or
any portion thereof, in either case having the same terms, including, without
limitation, the same original issue date, date or dates on which principal is
due, and interest rate or method of determining interest.
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
will be described in the applicable Prospectus Supplement. The Company expects
that the following provisions will apply to depositary arrangements. Unless
otherwise specified in the applicable Prospectus Supplement, Debt Securities
which are to be represented by a Global Security to be deposited with or on
behalf of a Depositary will be represented by a Global Security registered in
the name of such Depositary or its nominee. Upon the issuance of such Global
Security, and the deposit of such Global Security with or on behalf of the
Depositary for such Global Security, the Depositary will credit, on its
book-entry registration and transfer system, the respective principal amounts of
the Debt Securities represented by such Global Security to the accounts of
institutions that have accounts with such Depositary or its nominee
("participants"). The accounts to be credited will be designated by the
underwriters or agents of such Debt Securities or, if such Debt Securities are
offered and sold directly by the Company, by the Company. Ownership of
beneficial interests in such Global Security will be limited to participants or
Persons that may hold interests through participants. Ownership of beneficial
interests by participants in such Global Security will be shown on, and the
transfer of that ownership interest will be effected only through, records
maintained by the Depositary or its nominee for such Global Security. Ownership
of beneficial interests in such Global Security by Persons that hold through
participants will be shown on, and the transfer of that ownership interest
within such participant will be effected only through, records maintained by
such participant. The laws of some jurisdictions require that certain purchasers
of securities take physical delivery of such securities in certificated form.
The foregoing limitations and such laws may impair the ability to transfer
beneficial interests in such Global Securities.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or Holder of the Securities
represented by such Global Security for all purposes under the Indenture. Unless
otherwise specified in the applicable Prospectus Supplement, owners of
beneficial interests in such Global Security will not be entitled to have Debt
Securities of the series represented by such Global Security registered in their
names, will not receive or be entitled to receive physical delivery of Debt
Securities of such series in certificated form and will not be considered the
Holders thereof for any purposes under the Indenture. Accordingly, each Person
owning a beneficial interest in such Global Security must rely on the procedures
of the Depositary and, if such Person is not a participant, on the procedures of
the participant through which such Person owns its interest, to exercise any
rights of a Holder under the Indenture. The Company understands that under
existing industry practices, if the Company requests any action of Holders or an
owner of a beneficial interest in such Global Security desires to give any
notice or take any action a Holder is entitled to give or take under the
Indenture, the Depositary would authorize the participants to give such notice
or take such action, and participants would authorize beneficial owners owning
through such participants to give such notice or take such action or would
otherwise act upon the instructions of beneficial owners owning through them.
- 8 -
<PAGE>
Principal of and any premium and interest on a Global Security will be
payable in the manner described in the applicable Prospectus Supplement.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the
Outstanding Debt Securities under the Indenture, may consolidate with or merge
into, or transfer its assets substantially as an entirety to, any corporation
organized under the laws of any domestic jurisdiction, and any other person may
consolidate with, or merge into, or transfer its assets substantially as an
entirety to the Company provided that (i) the successor corporation (if any)
assumes the Company's obligations on the Debt Securities and under the
Indenture, (ii) after giving effect to the transaction and treating any
indebtedness which becomes an obligation of the Company or a Subsidiary as a
result of such transaction as having been incurred by the Company or the
Subsidiary at the time of such transaction, no Event of Default, and no event
which, after notice or lapse of time, would become an Event of Default, shall
have occurred and be continuing, (iii) if as a result of the transaction a
Principal Property would become subject to a Mortgage which would not be
permitted by the Indenture, the Debt Securities shall be secured equally with
(or prior to) the indebtedness secured thereby, and (iv) certain other
conditions are met.
DEFEASANCE AND COVENANT DEFEASANCE
The Indenture provides, if such provision is made applicable to the
Debt Securities of any series (which will be indicated in the Prospectus
Supplement) that the Company may elect either (a) to defease and be discharged
from any and all obligations in respect of the Debt Securities of such series
(except for certain obligations to register the transfer or exchange of Debt
Securities of such series, to replace mutilated, destroyed, lost or stolen Debt
Securities of such series, to maintain paying agencies and to hold moneys for
payment in trust) ("defeasance") or (b) to be released from its obligations with
respect to the Debt Securities of such series under certain restrictive
covenants of the Indenture, including those described under "Certain Covenants
of the Company," and "Consolidation, Merger and Sale of Assets" ("covenant
defeasance") and the occurrence of an event described in clause (d) under
"Events of Default" shall no longer be an Event of Default with respect to the
Debt Securities of such series, in each case, if the Company deposits, in trust,
with the Trustee money and/or Government Obligations, which through the payment
of interest thereon and principal thereof in accordance with their terms will
provide money in an amount sufficient, without reinvestment, to pay the
principal of and any premium and interest on the Outstanding Debt Securities of
such series and any mandatory sinking fund payments or analogous payments in
accordance with the terms of the Outstanding Debt Securities of such series and
the Indenture. Such a trust may only be established if, among other things, (i)
no Event of Default or event which with the giving of notice or lapse of time,
or both, would become an Event of Default with respect to such series under the
Indenture shall have occurred and be continuing on the date of such deposit,
(ii) such deposit will not cause the Trustee to have any conflicting interest
with respect to other securities of the Company and (iii) the Company shall have
delivered an Opinion of Counsel to the effect that the Holders will not
recognize income, gain or loss for federal income tax purposes as a result of
such defeasance and will be subject to federal income tax on the same amounts,
in the same manner, and at the same times as if such defeasance had not
occurred. In the event the Company exercises its covenant defeasance option with
respect to the Debt Securities of any series and the Debt Securities of such
series are declared due and payable because of the occurrence of any Event of
Default, the amount of money and Government Obligations on deposit with the
Trustee will be sufficient to pay amounts due on the Debt Securities of such
series at the time of their Stated Maturity but may not be sufficient to pay
amounts due on the Debt Securities of such series at the time of the
acceleration resulting from such Event of Default. However, the Company will
remain liable with respect to such payments.
- 9 -
<PAGE>
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the
Company and the Trustee with the consent of the Holders of a majority in
principal amount of the Outstanding Debt Securities of each series affected by
such modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Debt
Security affected thereby, (a) change the stated maturity date of the principal
of, or any installment of principal of or interest, if any, on, any Debt
Security, (b) reduce the principal amount of, or premium or rate of interest, if
any, on, any Debt Security, (c) reduce the amount of principal of an original
issue discount Debt Security payable upon acceleration of the maturity thereof,
(d) change the place or currency of payment of principal of, or premium or
interest, if any, on, any Debt Security, (e) impair the right to institute suit
for the enforcement of any payment on or with respect to any Debt Security, (f)
change the provisions for defeasance or covenant defeasance (each as defined
below) made applicable to any Debt Security, or (g) reduce the percentage in
principal amount of Outstanding Debt Securities of any series, the consent of
whose Holders is required for modification or amendment of the Indenture or for
waiver of compliance with certain provisions of the Indenture or for waiver of
certain defaults.
The Holders of a majority in principal amount of the Outstanding Debt
Securities of each series may, on behalf of all Holders of the Debt Securities
of that series, waive, insofar as that series is concerned, compliance by the
Company with certain restrictive provisions of the Indenture. The Holders of a
majority in aggregate principal amount of the Outstanding Debt Securities of
each series may, on behalf of all Holders of the Debt Securities of that series,
waive any past default under the Indenture with respect to the Debt Securities
of that series, except a default in the payment of principal, or premium or
interest, if any, or in respect of a covenant or condition which cannot be
waived without the consent of each Holder of the Debt Securities of that series.
REGARDING THE TRUSTEE
The Company maintains deposit accounts and conducts other banking
transactions with The Chase Manhattan Bank in the ordinary course of the
Company's business. The Chase Manhattan Bank serves as trustee under another
indenture with respect to certain of the Company's other senior debt securities.
PLAN OF DISTRIBUTION
The Company may sell the Offered Securities (i) to or through
underwriters or dealers; (ii) directly to purchasers; or (iii) through agents.
The Prospectus Supplement with respect to the Offered Securities will set forth
the terms of the offering of the Offered Securities, including the name or names
of any underwriters, dealers or agents; the purchase price of the Offered
Securities and the proceeds to the Company from such sale; any underwriting
discounts and commissions or agency fees and other items constituting
underwriters' or agents' compensation; any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers and any
securities exchange on which such Offered Securities may be listed. Any initial
public offering price, discounts or concessions allowed or reallowed or paid to
dealers may be changed from time to time.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The Offered Securities may be offered to the public either through underwriting
syndicates represented by one or more managing underwriters or directly by one
or more firms acting as underwriters. The underwriter or underwriters with
respect to a particular underwritten offering of Offered Securities will be
named in the Prospectus Supplement relating to such offering and, if an
underwriting syndicate is used, the managing underwriter or underwriters will be
set forth on the cover of such Prospectus Supplement. Unless otherwise set forth
in the Prospectus Supplement relating
- 10 -
<PAGE>
thereto, the obligations of the underwriters to purchase the Offered Securities
will be subject to certain conditions precedent, and the underwriters will be
obligated to purchase all the Offered Securities if any are purchased.
If dealers are utilized in the sale of Offered Securities, the Company
will sell such Offered Securities to the dealers as principals. The dealers may
then resell such Offered Securities to the public at varying prices to be
determined by such dealers at the time of resale. The names of the dealers and
the terms of the transaction will be set forth in the Prospectus Supplement
relating thereto.
The Offered Securities may be sold directly by the Company or through
agents designated by the Company from time to time. Any agent involved in the
offer or sale of the Offered Securities in respect to which this Prospectus is
delivered will be named, and any commissions payable by the Company to such
agent will be set forth, in the Prospectus Supplement relating thereto. Unless
otherwise indicated in the Prospectus Supplement, any such agent will be acting
on a best efforts basis for the period of its appointment.
The Offered Securities may be sold directly by the Company to
institutional investors or others, who may be deemed to be underwriters within
the meaning of the Securities Act with respect to any resale thereof. The terms
of any such sales will be described in the Prospectus Supplement relating
thereto.
Agents, dealers and underwriters may be entitled under agreements with
the Company to indemnification by the Company against certain civil liabilities,
including liabilities under the Securities Act, or to contribution with respect
to payments which such agents, dealers or underwriters may be required to make
in respect thereof. Agents, dealers and underwriters may be customers of, engage
in transactions with, or perform services for the Company in the ordinary course
of business.
Each series of Offered Securities will be a new issue of securities and
will have no established trading market. Any underwriters to whom Offered
Securities are sold for public offering and sale may make a market in such
Offered Securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice.The Offered Securities
may or may not be listed on a national securities exchange. No assurance can be
given that there will be a market for the Offered Securities.
VALIDITY OF OFFERED SECURITIES
The validity of the Offered Securities will be passed upon for the
Company by Miller, Nash, Wiener, Hager & Carlsen LLP, Portland, Oregon.
EXPERTS
The consolidated financial statements of the Company included in the
Company's annual report on Form 10-K for the year ended December 31, 1996, have
been audited by KPMG Peat Marwick LLP, independent auditors, as set forth in
their report included therein and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by reference in
reliance upon such report and upon the authority of such firm as experts in
accounting and auditing.
- 11 -
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<CAPTION>
<S> <C>
Securities and Exchange Commission filing fee....................... $151,515
Accounting fees..................................................... 30,000
Legal fees.......................................................... 70,000
Blue Sky qualification fees and expenses (including legal fees)..... 10,000
Printing and engraving.............................................. 50,000
Trustee's fees and expenses under Indenture......................... 25,000
Rating agency fees.................................................. 150,000
Miscellaneous....................................................... 25,000
Total...................................................... $511,515
=======
</TABLE>
All amounts, other than the Securities and Exchange Commission filing fee, are
estimates.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
ORS 60.367, a section of the Oregon Business Corporation Act (the
"Act"), provides in substance that any director held liable for an unlawful
distribution in violation of ORS 60.367 is entitled to contribution from (i)
every other director who voted for or assented to the distribution without
complying with the applicable statutory standards of conduct and (ii) each
shareholder for the amount the shareholder accepted knowing the distribution was
made in violation of the Act or the corporation's articles of incorporation.
As authorized by the Act, Sections A and B of Article V of the
registrant's Third Restated Articles of Incorporation provide that, subject to
certain limitations, directors and officers are entitled to indemnification
against certain liabilities to the full extent authorized under ORS 57.255 and
ORS 57.260 (now ORS 60.391), provided the directors or officers have met the
applicable standard of conduct specified in the Act. Subject to certain
specified limitations, directors and officers are also entitled to
indemnification under Sections D and E of Article V against liabilities arising
from the fact that they are or were directors or officers or acting in certain
other capacities at the registrant's request whether or not they met the
applicable standard of conduct specified in the Act.
Reference is made to section 6 of the Underwriting Agreement and
section 8 of the Distribution Agreement filed herewith as Exhibits 1.1 and 1.2,
respectively, for provisions regarding the indemnification of the registrant,
its directors, certain of its officers and its controlling persons against
certain civil liabilities, including civil liabilities under the Securities Act
of 1933.
II - 1
<PAGE>
The registrant maintains directors' and officers' liability insurance
under which the registrant's directors and officers are insured against loss (as
defined) on account of claims made against them for wrongful acts (as defined).
ITEM 16. EXHIBITS.
The exhibits to the registration statement required by Item 601 to
Regulation S-K are listed in the accompanying index to exhibits.
ITEM 17. UNDERTAKINGS.
(a) Rule 415 Offering.
The undersigned registrants hereby undertake:
(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 unless the information required to be included in
such post-effective amendment is contained in a periodic report filed by the
registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934 (the "Exchange Act") and incorporated herein by reference;
(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,
represent a fundamental change in the information set forth in the registration
statement, unless the information required to be included in such post-effective
amendment is contained in a periodic report filed by a registrant pursuant to
Section 13 or Section 15(d) of the Exchange Act and incorporated herein by
reference; provided that, 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 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;
and
(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.
(2) That, for purposes 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.
(b) Filing Incorporating Subsequent Exchange Act Documents by
Reference.
The undersigned registrants hereby undertake that, for the purpose of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or (15(d) of the
II - 2
<PAGE>
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.
(h) Acceleration of Effectiveness.
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 provisions described in Item 15 above, or
otherwise, the registrants have been advised that, in the opinion of the
Securities and Exchange Commission, such indemnification is against public
policy as expressed in the Securities Act of 1933 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 registrants will, unless in the opinion of their counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue. The undertaking of the
registrants in the preceding sentence does not apply to insurance against
liability arising under the Securities Act of 1933.
(i) Trust Indenture Act.
The undersigned registrants hereby undertake to file an application for
the purpose of determining the eligibility of the trustee to act under
subsection (a) of Section 310 of the Trust Indenture Act in accordance with the
rules and regulations prescribed by the Commission under Section 305(b)(2) of
the Act.
II - 3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each
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 Portland, State of Oregon, on the 30th day of July,
1997.
WILLAMETTE INDUSTRIES, INC.
By Steven R. Rogel*
President and Chief Executive Officer
WILLAMETTE CAPITAL TRUST I
By /s/ G. W. HAWLEY
G. W. HAWLEY
WILLAMETTE CAPITAL TRUST II
By /s/ G. W. HAWLEY
G. W. HAWLEY
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities indicated on the 30th day of July, 1997.
II - 4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C> <C>
(1) Principal Executive Officer and Director of Willamette President and Chief Executive
Industries, Inc.: Officer and Director
Steven R. Rogel*
(2) Principal Financial Officer of Willamette Industries, Inc.: Executive Vice President and
Chief Financial Officer,
Secretary, and Treasurer
/s/ J. A. PARSONS
J. A. PARSONS
(3) Principal Accounting Officer of Willamette Industries, Inc.: Vice President-Controller
/s/ G. W. HAWLEY
G. W. HAWLEY
</TABLE>
II - 5
<PAGE>
(4) A majority of the Board of Directors of Willamette Industries,
Inc.:
Director
Gerard K. Drummond*
Director
Kenneth W. Hergenhan*
Director
C. W. Knodell*
Director
Paul N. McCracken*
Director
G. Joseph Prendergast*
Director
Stuart J. Shelk, Jr.*
Director
Robert M. Smelick*
Director
William Swindells*
Director
Samuel C. Wheeler*
Director
Benjamin R. Whiteley*
(5) A majority of the Trustees of Willamette Capital Trust I:
/s/ G. W. HAWLEY
G. W. HAWLEY
/s/ DONALD C. ATKINSON
DONALD C. ATKINSON
II - 6
<PAGE>
(6) A majority of the Trustees of Willamette Capital Trust II:
/s/ G. W. HAWLEY
G. W. HAWLEY
/s/ DONALD C. ATKINSON
DONALD C. ATKINSON
*By /s/ J. A. PARSONS
J. A. PARSONS
ATTORNEY-IN-FACT
II - 7
<PAGE>
INDEX TO EXHIBITS
EXHIBIT DOCUMENT DESCRIPTION
NUMBER --------------------
- ------
1.1 Form of Underwriting Agreement**
1.2 Form of Agency Distribution Agreement**
3.1 Third Restated Articles of Incorporation of the Company, as
amended. Incorporated by reference from Exhibit 3A of the
registrant's quarterly report on Form 10-Q for the quarter
ended March 31, 1996.
3.2 Bylaws of the Company, as amended. Incorporated by reference
from Exhibit 3.2 of the registrants' quarterly report on
Form 10-Q for the quarter ended June 30, 1996.
3.3 Preferred Stock Purchase Rights of Willamette Industries,
Inc. Incorporated by reference from Exhibit 2 of the
registrants' Form 8-A filed February 26, 1990.
3.4 Certificate of Trust of Willamette Capital I
3.5 Declaration of Trust of Willamette Capital I
3.6 Certificate of Trust of Willamette Capital II
3.7 Declaration of Trust of Willamette Capital II
3.8 Amended and Restated Declaration of Trust of Willamette
Capital I*
3.9 Amended and Restated Declaration of Trust of Willamette
Capital II*
4.1 Indenture, dated as of January 30, 1993, between the Company
and The Chase Manhattan Bank. Incorporated by reference to
Exhibit 4A to the Company's registration statement on Form
S-3 (File No. 33-58044) effective March 1, 1993.
4.2 Form of Subordinated Indenture*
4.3 Form of Debt Securities**
4.4 Form of Warrants**
4.5 Form of Warrant Agreement**
4.6 Form of Stock Purchase Contract**
4.7 Form of Pledge Agreement**
4.8 Form of Stock Purchase Unit**
4.9 Form of Stock Purchase Contract Agreement**
4.10 Specimen Certificate of Common Stock of the Company
4.11 Form of Preferred Security Certificate for Willamette
Capital I**
4.12 Form of Guarantee Agreement in respect of Willamette Capital
I*
II - 8
<PAGE>
4.13 Form of Preferred Security Certificate for Willamette
Capital II**
4.14 Form of Guarantee Agreement in respect of Willamette Capital
II*
5.1 Opinion of Miller, Nash, Wiener, Hager & Carlsen LLP as to
the validity of the Securities
5.2 Opinion of Delaware special counsel as to the validity of
the Trust Preferred Securities*
12 Computation of ratio of earnings to fixed charges.
Incorporated by reference to Exhibit 12 to the registrants'
quarterly report on Form 10-Q for the quarter ended March
31, 1997.
23.1 Consent of KPMG Peat Marwick LLP, independent auditors
23.2 Consent of Miller, Nash, Wiener, Hager & Carlsen LLP
(included in Exhibit 5.1)
23.3 Consent of Delaware special counsel (to be included in
Exhibit 5.2)
24 Powers of attorney
25.1 Form T-1 Statement of Eligibility and Qualification under
the Trust Indenture Act of 1939 of The Chase Manhattan Bank*
25.2 Form T-1 Statement of Eligibility of the Trustee under the
Subordinated Indenture, the Property Trustee under the
Amended and Restated Declaration of Trust of Willamette
Capital I and Willamette Capital II, and the Guarantee
Trustee under the Guarantees for Willamette Capital I and
Willamette Capital II*
- ----------------------------
* To be filed by amendment
** To be filed as an exhibit to a report on Form 8-K, 10-Q, or 10-K, and
incorporated herein by reference
II - 9
<PAGE>
CERTIFICATE OF TRUST
OF
WILLAMETTE CAPITAL I
This Certificate of Trust is being duly executed as of July
30, 1997, for the purpose of organizing a business trust pursuant to the
Delaware Business Trust Act, 12 Del. C.
Section 3801 et seq. (the "Act").
The undersigned hereby certify as follows:
1. NAME. The name of the business trust is "Willamette
Capital I" (the "Trust").
2. DELAWARE TRUSTEE. The name and business address of
the Delaware resident trustee of the trust meeting the requirements of Section
3807 of the Act are as follows:
Chase Manhattan Bank Delaware
1201 North Market Street
Wilmington, Delaware 19801
3. EFFECTIVE. This Certificate of Trust shall be
effective immediately upon filing in the Office of the Secretary of State of the
State of Delaware.
4. COUNTERPARTS. This Certificate of Trust may be
executed in one or more counterparts.
IN WITNESS WHEREOF, the undersigned, being all of the trustees
of the Trust, have duly executed this Certificate of Trust as of the day and
year first above written.
CHASE MANHATTAN BANK DELAWARE, as
Delaware Trustee
By /s/ John J. Cashin
Name: John J. Cashin
Title: Vice President
/s/ G. W. Hawley, as Trustee
G. W. Hawley, as Trustee
/s/ Donald C. Atkinson
Donald C. Atkinson, as Trustee
Exhibit 3.4 - Page 1 of 1
WILLAMETTE CAPITAL I
DECLARATION OF TRUST
DECLARATION OF TRUST, dated as of July 30, 1997, between
Willamette Industries, Inc., an Oregon corporation, as Sponsor, Chase Manhattan
Bank Delaware, a Delaware banking corporation, as Delaware Trustee, and G. W.
Hawley, and Donald C. Atkinson, as Regular Trustees (collectively with the
Delaware Trustee, the "Trustees"). The Sponsor and the Trustees hereby agree as
follows:
1. The trust created hereby (the "Trust") shall be known as
"Willamette Capital I," in which name the Trustees, or the Sponsor to the extent
provided herein, may conduct the business of the Trust, make and execute
contracts, and sue and be sued.
2. The Sponsor hereby assigns, transfers, conveys, and sets
over to the Trustees the sum of $10. The Trustees hereby acknowledge receipt of
such amount in trust from the Sponsor, which amount shall constitute the initial
trust estate. The Trustees hereby declare that they will hold the trust estate
in trust for the Sponsor. It is the intention of the parties hereto that the
Trust created hereby constitutes a business trust under Chapter 38 of Title 12
of the Delaware Code, 12 Del. C. Section 3801 et seq. (the "Business Trust
Act"), and that this document constitutes the governing instrument of the Trust.
The Trustees are hereby authorized and directed to execute and file a
certificate of trust in the office of the Secretary of State of the State of
Delaware in the form attached hereto. The Trust is hereby established by the
Sponsor and the Trustees for the purposes of (i) issuing preferred securities
("Preferred Securities") representing undivided beneficial interests in the
assets of the Trust in exchange for cash and investing the proceeds thereof in
junior subordinated debt securities of the Sponsor, (ii) issuing and selling
common securities ("Common Securities" and, together with the Preferred
Securities, "Trust Securities") representing undivided beneficial interests in
the assets of the Trust to the Sponsor in exchange for cash and investing the
proceeds thereof in additional junior subordinated debt securities of the
Sponsor, and (iii) engaging in such other activities as are necessary,
convenient, or incidental thereof.
3. Concurrent with the first issuance of any Trust Securities
by the Trust, the Sponsor and the Trustees intend to enter into an amended and
restated Declaration of Trust, satisfactory to each such party and substantially
in the form to be included as an exhibit to the 1933 Act Registration Statement
referred to below for filing under the Securities Act of 1933, as amended (the
"Securities Act"), to provide for the contemplated operation of the Trust
created hereby and the issuance of the Preferred Securities and the Common
Securities referred to therein. Prior to the execution and delivery of such
amended and restated Declaration of Trust, the Trustees shall not have any duty
or obligation hereunder or with respect to the trust estate, except as otherwise
required by applicable law or as may be necessary to obtain, prior to such
execution and delivery, any licenses, consents, or approvals required by
applicable law or otherwise.
4. The Sponsor and the Trustees hereby authorize the Sponsor,
as the sponsor of the Trust, (i) to prepare and file with the Securities and
Exchange Commission (the "Commission") and execute, in each case on behalf of
the Trust, (a) a Registration Statement on Form S-3 (the "1933 Act Registration
Statement"), including any pre-effective or post-effective amendments to such
Registration Statement, relating to the registration of the Preferred Securities
under the Securities Act and (b) a Registration Statement on Form 8-A (the "1934
Act Registration Statement") (including any pre-effective or post-effective
amendments thereto) relating to the registration of the Preferred Securities
under Section 12 of the Securities Exchange Act of 1934, as amended; (ii) to
prepare and file with the New York Stock Exchange and execute, on behalf of the
Trust, a listing
Exhibit 3.5 - Page 1 of 3
<PAGE>
application and all other applications, statements, certificates, agreements,
and other instruments as shall be necessary or desirable if the Preferred
Securities are to be listed on the New York Stock Exchange; (iii) to prepare and
file and execute, in each case on behalf of the Trust, such applications,
reports, surety bonds, irrevocable consents, appointments of attorney for
service of process and other papers and documents as shall be necessary or
desirable to register the Preferred Securities under the securities or "blue
sky" laws of such jurisdictions as the Sponsor, on behalf of the Trust, may deem
necessary or desirable; and (iv) to negotiate the terms of, and execute on
behalf of the Trust, an underwriting agreement among the Trust, the Sponsor, and
any underwriter, dealer, or agent relating to the Preferred Securities,
substantially in the form to be included as an exhibit to, or incorporated by
reference in, the 1933 Act Registration Statement. It is hereby acknowledged and
agreed that in connection with any execution, filing, or document referred to in
clauses (i)-(iii) above, (A) any Regular Trustee (or his attorneys-in-fact and
agents or the Sponsor as permitted herein) is authorized on behalf of the Trust
to file and execute such document on behalf of the Trust and (B) the Delaware
Trustee shall not be required to join in any such filing or execute on behalf of
the Trust any such document unless required by the rules and regulations of the
Commission or the New York Stock Exchange or state securities or blue sky laws,
and in such case only to the extent so required. In connection with all of the
foregoing, the Sponsor and each Regular Trustee, solely in its capacity as
Trustee of the Trust, hereby constitutes and appoints J. A. Parsons, G. W.
Hawley, and Donald C. Atkinson, and each of them, his, her, or its, as the case
may be, true and lawful attorneys-in-fact, and agents, with full power of
substitution and resubstitution, for the Sponsor or such Trustee and in the
Sponsor's or such Trustee's name, place, and stead, in any and all capacities,
to sign and file (i) the 1933 Act Registration Statement and the 1934 Act
Registration Statement and any and all amendments (including post-effective
amendments) or supplements thereto, with all exhibits thereto, and other
documents in connection therewith, and (ii) a registration statement and any and
all amendments thereto filed pursuant to Rule 462(b) under the Securities Act
with the Commission, granting unto said attorneys-in-fact and agents full power
and authority to do and perform each and every act and thing and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as the Sponsor or
such Trustee might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents or any of them, or their or his or her
substitute or substitutes, shall do or cause to be done by virtue hereof.
5. This Declaration of Trust may be executed in one or more
counterparts.
6. The number of Trustees initially shall be three (3) and
thereafter the number of Trustees shall be such number as shall be fixed from
time to time by a written instrument signed by the Sponsor which may increase or
decrease the number of Trustees; provided, however, that the number of Trustees
shall in no event be less than three (3); and provided further, however, that to
the extent required by the Business Trust Act, one Trustee shall either be a
natural person who is a resident of the state of Delaware or, if not a natural
person, an entity that has its principal place of business in the state of
Delaware and meets any other requirements imposed by applicable law. Subject to
the foregoing, the Sponsor is entitled to appoint or remove without cause any
Trustee at any time. Any Trustee may resign upon thirty days' prior notice to
the Sponsor; provided, however, that the Delaware Trustee may resign immediately
upon notice to the Sponsor if the Delaware Trustee is required to join in any
filing or execute on behalf of the Trust any document pursuant to the provisions
of paragraph 4 hereof and, upon giving such notice, the Delaware Trustee shall
not be required to join in any such filing or execute on behalf of the Trust any
such document; provided further, however, that no resignation of the Delaware
Trustee shall be effective until a successor Delaware Trustee has been appointed
and has accepted such appointment by instrument executed by such successor
Delaware Trustee and delivered to the Trust, the Sponsor, and the resigning
Delaware Trustee.
7. To the fullest extent permitted by applicable law, the
Sponsor agrees to indemnify (i) the Delaware Trustee, (ii) any affiliate of the
Delaware Trustee, and (iii) any officers, directors, shareholders,
Exhibit 3.5 - Page 2 of 3
<PAGE>
members, partners, employees, representatives, nominees, custodians, or agents
of the Delaware Trustee (each of the persons or entities in (i) through (iii)
being referred to as an "Indemnified Person") for, and to hold each Indemnified
Person harmless against, any loss, liability, or expense incurred without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of the trust or trusts hereunder, including the
costs and expenses (including reasonable legal fees and expenses) of defending
itself against, or investigating, any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The obligation
to indemnify as set forth in this paragraph 7 shall survive the termination of
this Declaration.
8. The Trust may terminate without issuing any Trust
Securities at the election of the Sponsor.
9. This Declaration shall be governed by the laws of the state
of Delaware, without regard to conflict of laws principles.
IN WITNESS WHEREOF, the parties hereto have caused this
Declaration of Trust to be duly executed as of the day and year first above
written.
WILLAMETTE INDUSTRIES, INC., as Sponsor
By /s/ J. A. Parsons
Name: J. A. Parsons
Title: Executive Vice President and Chief
Financial Officer, Secretary, and
Treasurer
CHASE MANHATTAN BANK DELAWARE, as
Delaware Trustee
By /s/ John J. Cashin
Name: John J. Cashin
Title: Vice President
/s/ G. W. Hawley
G. W. Hawley, as Trustee
/s/ Donald C. Atkinson
Donald C. Atkinson, as Trustee
Exhibit 3.5 - Page 3 of 3
CERTIFICATE OF TRUST
OF
WILLAMETTE CAPITAL II
This Certificate of Trust is being duly executed as of July
30, 1997, for the purpose of organizing a business trust pursuant to the
Delaware Business Trust Act, 12 Del. C. Section 3801 et seq. (the "Act").
The undersigned hereby certify as follows:
1. NAME. The name of the business trust is "Willamette
Capital II" (the "Trust").
2. DELAWARE TRUSTEE. The name and business address of
the Delaware resident trustee of the trust meeting the requirements of Section
3807 of the Act are as follows:
Chase Manhattan Bank Delaware
1201 North Market Street
Wilmington, Delaware 19801
3. EFFECTIVE. This Certificate of Trust shall be
effective immediately upon filing in the Office of the Secretary of State of the
State of Delaware.
4. COUNTERPARTS. This Certificate of Trust may be
executed in one or more counterparts.
IN WITNESS WHEREOF, the undersigned, being all of the trustees
of the Trust, have duly executed this Certificate of Trust as of the day and
year first above written.
CHASE MANHATTAN BANK DELAWARE, as
Delaware Trustee
By /s/ John J. Cashin
Name: John J. Cashin
Title: Vice President
/s/ G. W. Hawley
G. W. Hawley, as Trustee
/s/ Donald C. Atkinson
Donald C. Atkinson, as Trustee
Exhibit 3.6 - Page 1 of 1
WILLAMETTE CAPITAL II
DECLARATION OF TRUST
DECLARATION OF TRUST, dated as of July 30, 1997, between
Willamette Industries, Inc., an Oregon corporation, as Sponsor, Chase Manhattan
Bank Delaware, a Delaware banking corporation, as Delaware Trustee, and G. W.
Hawley, and Donald C. Atkinson, as Regular Trustees (collectively with the
Delaware Trustee, the "Trustees"). The Sponsor and the Trustees hereby agree as
follows:
1. The trust created hereby (the "Trust") shall be known as
"Willamette Capital II," in which name the Trustees, or the Sponsor to the
extent provided herein, may conduct the business of the Trust, make and execute
contracts, and sue and be sued.
2. The Sponsor hereby assigns, transfers, conveys, and sets
over to the Trustees the sum of $10. The Trustees hereby acknowledge receipt of
such amount in trust from the Sponsor, which amount shall constitute the initial
trust estate. The Trustees hereby declare that they will hold the trust estate
in trust for the Sponsor. It is the intention of the parties hereto that the
Trust created hereby constitutes a business trust under Chapter 38 of Title 12
of the Delaware Code, 12 Del. C. Section 3801 et seq. (the "Business Trust
Act"), and that this document constitutes the governing instrument of the Trust.
The Trustees are hereby authorized and directed to execute and file a
certificate of trust in the office of the Secretary of State of the State of
Delaware in the form attached hereto. The Trust is hereby established by the
Sponsor and the Trustees for the purposes of (i) issuing preferred securities
("Preferred Securities") representing undivided beneficial interests in the
assets of the Trust in exchange for cash and investing the proceeds thereof in
junior subordinated debt securities of the Sponsor, (ii) issuing and selling
common securities ("Common Securities" and, together with the Preferred
Securities, "Trust Securities") representing undivided beneficial interests in
the assets of the Trust to the Sponsor in exchange for cash and investing the
proceeds thereof in additional junior subordinated debt securities of the
Sponsor, and (iii) engaging in such other activities as are necessary,
convenient, or incidental thereof.
3. Concurrent with the first issuance of any Trust Securities
by the Trust, the Sponsor and the Trustees intend to enter into an amended and
restated Declaration of Trust, satisfactory to each such party and substantially
in the form to be included as an exhibit to the 1933 Act Registration Statement
referred to below for filing under the Securities Act of 1933, as amended (the
"Securities Act"), to provide for the contemplated operation of the Trust
created hereby and the issuance of the Preferred Securities and the Common
Securities referred to therein. Prior to the execution and delivery of such
amended and restated Declaration of Trust, the Trustees shall not have any duty
or obligation hereunder or with respect to the trust estate, except as otherwise
required by applicable law or as may be necessary to obtain, prior to such
execution and delivery, any licenses, consents, or approvals required by
applicable law or otherwise.
4. The Sponsor and the Trustees hereby authorize the Sponsor,
as the sponsor of the Trust, (i) to prepare and file with the Securities and
Exchange Commission (the "Commission") and execute, in each case on behalf of
the Trust, (a) a Registration Statement on Form S-3 (the "1933 Act Registration
Statement"), including any pre-effective or post-effective amendments to such
Registration Statement, relating to the registration of the Preferred Securities
under the Securities Act and (b) a Registration Statement on Form 8-A (the "1934
Act Registration Statement") (including any pre-effective or post-effective
amendments thereto) relating to the registration of the Preferred Securities
under Section 12 of the Securities Exchange Act of 1934, as
Exhibit 3.7 - Page 1 of 3
<PAGE>
amended; (ii) to prepare and file with the New York Stock Exchange and execute,
on behalf of the Trust, a listing application and all other applications,
statements, certificates, agreements, and other instruments as shall be
necessary or desirable if the Preferred Securities are to be listed on the New
York Stock Exchange; (iii) to prepare and file and execute, in each case on
behalf of the Trust, such applications, reports, surety bonds, irrevocable
consents, appointments of attorney for service of process and other papers and
documents as shall be necessary or desirable to register the Preferred
Securities under the securities or "blue sky" laws of such jurisdictions as the
Sponsor, on behalf of the Trust, may deem necessary or desirable; and (iv) to
negotiate the terms of, and execute on behalf of the Trust, an underwriting
agreement among the Trust, the Sponsor, and any underwriter, dealer, or agent
relating to the Preferred Securities, substantially in the form to be included
as an exhibit to, or incorporated by reference in, the 1933 Act Registration
Statement. It is hereby acknowledged and agreed that in connection with any
execution, filing, or document referred to in clauses (i)-(iii) above, (A) any
Regular Trustee (or his attorneys-in-fact and agents or the Sponsor as permitted
herein) is authorized on behalf of the Trust to file and execute such document
on behalf of the Trust and (B) the Delaware Trustee shall not be required to
join in any such filing or execute on behalf of the Trust any such document
unless required by the rules and regulations of the Commission or the New York
Stock Exchange or state securities or blue sky laws, and in such case only to
the extent so required. In connection with all of the foregoing, the Sponsor and
each Regular Trustee, solely in its capacity as Trustee of the Trust, hereby
constitutes and appoints J. A. Parsons, G. W. Hawley, and Donald C. Atkinson,
and each of them, his, her, or its, as the case may be, true and lawful
attorneys-in-fact, and agents, with full power of substitution and
resubstitution, for the Sponsor or such Trustee and in the Sponsor's or such
Trustee's name, place, and stead, in any and all capacities, to sign and file
(i) the 1933 Act Registration Statement and the 1934 Act Registration Statement
and any and all amendments (including post-effective amendments) or supplements
thereto, with all exhibits thereto, and other documents in connection therewith,
and (ii) a registration statement and any and all amendments thereto filed
pursuant to Rule 462(b) under the Securities Act with the Commission, granting
unto said attorneys-in-fact and agents full power and authority to do and
perform each and every act and thing and authority to do and perform each and
every act and thing requisite and necessary to be done in connection therewith,
as fully to all intents and purposes as the Sponsor or such Trustee might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents or any of them, or their or his or her substitute
or substitutes, shall do or cause to be done by virtue hereof.
5. This Declaration of Trust may be executed in one or more
counterparts.
6. The number of Trustees initially shall be three (3) and
thereafter the number of Trustees shall be such number as shall be fixed from
time to time by a written instrument signed by the Sponsor which may increase or
decrease the number of Trustees; provided, however, that the number of Trustees
shall in no event be less than three (3); and provided further, however, that to
the extent required by the Business Trust Act, one Trustee shall either be a
natural person who is a resident of the state of Delaware or, if not a natural
person, an entity that has its principal place of business in the state of
Delaware and meets any other requirements imposed by applicable law. Subject to
the foregoing, the Sponsor is entitled to appoint or remove without cause any
Trustee at any time. Any Trustee may resign upon thirty days' prior notice to
the Sponsor; provided, however, that the Delaware Trustee may resign immediately
upon notice to the Sponsor if the Delaware Trustee is required to join in any
filing or execute on behalf of the Trust any document pursuant to the provisions
of paragraph 4 hereof and, upon giving such notice, the Delaware Trustee shall
not be required to join in any such filing or execute on behalf of the Trust any
such document; provided further, however, that no resignation of the Delaware
Trustee shall be effective until a successor Delaware Trustee has been appointed
and has accepted such appointment by instrument executed by such successor
Delaware Trustee and delivered to the Trust, the Sponsor, and the resigning
Delaware Trustee.
Exhibit 3.7 - Page 2 of 3
<PAGE>
7. To the fullest extent permitted by applicable law, the
Sponsor agrees to indemnify (i) the Delaware Trustee, (ii) any affiliate of the
Delaware Trustee, and (iii) any officers, directors, shareholders, members,
partners, employees, representatives, nominees, custodians, or agents of the
Delaware Trustee (each of the persons or entities in (i) through (iii) being
referred to as an "Indemnified Person") for, and to hold each Indemnified Person
harmless against, any loss, liability, or expense incurred without negligence or
bad faith on its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including the costs and
expenses (including reasonable legal fees and expenses) of defending itself
against, or investigating, any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder. The obligation
to indemnify as set forth in this paragraph 7 shall survive the termination of
this Declaration.
8. The Trust may terminate without issuing any Trust
Securities at the election of the Sponsor.
9. This Declaration shall be governed by the laws of the state
of Delaware, without regard to conflict of laws principles.
IN WITNESS WHEREOF, the parties hereto have caused this
Declaration of Trust to be duly executed as of the day and year first above
written.
WILLAMETTE INDUSTRIES, INC., as Sponsor
By /s/ J. A. Parsons
Name: J. A. Parsons
Title: Executive Vice President and Chief
Financial Officer, Secretary, and
Treasurer
CHASE MANHATTAN BANK DELAWARE, as
Delaware Trustee
By /s/ John J. Cashin
Name: John J. Cashin
Title: Vice President
/s/ G. W. Hawley
G. W. Hawley, as Trustee
/s/ Donald C. Atkinson
Donald C. Atkinson, as Trustee
Exhibit 3.7 - Page 3 of 3
EXHIBIT 4.10
- --------------- ----------------
NUMBER WILLAMETTE INDUSTRIES, INC. SHARES
- --------------- ----------------
INCORPORATED UNDER THE LAWS OF THE STATE OF OREGON
COMMON STOCK CUSIP 969133 10 7
SEE REVERSE FOR CERTAIN DEFINITIONS
- --------------------------------------------------------------------------------
THIS CERTIFIES THAT
is the owner of shares
- --------------------------------------------------------------------------------
OF THE PAR VALUE OF FIFTY CENTS ($.50) EACH FULLY PAID AND NONASSESSABLE,
OF THE COMMON STOCK OF
Willamette Industries, Inc. transferable on the books of the Corporation in
person or by duly authorized attorney upon surrender of this Certificate
properly endorsed. This Certificate is not valid until countersigned and
registered by the Transfer Agent and Registrar.
Witness the signatures of the duly authorized officers and the seal of the
Corporation.
Dated:
/s/ STEVEN R. ROGEL
COUNTERSIGNED AND REGISTERED: PRESIDENT AND CHIEF EXECUTIVE OFFICER
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
TRANSFER AGENT AND REGISTRAR
BY /s/ J. A. PARSONS
EXECUTIVE VICE PRESIDENT AND SECRETARY
AUTHORIZED SIGNATURE
Exhibit 4.10 - Page 1 of 2
<PAGE>
WILLAMETTE INDUSTRIES, INC.
The Corporation will furnish to any shareholder upon request and without
charge, a full statement of the designations, preferences, limitations and
relative rights of the shares of each class authorized to be issued, and, if the
Corporation is authorized to issue any preferred or special class in series, the
variations in relative rights and preferences between the shares of each such
series so far as the same have been fixed and determined and the authority of
the board of directors to fix and determine the relative rights and preferences
of subsequent series.
The following abbreviations, when used in the inscription on the face of
this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
<TABLE>
<CAPTION>
<S> <C>
TEN COM - as tenants in common UNIF GIFT MIN ACT -- .............Custodian.........
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right of under Uniform Gifts to Minors
survivorship and not as tenants Act .........................
in common (State)
</TABLE>
Additional abbreviations may also be used though not in the above
list.
For Value received __________________________________________ hereby sell,
assign and transfer unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- ----------------------------------------
- --------------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE, OF ASSIGNEE)
Shares
of the Common Stock represented by the within Certificate, and do hereby
irrevocably constitute and appoint ------------------------ Attorney, to
transfer the said stock on the books of the within-named Corporation will full
power of substitution in the premises.
Dated -------------------------
------------------------------------------------------
THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH
NOTICE: THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE
IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT
OR ANY CHANGE WHATEVER.
Signature(s) Guaranteed
By ------------------------------------------------------
THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE
GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN
ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN
APPROVED SIGNATURE GUARANTEE MEDALLION PROGRAM), PURSUANT TO
S.E.C. RULE 17Ad-15.
This certificate also evidences and entitles the holder hereof to certain Rights
as set forth in a Rights Agreement between Willamette Industries, Inc. (the
"Company"), and ChaseMellon Shareholder Services, L.L.C., successor to First
Interstate Bank of Oregon, N.A., as Rights Agent, dated as of February 26, 1990,
and as amended December 3, 1996 (the "Rights Agreement"), the terms of which are
hereby incorporated herein by reference and a copy of which is on file at the
principal executive offices of the Company. Under certain circumstances, as set
forth in the Rights Agreement, such Rights will be evidenced by separate
certificates and will no longer be evidenced by this certificate. The Company
will mail to the holder of this certificate a copy of the Rights Agreement
without charge after receipt of a written request therefor. Under certain
circumstances, Rights beneficially owned by an Acquiring Person or any Affiliate
or Associate thereof (as such terms are defined in the Rights Agreement) and any
subsequent holder of such Rights may become null and void.
Exhibit 4.10 - Page 2 of 2
August 1, 1997
Willamette Industries, Inc.
Suite 3800
1300 S.W. Fifth Avenue
Portland, Oregon 97201
Gentlemen:
Reference is made to the Registration Statement on Form S-3
(the "Registration Statement"), to be filed by Willamette Industries, Inc., an
Oregon corporation (the "Company"), with the Securities and Exchange Commission
(the "Commission") for the purpose of registering under the Securities Act of
1933, as amended (the "Act"), debt securities, preferred stock, common stock,
warrants or purchase contracts, stock purchase units, and guarantees of the
Company (the "Company Securities") and preferred securities of Willamette
Capital I and Willamette Capital II (each a statutory business trust) in the
aggregate principal amount of $500,000,000 (such preferred securities, together
with the Company Securities, the "Securities"). Senior debt securities of the
Company are to be issued under an indenture dated as of January 30, 1993 (the
"Indenture"), between the Company and The Chase Manhattan Bank (National
Association). One or more additional indentures will be executed, delivered, and
qualified as necessary prior to the issuance of any subordinated debt
securities. The Securities may be offered and sold from time to time as set
forth in the prospectus (the "Prospectus") included in the Registration
Statement and in supplements to the Prospectus.
As counsel for the Company, we are familiar with the actions
taken by the Company with respect to the authorization of the Securities and the
Indenture. We have examined the Registration Statement, the Indenture, and
originals or copies, certified or otherwise identified to our satisfaction, of
such corporate records, certificates, and other documents as we have deemed
necessary or relevant as a basis for the opinion set forth herein.
Based on the foregoing, it is our opinion that:
1. The Company is a corporation duly organized and validly
existing under the laws of the state of Oregon with corporate power and
authority under such laws to issue the Company Securities.
2. The Indenture has been duly executed and delivered by the
Company and constitutes a legal, valid, and binding indenture of the
Company.
3. When (i) any required indenture has been duly executed and
delivered by the Company, and qualified under the Trust Indenture Act
of 1939, as amended, and constitutes a legal, valid,
Exhibit 5.1 - Page 1 of 2
<PAGE>
and binding indenture of the Company, (ii) the issuance and sale of the
Company Securities has been duly authorized by appropriate corporate
action, (iii) the Company Securities have been duly executed,
authenticated, and delivered in accordance with the Indenture or other
applicable indenture, and (iv) the Company Securities have been sold as
described in the Registration Statement, the Prospectus, and
supplements to the Prospectus, and payment is received therefor, while
the Registration Statement is effective and in compliance with state
securities laws, the Company Securities will constitute legal, valid,
and binding obligations of the Company entitled to the benefits of the
Indenture or other applicable indenture.
This opinion is based upon the laws of the United States and
the state of Oregon at the date hereof and would not necessarily be the same at
any subsequent date.
We consent to the use of this opinion in the Registration
Statement and in any amendments thereto and to the reference to us under the
caption "Validity of Offered Securities" in the Prospectus. In giving this
consent, we do not thereby admit that we come within the category of persons
whose consent is required under Section 7 of the Act or the rules and
regulations of the Commission thereunder.
Very truly yours,
/s/ MILLER, NASH, WIENER, HAGER & CARLSEN LLP
Exhibit 5.1 - Page 2 of 2
EXHIBIT 23.1
Consent of Independent Auditors
The Board of Directors
Willamette Industries, Inc.:
We consent to the use of our report incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the Prospectus.
/s/ KPMG PEAT MARWICK LLP
July 31, 1997
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each person whose signature
appears below constitutes and appoints Steven R. Rogel and J. A. Parsons, and
each of them, such person's true and lawful attorneys-in-fact and agents, with
full power of substitution and resubstitution, for such person and in his or her
name, place and stead, in any and all such person's capacities with Willamette
Industries, Inc., an Oregon corporation (the "Company"), to sign a registration
statement on Form S-3 relating to up to $500 million of securities of the
Company (including, without limitation, debt securities of the Company, common
stock or cumulative preferred stock of the Company, warrants or contracts
relating to any such debt securities, common stock or preferred stock, preferred
securities of one or more business trusts holding securities of the Company,
guaranties by the Company of such preferred securities, or units consisting of
any combination of the foregoing), and any and all amendments (including
post-effective amendments) thereto, and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done,
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, or
each of them, or their or his substitute or substitutes, may lawfully do or
cause to be done by virtue hereof. This power of attorney may be executed in
counterparts which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, this power of attorney has been executed by each
of the undersigned as of the 7th day of July, 1997.
Signature Title
--------- -----
/s/ STEVEN R. ROGEL President and Chief
Steven R. Rogel Executive Officer and Director (Principal
Executive Officer)
/s/ J. A. PARSONS Executive Vice President
J. A. Parsons and Chief Financial Officer (Principal
Financial Officer)
/s/ GREG W. HAWLEY Vice President -
Greg W. Hawley Controller (Principal Accounting Officer)
/s/ GERARD K. DRUMMOND Director
Gerard K. Drummond
Exhibit 24 - Page 1 of 2
<PAGE>
/s/ KENNETH W. HERGENHAN Director
Kenneth W. Hergenhan
/s/ C. W. KNODELL Director
C. W. Knodell
/s/ PAUL N. McCRACKEN Director
Paul N. McCracken
/s/ G. JOSEPH PRENDERGAST Director
G. Joseph Prendergast
/s/ STUART J. SHELK, JR. Director
Stuart J. Shelk, Jr.
/s/ ROBERT M. SMELICK Director
Robert M. Smelick
/s/ WILLIAM SWINDELLS Director
William Swindells
/s/ SAMUEL C. WHEELER Director
Samuel C. Wheeler
/s/ BENJAMIN R. WHITELEY Director
Benjamin R. Whiteley
Exhibit 24 - Page 2 of 2
