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As filed with the Securities and Exchange Commission on January 29, 1999
Registration No. 333-________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
KEYSTONE CONSOLIDATED INDUSTRIES, INC.
(Exact name of Registrant as specified in its charter)
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DELAWARE 37-0364250
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(State or other jurisdiction of incorporation or organization) (IRS Employer Identification Number)
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THREE LINCOLN CENTRE, 5430 LBJ FREEWAY, SUITE 1740, DALLAS, TEXAS 745240
(972) 458-0028
(Address and telephone number of Registrant's principal executive offices)
RALPH P. END, ESQ.
VICE PRESIDENT AND GENERAL COUNSEL
KEYSTONE CONSOLIDATED INDUSTRIES, INC.
THREE LINCOLN CENTRE
5430 LBJ FREEWAY, SUITE 1740
DALLAS, TEXAS 75240
(972) 458-0028
(Name, address and telephone number of agent for service)
Copies of all communications, including all communications sent to the agent
for service, should be sent to:
ROBERT C. HUSSLE, ESQ.
ROGERS & HARDIN LLP
2700 INTERNATIONAL TOWER, PEACHTREE CENTER
229 PEACHTREE STREET, N.E.
ATLANTA, GEORGIA 30303
(404) 522-4700
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement as
determined by market conditions.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [x]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of
the earlier effective registration statement for the same offering. [ ]
-----------
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities
Act registration number of the earlier effective registration statement for
the same offering. [ ]
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If the delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
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CALCULATION OF REGISTRATION FEE
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TITLE OF EACH CLASS OF AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
SECURITIES TO BE REGISTERED TO BE REGISTERED OFFERING PRICE PER AGGREGATE OFFERING REGISTRATION FEE
SECURITY PRICE
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Common Stock, $1.00 par value 447,900 $8.50(1) $3,807,150 $1,058
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(1) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(c) under the Securities Act of 1933, as amended, on the
basis of the average of the reported high and low sales prices of the Company's
common stock quoted on the New York Stock Exchange, Inc. Composite Transactions
on January 25, 1999.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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SUBJECT TO COMPLETION, DATED JANUARY 29, 1999
The information in this prospectus is not complete, and it may change.
This prospectus is included in a registration statement that we filed with the
Securities and Exchange Commission. The selling stockholders cannot sell these
securities until that registration statement becomes effective. This prospectus
is not an offer to sell these securities or the solicitation of an offer to buy
these securities in any state where an offer to sell or the solicitation of an
offer to buy is not permitted.
447,900 SHARES
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KEYSTONE CONSOLIDATED INDUSTRIES, INC.
COMMON STOCK
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This prospectus covers the sale of up to 447,900 Shares of our Common
Stock.
Our Common Stock is traded on the New York Stock Exchange under the
symbol "KES." The closing sales price of the Common Stock on January 25, 1999
was $8.44 per share.
Certain of the Company's stockholders are selling the Shares of Common
Stock. The Company will not receive any proceeds from the sale.
INVESTING IN THE COMMON STOCK INVOLVES CERTAIN RISKS. SEE "RISK
FACTORS" BEGINNING ON PAGE 7.
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THE SHARES HAVE NOT BEEN APPROVED BY THE SEC OR ANY STATE SECURITIES
COMMISSION, NOR HAVE THESE ORGANIZATIONS DETERMINED THAT THIS PROSPECTUS IS
ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is _____________, 1999.
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TABLE OF CONTENTS
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PAGE
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Where You Can Find More Information................... 2
About the Company..................................... 5
Risk Factors.......................................... 7
Use of Proceeds....................................... 17
Selling Stockholders.................................. 17
Plan of Distribution.................................. 18
Legal Matters......................................... 20
Experts............................................... 20
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WE HAVE NOT AUTHORIZED ANYONE (INCLUDING ANY SALESMAN OR BROKER) TO GIVE
ORAL OR WRITTEN INFORMATION ABOUT THIS OFFERING THAT IS DIFFERENT FROM THE
INFORMATION INCLUDED IN THIS PROSPECTUS OR THAT IS NOT INCLUDED IN THIS
PROSPECTUS.
---------------
NOTE: We sometimes refer to ourselves in this prospectus as the "Company."
Whenever we refer to ourselves in this prospectus, we intend to include our
consolidated subsidiaries, unless the context otherwise requires.
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WHERE YOU CAN FIND MORE INFORMATION
Federal securities law requires us to file information with the Securities
and Exchange Commission concerning our business and operations. Accordingly, we
file annual, quarterly and special reports, proxy statements and other
information with the Commission. You can inspect and copy this information at
the public reference facility maintained by the Commission at Judiciary Plaza,
450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549. You can also do so at
the following regional offices of the Commission:
- New York Regional Office
Seven World Trade Center
Suite 1300
New York, New York 10048
- Chicago Regional Office
Citicorp Center
500 West Madison Street
Suite 1400
Chicago, Illinois 60661
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You can get additional information about the operation of the
Commission's public reference facilities by calling the Commission at
1-800-SEC-0330. The Commission also maintains a web site (http://www.sec.gov)
that contains reports, proxy and information statements and other information
regarding companies that, like us, file information electronically with the
Commission. You can also inspect information about us at the offices of the New
York Stock Exchange, 20 Broad Street, New York, New York 10005.
This prospectus is part of a registration statement that we filed with
the Commission (Registration No. _________).
The Commission allows us to "incorporate by reference" the information
we file with it, which means that we can disclose important information to you
by referring you to those documents. The information incorporated by reference
is considered to be part of this prospectus, and later information that we file
with the Commission will automatically update and supersede this information. We
incorporate by reference the documents listed below, and any future filings made
with the Commission will automatically update and supersede this information. We
incorporate by reference the documents listed below and any future filings made
with the Commission under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until the Selling Stockholders sell all the Shares.
- Our Annual Report on Form 10-K for the year ended December 31, 1997;
- Our Quarterly Reports on Form 10-Q for the quarters ended March 31,
1998, June 30, 1998 and September 30, 1998;
- Our Current Report on Form 8-K filed January 16, 1998; and
- Our Registration Statement on Form 8-A filed on April 29, 1968.
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
5430 LBJ Freeway, Suite 1440,
Three Lincoln Centre
Dallas, Texas 75240-2697
Attention: Ms. Sandra K. Myers,
Corporate Secretary
Telephone: (972) 458-0028
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You should rely only on the information incorporated by reference or
provided in this prospectus or any supplement. We have not authorized anyone
else to provide you with different information. The Selling Stockholders will
not make an offer of these shares in any state where the offer is not permitted.
You should not assume that the information in this prospectus or any supplement
is accurate as of any date other than the date on the front of the respective
document.
FORWARD-LOOKING STATEMENTS
This prospectus (including information included or incorporated by
reference herein) contains certain "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, which represent our expectations or beliefs
concerning future events that involve risks and uncertainties. All statements
other than statements of historical facts included in this prospectus
(including, without limitation, the statements under "About the Company" and
elsewhere herein) are forward-looking statements. Although we believe that the
expectations reflected in such forward-looking statements are reasonable, we can
give no assurance that such expectations will prove to be correct. Such
forward-looking statements are subject to risks, uncertainties and other factors
which could cause actual future results or trends to differ materially from
future results or trends expressed or implied by such forward-looking
statements. The most significant of such risks, uncertainties and other factors
are discussed under the heading "Risk Factors," beginning on page 7 of this
prospectus, and prospective investors are urged to consider carefully such
factors.
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ABOUT THE COMPANY
WHAT WE DO. We manufacture steel fabricated wire products, industrial
wire and carbon steel rod for the agricultural, industrial, construction,
original equipment manufacturer and retail consumer markets. We are vertically
integrated, converting substantially all of our fabricated wire products and
industrial wire from carbon steel rod produced in our steel mini-mill. Our
vertical integration allows us to benefit from the higher and more stable
margins associated with fabricated wire products as compared to carbon steel
rod, as well as from lower production costs of carbon steel rod as compared to
wire fabricators who purchase rod in the open market.
OUR PRODUCTS AND CUSTOMERS. Our fabricated wire products include
fencing, barbed wire, welded and woven hardware cloth and nails. We sell these
products to agricultural, construction, industrial, consumer do-it-yourself and
other end-user markets. We serve these markets through distributors,
merchandisers and consumer do-it-yourself chains such as Home Depot U.S.A.,
Inc., Lowe's Companies, Inc. and McCoy's Building Supply Center. A significant
proportion of these products are sold to agricultural, consumer do-it-yourself
and other end-user markets, which we believe are typically less cyclical than
many steel consuming end-use markets such as the automotive, construction,
appliance and machinery manufacturing industries. Approximately 70% of our
fabricated wire products net sales are generated by sales under our RED BRAND
trademark, a widely recognized brand name in the agricultural and construction
fencing marketplaces for more than 70 years.
We also sell industrial wire, an intermediate product used in the
manufacture of fabricated wire products, to third parties who are generally not
in competition with us. Our industrial wire customers include manufacturers of
nails, coat hangers, barbecue grills, air conditioners, tools, refrigerators and
other appliances. We also sell into the open market carbon steel rod which we
are not able to use in our downstream fabricated wire products and industrial
wire operations.
PROPOSED NEW BUSINESS. We recently announced that we intend to form a
joint venture that will market and distribute wire, wood and plastic products to
the consumer lawn and garden market.
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OUR CORPORATE HISTORY. We are the successor to Keystone Steel & Wire
Company, which was founded in 1889. In 1981, Contran Corporation ("Contran") and
entities affiliated with Contran acquired an interest in us and subsequently
acquired a majority of our outstanding capital stock. Substantially all of
Contran's outstanding voting stock is held either by trusts established for the
benefit of certain children and grandchildren of Harold C. Simmons, of which Mr.
Simmons is sole trustee, or by Mr. Simmons directly. At December 31, 1998,
Contran and other entities related to Mr. Simmons held approximately 50% of our
outstanding capital stock. Contran and Mr. Simmons may be deemed to control us.
OUR ADDRESS AND PHONE NUMBER. Our principal executive offices are
located at Three Lincoln Centre, 5430 LBJ Freeway, Suite 1740, Dallas, Texas
75240-2697. Our telephone number at that address is (972) 458-0028.
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RISK FACTORS
You should carefully consider the risk factors set forth below, as well
as the other information in this Prospectus, in evaluating whether to purchase
the Shares.
CONTROL PERSON AND POTENTIAL CONFLICTS OF INTEREST. Contran
beneficially owns, directly and indirectly, with its affiliates approximately
50% of the outstanding shares of our Common Stock. Substantially all of
Contran's outstanding voting stock is held either by trusts established for the
benefit of certain children and grandchildren of Harold C. Simmons, of which Mr.
Simmons is the sole trustee, or by Mr. Simmons directly. Accordingly, each of
Contran and us may be deemed to be controlled by Mr. Simmons. The election of
directors and taking of other corporate actions, including mergers, requiring
the approval of our stockholders, may be controlled by Contran. Therefore,
Contran could participate in a transaction which could precipitate a "change of
control" which could require us to repurchase our $100 million Senior Secured
Notes (issued in August 1997) at 101% of the principal amount then outstanding
plus accrued and unpaid interest, if any. There can be no assurance that we
would be able to complete such a repurchase. In addition, a "change of control"
constitutes an event of default under our primary revolving credit facility,
which may, under certain circumstances, constitute an event of default under our
Indenture relating to our Senior Secured Notes.
Certain of our officers and directors are also officers and directors
of Contran or of entities that may be deemed to be controlled by or affiliated
with Contran and/or Harold C. Simmons. In addition, from time to time,
corporations that may be deemed to be controlled by or affiliated with Harold C.
Simmons, including us, engage in (i) intercorporate transactions with related
companies, including guarantees, management and expense sharing arrangements,
shared fee arrangements, joint ventures, partnerships, loans, options, advances
of funds on open account, sales, leases and exchanges of assets, including
securities issued by both related and unrelated parties, and (ii) common
acquisition strategies, business combinations, reorganizations,
recapitalizations, securities repurchases, purchases and sales (and other
acquisitions and dispositions) of subsidiaries, divisions or other business
units, which transactions may involve both related and unrelated parties and may
include transactions which result in the acquisition by one related party of a
publicly-held minority equity interest in another related party. Depending upon
the business, tax and other objectives then relevant, it is possible that we
might be a party to one or more such transactions in the future. The foregoing
relationships, transactions and agreements may create potential conflicts of
interest. It is, however, our policy to engage in transactions with related
parties on terms, in our opinion, no less favorable to us than could be obtained
from unrelated parties.
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ENVIRONMENTAL MATTERS. Our operations are affected by a variety of
environmental laws and regulations. Many of these laws and regulations require
permits to operate the facilities to which they pertain. Denial, revocation,
suspension or expiration of such permits could adversely effect the ability of a
facility to continue operations.
We generate hazardous materials, wastewater and air emissions in the
ordinary course of our business. We are subject to federal, state and local
environmental laws and regulations governing, among other things, wastewater,
air emissions, toxic use reduction and hazardous materials disposal. We are
currently involved in a six-phase closure of several inactive hazardous waste
surface impoundments at our Peoria facility. We are also subject to federal and
state "Superfund" and other legislation that impose cleanup and remediation
liability upon present and former owners and operators of, and persons that
generated hazardous waste deposited in, sites determined by federal and state
regulators to contain hazardous waste.
The United States Environmental Protection Agency ("EPA") has notified
us that we are a potentially responsible party under the federal Superfund
statute for the alleged release or threat of release of hazardous waste into the
environment in several instances. Most of these instances involve the cleanup of
landfills and disposal facilities which allegedly received hazardous waste
generated by us, DeSoto, Inc. (our subsidiary that we acquired in September
1996) or our respective predecessors. We incurred expenses associated with
environmental matters of $3.6 million in 1995, $6.7 million in 1996 and $385,000
in 1997 and $93,000 during the first nine months of 1998. At September 30, 1998,
our financial statements reflected total accrued liabilities of $14.3 million to
cover estimated remediation costs arising from environmental issues relating to
these matters. Although we have established an accrual for estimated future
required environmental remediation, there is no assurance as to the ultimate
cost of remedial measures that might eventually be required by environmental
authorities or that additional environmental hazards, requiring additional
remedial expenditures, might not be asserted by such authorities or private
parties. Accordingly, the costs of remedial measures may exceed the amounts
accrued.
Environmental legislation and regulations and related administrative
policies have changed rapidly and significantly in recent years. We may be
subject to increasingly stringent environmental standards in the future
(including those under the Clean Air Act Amendments of 1990, the Clean Water Act
Amendments of 1990, storm water permit programs and toxic use reduction
programs) and we may be required to make additional expenditures, which could be
significant, relating to environmental matters on an ongoing basis. Accordingly,
our actual
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future expenditures for installation of, and improvements to, environmental
control facilities and other similar matters cannot be conclusively determined.
We are subject to (and may in the future be subject to) legal
proceedings brought by private parties or governmental agencies with respect to
environmental matters. There is no assurance that expenditures or proceedings of
the nature described above, or other expenditures or liabilities resulting from
hazardous substances located on our property or used or generated in the conduct
of our business, or resulting from circumstances, actions, proceedings or claims
relating to environmental matters, will not have a material adverse effect on
us.
CYCLICALITY, COMPETITION AND OTHER MARKET FACTORS. The steel and wire
business and the markets that we serve are highly cyclical and competitive and
include both domestic and foreign competitors. The economic recession during the
early 1990s significantly reduced industry profitability. Most domestic
integrated steel producers suffered substantial losses as a result of the
economic recession, high levels of steel imports, worldwide production
overcapacity, a strong U.S. dollar and increased domestic and international
competition. Worldwide overcapacity in the steel industry continues to exist and
since the expiration of certain voluntary restraint agreements with certain
foreign governments in 1992, imports of rod and certain wire products have
increased. We believe that certain competitors may increase their rod production
capacity in the next few years, which could adversely affect rod pricing
generally and increase competition among rod manufacturers.
Certain of our competitors have significantly greater financial and
other resources than we do, which could affect our ability to compete
effectively. In addition, changes in currency exchange rates may result in
increased competition from foreign manufacturers. Accordingly, any significant
economic downturn in the domestic or worldwide economy, increase in steel
imports, increase in production, increase in the strength of the U.S. dollar or
increase in domestic or international competition would likely have an adverse
effect on our results of operations and financial condition.
SCRAP STEEL, OTHER MATERIAL AND ENERGY COSTS. Scrap steel is the
principal raw material that we and other mini-mill producers use in producing
steel rod. The purchase of scrap steel is highly competitive and its price
volatility is influenced by periodic shortages, freight costs, weather and other
conditions beyond our control. The cost of scrap steel has fluctuated
significantly in the past, and may fluctuate significantly in the future, and we
cannot predict accurately the future price of scrap and are not always able to
pass on higher scrap costs by increasing the selling prices of our products. We
have not entered into any long-term contracts for the purchase or supply of
scrap steel and it is, therefore, subject to price fluctuations. In addition to
scrap steel, our production is
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dependent upon the availability of certain other materials and adequate energy
supplies.
Our manufacturing processes consume large amounts of energy in the form
of electricity and natural gas. We purchase electrical energy for our Peoria,
Illinois facility from a regulated utility under an interruptible service
contract which provides for more economical electricity rates but allows the
utility to refuse or interrupt power to our manufacturing facilities during
periods of peak demand. Such interruptions in energy supply have adversely
affected our rod production in the past and may do so in the future. During the
1998 second quarter we entered into a new service contract with the electric
utility at our Peoria facility. The new contract requires us to pay higher rates
during months with high demands. Overall, the new contract is expected to
increase our energy costs approximately $2 million per year, as compared to the
prior contract. Significant increases in the cost, or interruption in the
supply, of scrap steel, other raw materials or energy supplies could adversely
affect our liquidity, financial condition and results of operations.
PLANT UTILIZATION AND CAPACITY. In order to operate profitably, we must
effectively utilize our production capacity and successfully market our products
in highly competitive markets. Due to significant costs associated with idling a
steel mill, it is critical that we fully utilize our steel manufacturing
capacity. We anticipate the new caster, which was installed in September 1998 as
a part of our capital improvements program, will expand our billet producing
capacity by approximately 18%. There is no assurance, however, that we will be
able to utilize fully our expanded billet capacity. Furthermore, any of the
following factors could result in operating our steel and rod mills and our
industrial wire and wire products facilities at lower, less than optimal,
capacity levels:
- an economic downturn;
- our failure to compete effectively in our major markets; or
- a failure of plant or equipment requiring significant capital
expenditures or time to repair.
RISKS IN IMPLEMENTING CAPITAL IMPROVEMENTS PROGRAM. A key element of
our business strategy is to achieve cost savings and production efficiencies
through major capital improvements. Timely completion of the several components
of the capital improvements plan are subject to a number of uncertainties,
including the need to complete the engineering, design and construction of the
improvements and the task of bringing the new production facilities up to
production capacity while minimizing production interruptions. There is no
assurance that we will not experience delays and difficulties with respect to
such efforts, which may include construction delays, production interruptions
and the diversion of resources from our other operations.
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During 1997, we began a three year, $75 million capital improvement
program to upgrade some of our plant and equipment and eliminate production
capacity bottlenecks in order to reduce costs and improve production efficiency.
The principal components of our capital improvements program include
reconfiguring our electric are furnace, replacing the caster and upgrading our
wire and rod mills. During September 1998, we completed the installation of the
new caster which was the single largest project in the capital improvement
program. We completed significantly all of the capital improvements by December
31, 1998. We, however, expect that efficiencies resulting from the installation
of the new caster to improve over the next year as employees become more
familiar with the operation of the new caster.
Furthermore, our ability to achieve, within budgeted time frames, the
anticipated cost savings, operating efficiencies, yield improvements and other
benefits from the capital improvements plan is subject to significant
uncertainties, certain of which are beyond our control. There is no assurance
that such anticipated cost savings or yield improvements or other benefits will
be realized within budgeted time frames or that sufficient demand will exist for
the products that we can produce as a result of such improvements, any of which
could have a material adverse effect on us.
OPERATING RESULTS AND LIQUIDITY. Although we have reported net income
in recent years, in order to meet our financial obligations during such years we
have relied to a significant extent upon borrowed funds. In 1997, we increased
our net borrowings by $50 million in part to fund $11 million of payments
associated with completing our acquisition of Engineered Wire Products, Inc.
("EWP"), to fund our capital expenditures program and to finance operating
activities.
We incur significant on-going costs for plant and equipment,
environmental matters and employee welfare benefits for current and retired
employees, which leave us vulnerable to business downturns. Any of the following
events could materially and adversely affect our results of operations and
liquidity:
- a significant decline in our sales,
- an inability to maintain satisfactory production levels,
- a significant increase in our scrap, other material or energy costs,
- additional liabilities under environmental laws and regulations with
respect to conducting our operations or the disposal and cleanup of
wastes beyond those amounts already accrued,
- significant increases in pension and welfare benefits expense or
funding requirements,
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- significant increases in interest rates, or
- other significant unanticipated costs.
HIGH LEVEL OF INDEBTEDNESS; ABILITY TO SERVICE INDEBTEDNESS. We are
highly leveraged. At September 30, 1998, our aggregate outstanding indebtedness
was approximately $119.6 million, including $16.2 million under our revolving
credit facilities. We had an additional $44 million available for borrowing
under our $61 million of revolving credit facilities at September 30, 1998,
subject to certain limitations provided in the Indenture relating to our $100
million in Senior Secured Notes that we issued in August 1997. We expect our
total debt service requirements through the end of 1999, including both
principal and interest payments, will approximate $3.5 million per quarter or
$14.0 million per year based on our level of indebtedness at September 30, 1998.
Our ability to make scheduled payments of interest on, or to refinance, or pay
when due the principal on our Senior Secured Notes, revolving credit facilities
or our other secured indebtedness, depends on our future operating performance,
which to a certain extent is subject to economic, financial, competitive and
other factors beyond our control.
RESTRICTIVE COVENANTS AND ASSET ENCUMBRANCES. Our revolving credit
facilities contain certain financial and other covenants, including covenants
requiring us to maintain certain financial ratios and restricting our ability
from incurring additional indebtedness or from creating or suffering to exist
certain liens. Our ability to comply with these provisions may be affected by
events beyond our control, including, for example, an increase in the price of
scrap steel and other materials we use or a decrease in the demand for, or
market price of, our products. If we are unable to comply with the financial or
other restrictive covenants under our revolving credit facilities at any time in
the future, there can be no assurance that the lenders would agree to any
necessary amendments or waivers. In such a case, the failure to obtain
amendments or waivers could have a material adverse effect upon our ability to
meet our obligations, including obligations with respect to our Senior Secured
Notes. A failure to make any required payment under our principal revolving
credit facility or any of our other indebtedness or to comply with any of the
financial and operating covenants included therein could result in an event of
default thereunder, permitting the lender to accelerate the maturity of the
indebtedness under our principal revolving credit facility and to foreclose upon
the lender's collateral, and, depending upon the action taken by such lender,
delaying or precluding payment of principal of, premium, if any, or interest on
our Senior Secured Notes. The Indenture also has certain covenants which, if not
complied with, would result in an event of default thereunder, permitting the
acceleration of our Senior Secured Notes. Any such event of default or
acceleration of our Senior Secured Notes could also result in an event of
default or acceleration of our principal revolving credit facility or other of
our indebtedness.
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SECURITY. Our Senior Secured Notes are secured by a second priority
lien on substantially all of our existing and, subject to the terms of the
Indenture, future fixed assets, including equipment acquired and improvements
made pursuant to our capital improvements plan. The lien on our fixed assets
will become a first priority lien upon the termination of the first priority
lien in favor of the trust securing our contingent pension contribution
obligations of approximately $2.4 million. We expect this obligation to decline
in annual increments to nil by January 1, 2001.
Our principal revolving credit facility is secured by all of our
assets, other than our fixed assets. In the event of default under our principal
revolving credit facility, the lender will have prior claim on such assets over
other creditors, including the holders of our Senior Secured Notes. In addition,
a "change of control" of the Company constitutes an event of default under our
principal revolving credit facility, which may, under certain circumstances,
constitute an "event of default" under our Indenture. If the lender accelerates
the maturity of our revolving credit facility, there can be no assurance that we
will have sufficient assets to satisfy our obligations under our Senior Secured
Notes.
SUBSTANTIAL EMPLOYEE POSTRETIREMENT OBLIGATIONS. We have substantial
financial obligations related to our employee postretirement medical and life
insurance benefits plans. Most of our employees and certain retired employees of
our currently owned, sold or discontinued businesses are currently entitled to
certain postretirement medical and life insurance benefits. Statement of
Financial Accounting Standards No. 106, "Accounting for Postretirement Benefits
Other than Pensions," ("SFAS 106") requires that we accrue estimated future
retiree medical and life insurance benefits rather than recognizing the costs as
claims are paid. In accordance with SFAS 106, we have established a liability on
our financial statements for the present value of the estimated future medical
and life insurance benefit obligations based on various assumptions, such as the
discount rate and the rate of increase of future health care costs. Changes in
such assumptions or termination of the employee postretirement plans for medical
and life insurance benefits could result in a material change in our
postretirement medical and life insurance benefit obligation and the associated
expense ("OPEB expense"). As of September 30, 1998, we had accrued a
postretirement health care and life insurance benefit liability of $109.4
million. The OPEB expense for financial reporting purposes and cash payments for
actual postretirement health care and life insurance claims were approximately
$8.3 million and $7.6 million, respectively, during 1997. During the first nine
months of 1998, OPEB expense and cash payments amounted to $6.1 million and $6.5
million, respectively. As medical costs rise, we expect our employee
postretirement cash payments to increase.
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We also maintain a pension plan pursuant to which our current and
former employees (and certain of the former employees of our predecessors) are
entitled to pension benefits. As part of our acquisition of DeSoto in September
1996, we merged our three underfunded defined benefit pension plans with and
into DeSoto's single overfunded defined benefit pension plan resulting in a plan
that was overfunded for financial reporting purposes by $62 million at December
31, 1997. We are, however, still subject to the minimum funding requirements of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and
we may be obligated in the future to make further contributions to our pension
plan even though there is an "overfunding" for financial reporting purposes
because the actuarial assumptions under ERISA are different than those we used
for financial reporting purposes. Although we will not be obligated to make any
payments to our pension plan in 1998, future pension plan funding obligations
will be contingent upon various factors, including the performance of our
pension plan's investments and changes in our actuarial assumptions, including
our pension plan participants' mortality rates, length of service and salary
amount prior to retirement.
At September 30, 1998, approximately 97% of the assets of our pension
plan were invested in a collective investment trust (the "Collective Trust")
formed by Valhi, Inc. ("Valhi"), a majority owned subsidiary of Contran, to
permit the collective investment by trusts which implement employee benefit
plans maintained by Contran, Valhi and related companies, including the Company.
The remainder of our pension plan and the Collective Trust's assets at September
30, 1998 were invested in United States Treasury Notes, corporate bonds and
notes, investment partnerships, time deposits, commercial paper, foreign
currency, certain real estate leased by us, various mutual funds invested in
bonds, equity and real estate, mortgages and other short-term investments.
Harold C. Simmons is the sole trustee and the sole member of the Trust
Investment Committee for the Collective Trust.
LIABILITIES ASSOCIATED WITH DESOTO. DeSoto is one of our wholly-owned
subsidiaries and is subject to certain contingent liabilities, including
contingent liabilities associated with environmental matters discussed above. We
believe that DeSoto has established appropriate accruals for these
contingencies. However, we acquired DeSoto in September 1996 and, accordingly,
we have been managing the resolution of these contingencies for only a limited
time. There is no assurance that the ultimate cost of these contingencies will
not exceed the current accruals.
LABOR RELATIONS. A majority of our workforce is represented by various
labor organizations, including the Independent Steel Workers Alliance, the
International Association of Machinists and Aerospace Workers (Local 1570), and
the Local Union #40 -- An Affiliate of the International Brotherhood of
Teamsters'
14
<PAGE> 17
Chauffers Warehouseman and Helpers of America -- AFL-CIO (collectively, the
"Unions"). We currently have collective bargaining agreements with all of the
Unions, which expire at various times between May 1999 and November 2001. There
can be no assurance, however, as to the results of negotiations of future
collective bargaining agreements, whether future collective bargaining
agreements will be negotiated without production interruptions or the possible
impact of future collective bargaining agreements, or the negotiation thereof,
on our financial condition and results of operations.
DIVIDENDS. We have not paid cash dividends on our common stock since
1977. Further, we are prohibited from paying dividends without the consent of
the lender of our principal revolving credit facility. In addition, the
Indenture related to our Senior Secured Notes limits our ability to pay
dividends on our common stock. Accordingly, we do not anticipate paying any cash
dividends in the foreseeable future.
YEAR 2000 ISSUE. As a result of certain computer programs being written
using two digits rather than four to define the applicable year, any of our
computer programs that have date sensitive software may recognize a date using
"00" as the year 1900 rather than the year 2000 (the "Year 2000 Issue"). This
could result in a system failure or miscalculations causing disruptions of
operations, including, among other things, a temporary inability to process
transactions, send invoices or engage in normal business activities. Such
failures could materially and adversely affect our results of operations,
liquidity and financial condition.
We are in the process of taking an inventory of our information systems
to determine the modifications to existing software and new software required to
mitigate any Year 2000 issues. Our evaluation includes information systems
infrastructure, financial and administrative systems, process control and
manufacturing operating systems as well as significant vendors and customers. We
expect this inventory will be completed during the 1999 first quarter. Because
the majority of our significant information systems have recently been installed
or updated, many of our systems and related software are already Year 2000
compliant.
We are utilizing both internal and external sources to reprogram or
replace and test our software, and we expect to have our evaluation completed
during the 1999 first quarter and required modifications completed prior to
December 31, 1999.
Although we expect our critical systems to be compliant by December 31,
1999, there is no assurance these results will be achieved. However, the impact
of a failure of any of our information systems would be mitigated to the extent
that
15
<PAGE> 18
other alternate processes, including manual processes, were able to meet
processing requirements. Presently, we expect alternate procedures would be able
to meet our processing needs. In addition, excluding recent equipment additions
that are Year 2000 compliant, a significant portion of our plant and equipment
is aged and does not include imbedded chip technology susceptible to Year 2000
issues.
We rely on third parties for raw materials, utilities, transportation
and other key services. In addition, we are dependent upon our customers for
cash flow. We have initiated formal communications with our significant
suppliers and large customers to determine the extent to which we are vulnerable
to those third parties' failure to eliminate their own Year 2000 Issues. We
presently expect to complete these third party communications during the 1999
first quarter and will at that time begin developing contingency plans for
potential noncompliance by these third parties. Year 2000 Issues that adversely
impact these third parties could also effect our operations. There can be no
assurance the systems of other companies on which our systems rely will be
timely converted, or that a failure to convert by another company, or a
conversion that is incompatible with our systems, would not have a material
adverse effect on us.
Because we have not completed the evaluation of our Year 2000 Issue, we
are not able to quantify the costs that may be incurred in order to eliminate
any Year 2000 Issues. The total costs that will be incurred by us in connection
with resolving our Year 2000 Issues will be impacted by our ability to
successfully identify our Year 2000 Issues, the level of effort required to
remediate the issue and the ability of third parties to successfully address
their own Year 2000 Issues. Total costs incurred to date relative to the
remediation of our Year 2000 Issues have been expensed as incurred and have not
been material.
The costs of the project and the date on which we plan to complete our
Year 2000 assessment and remediation are based on management's estimates, which
were derived utilizing numerous assumptions of future events, including the
continued availability of certain resources, third party modification plans and
other factors. There can be no guarantee that these estimates will be achieved
and actual results could differ significantly from those plans. Specific factors
that might cause differences from management's estimates include, but are not
limited to, the availability and cost of personnel trained in this area, the
ability to locate and correct relevant computer codes, and similar
uncertainties. We believe that we are devoting the necessary resources to
identify and resolve significant Year 2000 Issues in a timely manner.
16
<PAGE> 19
USE OF PROCEEDS
All of the Shares of our Common Stock offered hereby are being sold by
the Selling Stockholders identified in the section of this prospectus captioned
"Selling Stockholders." We will not receive any of the proceeds from the sale of
the Shares. We will pay certain expenses relating to the offering, estimated to
be approximately $50,000.
SELLING STOCKHOLDERS
The following sets forth information regarding the Selling Stockholders
and the Shares of our Common Stock that they are offering for sale pursuant to
this Prospectus.
The Selling Stockholders acquired the Shares offered hereby upon the
exercise of warrants held by them. We issued the warrants to the Selling
Stockholders in exchange for certain warrants they held which were exercisable
for shares of the capital stock of DeSoto, a company that we acquired in
September 1996 by means of a merger transaction.
<TABLE>
<CAPTION>
NAME SHARES BENEFICIALLY NUMBER OF SHARES BENEFICIALLY
- ---------------------------------- OWNED PRIOR TO SHARES TO BE OWNED AFTER
THE OFFERING(1) SOLD IN THE THE OFFERING
----------------------- OFFERING -----------------------
NUMBER PERCENT ------------ NUMBER PERCENT
--------- ---------- -------- -------
<S> <C> <C> <C> <C> <C>
Asgard Ltd........................ 240,060 2.4% 149,300 90,760 .9%
William Spier(2).................. 345,262 3.5 142,632 202,630 2.1
LBN Investment Associates LP...... 56,435 * 56,435 -- --
Parkway M&A Capital Corp.......... 134,556 1.4 99,533 35,023 .4
</TABLE>
- ------------------------
*Less than 1
(1) Beneficial ownership has been determined in accordance with Rule 13d-3
under the Securities Exchange Act of 1934. Unless otherwise noted, we
believe that all persons named in the table above have sole voting and
investment power with respect to all shares of our Common Stock owed by
them, and beneficial ownership includes shares of our Common Stock
underlying options or warrants that may be exercised within 60 days
following January 27, 1999.
(2) Mr. Spier has been one of our directors since 1996. He served as the
Chairman of DeSoto from 1991 to 1996, and the Chief Executive Officer of
DeSoto from 1991 to 1994 and again from 1995 to 1996.
17
<PAGE> 20
PLAN OF DISTRIBUTION
All or part of the Shares may be offered by the Selling Stockholders
from time to time in transactions on the New York Stock Exchange, Inc., in
privately negotiated transactions, through the writing of options on the Shares,
or a combination of such methods of sale, at fixed prices that may be changed,
at market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. For purposes of this
Prospectus, the term "Selling Stockholder" includes donees, transferees,
pledgees or other successors in interest of or to a Selling Stockholder that
receive the Shares as a gift, partnership distribution or other non-sale related
transfer. Each Selling Stockholder will act independently of the Company in
making decisions with respect to the timing, manner and size of each sale. The
methods by which the Shares may be sold or distributed may include, but are not
limited to, the following:
- a cross or block trade in which the broker or dealer engaged by a
Selling Stockholder will attempt to sell the Shares as agent but may
position and resell a portion of the block as principal to
facilitate the transaction;
- purchases by a broker or dealer as principal and resale by such
broker or dealer for its account;
- an exchange distribution in accordance with the rules of such
exchange;
- ordinary brokerage transactions and transactions in which the broker
solicits purchasers;
- privately negotiated transactions;
- short sales or borrowings, returns and reborrowings of the Shares
pursuant to stock loan agreements to settle short sales;
- delivery in connection with the issuance of securities by issuers,
other than the Company, that are exchangeable for (whether on an
optional or mandatory basis), or payable in, such shares (whether
such securities are listed on a national securities exchange or
otherwise) or pursuant to which such shares may be distributed; and
- a combination of any such methods of sale or distribution.
In effecting sales, brokers or dealers engaged by a Selling Stockholder
may
18
<PAGE> 21
arrange for other brokers or dealers to participate in such sales. Brokers or
dealers may receive commissions or discounts from a Selling Stockholder or from
the purchasers in amounts to be negotiated immediately prior to the sale. A
Selling Stockholder may also sell the Shares in accordance with Rule 144 under
the Securities Act or pursuant to other exemptions from registration under the
Securities Act.
If the Shares are sold in an underwritten offering, the Shares may be
acquired by the underwriters for their own account and may be further 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 names of the underwriters with respect to any such
offering and the terms of the transactions, including any underwriting
discounts, concessions or commissions and other items constituting compensation
of the underwriters and broker-dealers, if any, will be set forth in a
prospectus supplement relating to such offering. Any public offering price and
any discounts, concessions or commissions allowed or reallowed or paid to
broker-dealers may be changed from time to time. Unless otherwise set forth in a
prospectus supplement, the obligations of the underwriters to purchase the
Shares will be subject to certain conditions precedent and the underwriters will
be obligated to purchase all the Shares specified in such prospectus supplement
if any such Shares are purchased. This Prospectus also may be used by brokers
who borrow the Shares to settle short sales of shares of our Common Stock and
who wish to offer and sell such Shares under circumstances requiring use of the
prospectus or making use of the prospectus desirable.
From time to time the Selling Stockholders may engage in short sales,
short sales against the box, puts, calls and other transactions in securities of
the Company, or derivatives thereof, and may sell and deliver the Shares in
connection therewith.
None of the proceeds from the sales of the Shares by the Selling
Stockholders will be received by the Company. The Company will bear certain
expenses in connection with the registration of the Shares being offered by the
Selling Stockholders, including all costs incident to the offering and sale of
the Shares to the public other than any commissions and discounts of
underwriters, dealers or agents and any transfer taxes.
A Selling Stockholder, and any broker-dealer who acts in connection
with the sale of Shares hereunder, may be deemed to be an "underwriter" as that
term is defined in the Securities Act, and any commissions received by them and
profit on any resale of the Shares as principal might be deemed to be
underwriting discounts and commissions under the Securities Act. The Company has
agreed to indemnify the Selling Stockholders, any underwriters and certain other
19
<PAGE> 22
participants in an underwriting or distribution of the Shares and their
directors, officers, employees and agents against certain liabilities, including
liabilities arising under the Securities Act.
LEGAL MATTERS
The validity of the Common Stock offered hereby will be passed upon for
the Company by Rogers & Hardin LLP, Atlanta, Georgia.
EXPERTS
The audited consolidated financial statements of Keystone Consolidated
Industries, Inc. and subsidiaries included in our Annual Report on Form 10-K for
the year ended December 31, 1997 and incorporated by reference in this
Prospectus have been incorporated herein in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
such firm as experts in accounting and auditing.
The audited financial statements of Engineered Wire Products, Inc.
included in our Current Report on Form 8-K filed January 16, 1998 and
incorporated by reference in this Prospectus have been incorporated herein in
reliance on the report of Deloitte & Touche LLP, independent auditors, given on
the authority of such firm as experts in accounting and auditing.
20
<PAGE> 23
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The expenses to be paid in connection with the issuance and
distribution of the securities being registered are as follows and will be borne
by the Registrant:
<TABLE>
<S> <C>
SEC Registration Fee............................................................... $ 1,058
NYSE Listing Fee................................................................... 1,568
Printing and Mailing Expenses...................................................... 3,000
Legal Fees and Expenses............................................................ 7,500
Accounting Fees and Expenses....................................................... 12,500
Transfer Agent's Fees and Expenses................................................. 3,000
Blue Sky Fees and Expenses......................................................... 2,000
Miscellaneous Expenses............................................................. 19,374
--------
Total.................................................................... $ 50,000
========
</TABLE>
- ----------
* Estimated
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 145 of the Delaware General Corporation Law ("DGCL") provides
that, to the extent a director, officer, employee or agent of a corporation has
been successful on the merits or otherwise in defense of any action, suit or
proceeding, whether civil, criminal, administrative or investigative or in
defense of any claim, issue, or matter therein (hereinafter a "Proceeding"), by
reason of the fact that he is or was a director, officer, employee or agent of a
corporation or is or was serving at the request of such corporation as a
director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust or other enterprise (collectively an "Agent" of the
corporation), he shall be indemnified against expenses (including attorney's
fees) actually and reasonably incurred by him in connection therewith.
Section 145 also provides that a corporation may indemnify any person
who was or is a party or is threatened to be made a party to any threatened
Proceeding by reason of the fact that he is or was an Agent of the corporation,
against expenses (including attorney's fees), judgment, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in, or not opposed to, the best interest of the
corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful; provided, however, that in
an action by or in the right of the corporation, the corporation may not
indemnify such person in respect of any claim, issue, or matter as to which he
is adjudged to be liable to the corporation unless, and only to the extent that,
the Court of Chancery or the court in which such proceeding was brought
determined that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is reasonably entitled in indemnity.
21
<PAGE> 24
Article V of the Bylaws of Registrant provides with respect to the
indemnification of directors and officers that the Registrant shall indemnify to
the same extent currently permitted by Section 145 of the DGCL, each person that
such Section grants the Registrant power to indemnify. Article Eleventh of the
Certificate of Incorporation of the Registrant provides that no director shall
be personally liable to the corporation or any of its stockholders for monetary
damages for breach of fiduciary duty as a director, except with respect to (1) a
breach of the director's duty of loyalty to the corporation its stockholders,
(2) acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (3) liability under Section 174 of the DGCL, or
(4) a transaction from which the director derived an improper personal benefit.
Article Eleventh further provides that the liability of the corporation's
directors to the corporation or its stockholders will be limited to the fullest
extent permitted by Section 102(b)(7) of the DGCL, as amended from time to time.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling the
Registrant pursuant to the foregoing provisions, the Registrant has been
informed that, in the opinion of the Commission, such indemnification is against
public policy as expressed in the Act and is therefore unenforceable.
ITEM 16. EXHIBITS.
<TABLE>
<S> <C> <C>
3.1 -- Certificate of Incorporation, as amended and filed with
the Secretary of State of Delaware (Incorporated by
reference to Exhibit 3.1 to the Registrant's Annual Report
on Form 10-K for the year ended December 31, 1990.)
3.2 -- Bylaws of the Registrant, as amended and restated
December 30, 1994 (Incorporated by reference to Exhibit
3.2 to the Registrant's Annual Report on Form 10-K for the
year ended December 31, 1994.)
4.1 -- Indenture dated as of August 7, 1997 relating to the
Registrant's 9 5/8% Senior Secured Notes due 2007
(Incorporated by reference to Exhibit 4.1 to the
Registrant's Form 8-K filed September 4, 1997.)
5.1 -- Opinion and Consent of Rogers & Hardin LLP.
23.1 -- Consent of Rogers & Hardin LLP (included in Exhibit 5.1).
23.2 -- Consent of PricewaterhouseCoopers LLP.
23.3 -- Consent of Deloitte & Touche LLP
24.1 -- Powers of Attorney (included on the signature page to this
Registration Statement).
</TABLE>
22
<PAGE> 25
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933, as amended (the "Securities Act");
(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 (notwithstanding the foregoing, any
increase or decrease in the 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 percent 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 in such information in the
Registration Statement.
Provided, however, that (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference into this
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, 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.
(4) For purposes of determining any liability under the Securities Act,
the information omitted from the form of Prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
Prospectus filed by Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under
the Securities Act shall be deemed to be part of this Registration Statement as
of the time it was declared effective.
23
<PAGE> 26
(5) For purposes of determining any liability under the Securities Act,
each filing of the registrant's annual report pursuant to Section 13(a) or 15(d)
of the Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted as to directors, officers and controlling persons of the
Registrant pursuant to the Delaware General Corporation Law, the Certificate of
Incorporation or the By-laws of Registrant, or otherwise, the Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act and
is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer, or controlling person of the Registrant
in the successful defense of any action, suit, or proceeding) is asserted by
such director, officer, or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
24
<PAGE> 27
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended
(the "Securities Act"), the Registrant certifies that it has reasonable grounds
to believe that it meets all of the requirements for filing on Form S-3 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized in Dallas, Texas, on this 29th day of
January, 1999.
KEYSTONE CONSOLIDATED
INDUSTRIES, INC.
By: /s/ Robert W. Singer
---------------------------------
Robert W. Singer
President and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed by the following persons
in the capacities and on the dates indicated.
We, the undersigned officers and directors of Keystone Consolidated
Industries, Inc., hereby severally constitute and appoint Robert W. Singer,
Ralph P. End and Harold M. Curdy, and each of them, with full power of
substitution, our true and lawful attorneys and agents, to execute in our names
and on our behalf in the capacities indicated below, any and all amendments
(including, without limitation, post-effective amendments) to this Registration
Statement and any and all other instruments which such attorneys and agents, or
any one of them, deem necessary or advisable to enable Keystone Consolidated
Industries, Inc. to comply with the Securities Act, the rules, regulations and
requirements of the Securities Act in respect thereof, and the securities laws
of any state or other political subdivision or jurisdiction; and the undersigned
officers and directors do hereby severally ratify and confirm as our own acts
and deeds all that such attorneys and agents, and each of them, shall do or
cause to be done by virtue hereof. Any one of such attorneys and agents shall
have, and may exercise, all of the powers hereby conferred.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Glenn R. Simmons Chairman of the Board January 29, 1999
- ---------------------------- and Director
Glenn R. Simmons
/s/ J. Walter Tucker, Jr. Vice Chairman of the Board January 29, 1999
- ---------------------------- and Director
J. Walter Tucker, Jr.
/s/ Robert W. Singer President, Chief Executive January 29, 1999
- ---------------------------- Officer and Director (Principal
Robert W. Singer Executive Officer)
</TABLE>
25
<PAGE> 28
<TABLE>
<S> <C> <C>
/s/ Harold M. Curdy Vice President-- Finance January 29, 1999
- ---------------------------- and Treasurer (Principal
Harold M. Curdy Financial Officer)
/s/ Bert E. Downing, Jr. Corporate Controller January 29, 1999
- ---------------------------- (Principal Accounting
Bert E. Downing, Jr. Officer)
/s/ Thomas E. Barry Director January 29, 1999
- ----------------------------
Thomas E. Barry
/s/ Paul M. Bass, Jr. Director January 29, 1999
- ----------------------------
Paul M. Bass, Jr.
/s/ David E. Connor Director January 29, 1999
- ----------------------------
David E. Connor
/s/ William P. Lyons Director January 29, 1999
- ----------------------------
William P. Lyons
/s/ William Spier Director January 29, 1999
- ----------------------------
William Spier
</TABLE>
26
<PAGE> 29
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
------- -------
<S> <C> <C>
3.1 -- Certificate of Incorporation, as amended and filed with
the Secretary of State of Delaware (Incorporated by
reference to Exhibit 3.1 to the Registrant's Annual Report
on Form 10-K for the year ended December 31, 1990.)
3.2 -- Bylaws of the Registrant, as amended and restated
December 30, 1994 (Incorporated by reference to Exhibit 3.2
to the Registrant's Annual Report on Form 10-K for the year
ended December 31, 1994.)
4.1 -- Indenture dated as of August 7, 1997 relating to the
Registrant's 9 5/8% Senior Secured Notes due 2007
(Incorporated by reference to Exhibit 4.1 to the
Registrant's Form 8-K filed September 4, 1997.)
5.1 -- Opinion and Consent of Rogers & Hardin LLP.
23.1 -- Consent of Rogers & Hardin LLP (included in Exhibit 5.1).
23.2 -- Consent of PricewaterhouseCoopers LLP.
23.3 -- Consent of Deloitte & Touche LLP.
24.1 -- Powers of Attorney (included on the signature page to this
Registration Statement).
</TABLE>
- ----------
27
<PAGE> 1
EXHIBIT 5.1
January 29, 1999
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: KEYSTONE CONSOLIDATED INDUSTRIES, INC.
REGISTRATION STATEMENT ON FORM S-3
Ladies and Gentlemen:
We have acted as counsel to Keystone Consolidated Industries, Inc. (the
"Company") in connection with the filing by the Company of a Registration
Statement on Form S-3 (the "Registration Statement") with the Securities and
Exchange Commission (the "Commission") registering under the Securities Act of
1933, as amended (the "Act"), 447,900 shares of the common stock, par value
$1.00 per share (the "Common Stock"), of the Company that have been issued
pursuant to certain warrants issued by the Company (the "Warrants"). All such
shares of Common Stock are referred to herein as the "Shares".
In giving the opinion hereinafter set forth, we have examined the
minutes of the proceedings of the stockholders and the Board of Directors of the
Company, the Warrants and such other agreements, documents, instruments and
records as we deemed necessary or appropriate under the circumstances for us to
express the opinion hereinafter set forth. As to various factual matters that
are material to our opinion, we have relied upon certificates of officers of the
Company and certificates of various public officials. In making the foregoing
examinations, we assumed the genuineness of all signatures, the authenticity of
all documents submitted to us as originals, the conformity to the original
documents of all documents submitted to us as copies, the authority of the
person or persons who executed each of such documents on behalf of any person or
entity other than the Company, the correctness and accuracy of all certificates
of officers of the Company and the correctness and accuracy of all certificates
of various public officials.
Based upon and subject to the foregoing, we are of the opinion that the
Shares have been validly issued and are fully paid and nonassessable.
<PAGE> 2
Securities and Exchange Commission
January 29, 1999
Page 2
Our conclusions are limited to the matters expressly set forth as our
"opinion" in the immediately preceding paragraph, and no opinion is implied or
is to be inferred beyond the matters expressly so stated. Such opinion is given
as of the date hereof, and we expressly decline any undertaking to revise or
update such opinion subsequent to the date hereof or to advise the Commission of
any matter arising subsequent to the date hereof that would cause us to modify,
in whole or in part, such opinion.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving the foregoing consent, we do not admit that we
are in the category of persons whose consent is required under Section 7 of the
Act or the rules and regulations of the Commission promulgated thereunder.
Very truly yours,
ROGERS & HARDIN
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration statement of
Keystone Consolidated Industries, Inc. and Subsidiaries on Form S-3 of our
report dated March 2, 1998, on our audits of the consolidated financial
statements and financial statement schedule of Keystone Consolidated
Industries, Inc. and Subsidiaries as of December 31, 1997 and 1996, and for the
years ended December 31, 1997, 1996, and 1995, which report is incorporated by
reference in this Registration Statement on Form S-3.
PricewaterhouseCoopers LLP
Dallas, Texas
January 29, 1999
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EXHIBIT 23.3
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
Keystone Consolidated Industries, Inc. on Form S-3 of our report on Engineered
Wire Products dated February 28, 1997 (December 23, 1998 as to Note A),
appearing in the Form 8-K of Keystone Consolidated Industries, Inc. dated
January 16, 1998.
DELOITTE & TOUCHE LLP
Dayton, Ohio
January 26, 1999
