SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of
1934
(Amendment No. ________________)
Filed by the Registrant [X]
Filed by a party other than the Registrant []
Check the appropriate box:
[X] Preliminary Proxy Statement
[] Confidential for Use of the Commission Only (as permitted by
Rule 14a-
6(e)(2))
[] Definitive Proxy Statement
[] Definitive Additional Materials
[] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
Kinark Corporation
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of filing fee (Check the appropriate box):
[X] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1),
14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[] $500 per each party to the controversy pursuant to Exchange
Act Rule 14a-
6(i)(3).
[] Fee computed on table below per Exchange Act Rules
14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction
applies:
(2) Aggregate number of securities to which transactions
applies:
(3) Per unit price or other underlying value of transaction
computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[] Fee paid previously with preliminary materials.
[] Check box if any part of the fee is offset as provided by
Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee
was paid
previously. Identify the previous filing by registration
statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE>
As filed with the Securities and Exchange Commission on September
15, 1995.
Registration No.
33-________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
KINARK CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
DELAWARE 71-0268502
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification Number)
7060 SOUTH YALE
TULSA, OKLAHOMA 74136
(918) 494-0964
(Address, Including Zip Code and Telephone Number, Including
Area Code, of Registrant's Principal Executive Offices)
PAUL R. CHASTAIN
PRESIDENT AND CHIEF EXECUTIVE OFFICER
7060 SOUTH YALE
TULSA, OKLAHOMA 74136
(918) 494-0964
(Name, Address, Including Zip Code, and Telephone Number,
Including
Area Code, of Agent for Service)
COPY TO:
Paul A. Quiros, Esq.
Nelson Mullins Riley & Scarborough, L.L.P.
1201 Peachtree Street, Suite 2200
Atlanta, Georgia 30361
(404) 817-6000
(404) 817-6050 (Fax)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
AS SOON AS PRACTICABLE AFTER THIS REGISTRATION STATEMENT BECOMES
EFFECTIVE
If the only securities being registered in this form are
being offered
pursuant to dividend or interest reinvestment plans, please check
the following
box. []
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. []
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]
<TABLE>
CALCULATION OF
REGISTRATION FEE
<CAPTION>
Title of Each Class ofAmount to beProposed MaximumProposed
MaximumAmount of
Securities to be RegisteredRegisteredPrice Per Share<F1>Aggregate
Offering Price<F1>Registration Fee
<S> <C> <C> <C>
<C>
Common Stock, $.10 par value5,619,615$2.00 $11,239,230
$3,875.60
<FN>
<F1> Estimated solely for the purpose of calculating the
registration fee pursuant to Rule 457(a).
</FN>
</TABLE>
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 SUCH
SECTION 8(A),
MAY DETERMINE.
<PAGE>
KINARK CORPORATION
Cross Reference Sheet Between Items in Part I
of
Form S-3 and the Prospectus
Item Number and Caption Prospectus Caption
1. Front of Registration Statement
and Outside Front Cover Page of
Prospectus Outside Front Cover Page
2. Inside Front and Outside Back
Cover Pages of Prospectus Inside Front and Outside
Back Cover Pages
3. Summary Information, Risk
Factors and Ratio of Earnings
to Fixed Charges Summary; Risk Factors;
Summary Pro
Forma and Selected
Financial Data
4. Use of Proceeds Use of Proceeds
5. Determination of Offering Price Outside Front Cover Page;
Risk Factors
6. Dilution *
7. Selling-Security Holders *
8. Plan of Distribution Outside Front Cover Page;
Summary; The
Rights Offering
9. Description of Securities to
Be Registered Description of Capital
Stock
10. Interests of Named Experts
and Counsel Legal Matters; Experts
11. Material Changes Summary; Business
Strategy; The
Acquisition; Description
of
Subordinated Financing
12. Incorporation of Certain
Information by Reference Inside Front Cover Page;
Description of
Capital Stock
13. Disclosure of Commission
Position on Indemnification
for Securities Act Liabilities *
*Omitted because answer is negative or not applicable<PAGE>
SUBJECT TO COMPLETION, DATED SEPTEMBER 15, 1995
PROSPECTUS AND PROXY STATEMENT
KINARK
CORPORATION
5,619,615 COMMON SHARES
Kinark Corporation ("Kinark" or the "Company") is
distributing to holders
of record as of the close of business on ________________, 1995
(the "Record
Date"), of its common stock, $.10 par value per share (the
"Common Stock"),
three nontransferable rights (each, a "Right") for each two
shares of Common
Stock held on the Record Date, with each such Right entitling the
holder
thereof to subscribe for and purchase one share of Common Stock
(the "Basic
Subscription Privilege") for a price of $2.00 per share (the
"Subscription
Price"). The Rights will expire at 5:00 p.m. New York City time,
on
____________, 1995, unless extended as described herein (the
"Expiration
Date"). Each Right also carries with it the right to subscribe
at the
Subscription Price for additional shares that are not otherwise
purchased
through the exercise of Rights in an aggregate amount up to 50%
of the shares
that the holder is entitled to purchase under the Basic
Subscription Privilege
(the "Oversubscription Privilege"). The number of Rights
distributed to each
holder of Common Stock will be rounded down to the nearest whole
number. No
fractional rights will be distributed, no fractional shares of
Common Stock
will be issued, and no cash in lieu thereof will be paid. The
Rights are
evidenced by nontransferable Subscription Certificates (the
"Subscription
Certificates") distributed to holders of record on the Record
Date with this
Prospectus. Pursuant to agreements with the Company, certain
directors of the
Company have agreed to purchase not less than $1,750,000 of the
Common Stock
(or 15.6% of the shares offered hereby) at the Subscription Price
(the
"Purchase Commitment"). See "The Rights Offering - Purchase
Commitment." ONCE
A HOLDER HAS EXERCISED ANY RIGHTS, SUCH EXERCISE MAY NOT BE
REVOKED. HOLDERS
EXERCISING RIGHTS SHOULD COMPLETE AND RETURN THEIR SUBSCRIPTION
CERTIFICATE(S)
WITH PAYMENT OF THE SUBSCRIPTION PRICE PROMPTLY TO INSURE TIMELY
RECEIPT AND
THE COLLECTION OF ANY FUNDS PRIOR TO THE EXPIRATION DATE.
The proceeds of this offering (the "Rights Offering"),
together with other
sources of funds available to the Company, will be used by the
Company to
acquire for $8,321,200 all of the capital stock (the
"Acquisition") of Rogers
Galvanizing Company ("Rogers"), to pay related fees and expenses,
and for
general corporate purposes. Additional financing for the
Acquisition will be
provided, to the extent necessary, by the issuance of up to
$4,000,000
principal amount of Senior Secured Subordinated Notes (the
"Notes") to a family
investment company (the "Investor") controlled by Michael T.
Crimmins, Chairman
of the Board of the Company, pursuant to a securities purchase
agreement (the
"Subordinated Financing Agreement"). Completion of the Rights
Offering is
contingent upon satisfaction or waiver of a number of conditions,
including the
determination by the Board of Directors of the Company that
sufficient
financing is available to permit the Company to consummate the
Acquisition. In
the event the conditions to the Rights Offering have not been
satisfied by
_______________, 1995, or the Rights Offering is otherwise
terminated, all
subscription payments will be returned promptly, without interest
or deduction.
See "The Acquisition," "Description of Subordinated Financing,"
and "Use of
Proceeds."
[The following paragraph appears sideways along the left-hand
margin of this
page in red ink.]
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR
AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN
FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE
SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL
OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF
THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF
SUCH STATE.
This document contains two parts: a Prospectus of the
Company with
respect to the shares of Common Stock issuable upon the exercise
of the Rights,
and a Proxy Statement with respect to the solicitation of proxies
(the
"Proxies") by the Board of Directors of the Company for a special
meeting of
stockholders to be held on ________________, 1995 (the "Special
Meeting"), for
the purpose of voting on an amendment to the Restated Certificate
of
Incorporation of the Company to increase the number authorized
shares of the
Common Stock from 12,000,000 to 18,000,000, and to approve the
issuance of
certain warrants and underlying shares of Common Stock to be
issued to the
Investor pursuant to the Subordinated Financing Agreement. The
Proxy Statement
begins on page P-1 hereof. A proxy with respect to the matters
to be
considered at the Special Meeting is enclosed with the Proxy
Statement. PLEASE
COMPLETE AND RETURN THE ENCLOSED PROXY PROMPTLY SO THAT YOUR VOTE
MAY BE
RECORDED.
The Company's Common Stock is listed on the AMEX under the
symbol "KIN."
The last reported sales price of the Common Stock on
________________, 1995,
was $_______ per share. The Company anticipates that the shares
of Common
Stock issued upon the exercise of the Rights will be approved for
trading on
the AMEX.
PRIOR TO DECIDING TO EXERCISE RIGHTS AND PURCHASE SHARES OF
THE COMMON
STOCK, POTENTIAL INVESTORS SHOULD CAREFULLY CONSIDER THE FACTORS
SET FORTH IN
"RISK FACTORS" ON PAGE 12 IN ADDITION TO THE OTHER INFORMATION
CONTAINED IN
THIS PROSPECTUS. STOCKHOLDERS WHO DO NOT EXERCISE THEIR RIGHTS
IN FULL WILL
SUFFER SIGNIFICANT DILUTION IN THEIR PROPORTIONATE INTEREST IN
THE EQUITY
OWNERSHIP AND VOTING POWER OF THE COMPANY. SEE "RISK FACTORS."
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.
Underwriting Discounts
Proceeds to the
Price to Public and Commissions(1)
Company(2)
Per Share $2.00 N/A $2.00
Total $11,239,230 N/A
$11,239,230
(1) See "Plan of Distribution" for information with respect to
certain
contingent fees payable by the Company to Morrow & Co.,
Inc., the
Information Agent for the Rights Offering and solicitation
of the Proxies.
(2) Before deducting expenses of the offering payable by the
Company,
estimated to be $385,000.
The date of this Prospectus and Proxy Statement is
_______________, 1995.<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of
the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance
therewith files reports, proxy statements and other information
with the
Securities and Exchange Commission (the "Commission"). Such
reports, proxy
statements and other information can be inspected and copied at
the public
reference facilities of the Commission, Room 1024, 450 Fifth
Street, N.W.,
Washington, D.C. 20549; New York Regional Office, Public
Reference Room, 7
World Trade Center, 13th Floor, New York, New York 10048; and
Chicago Regional
Office, Suite 1400, Citicorp Center, 500 West Madison Street,
Chicago, Illinois
60661. Copies of such material can be obtained from the Public
Reference
Section of the Commission at 450 Fifth Street, N.W., Washington
D.C. 20549, at
prescribed rates. The Company's Common Stock is listed on the
American Stock
Exchange, Inc., and reports, proxy statements and other
information concerning
the Company may be inspected at the office of the American Stock
Exchange Inc.,
86 Trinity Place, New York, New York 10006. This Prospectus does
not contain
all of the information set forth in the Registration Statement,
certain parts
of which are omitted in accordance with the rules and regulations
of the
Commission. The Registration Statement and any amendments
thereto, including
exhibits filed as a part thereof, are available for inspection
and copying as
set forth above.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents heretofore filed by the Company with
the
Commission under the Exchange Act are incorporated herein by
reference: (a)
the Company's Annual Report on Form 10-K for the year ended
December 31, 1994;
(b) the Company's Quarterly Reports on Form 10-Q for the quarters
ended March
31, 1995, and June 30, 1995; and (c) the Company's Current Report
on Form 8-K
dated March 31, 1995.
All documents filed by the Company pursuant to Sections
13(a), 13(c), 14
or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the
termination of the offering made by this Prospectus shall be
deemed to be
incorporated by reference in this Prospectus and to be a part
hereof from the
date of filing of such documents. Any statements contained in a
document
incorporated by reference herein shall be deemed to be modified
or superseded
for purposes hereof to the extent that a statement contained
herein (or in any
other subsequently filed document which also is incorporated by
reference
herein) modifies or supersedes such statement. Any statement so
modified or
superseded shall not be deemed to constitute a part hereof except
as so
modified or superseded. All information appearing in this
Prospectus is
qualified in its entirety by the information and financial
statements
(including notes thereto) appearing in the documents incorporated
herein by
reference.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH
ARE NOT
PRESENTED HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS (OTHER
THAN EXHIBITS
THERETO) ARE AVAILABLE WITHOUT CHARGE, UPON WRITTEN OR ORAL
REQUEST BY ANY
PERSON TO WHOM THIS PROSPECTUS HAS BEEN DELIVERED, FROM MORROW &
CO., INC., 909
THIRD AVENUE, 20TH FLOOR, NEW YORK, NEW YORK 10022-4799
(TELEPHONE (800) ___-
____).<PAGE>
PROSPECTUS SUMMARY
This summary is qualified in its entirety by the more
detailed information
and consolidated financial statements, including the notes
thereto, appearing
elsewhere or incorporated by reference in this Prospectus.
Pursuant to the
Stock Purchase Agreement dated as of August 3, 1994, as amended
(the "Rogers
Agreement"), by and among the Company and The C.L. Simpson Inter
Vivos
Revocable Trust and The Alta Rogers Simpson Inter Vivos Revocable
Trust
(collectively, the "Trusts"), the Company and the Trusts have
agreed that the
Company will acquire 51.2% of the capital stock (the "Trust
Stock") of Rogers
from the Trusts. In addition, the Company has agreed to offer to
purchase the
remaining shares of Rogers from its minority stockholders at the
same price per
share paid for the Trust Stock. The Company cannot determine how
many minority
stockholders of Rogers will accept the Company's offer, but for
purposes of pro
forma financial information appearing herein, all of the Rogers
capital stock
is assumed to be purchased.
THE COMPANY
The Company is currently a diversified company conducting
business in
three market segments: galvanizing, specialty chemicals, and
chemical storage
and distribution. The Company operates its galvanizing business
through Boyles
Galvanizing Company, a wholly-owned subsidiary ("Boyles").
Boyles engages
principally in hot dip galvanizing, a process in which iron and
steel products
are immersed in molten zinc to create an alloyed metal surface
which is highly
resistant to oxidation or corrosion (rusting). The Company is
presently
expanding its galvanizing business through its proposed
acquisition of Rogers
(the "Acquisition"). Through its wholly-owned subsidiary, Lake
River
Corporation ("Lake River"), the Company engages in the bulk
storage of
chemicals. Lake River, located in Chicago, has 235 tanks
providing 43 million
gallons of liquid storage capacity and 520,000 square feet of
warehouse
capacity. Lake River also operates bag and drum filling lines
for integrated
storage, formulating, packaging and distribution of chemicals.
Through its
wholly-owned specialty chemicals subsidiary, Kinpak, Inc.
("Kinpak"), the
Company engages in the production and packaging of antifreeze,
windshield
washer fluid and household cleaning products. The Company has
announced plans
to divest Kinpak, but there can be no assurance as to the timing
of any such
divestiture or the net proceeds thereof. The Company is also
evaluating the
future prospects of Lake River as a subsidiary of the Company.
The Company was incorporated under the laws of the State of
Delaware in
1955. The mailing address of the Company's executive offices is
P.O. Box 1499,
Tulsa, Oklahoma 74101-1499. Its telephone number is (918)
494-0964.
BUSINESS STRATEGY
A key part of the Company's business strategy is to grow its
galvanizing
business. The Acquisition will significantly increase the
Company's share of
the central midwestern United States independent galvanizing
market, and
management believes that the combined company will have the
largest share of
this market in the four-state region comprised of Missouri,
Kansas, Oklahoma
and Arkansas. Based on the pro forma combined results of the
Company for the
most recently completed fiscal year, management expects the
Acquisition to
increase substantially the revenues and earnings of the Company's
galvanizing
operations. Management believes that this increased market
share should
provide for greater versatility of service, optimization of
production,
strengthened price leadership and enhanced profitability. In
addition, the
Acquisition should provide the Company with greater financial and
managerial
resources which will enhance the Company's ability to make future
acquisitions
of independent galvanizing operations. Also, Rogers has recently
entered into
a letter of intent to purchase the operations of a small
galvanizing company in
a complementary geographic market. See "Business Strategy."
THE ACQUISITION
Pursuant to the Rogers Agreement, the Company will acquire
the Trust Stock
from the Trusts for $4,260,000 in cash. As part of the Rogers
Agreement, the
Company has agreed to offer to purchase the remaining outstanding
shares of
capital stock of Rogers from its minority stockholders for cash
at a price per
share equivalent to that paid to the Trusts for the Trust Stock.
If all shares
of Rogers are purchased at the proposed price per share the total
acquisition
price will be $8,321,200. The acquisition of the Trust Stock
will trigger
certain change in control provisions of an existing life
insurance premium
payment arrangement between Rogers and its former Chairman
requiring
acceleration of those payments. Giving effect to those payments
and the
payment of related fees and expenses, the total acquisition cost
is estimated
to be approximately $9,600,000. These payments will be financed
by the
proceeds of the Rights Offering, and, to the extent necessary,
the proceeds of
the Notes. If sufficient funds are not available to complete the
Acquisition,
no shares will be sold in this offering and all subscription
payments will be
returned promptly, without interest or deduction. The conditions
to the
acquisition of the Trust Stock include the settlement or
favorable
determination of litigation by certain beneficiaries of the
Trusts which seeks
to prevent the Acquisition, the absence of a material adverse
change in the
business of Rogers, and the delivery of certain standard closing
documents.
There can be no assurance that these conditions will be satisfied
or, if not
satisfied, waived by the appropriate party. See "Summary Pro
Forma and
Selected Consolidated Financial Information" and "The
Acquisition."
THE RIGHTS OFFERING
Rights Each stockholder of the Company
will receive three
nontransferable rights (the
"Rights") for each two shares of
the Common Stock held by such
holder as of the close of
business on ______________, 1995
(the "Record Date"). The number
of Rights distributed to each
holder will be rounded down to
the nearest whole number and no
fractional rights, fractional
shares of Common Stock or cash
will be distributed or paid in
lieu thereof. An aggregate
maximum of 5,619,615 Rights will
be distributed pursuant to the
Rights Offering. The Rights are
evidenced by nontransferable
Subscription Certificates (the
"Subscription Certificates").
Subscription Price $2.00 in cash per share of Common
Stock subscribed for pursuant to
the Basic Subscription Privilege
or the Oversubscription Privilege
(the "Subscription Price").
Basic Subscription Privilege Each Right entitles the holder
thereof to purchase one share of
Common Stock upon payment of the
Subscription Price (the "Basic
Subscription Privilege"). See
"The Rights Offering
Subscription Privileges."
Oversubscription Privilege Each holder of Rights who elects
to exercise the Basic
Subscription Privilege is also
entitled to subscribe for
additional shares of Common Stock
upon payment of the Subscription
Price in an aggregate amount up
to 50% of the shares that the
holder is entitled to purchase
under the Basic Subscription
Privilege (the "Oversubscription
Privilege"). If the number of
shares of Common Stock available
after satisfaction of all
subscriptions pursuant to the
exercise of the Basic
Subscription Privilege (the
"Excess Shares") is insufficient
to satisfy fully all elections to
exercise the Oversubscription
Privilege, the Excess Shares will
be allocated pro rata among
holders who exercise their
Oversubscription Privilege based
on the respective numbers of
shares of Common Stock subscribed
by such holders pursuant to
exercise of the Basic
Subscription Privilege. See "The
Rights Offering - Subscription
Privileges."
Purchase Commitment Pursuant to agreements with the
Company, certain directors of the
Company have agreed to exercise
their Rights and purchase not
less than 875,000 shares (or
15.6% of the shares in this
Offering) at the Subscription
Price, or an aggregate of
$1,750,000 (the "Purchase
Commitment"). The Purchase
Commitment could have the effect
of increasing the proportionate
ownership of the Company by such
directors. See "The Rights
Offering - Purchase Commitment."
Non-Transferability of
Rights The Rights are nontransferable.
Record Date ________________, 1995, at 5:00
p.m. New York City time.
Expiration Date ________________, 1995, at 5:00
p.m. New York City time, unless
extended (the "Expiration Date").
The Expiration Date will not be
extended beyond ____________,
1995, and if the conditions to
the Rights Offering have not been
satisfied by ____________, 1995,
or the Rights Offering is
otherwise terminated, all
subscription payments will be
returned promptly, without
interest or deduction. See "The
Rights Offering - Expiration
Date."
Procedure for Exercising
Rights Rights may be exercised by the
holder by properly completing and
signing the Subscription
Certificate evidencing those
Rights and forwarding such
Subscription Certificate (or
following the Guaranteed Delivery
Procedures described herein),
with payment of the Subscription
Price for each share of Common
Stock subscribed for pursuant to
the Basic Subscription Privilege
and the Oversubscription
Privilege, to Mellon Securities
Transfer Services (the
"Subscription Agent") on or prior
to the Expiration Date. If the
mail is used to forward
Subscription Certificates, it is
recommended that insured,
registered mail be used. No
interest will be paid on funds
delivered in payment of the
Subscription Price. ONCE A
HOLDER HAS EXERCISED ANY RIGHTS,
SUCH EXERCISE MAY NOT BE REVOKED.
See "The Rights Offering -
Exercise of Rights."
Procedure for Exercising
Rights by Foreign and
Certain Other Stockholders Subscription Certificates will
not be mailed to holders of
Common Stock whose addresses are
outside the United States or who
have an APO or FPO address, but
will be held by the Subscription
Agent for their account. To
exercise the Rights represented
thereby, such holders must
contact the Subscription Agent on
or prior to 5:00 p.m. New York
City time, on ________________,
1995. See "The Rights Offering -
Foreign and Certain Other
Stockholders."
Persons Holding Common Stock
and Wishing to Exercise
Rights Through Others Persons holding Common Stock and
receiving the Rights distributed
with respect thereto through a
broker, dealer, commercial bank,
trust company or other nominee
should contact the appropriate
institution or nominee and
request it to effect the
transactions for them. See "The
Rights Offering - Exercise of
Rights."
Issuance of Common Stock Certificates representing shares
of the Common Stock purchased
pursuant to the valid exercise of
the Rights will be delivered to
subscribers as soon as
practicable after the Expiration
Date and the conditions to the
Rights Offering have been
satisfied and, in the case of the
exercise of the Oversubscription
Privilege, after all prorations
have been effected. See "The
Rights Offering - Subscription
Privileges."
Subscription Agent Mellon Securities Transfer
Services.
Information Agent Morrow & Co., Inc. (Telephone
number: (800) ___-____).
Common Stock to be
Outstanding After the
Rights Offering The exact number of shares
outstanding after completion of
the Rights Offering depends upon
the number of shares sold herein.
Two scenarios are presented: (i)
9,486,025 shares assuming the
issuance of 100% of the shares
offered hereby (including 120,000
shares issuable upon the exercise
of the Warrants) (the "100%
Case"), and (ii) 8,826,217 shares
assuming the issuance of
2,809,807 (or 50%) of the shares
offered hereby (including
2,270,000 shares issuable upon
exercise of the Warrants) (the
"50% Case").
AMEX Symbol for the Common
Stock KIN
Use of Proceeds The net proceeds from the sale of
the Common Stock in the Rights
Offering, together with the
proceeds from the sale of the
Notes to the Investor, will be
used by the Company to finance
the Acquisition, pay related fees
and expenses and for general
corporate purposes. See "Use Of
Proceeds," "The Acquisition" and
"Description of Subordinated
Financing."
Conditions to the Rights
Offering The issuance of shares pursuant to
the Rights Offering is subject to a
number of conditions, including (i)
the approval by the stockholders at
the Special Meeting of the increase
in the authorized number of shares
of
the Common Stock and the issuance
of
the Warrants and Warrant Shares,
(ii)
the absence of any suit or other
action
seeking to enjoin the Rights
Offering
or the Acquisition, (iii) the
determination by the Board of
Directors
of the Company that sufficient
funds
are available to the Company from
the
proceeds of the Rights Offering,
the
sale of the Notes and other sources
to
enable it to complete the
Acquisition,
and (iv) the determination by the
Board
of Directors of the Company that
all of
the conditions to the Acquisition
have
been or are expected to be
satisfied
or, if not satisfied, waived. In
the
event that the foregoing conditions
to
the Rights Offering have not been
satisfied by _________, 1995, or
the
Rights Offering is otherwise
terminated, all subscription
payments
will be returned promptly, without
interest or deduction. See "The
Rights
Offering - Conditions to the Rights
Offering."
Amendments and Termination The Company may extend the Rights
Offering and otherwise amend the
terms
of the Rights Offering or terminate
the
Rights Offering at any time prior
to
the Expiration Date or thereafter
if
the conditions to the Rights
Offering
have not been satisfied. See "The
Rights Offering - Amendment and
Termination."
Risk Factors A purchase of the Common Stock
involves a substantial degree of
risk. See "Risk Factors" for
certain factors that a potential
investor should carefully
consider.
<PAGE>
SUMMARY PRO FORMA AND SELECTED CONSOLIDATED FINANCIAL
INFORMATION
(In thousands, except per share data)
The Company's pro forma combined financial data set forth
below and on the
following page should be read in conjunction with the Unaudited
Pro Forma
Combined Condensed Financial Statements included elsewhere
herein. Such pro
forma data do not purport to present the financial position or
results of
operations of the Company had the transactions assumed herein
occurred on the
dates indicated, nor are they necessarily indicative of the
results of
operations which may be expected in the future. The pro forma
combined
financial data have been prepared showing the elimination of the
Company's
wholly-owned specialty chemicals subsidiary, Kinpak, as a
continuing operation,
and the acquisition of all of the capital stock of Rogers, and
are presented
assuming the acquisition is funded either (i) entirely by the
proceeds of the
sale of all of the shares offered hereby (the "100% Case") or
(ii) by the sale
of 2,809,807 of the shares offered hereby (or 50% of the total
shares offered)
and the sale of all of the Notes to the Investor (the "50%
Case"). The summary
historical data presented below and on the following pages have
been derived
from the Company's Consolidated Financial Statements and notes
thereto
incorporated by reference herein and Rogers' Consolidated
Financial Statements
and notes thereto included elsewhere herein, and should be read
in conjunction
therewith.
Pro Forma
<TABLE>
For
the Six Months Ended June 30, 1995
<CAPTION>
Kinark
100% Case<F2> 50% Case<F3>
Kinark Kinpak Adjusted
Rogers Pro Forma Pro Forma Pro Forma Pro Forma
Historical Elimination<F1> Historical
Historical Adjustments Combined Adjustments Combined
<S> <C> <C> <C>
<C> <C> <C> <C> <C>
Sales $17,029 $4,259 $12,770
$9,190 $21,960 $21,960
Costs and expenses 17,845 4,580 13,265
8,372 $(83) 21,554 $(83) 21,554
Other expenses 355 45 310 20
(85) 245 278 608
Income tax expense
(benefit) (427) (134) (293)
240 (97) (150) (36) (89)
Earnings (loss) (744) (232) (512)
558 265 311 (159) (113)
Earnings (loss) per
common share (0.20) N/M (0.14)
N/M N/M 0.03 N/M (0.02)
Weighted average shares
outstanding<F4> 3,747 N/M 3,747
N/M 5,620 9,366 2,810 6,567
<FN>
<F1> During August 1995, management of the Company finalized a
formal plan to
discontinue the operations of Kinpak, one of the Company's
subsidiaries.
The estimated pre-tax loss on disposal of this subsidiary is
$1,525,000
including $185,000 of estimated operating losses to be
incurred during the
disposal period. This estimated loss is not included in the
pro forma
financial data presented.
<F2> Pro forma data reflecting (i) the issuance of all 5,619,615
shares of the
Common Stock offered in this Rights Offering, (ii) the
issuance of none of
the Notes, (iii) the issuance of Warrants covering 120,000
shares of
Common Stock to the Investor and its financial advisor, and
(iv) the
acquisition of 100% of the capital stock of Rogers by the
Company. See
"The Acquisition" and "Description of Subordinated
Financing."
<F3> Pro forma data reflecting (i) the issuance of 2,809,807 of
the shares of
the Common Stock offered in this offering, (ii) the issuance
of $4,000,000
of the Notes to the Investor (and the related issuance of
Warrants
covering 2,270,000 shares of the Common Stock to the
Investor and its
financial advisor), and (iii) the acquisition of 100% of the
capital stock
of Rogers by the Company. See "The Acquisition" and
"Description of
Subordinated Financing."
<F4> Weighted average shares outstanding include the dilutive
effect of stock
options and warrants, if applicable.
</FN>
</TABLE>
<PAGE>
<TABLE>
For the Year Ended December 31, 1994
<CAPTION>
Kinark
100% Case<F2> 50% Case <F3>
Kinark Kinpak Adjusted
Rogers Pro Forma Pro Forma Pro Forma Pro Forma
Historical Elimination<F1> Historical
Historical Adjustments Combined Adjustments Combined
<S> <C> <C> <C>
<C> <C> <C> <C> <C>
Sales $34,782 $8,559 $26,223
$12,624 $38,847 $38,847
Costs and expenses 33,497 9,410 24,087
12,246 $(209) 36,124 $(209) 36,124
Other expenses 694 96 598
(51) (153) 394 555 1,102
Income tax expense
(benefit) 181 (346) 527
104 (203) 834 (55) 576
Earnings (loss) 410 (601) 1,011
325 159 1,495 (291) 1,045
Earnings (loss) per
common share 0.11 N/M 0.27
N/M N/M 0.16 N/M 0.16
Weighted average shares
outstanding (4) 3,752 N/M 3,752
N/M 5,620 9,372 2,810 6,562
<FN>
<F1> During August 1995, management of the Company finalized a
formal plan to
discontinue the operations of Kinpak, one of the Company's
subsidiaries.
The estimated pre-tax loss on disposal of this subsidiary is
$1,525,000
including $185,000 of estimated operating losses to be
incurred during the
disposal period. This estimated loss is not included in the
pro forma
financial data presented.
<F2> Pro forma data reflecting (i) the issuance of all 5,619,615
shares of the
Common Stock offered in this Rights Offering, (ii) the
issuance of none of
the Notes, (iii) the issuance of Warrants covering 120,000
shares of
Common Stock to the Investor and its financial advisor, and
(iv) the
acquisition of 100% of the capital stock of Rogers by the
Company. See
"The Acquisition" and "Description of Subordinated
Financing."
<F3> Pro forma data reflecting (i) the issuance of 2,809,807 of
the shares of
the Common Stock offered in this offering, (ii) the issuance
of $4,000,000
of the Notes to the Investor (and the related issuance of
Warrants
covering 2,270,000 shares of the Common Stock to the
Investor and its
financial advisor), and (iii) the acquisition of 100% of the
capital stock
of Rogers by the Company. See "The Acquisition" and
"Description of
Subordinated Financing."
<F4> Weighted average shares outstanding include the dilutive
effect of stock
options and warrants, if applicable.
</FN>
/TABLE
<PAGE>
<TABLE>
At and For the Six Months Ended June 30,
1995
<CAPTION>
Kinark
100% Case<F2> 50% Case <F3>
Kinark Kinpak Adjusted
Rogers Pro Forma Pro Forma Pro Forma Pro Forma
Historical Elimination<F1> Historical
Historical Adjustments Combined Adjustments Combined
<S> <C> <C> <C>
<C> <C> <C> <C> <C>
Working capital $3,417 $1,200 4,617
$1,408 $6,025 $(24) $6,049
Total assets 21,898 1,852 20,046
7,587 $4,865 32,498 5,009 642
Capital expenditures 514 -- 514
552 -- 1,066 -- 1,066
Depreciation 946 150 796
453 -- 1,249 -- 1,249
Long-term obligations 7,454 (969) 6,485
761 (1,703) 5,543 4,000 11,246
Stockholders' equity 9,300 -- 9,300
4,286 6,568 20,154 34 14,595
Per share 2.48 N/M 2.48
N/M N/M 2.15 N/M 2.22
Common shares
outstanding 3,747 N/M 3,747
N/M 5,620 9,372 2,810 6,562
<FN>
<F1> During August 1995, management of the Company finalized a
formal plan to
discontinue the operations of Kinpak, one of the Company's
subsidiaries.
The estimated pre-tax loss on disposal of this subsidiary is
$1,525,000
including $185,000 of estimated operating losses to be
incurred during the
disposal period. This estimated loss is not included in the
pro forma
financial data presented.
<F2> Pro forma data reflecting (i) the issuance of all 5,619,615
shares of the
Common Stock offered in this Rights Offering, (ii) the
issuance of none of
the Notes, (iii) the issuance of Warrants covering 120,000
shares of
Common Stock to the Investor and its financial advisor, and
(iv) the
acquisition of 100% of the capital stock of Rogers by the
Company. See
"The Acquisition" and "Description of Subordinated
Financing."
<F3> Pro forma data reflecting (i) the issuance of 2,809,807 of
the shares of
the Common Stock offered in this offering, (ii) the issuance
of $4,000,000
of the Notes to the Investor (and the related issuance of
Warrants
covering 2,270,000 shares of the Common Stock to the
Investor and its
financial advisor), and (iii) the acquisition of 100% of the
capital stock
of Rogers by the Company. See "The Acquisition" and
"Description of
Subordinated Financing."
</FN>
/TABLE
<PAGE>
Kinark Historical
<TABLE>
For the Six Months
Ended June 30, For the Year
Ended December 31,
1995 1994 1994
1993 1992 1991<F1> 1990
<S> <C> <C> <C>
<C> <C> <C> <C>
Sales $17,029 $17,820 $34,782
$30,900 $30,476 $34,109 $34,202
Costs and expenses 17,845 16,362 33,497
28,062 27,399 28,283 30,490
Other expense 355 282 694
1,619 1,361 477 309
Income tax expense
(benefit) (427) 429 181
439 21 66 1,273
Earnings (loss)<F2> (744) 747 410
780 1,695 4,067 2,130
Earnings (loss) per
common share<F2> (0.20) 0.20 0.11
0.21 0.45 1.10 0.60
Weighted average shares
outstanding<F3> 3,747 3,754 3,752
3,755 3,748 3,705 3,561
<FN>
<F1> The Company changed its method of valuing certain inventory
from the
first-in first-out (FIFO) method to the last-in first-out
(LIFO) method in
1991. This change increased 1991 net earnings by $300,000
or $.08 per
share.
<F2> Earnings from continuing operations before cumulative effect
of change in
accounting method.
<F3> Weighted average shares outstanding include the dilutive
effect of stock
options, if applicable.
</FN>
</TABLE>
<TABLE>
At and For the
Six Months Ended At and For
the Year Ended December 31,
June 30, 1995 1994
1993 1992 1991 1990
<S> <C> <C>
<C> <C> <C> <C>
Working capital $3,417 $2,761
$3,961 $4,028 $2,000 $2,402
Total assets 21,898 20,954
20,931 18,402 16,841 17,716
Capital expenditures 514 1,668
2,540 3,306 2,414 1,639
Depreciation 946 1,771
1,584 1,523 1,574 1,636
Long-term obligations 7,454 6,009
7,720 7,548 6,417 10,686
Stockholders' equity 9,300 10,044
9,634 7,052 5,119 1,372
Per share 2.48 2.68
2.57 1.88 1.41 0.38
Common shares
outstanding 3,747 3,746
3,746 3,746 3,623 3,579
</TABLE>
<PAGE>
Rogers Historical
<TABLE>
For the Nine Months
Ended June 30, For the Year
Ended September 30,
1995 1994 1994
1993 1992 1991 1990
<S> <C> <C> <C>
<C> <C> <C> <C>
Sales $13,285 $9,225 $12,625
$11,544 $10,907 $11,575 $10,549
Costs and expenses 12,050 8,768 12,247
10,070 10,096 10,094 9,695
Other (income) expense 16 (36) (50)
(44) (8) (26) (48)
Income tax expense 452 110 104
511 312 495 335
Earnings 767 383 324
1,007 507 960 567
Dividends paid 169 403 459
225 225 284 225
</TABLE>
<TABLE>
At and For the
Nine Months Ended At and For
the Year Ended September 30,
June 30, 1995 1994
1993 1992 1991 1990
<S> <C> <C>
<C> <C> <C> <C>
Working capital $1,614 $1,119
$1,515 $1,160 $909 $799
Total assets 7,587 6,852
5,548 4,298 4,157 3,321
Capital expenditures 712 973
923 596 828 883
Depreciation 660 672
550 474 381 201
Long-term obligations 634 751
231 287 233 --
Stockholders' equity 4,286 3,688
3,824 3,042 2,760 2,316
</TABLE>
<PAGE>
RISK FACTORS
Prior to deciding to exercise the Rights and purchase the
Common Stock,
potential investors should carefully consider the following
factors, together
with other information contained in or incorporated by reference
into this
Prospectus, in evaluating the Company and its businesses.
RECENT OPERATING LOSSES
During the last four fiscal quarters, the Company has
experienced
operating losses due primarily to losses at Kinpak and diminished
profitability
at Lake River, its chemical packaging and storage subsidiaries.
As a result of
these losses, the Company has determined to divest Kinpak, or, if
necessary,
shut down Kinpak if a suitable buyer is not found. While
management expects
the Company's earnings to improve greatly if the divestiture of
Kinpak is
completed and the Acquisition is consummated, there can be no
assurance that
the Company will be profitable over any particular time frame.
Continued
losses will impair the Company's liquidity and capital resources
and reduce the
value of the Common Stock. See "Business Strategy."
PRO FORMA LIQUIDITY AND CAPITAL RESOURCES
The Company's recent losses have reduced its liquidity and
capital
resources. Depending upon the number of shares of Common Stock
issued in the
Rights Offering, substantially all of the net proceeds from the
Rights Offering
and the issuance of the Notes could be utilized in the
acquisition of Rogers.
In addition, the Company's outstanding borrowings under its bank
term loan and
revolving credit facility mature on March 31, 1996, and there can
be no
assurance that the maturity date can be extended or the
borrowings refinanced.
Unless the Company is sufficiently profitable or the bank
borrowings are
extended or refinanced, the Company will likely have to find
additional sources
of working capital to fund its operations. There can be no
assurance that
these sources, if needed, will be found.
CONDITIONS TO THE RIGHTS OFFERING
The issuance of shares pursuant to the exercise of the
Rights is subject
to a number of conditions, including (i) the approval by the
stockholders of
the increase in the authorized shares of Common Stock and the
issuance of the
Warrants and Warrant Shares, (ii) the absence of any suit or
other action
seeking to enjoin the Rights Offering or the Acquisition, (iii)
no stockholder
other than the Investor owning beneficially after the Rights
Offering more than
20% of the outstanding shares of the Common Stock of the Company,
(iv) the
determination by the Board of Directors of the Company that
sufficient funds
are available to the Company from the proceeds of the Rights
Offering, the sale
of the Notes and other sources to enable it to complete the
Acquisition, and
(v) the determination by the Board of Directors of the Company
that all of the
conditions to the Acquisition have been or are expected to be
satisfied or, if
not satisfied, waived. There can be no assurance that these
conditions will be
satisfied or if not satisfied, waived by the appropriate party.
See "The
Rights Offering - Conditions to the Rights Offering."
<PAGE>
CONDITIONS TO THE ACQUISITION
The Company's right and obligation to consummate the
Acquisition are
subject to numerous conditions, including the settlement of
certain stockholder
litigation which seeks to prevent the Acquisition, the absence of
certain
adverse changes in Rogers, and the delivery of certain standard
closing
documents. There can be no assurance that these conditions will
be satisfied
or, if not satisfied, waived by the appropriate party. In
addition, the
Company's ability to complete the Acquisition is dependent upon
its securing
the necessary financing, of which the Rights Offering is a part.
Depending
upon the success of the Rights Offering, the Company may need to
sell all or a
portion of the Notes to the Investor in order to finance the
Acquisition.
There can be no assurance that sufficient funds from these
sources will exist
to complete the Acquisition. If sufficient funds are not
available, no shares
will be sold in this Offering and all subscription payments will
be returned
promptly, without interest or deduction. See "The Acquisition"
and
"Description of Subordinated Financing."
IMPACT OF RIGHTS OFFERING ON HOLDERS OF COMMON STOCK
The Rights entitle the holders of the Common Stock to
purchase shares of
the Common Stock at a price below the prevailing market price of
the Common
Stock immediately prior to the commencement of the Rights
Offering. Holders of
the Common Stock who exercise their Rights will preserve, and
through the
Oversubscription Privilege may increase, their proportionate
interest in the
equity ownership and voting power of the Company. Holders who do
not exercise
their Rights will experience a decrease in their proportionate
interest in the
equity ownership and voting power of the Company. The
consummation of the sale
of the shares offered hereby would increase the number of shares
of Common
Stock outstanding (on a pro forma basis as of _____________,
1995) (i) under
the 100% Case by 5,739,615 shares (or 153%) to 9,486,025 shares,
assuming all
of the shares offered hereby are issued and including 120,000
shares issuable
upon exercise of the Warrants and (ii) under the 50% Case by
5,079,807 shares
(or 136%) to 8,826,217 shares assuming 50% of the shares offered
hereby are
issued and including 2,270,000 shares issuable upon the exercise
of the
Warrants.
MARKET CONSIDERATIONS
There can be no assurance that the market price of the
Common Stock will
not decline during the subscription period or that, following the
issuance of
the Rights and the issuance of the underlying shares upon
exercise of the
Rights, a subscribing Rights holder will be able to sell shares
purchased in
the Rights Offering at a price equal to or greater than the
Subscription Price.
The election of a Rights holder to exercise Rights in the Rights
Offering is
irrevocable. Moreover, until certificates are delivered,
subscribing Rights
holders may not be able to sell the Common Stock that they have
purchased in
the Rights Offering. Certificates representing shares of the
Common Stock
purchased pursuant to the Basic Subscription Privilege will be
delivered as
soon as practicable after the Expiration Date and, in the case of
shares
purchased pursuant to the Oversubscription Privilege, all
prorations and
adjustments contemplated by the terms of the Rights Offering have
been
effected. No interest will be paid to Rights holders on funds
delivered to the
Subscription Agent pursuant to the exercise of Rights pending
delivery of
Common Stock acquired upon exercise of the Rights.
RIGHTS NOT TRANSFERABLE; NO MARKET FOR RIGHTS
The Rights are not transferable, and thus there will be no
market or other
means for holders of the Rights to directly realize any value
associated with
the Rights. Thus, holders of the Rights must exercise them and
acquire
additional shares of the Common Stock in order to realize any
such value. The
election of a Rights holder to exercise Rights in the Rights
Offering is
irrevocable.
CONCENTRATION OF OWNERSHIP
Following the Rights Offering and the consummation of the
Acquisition,
certain stockholders will own or have the right to acquire a
substantial
portion of the Common Stock. Assuming the sale of all 5,619,615
shares offered
hereby, including 120,000 shares issuable upon exercise of the
Warrants, and no
issuance of the Notes (the "100% Case"), the exercise by the
Investor of its
Rights pursuant to the Purchase Commitment and the exercise by
Steel Partners
II, Ltd. ("Steel Partners") of its full Basic Subscription
Privilege and
Oversubscription Privilege with respect to its Rights, the
Investor will own
approximately 12.8% of the Common Stock and Steel Partners will
own
approximately 18.1% of the Common Stock. Assuming the sale of
2,809,807 of the
shares offered hereby and the issuance of $4.0 million of the
Notes to the
Investor, including 2,270,000 shares issuable upon exercise of
the Warrants
(the "50% Case"), and the exercise by the Investor of its Rights
pursuant to
the Purchase Commitment and the exercise by Steel Partners of its
full Basic
Subscription Privilege and Oversubscription Privilege with
respect to its
Rights, the Investor will own approximately 38.1% of the Common
Stock and Steel
Partners will own approximately 19.4% of the Common Stock. As a
result, the
ability of stockholders other than the Investor or Steel Partners
to influence
the election of the Company's directors or the management and
operations of the
Company may be limited. Under the 50% Case excluding the
2,270,000 shares
issuable upon exercise of the Warrants, and assuming the exercise
by the
Investor of its Rights pursuant to the Purchase Commitment and
the exercise by
Steel Partners of its full Basic Subscription Privilege and
Oversubscription
Privilege with respect to their Rights, the Investor will own
approximately
17.0% of the Common Stock and Steel Partners will own
approximately 26.2% of
the Common Stock. However, under this scenario, a condition to
the Investor's
purchase of the Notes will not have been satisfied which requires
that no
stockholder other than the Investor own beneficially after the
Rights Offering
more than 20% of the outstanding Common Stock of the Company and,
unless
waived, the Investor will have no obligation to exercise the
Purchase
Commitment and purchase $1,500,000 of Common Stock or to purchase
the Notes.
See "Conditions to the Rights Offering."
CERTAIN ANTI-TAKEOVER EFFECTS
Assuming the sale of all 5,619,615 shares offered hereby,
including
120,000 shares issuable upon exercise of the Warrants and no
issuance of the
Notes (the "100% Case"), the members of the Board of Directors
and senior
management of the Company will beneficially own approximately
19.6% of the
Common Stock, and assuming the sale of 2,809,807 of the shares
offered hereby,
the issuance of $4.0 million of the Notes to the Investor
including 2,270,000
shares issuable upon exercise of the Warrants (the "50% Case"),
the members of
the Board of Directors and senior management will beneficially
own
approximately 45.3% of the Common Stock. This Common Stock
ownership, together
with various provisions of the Company's Restated Certificate of
Incorporation
may tend to deter nonnegotiated tender offers or other efforts to
obtain
control of the Company and thereby deprive stockholders of
opportunities to
sell shares at prices higher than those prevailing in the market.
See
"Description of Capital Stock - Certain Certificate of
Incorporation and Bylaw
Provisions."
DEBT RESTRICTIONS
The terms of the Company's existing bank term loan and
revolving credit
facility and the Subordinated Financing Agreement restrict
certain aspects of
the Company's operations. These restrictions include specified
minimum values
for the net worth, working capital and debt service coverage for
the Company,
and limitations on incurring additional debt or capital
expenditures or
engaging in acquisitions and dispositions by the Company. There
can be no
assurance that the Company will be able to comply with these
restrictions
without disrupting its business. See "Description of
Subordinated Financing."
COMPETITION
The independent after-fabrication hot dip galvanizing market
is highly
competitive. In particular, during the first six months of 1995
Boyles has
been subject to increasing price pressure from its competitors in
certain of
its geographic markets, and a new independent galvanizer recently
commenced
operations in Rogers' geographic market. The current
profitability of Boyles
and Rogers, and hence the Company, will depend in part on their
ability to
maintain current prices. There can be no assurance that these
prices can be
maintained. See "Business Strategy."
GOVERNMENT REGULATION
The Company's operations are subject to various government
regulations,
including those related to occupational safety and health (OSHA),
workers
compensation and environmental matters. Like their competitors
in the
galvanizing and chemicals businesses, Kinark and its subsidiaries
and Rogers
will have regulatory compliance costs associated with past,
present and future
operations, but the Company cannot presently quantify the cost of
complying
with these regulations. While neither the Company, its
subsidiaries nor Rogers
is presently the subject of any material claim or investigation
with respect to
these regulations, there can be no assurance that the cost of
complying with
these regulations in the future will not have a material adverse
affect on the
Company, its subsidiaries or Rogers.
BUSINESS STRATEGY
In May 1995, Michael T. Crimmins, the Chairman of the Board
of the
Company, acquired 9.7% of the Company's Common Stock from
Northbridge Holdings,
Inc. In connection with this acquisition, Mr. Crimmins assumed
the duties of
Chairman of the Board of the Company. In this new role, Mr.
Crimmins intends
to lead the Company toward a refocusing of its efforts on its
galvanizing
business and away from its specialty chemicals and chemical
storage businesses.
As a result, the Company has determined to divest Kinpak, or if a
suitable
buyer is not found, shut down Kinpak. In connection with the
Acquisition and
the Subordinated Financing, Mr. Crimmins will assume the office
of Chief
Executive Officer of the Company, and the Company's current
President and Chief
Executive Officer will become the President and Chief Operating
Officer of the
Company.
In conjunction with the refocusing of its efforts on
galvanizing, the
Company is proceeding toward the consummation of the Acquisition
and the
integration of Rogers into its operations. The Rights Offering
and the
Subordinated Financing are integral steps in the financing of the
Acquisition.
To assist the Company in its efforts to acquire Rogers, a family
investment
company controlled by Mr. Crimmins (the "Investor") has agreed to
purchase up
to $4.0 million principal amount of the Notes and purchase not
less than $1.5
million of Common Stock offered hereby to finance the acquisition
of Rogers.
A key part of the Company's business strategy is to
grow its
galvanizing business. The Acquisition will significantly
increase the
Company's share of the central midwestern United States
independent galvanizing
market, and management believes that the combined company will
have the largest
share of this market in the four-state region comprised of
Missouri, Kansas,
Oklahoma and Arkansas. Based on the pro forma combined results
of the Company
for the most recently completed fiscal year, the Acquisition to
increase
greatly the revenues and earnings of the Company's galvanizing
operations.
Management believes that this increased market share should
provide for greater
versatility of service, optimization of production, strengthened
price
leadership and enhanced profitability. In addition, the
Acquisition should
provide the Company with greater financial and managerial
resources which will
enhance the Company's ability to make future acquisitions of
independent
galvanizing operations. Also, Rogers has recently entered into a
letter of
intent to purchase the operations of a small galvanizing company
in a
complementary geographic market. The Acquisition has the
potential to restore
the Company to profitability. Rogers' sales have increased
steadily since 1990
due to a strong geographic niche in the central Midwestern United
States market
and, based on its operating income for the six months ended June
30, 1995,
Rogers would have been a major contributor to Kinark's
profitability during
this period.
THE ACQUISITION
GENERAL
On August 3, 1994, the Company entered into an agreement
(the "Rogers
Agreement") with two trusts (the "Trusts") which together own
51.2% of the
capital stock (the "Trust Stock") of Rogers Galvanizing Company
("Rogers") to
acquire their stock in Rogers for $4.3 million in cash (the
"Acquisition").
The acquisition of the Trust Stock is conditioned upon the
settlement or
favorable determination of litigation by certain beneficiaries of
the Trusts
which seeks to prevent the Acquisition, the absence of a material
adverse
change in the business of Rogers, the delivery of certain
standard closing
documents, and other standard conditions. There can be no
assurance that these
conditions will be satisfied or, if not satisfied, waived by the
appropriate
party. As part of the Rogers Agreement, the Company has agreed
to offer to
purchase the remaining outstanding shares of capital stock of
Rogers from its
minority stockholders for cash at a price per share equivalent to
that paid to
the Trusts for the Trust Stock.
The Company expects that the litigation by certain
beneficiaries of the
Trusts which seeks to prevent the Acquisition will be settled or
determined
favorably to the Company during the fourth quarter of 1995, but
there can be no
assurance that this will be the case. Upon such settlement or
determination,
the Company will be obligated to consummate the Acquisition
within forty-five
days. If the Company is not able to close the Acquisition at
such time due to
a lack of financing or for other reasons, the Trusts have the
right to
terminate the Rogers Agreement. If the Acquisition does not
close for any
reason, the Rights Offering will be terminated and all
subscription payments
will be returned promptly, without interest or deduction.
ROGERS' BUSINESS
Similar to Boyles, Rogers provides corrosion protection for
metal
components by means of hot dip galvanizing. Rogers was
incorporated in 1940
and competes with Boyles in the central midwestern United States
market.
Although the two companies have often bid jobs for the same
customers, the
primary markets of the two companies do not generally overlap due
to the
diverse physical locations of the Boyles' and Rogers' plants.
Rogers
galvanizes for more than 600 customers annually. Rogers' primary
market is in
the Tulsa area, which generates approximately 65% of its annual
tonnage.
Currently, 40% to 50% of Rogers' business is subject to a yearly
contract or
blanket purchase order.
Rogers maintains and operates two adjacent galvanizing
plants in Tulsa.
On a combined basis, Rogers operates three galvanizing kettles
with 56,000
square feet under roof. Combined capacity is 60,000 tons of
galvanized steel
per year and, in the year ended December 31, 1994, Rogers
galvanized
approximately 46,000 tons of steel. Rogers employs approximately
182 full-time
employees.
Rogers conducts specialty galvanizing operations through two
subsidiaries,
Spin-Galv, Inc. ("Spin-Galv") and Reinforcing Services, Inc.
("RSI"). Spin-
Galv provides specialized centrifuge galvanizing for smaller
metal components
by placing them in a basket-like container and "spinning" them in
a molten zinc
solution. Markets targeted by Spin-Galv include fabricators,
original
equipment manufacturers, and manufacturers of industrial
fasteners and
connectors. RSI provides galvanized components primarily through
a business
agreement with The Reinforced Earth Company ("RECO"). RSI
purchases steel,
fabricates it to RECO's specifications and then galvanizes it
using a highly
specialized and automated process that requires roughly one-third
of the
personnel needed for more traditional galvanizing methods. This
on-site
fabrication and galvanizing eliminates the in-bound
transportation expense
normally incurred by RECO in shipping to the galvanizer. RSI's
agreement with
RECO expires August 31, 1997. RSI plans to target other
specialty
manufacturers, such as rebar manufacturers, to explore
opportunities for adding
new galvanizing business.
A competitor of Rogers recently built a new plant in the
Tulsa area, and
as a result the price that Rogers can charge for galvanizing is
expected to be
subject to enhanced competitive pressure.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the maximum
number of
shares of Common Stock to be issued with respect to the Rights
are estimated to
be approximately $10,854,230, after deducting the estimated
offering expenses
payable by the Company. The Company will use the net proceeds of
the Rights
Offering to finance the Acquisition, pay related fees and
expenses and for
other general corporate purposes. The following table
illustrates the
estimated sources and uses of funds, assuming that the Company
acquired 100% of
the capital stock of Rogers on June 30, 1995, through either (i)
the issuance
of all of the shares of Common Stock offered hereby, including
170,000 shares
issuable upon exercise of the Warrants and no issuance of the
Notes (the "100%
Case") and (ii) the issuance of 2,809,807 of the shares of Common
Stock offered
hereby, and the issuance of $4.0 million of the Notes to the
Investor including
120,000 shares issuable upon exercise of the Warrants and no
issuance of the
Notes (the "50% Case").
AMOUNT
(IN THOUSANDS)
100% CASE
SOURCES OF FUNDS:
Common Stock offered hereby $11,239
Notes sold to the Investor --
Total Sources of Funds $11,239
USES OF FUNDS:
Acquisition of Rogers $8,321
Fees and expenses<F1> 1,215
Other corporate purposes 1,703
Total Uses of Funds $11,239
50% CASE
SOURCES OF FUNDS:
Common Stock offered hereby $5,620
Notes sold to the Investor 4,000
Total Sources of Funds $9,620
USES OF FUNDS:
Acquisition of Rogers $8,321
Fees and expenses<F1> 1,275
Other corporate purposes 24
Total Uses of Funds $9,620
(1) Includes approximately $415,000 to fund a trust to pay
certain life
insurance premiums for the benefit of the chairman of Rogers
pursuant to a
contractual provision triggered by the Acquisition.
CAPITALIZATION
The following table sets forth, assuming the acquisition of
all of the
capital stock of Rogers, (i) the actual capitalization of the
Company at
June 30, 1995, (ii) the capitalization of the Company at June 30,
1995,
adjusted to reflect the elimination of Kinpak as a discontinued
operation,
(iii) the pro forma capitalization of the Company at June 30,
1995, in the 100%
Case, after deducting the estimated offering expenses and the
application of
the net proceeds, and (iii) the pro forma capitalization of the
Company at
June 30, 1995, in the 50% Case, after deducting the estimated
offering expenses
and the application of the net proceeds.
<TABLE>
June 30, 1995
<CAPTION>
Adjusted
Pro Forma Pro Forma
<S>
HistoricalHistorical<F1>100% Case50% Case
<C> <C> <C>
<C>
Long-term obligations $7,454 $6,485
$5,381 $11,119
Stockholders' equity
Common stock, $.10 par value,
Authorized: Actual - 12,000,000 shares;
Pro forma - 18,000,000 shares;
Issued: Historical and Adjusted Historical
- 5,200,562 shares
Pro forma 100% Case - 9,366,025 shares
Pro forma 50% Case - 6,974,151 shares<F2>520 520 1,082
801
Additional paid-in capital 10,531 10,531
14,876 9,607
Retained earnings 4,226 3,251 3,251
3,251
Less: Treasury stock at cost:
Actual - 1,454,152 shares:
Pro forma 100% Case and pro forma
50% Case - no shares (5,977) (5,977) --
--
Total stockholders' equity 9,300 8,325
19,209 13,659
Total long-term obligations and stockholders'
equity$16,754$19,07131,41031,598
<FN>
<F1> During August 1995, management of the Company finalized a
formal plan to discontinue the operations of Kinpak. The
estimated loss on disposal of this subsidiary is $975,000
(net of income tax effects of $550,000) including $185,000 of
estimated operating losses to be incurred during the
disposal period. The Kinpak elimination presented in the
accompanying
pro forma financial statements reflect that entity as a
discontinued operation.
<F2> Does not include shares issuable pursuant to currently
exercisable options and warrants to purchase Common Stock, which
aggregate 112,500 shares - historical and adjusted
historical, 112,500 shares - Pro Forma 100% Case, and 2,385,000
shares -
Pro Forma 50% Case.
</FN>
/TABLE
<PAGE>
COMMON STOCK DIVIDENDS AND PRICE RANGE
The Company has a longstanding policy of not paying cash
dividends on the
Common Stock in order to reinvest earnings to support its
business operations.
The Company presently intends to continue that policy. The terms
of the
Company's bank borrowings and the Notes also restrict the payment
of dividends
on the Common Stock. See "Description of Subordinated
Financing." The
Company's Common Stock is listed on the American Stock Exchange
(the "AMEX")
under the symbol "KIN" and appears in the market reports in The
Wall Street
Journal as "KinarkCp." The following table sets forth, for the
periods
indicated, the high and low sales prices of the Common Stock as
reported by the
AMEX:
Quarterly Stock Prices
First Second Third Fourth
1995
High $4 $3 15/16 3 7/16(1) N/A
Low 3 2 7/8 2 7/8 (1) N/A
1994
High $4 11/16 $4 7/8 $4 1/2 $4 1/4
Low 3 3/4 4 3 1/2 3
1993
High $5 1/2 $5 1/2 $5 3/8 $4 1/4
Low 4 3/8 4 1/4 4 3 3/8
(1) Through September 14, 1995.
On September 14, 1995, the closing price of the Common Stock
on the AMEX
was $3 1/16 per share. On that date, there were approximately
2,675 record
holders of the Common Stock.
THE RIGHTS OFFERING
THE RIGHTS
The Company is distributing nontransferable Rights, at no
cost, to the
record holders ("Holders") of outstanding shares of the Common
Stock as of the
Record Date (5:00 p.m. New York City time, on ________________,
1995). The
Company will distribute three Rights for each two shares of the
Common Stock
held on the Record Date. Each such Right entitles the holder
thereof to
subscribe for shares of the Common Stock pursuant to a Basic
Subscription
Privilege and an Oversubscription Privilege. See "Subscription
Privileges."
No fractional rights will be distributed and no cash in lieu
thereof will be
paid. The Rights are evidenced by nontransferable Subscription
Certificates
(the "Subscription Certificates").
The Subscription Price of $2.00 per share of the Common
Stock represents a
discount of ____% from the closing price of $_______ for the
shares of the
Common Stock listed on the AMEX immediately prior to the
commencement of the
Rights Offering. There can be no assurance that shares of the
Common Stock
will trade at prices above the Subscription Price. See "Risk
Factors - Market
Considerations."
EXPIRATION DATE
The Rights will expire at 5:00 p.m. New York City time, on
____________,
1995, unless extended by the Company (the "Expiration Date"),
after which time
all unexercised Rights will be null and void. The Company will
not be
obligated to honor any purported exercise of Rights received by
the
Subscription Agent after 5:00 p.m. New York City time, on the
Expiration Date,
regardless of when the documents relating to such exercise were
transmitted,
except when timely transmitted pursuant to the Guaranteed
Delivery Procedures
described below. The Expiration Date will not be extended beyond
____________,
1995, and if the conditions to the Rights Offering have not been
satisfied by
such date, or the Rights Offering is otherwise terminated, all
subscription
payments will be returned promptly, without interest or
deduction. See
"Amendments and Termination."
SUBSCRIPTION PRIVILEGES
Basic Subscription Privilege. The Basic Subscription
Privilege entitles
the holder of each Right to purchase one share of the Common
Stock upon payment
of the Subscription Price. Certificates representing shares of
the Common
Stock purchased pursuant to the Basic Subscription Privilege will
be delivered
to subscribers as soon as practicable after the Expiration Date.
Oversubscription Privilege. Subject to proration as
described below, the
Oversubscription Privilege entitles the holder of a Right to
subscribe upon
payment of the Subscription Price for a limited number of shares
of the Common
Stock in addition to those subscribed by such holder through
exercise of the
Basic Subscription Privilege. Shares of the Common Stock will be
available for
purchase pursuant to the Oversubscription Privilege by each Right
holder in an
aggregate amount up to 50% of the shares that the holder is
entitled to
purchase under the Basic Subscription Privilege and only to the
extent that any
shares of the Common Stock are not subscribed for through
exercise of the Basic
Subscription Privilege (the "Excess Shares"). No fractional
shares of Common
Stock will be issued pursuant to the exercise of the
Oversubscription
Privilege. If the number of Excess Shares is not sufficient to
satisfy all
subscriptions pursuant to the exercise of the Oversubscription
Privilege, the
Excess Shares will be allocated pro rata (subject to the
elimination of
fractional shares) among those holders who have exercised the
Oversubscription
Privilege, in proportion to the number of shares each such holder
has purchased
pursuant to the exercise of the Basic Subscription Privilege.
However, no such
holder may be allocated a greater number of Excess Shares than
was subscribed
by such holder pursuant to the exercise of such holder's
Oversubscription
Privilege. Only those holders that exercise the Basic
Subscription Privilege
will be entitled to exercise the Oversubscription Privilege.
Certificates
representing shares of the Common Stock purchased pursuant to
exercise of the
Oversubscription Privilege will be delivered to subscribers as
soon as
practicable after the Expiration Date and after all prorations
have been
effected.
Banks, brokers and other nominee holders of Rights that
exercise the
Oversubscription Privilege on behalf of beneficial owners of
Rights will be
required to certify to the Subscription Agent and the Company, in
connection
with the exercise of the Oversubscription Privilege, the
aggregate number of
shares that have been subscribed through the exercise of the
Basic Subscription
Privilege on behalf of those beneficial owners in addition to the
number of
shares that are being subscribed pursuant to exercise of the
Oversubscription
Privilege by each such beneficial owner.
PURCHASE COMMITMENT
Pursuant to agreements with the Company, certain directors
of the Company
have agreed to exercise their Rights and purchase an aggregate of
875,000
shares, or approximately 15.6% of the shares offered hereby, at
an aggregate
purchase price of $1,750,000 (the "Purchase Commitment"). These
obligations
are contingent upon the continued existence of a binding
agreement between the
Company and the Investor with respect to the issuance of the
Notes and the
Warrants. See "Description of Subordinated Financing."
EXERCISE OF RIGHTS
Rights may be exercised by delivering to the Subscription
Agent, at or
prior to the Expiration Date (5:00 p.m. New York City time, on
____________,
1995, unless extended), the properly completed and executed
Subscription
Certificate evidencing those Rights with any required signature
guarantees,
together with payment in full of the Subscription Price for each
share of the
Common Stock subscribed for pursuant to the Basic Subscription
Privilege and
the Oversubscription Privilege. Such payment must be made by (a)
check or bank
draft drawn upon a U.S. bank or postal, telegraphic, or express
money order
payable to Mellon Securities Transfer Services, as Subscription
Agent, or
(b) wire transfer of same day funds to the account maintained by
the
Subscription Agent for such purpose at Mellon Bank, N.A., ABA No.
_______________, Account No. _____________________ (marked:
"Kinark
Corporation Subscription"). Payment of the Subscription Price
will be deemed
to have been received by the Subscription Agent only upon (i)
clearance of any
uncertified check, (ii) receipt by the Subscription Agent of any
certified
check or bank draft drawn upon a U.S. bank or any postal,
telegraphic or
express money order or (iii) receipt of good funds in the
Subscription Agent's
account designated above. HOLDERS WISHING TO PAY BY UNCERTIFIED
PERSONAL CHECK
SHOULD NOTE THAT SUCH A CHECK MAY TAKE AT LEAST FIVE BUSINESS
DAYS TO CLEAR AND
SHOULD TRANSMIT THE CHECK SUFFICIENTLY IN ADVANCE OF THE
EXPIRATION DATE TO
ENSURE THAT IT IS RECEIVED AND CLEARS BY SUCH DATE OR CONSIDER
PAYMENT BY MEANS
OF CERTIFIED OR CASHIER'S CHECK, MONEY ORDER OR WIRE TRANSFER OF
FUNDS.
The address to which the Subscription Certificates and
payment of the
Subscription Price should be delivered is:
Mellon Securities Transfer Services
85 Challenger Road
Ridgefield Park, New Jersey 07660-2108
If a Rights holder wishes to exercise Rights, but time will not
permit such
holder to cause the Subscription Certificates evidencing such
Rights to reach
the Subscription Agent on or prior to the Expiration Date, such
Rights may
nevertheless be exercised if all of the following conditions (the
"Guaranteed
Delivery Procedures") are met:
(i) such holder has caused payment in full of the
Subscription Price
for each share of the Common Stock being subscribed for
pursuant to the
Basic Subscription Privilege and the Oversubscription
Privilege to be
received (in the manner set forth above) by the Subscription
Agent on or
prior to the Expiration Date;
(ii) the Subscription Agent receives, on or prior to
the Expiration
Date, a guarantee notice (a "Notice of Guaranteed
Delivery"),
substantially in the form provided with the Instructions as
to Use of
Kinark Corporation Subscription Certificates (the
"Instructions")
distributed with the Subscription Certificates, from a
member firm of a
registered national securities exchange or a member of the
National
Association of Securities Dealers, Inc. (the "NASD"), or
from a commercial
bank or trust company having an office or correspondent in
the United
States (each, an "Eligible Institution"), stating the name
of the
exercising Rights holder, the number of Rights represented
by the
Subscription Certificates held by such exercising Rights
holder, the
number of shares of the Common Stock being subscribed for
pursuant to the
Basic Subscription Privilege and the number of the shares of
Common Stock,
if any, being subscribed for pursuant to the
Oversubscription Privilege,
and guaranteeing the delivery to the Subscription Agent of
any
Subscription Certificate evidencing such Rights within three
AMEX trading
days following the date of the Notice of Guaranteed
Delivery; and
(iii) the properly completed Subscription Certificate
evidencing the
Rights being exercised, with any required signatures
guaranteed, is
received by the Subscription Agent within three AMEX trading
days
following the date of the Notice of Guaranteed Delivery
relating thereto.
The Notice of Guaranteed Delivery may be delivered to the
Subscription
Agent in the same manner as Subscription Certificates at the
addresses set
forth above, or may be transmitted to the Subscription Agent
by telegram
or facsimile transmission (telecopier no. ________________).
Additional
copies of the form of Notice of Guaranteed Delivery are
available upon
request from the Information Agent, whose address and
telephone number are
set forth below under "Information Agent."
Funds received in payment of the Subscription Price for
shares subscribed
for pursuant to the Rights will be held in a segregated account
pending
issuance of such shares. If a Rights holder exercising the
Oversubscription
Privilege is allocated less than all of the shares of the Common
Stock which
such holder wished to subscribe for pursuant to the
Oversubscription Privilege,
the excess funds paid by such holder in respect of the
Subscription Price for
shares of the Common Stock not so allocated shall be returned by
mail without
interest or deduction as soon as practicable after the Expiration
Date.
Unless a Subscription Certificate (i) provides that the
shares of the
Common Stock to be issued pursuant to the exercise of Rights
represented
thereby are to be delivered to the record holder of such Rights
or (ii) is
submitted for the account of an Eligible Institution, signatures
on such
Subscription Certificate must be guaranteed by a commercial bank,
trust
company, securities broker or dealer, credit union, savings
association or
other eligible guarantor institution which is a member of or a
participant in a
signature guarantee program acceptable to the Subscription Agent.
Holders who hold shares of the Common Stock for the account
of others,
such as brokers, trustees or depositaries for securities, should
notify the
respective beneficial owners of such shares as soon as possible
to ascertain
such beneficial owners' intentions and to obtain instructions
with respect to
the Rights. If the beneficial owner so instructs, the record
holder of such
Right should complete Subscription Certificates and submit them
to the
Subscription Agent with the proper payment. In addition,
beneficial owners of
shares of the Common Stock or Rights held through such a holder
should contact
the holder and request the holder to effect transactions in
accordance with the
beneficial owner's instructions.
The instructions accompanying the Subscription Certificates
should be read
carefully and followed in detail. DO NOT SEND SUBSCRIPTION
CERTIFICATES TO THE
COMPANY.
THE METHOD OF DELIVERY OF SUBSCRIPTION CERTIFICATES AND
PAYMENT OF THE
SUBSCRIPTION PRICE TO THE SUBSCRIPTION AGENT WILL BE AT THE
ELECTION AND RISK
OF THE RIGHTS HOLDERS, BUT IF SENT BY MAIL IT IS RECOMMENDED THAT
SUCH
SUBSCRIPTION CERTIFICATES AND PAYMENTS BE SENT BY REGISTERED
MAIL, PROPERLY
INSURED, WITH RETURN RECEIPT REQUESTED, AND THAT A SUFFICIENT
NUMBER OF DAYS BE
ALLOWED TO ENSURE DELIVERY TO THE SUBSCRIPTION AGENT AND
CLEARANCE OF PAYMENT
PRIOR TO 5:00 P.M. NEW YORK CITY TIME, ON THE EXPIRATION DATE.
BECAUSE
UNCERTIFIED PERSONAL CHECKS MAY TAKE AT LEAST FIVE BUSINESS DAYS
TO CLEAR, YOU
ARE STRONGLY URGED TO PAY, OR ARRANGE FOR PAYMENT, BY MEANS OF
CERTIFIED OR
CASHIER'S CHECK, MONEY ORDER OR WIRE TRANSFER OF FUNDS.
All questions concerning the timeliness, validity, form and
eligibility of
any exercise of Rights will be determined by the Company, whose
determinations
will be final and binding. The Company in its sole discretion
may waive any
defect or irregularity, or permit a defect or irregularity to be
corrected
within such time as it may determine, or reject the purported
exercise of any
Right. Subscriptions will not be deemed to have been received or
accepted
until all irregularities have been waived or cured within such
time as the
Company determines in its sole discretion. Neither the Company
nor the
Subscription Agent will be under any duty to give notification of
any defect or
irregularity in connection with the submission of Subscription
Certificates or
incur any liability for failure to give such notification.
The Company will pay the fees and expenses of the
Subscription Agent, and
has also agreed to indemnify the Subscription Agent from any
liability which it
may incur in connection with the Rights Offering.
INFORMATION AGENT
The Company has appointed Morrow & Co., Inc. as Information
Agent for the
Rights Offering. Any questions or requests for assistance
concerning the
method of exercising Rights or additional copies of this
Prospectus, the
Instructions or the Notice of Guaranteed Delivery may be directed
to the
Information Agent at the telephone number and address below.
Morrow & Co., Inc.
909 Third Avenue
20th Floor
New York, New York 10022-4799
or
CALL TOLL-FREE
(800) - ______________
The Company will pay the fees and expenses of the
Information Agent and
has also agreed to indemnify the Information Agent from certain
liabilities
which it may incur in connection with the Rights Offering.
NO REVOCATION
ONCE A HOLDER OF RIGHTS HAS EXERCISED THE BASIC SUBSCRIPTION
PRIVILEGE
AND/OR THE OVERSUBSCRIPTION PRIVILEGE, SUCH EXERCISE MAY NOT BE
REVOKED.
CONDITIONS TO THE RIGHTS OFFERING
The issuance of shares pursuant to the exercise of the
Rights is subject
to a number of conditions, including (i) the approval by the
stockholders at
the Special Meeting of the increase in the authorized number of
shares of the
Common Stock and the issuance of the Warrants and Warrant Shares,
(ii) the
absence of any suit or other action seeking to enjoin the Rights
Offering or
the Acquisition, (iii) no stockholder other than the Investor
owning
beneficially after the Rights Offering more than 20% of the
Common Stock of the
Company, (iv) the determination by the Board of Directors of the
Company that
sufficient funds are available to the Company from the proceeds
of this
offering, the sale of the Notes and other sources to enable it to
complete the
Acquisition, and (v) the determination by the Board of Directors
of the Company
that all of the conditions to the Acquisition have or are
expected to be
satisfied or, if not satisfied, waived, or the Rights Offering is
otherwise
terminated. In the event that the foregoing conditions to the
Rights Offering
have not been satisfied by _________, 1995, all subscription
payments will be
returned promptly, without interest or deduction.
AMENDMENTS AND TERMINATION
The Company may extend the Rights Offering and otherwise
amend the terms
of the Rights Offering or terminate the Rights Offering at any
time prior to
the Expiration Date or thereafter if the conditions to the Rights
Offering have
not been satisfied.
SHARES OF THE COMMON STOCK OUTSTANDING AFTER THE RIGHTS OFFERING
Assuming the issuance of all of the shares offered hereby,
approximately
5,619,615 shares of the Common Stock will be issued in connection
with the
Rights Offering. Based on the 3,746,410 shares of the Common
Stock outstanding
as of ____________, 1995, the issuance of such shares pursuant to
the Rights
Offering would result (on a pro forma basis as of such date) in a
150% increase
in the number of outstanding shares of the Common Stock.
Assuming the issuance
of 2,809,807 of the shares offered hereby, the issuance of such
shares would
result (on a pro forma basis as of _____________, 1995) in a 75%
increase in
the number of outstanding shares of the Common Stock.
<PAGE>
FOREIGN AND CERTAIN OTHER STOCKHOLDERS
Subscription Certificates will not be mailed to holders
whose addresses
are outside the United States or who have an APO or FPO address,
but will be
held by the Subscription Agent for their account. To exercise
such Rights,
such holders must notify the Subscription Agent on or prior to
5:00 p.m. New
York City time, on ________________, 1995.
FEDERAL INCOME TAX CONSEQUENCES
In the opinion of Nelson Mullins Riley & Scarborough,
L.L.P., the material
United States federal income tax consequences to holders of
shares of the
Common Stock upon the issuance (the "Issuance") of the Rights,
and to holders
of the Rights upon the exercise, lapse or disposition of the
Rights, will be as
set forth below. This opinion is based upon laws, regulations,
rulings and
decisions currently in effect. This opinion does not discuss all
aspects of
federal income taxation that may be relevant to a particular
investor or to
certain types of investors subject to special treatment under the
federal
income tax laws (for example, banks, dealers in securities, life
insurance
companies, tax exempt organizations and foreign taxpayers), and
does not
discuss any aspect of state, local or foreign tax laws. This
opinion is
limited to holders who will hold the Rights and any shares of the
Common Stock
received therefor upon exercise as capital assets.
Issuance of the Rights. Holders of shares of the Common
Stock will not
recognize taxable income, for federal income tax purposes, in
connection with
the receipt of the Rights.
Basis and Holding Period of the Rights. Except as provided
in the
following sentence, the basis of the Rights received by a holder
of Common
Stock as a distribution with respect of such holder's shares of
the Common
Stock will be zero. If either (i) the fair market value of the
Rights on the
date of Issuance is 15% or more of the fair market value (on the
date of
Issuance) of the shares of the Common Stock with respect to which
they are
received or (ii) the holder of Common Stock elects, in his or her
federal
income tax return for the taxable year in which the Rights are
received, to
allocate part of the basis of such shares of the Common Stock to
the Rights,
then upon exercise or sale of the Rights, the holder's basis in
such shares of
the Common Stock will be allocated between the shares of the
Common Stock and
the Rights in proportion to the fair market values of each on the
date of
Issuance. The holding period of the Rights received by a holder
as a
distribution on such holder's shares of the Common Stock will
include the
holder's holding period (as of the date of Issuance) for the
shares of the
Common Stock with respect to which the Rights were issued.
Lapse of the Rights. Holders of shares of the Common Stock
who allow the
Rights received by them at the Issuance to lapse will not
recognize any gain or
loss, and no adjustment will be made to the basis of the shares
of the Common
Stock, if any, owned by such holders of the Rights.
Exercise of the Rights; Basis and Holding Period of Shares
of the Common
Stock. Holders of the Rights will not recognize any gain or loss
upon the
exercise of such Rights. The basis of the shares of the Common
Stock acquired
through exercise of the Rights will generally be equal to the sum
of the
Subscription Price therefor and the holder's basis in such Rights
(if any).
The holding period for the shares of the Common Stock acquired
through exercise
of the Rights will begin on the date such Rights are exercised.
THE FOREGOING IS INCLUDED FOR GENERAL INFORMATION ONLY.
ACCORDINGLY, EACH
HOLDER OF SHARES OF THE COMMON STOCK IS URGED TO CONSULT WITH HIS
OR HER OWN
TAX ADVISOR WITH RESPECT TO THE TAX CONSEQUENCES OF THE RIGHTS
OFFERING ON HIS
OR HER OWN PARTICULAR TAX SITUATION, INCLUDING THE APPLICATION
AND EFFECT OF
STATE AND LOCAL INCOME AND OTHER TAXES.
OTHER MATTERS
The Rights Offering is not being made in any state or other
jurisdiction
in which it is unlawful to do so, nor is the Company selling or
accepting any
offers to purchase any shares of the Common Stock from Rights
holders who are
residents of any such state or other jurisdiction. The Company
may delay the
commencement of the Rights Offering in certain states or other
jurisdictions in
order to comply with the securities law requirements of such
states or other
jurisdictions. It is not anticipated that there will be any
changes in the
terms of the Rights Offering. The Company, if it so determines
in its sole
discretion, may decline to make modifications to the terms of the
Rights
Offering requested by certain states or other jurisdictions, in
which event
Rights holders resident in those states or jurisdictions will not
be eligible
to participate in the Rights Offering.
DESCRIPTION OF CAPITAL STOCK
COMMON STOCK
The authorized capital stock of the Company consists of
12,000,000 shares
of Common Stock, $.10 par value per share. As of June 30, 1995,
the Company
had issued 5,200,562 shares of Common Stock, 3,746,410 of which
were
outstanding and 1,454,152 of which were treasury shares. Holders
of Common
Stock are entitled to one vote per share on all matters on which
the holders of
Common Stock are entitled to vote and do not have any cumulative
voting rights.
The holders of Common Stock are entitled to receive such
dividends as may be
declared from time to time by the Board of Directors. The
Company has a
longstanding policy of not paying cash dividends on the Common
Stock in order
to reinvest earnings to support its business operations. The
terms of the
Company's secured credit facilities and the Subordinated
Financing Agreement
also restricts the payment of dividends on the Common Stock. See
"Common Stock
Dividends and Price Range."
Holders of Common Stock have no preemptive, conversion,
redemption or
sinking fund rights. In the event of a liquidation, dissolution
or winding-up
of the Company, holders of Common Stock are entitled to share
equally and
ratably in the assets of the Company, if any, remaining after the
payment of
all debts and liabilities of the Company. The outstanding shares
of Common
Stock are, and the shares of Common Stock issuable upon exercise
of the Rights
when issued will be, fully paid and nonassessable.
For a description of the Rights to be distributed by the
Company, see "The
Rights Offering." For a description of the Warrants to be issued
to the
Investor and his financial advisor, see "Description of
Subordinated
Financing - Warrants."
CERTAIN CERTIFICATE OF INCORPORATION AND BYLAW PROVISIONS
The provisions of the Company's Restated Certificate of
Incorporation (the
"Certificate"), the Company's Amended and Restated Bylaws (the
"Bylaws") and
the Delaware Corporation Law summarized in the following
paragraphs may be
deemed to have anti-takeover effects and may delay, defer or
prevent a tender
offer or takeover attempt that a stockholder might consider to be
in such
stockholder's best interest, including those attempts that might
result in a
premium over the market price for the shares held by
stockholders, and may make
removal of management more difficult.
Authorized but Unissued Stock. The authorized but unissued
shares of
Common Stock will be available for future issuance without
stockholder
approval. These additional shares may be utilized for a variety
of corporate
purposes, including future public offerings to raise additional
capital,
corporate acquisitions and employee benefit plans. The existence
of authorized
but unissued and unreserved Common Stock may enable the Board of
Directors to
issue shares to persons friendly to current management, which
could render more
difficult or discourage any attempt to obtain control of the
Company by means
of a proxy contest, tender offer, merger or otherwise, and
thereby protect the
continuity of the Company's management.
The Board of Directors may also create and issue, without
stockholder
approval, rights or options entitling the holders thereof to
purchase from the
Company shares of the Company's Common Stock.
Number of Directors. The Certificate provides that the
number of
directors of the Company shall be as provided in the Bylaws, but
may not be
less than three and shall be seven if the Bylaws do not provide a
number. The
Bylaws set the number of directors of the Company at six. This
number may be
increased or decreased at any time by amendment of the Bylaws,
subject to the
provisions of the Certificate.
Advance Notice Requirements for Stockholder Proposals and
Director
Nominations. The Bylaws establish advance notice procedures with
regard to
stockholder proposals and the nomination, other than by or at the
direction of
the Board of Directors or a committee thereof, of candidates for
election as
directors. These procedures provide that the notice of
stockholder proposals
and stockholder nominations for the election of directors at any
annual meeting
of stockholders must be in writing and be received at the
principal executive
offices of the Company not less than 90 days in advance of the
annual meeting.
The requirement to deliver notice to the Corporation a set number
of days in
advance of an annual meeting shall mean that such notice must be
delivered such
number of days in advance of the first anniversary of the
preceding year's
annual meeting; provided, however, that in the event that the
date of the
annual meeting is advanced by more than 30 days or delayed more
than 60 days
from such anniversary, notice by the stockholder to be timely
must be so
delivered not later than the close of business on the later of
the 60th day
prior to such annual meeting or the 10th day following the day on
which notice
of such meeting is first given to stockholders. For the
purposes of this
Section, notice of an annual meeting shall be deemed to first be
given to
stockholders when disclosure of such date is first made in a
press release
reported by the Dow Jones News Services, Associated Press or
comparable
national news service or in a document publicly filed by the
Corporation with
the Securities and Exchange Commission pursuant to Sections 13,
14 and 15(d) of
the Securities Exchange Act of 1934, as amended. The Chairman of
an annual
meeting shall, if the facts warrant, determine and declare to the
annual
meeting that business was not properly brought before the meeting
and if he
should so determine, he shall so declare to the annual meeting
and any such
business not properly brought before the annual meeting shall not
be
transacted. At any special meeting of the stockholders, only
such business
shall be conducted as shall have been brought before the meeting
by or at the
direction of the Board of Directors.
Approval of Business Combinations. The Certificate provides
that subject
to certain exceptions summarized below and in addition to any
affirmative vote
required by law or by the Certificate, approval of any Business
Combination (as
hereinafter defined) requires the affirmative vote of at least
two-thirds of
the outstanding Voting Shares (as hereinafter defined). For
these purposes,
"Business Combination" shall mean:
(A) Any merger or consolidation of the Company or any
subsidiary
with or into (i) any Interested Stockholder (as hereinafter
defined) or
(ii) any other corporation which is, or after such merger or
consolidation, would be an Interested Stockholder or an
affiliate of an
Interested Stockholder;
(B) Any sale, lease, exchange, mortgage, pledge,
transfer or other
disposition to or with any Interested Stockholder or any
affiliate of any
Interested Stockholder of any assets of the Company or any
subsidiary
having an aggregate Fair Market Value of $1,000,000 or more
in one
transaction or a series of related transactions;
(C) The issuance or transfer by the Company or any
subsidiary of any
securities of the Company or any subsidiary to any
Interested Stockholder
or any affiliate of any Interested Stockholder in exchange
for cash,
securities or other property (or a combination thereof)
having an
aggregate Fair Market Value of $1,000,000 or more in one
transaction or a
series of related transactions; or
(D) The adoption of any plan for the liquidation or
dissolution of
the Company proposed by or on behalf of an Interested
Stockholder or any
affiliate of any Interested Stockholder.
"Voting Shares" shall mean all issued and outstanding shares of
equity
securities and all rights to acquire any equity securities which
are generally
entitled to vote in the election of directors.
The two-thirds voting requirement shall not apply to a
particular Business
Combination if (i) any noncash consideration to be paid to
holders of Common
Stock in such Business Combination is in the same form and bears
the same
percentage to the total consideration as previously paid by the
Interested
Stockholder in connection with its acquisition of beneficial
ownership of
shares of Common Stock of the Company and (ii) the aggregate
amount of cash and
the Fair Market Value of noncash consideration, determined as of
the date of
the consummation of the Business Combination, to be received per
share by the
holders of Common Stock in such Business Combination is at least
equal to the
highest of the following:
(A) The highest per share price (including any
brokerage
commissions, transfer taxes and soliciting dealers' fees)
paid by the
Interested Stockholder for any Voting Shares acquired by it
(1) within the
two-year period immediately prior to the date of the first
public
announcement of the proposed Business Combination or (2) in
the
transaction in which it became an Interested Stockholder,
whichever is
higher;
(B) The Fair Market Value per share of Common Stock on
the date of
the first public announcement of the proposed Business
Combination or on
the date on which the Interested Stockholder became an
Interested
Stockholder, whichever is higher; and
(C) The per share book value of the Common Stock as
reported at the
end of the fiscal quarter immediately preceding the date of
the first
public announcement of the proposed Business Combination.
The two-thirds voting requirement shall also not apply to a
particular Business
Combination if the Business Combination has been approved by
two-thirds of the
directors of the Company.
"Fair Market Value" shall mean: (i) in the case of stock,
the highest
closing sale price during the 30-day period immediately preceding
the date in
question of a share of such stock on the Composite Tape for New
York Stock
Exchange-Listed Stocks, or, if such stock is not quoted on the
Composite Tape,
on the New York Stock Exchange, or, if such stock is not listed
on such
Exchange, on the principal United States securities exchange
registered under
the Securities Exchange Act of 1934 on which such stock is
listed, or, if such
stock is not listed on any such exchange, the highest closing bid
quotation
with respect to a share of such stock during the 30-day period
preceding the
date in question on the National Association of Securities
Dealers, Inc.
Automated Quotations System or any system then in use, or if no
such quotations
are available, the Fair Market Value on the date in question of a
share of such
stock as determined by a majority of the whole Board of Directors
in good
faith; and (ii) in the case of property other than cash or stock,
the Fair
Market Value of such property on the date in question as
determined in good
faith by a majority of the whole Board of Directors.
"Interested Stockholder" shall mean any Person (other than
the Company or
any corporation of which a majority of each class of equity
securities is
owned, directly or indirectly, by the Company) which, as of the
record date for
the determination of stockholders entitled to notice of and to
vote on a
Business Combination, or immediately prior to the consummation of
any such
transaction:
(A) is the beneficial owner, directly or indirectly,
of more than
10% of the Voting Shares; or
(B) is an affiliate of the Company and at any time
within two years
prior thereto was the beneficial owner, directly or
indirectly, of not
less than 10% of the then outstanding Voting Shares; or
(C) is an assignee of or successor in interest to any
shares of
capital stock of the Company which were at any time within
two years prior
thereto beneficially owned by any Interested Stockholder,
and such
assignment or succession shall have occurred in the course
of a
transaction or series of transactions not involving a public
offering
within the meaning of the Securities Act of 1933.
A majority of the whole Board of Directors shall have the
power and duty
to determine on the basis of information known to them whether a
person is an
Interested Stockholder, the number of Voting Shares beneficially
owned by any
person, whether a person is an affiliate of another, whether a
person has the
power to vote or dispose of Voting Shares or to direct the voting
or
disposition of Voting Shares, whether the assets subject to any
Business
Combination or the consideration received for the issuance or
transfer of
securities by the corporation or any subsidiary or any Business
Combination has
an aggregate Fair Market Value of $1,000,000 or more, or whether
a person has
the right to acquire beneficial ownership of Voting Shares. The
affirmative
vote of the holders of at least two-thirds of the Voting Shares
shall also be
required to amend, repeal or adopt any provisions inconsistent
with the two-
thirds votes required for Business Combinations.
Section 203 of the Delaware Corporation Law. Subject to
certain
exclusions summarized below, Section 203 of the Delaware
Corporation Law
("Section 203") prohibits any "Interested Stockholder" from
engaging in a
"Business Combination" with a Delaware corporation for three
years following
the date such person became an Interested Stockholder. For
purposes of this
subsection, "Interested Stockholder" generally includes: (a)(i)
any person who
is the beneficial owner of 15% or more of the outstanding voting
stock of the
corporation or (ii) any person who is an affiliate or associate
of the
corporation and who was the beneficial owner of 15% or more of
the outstanding
voting stock of the corporation at any time within three years
before the date
on which such person's status as an Interested Stockholder is
determined; and
(b) the affiliates and associates of such person. For purposes
of this
subsection and subject to certain exceptions, a "Business
Combination" includes
(i) any merger or consolidation of the corporation or a
majority-owned
subsidiary of the corporation, (ii) the sale, lease, exchange,
mortgage,
pledge, transfer or other disposition of assets of the
corporation or a
majority-owned subsidiary of the corporation having an aggregate
market value
equal to 10% or more of either the aggregate market value of all
assets of the
corporation determined on a consolidated basis or the aggregate
market value of
all the outstanding stock of the corporation, (iii) any
transaction that
results in the issuance or transfer by the corporation or a
majority-owned
subsidiary of the corporation of any stock of the corporation or
the subsidiary
to the Interested Stockholder, except pursuant to a transaction
that effects a
pro rata distribution to all stockholders of the corporation,
(iv) any
transaction involving the corporation or a majority-owned
subsidiary of the
corporation that has the effect of increasing the proportionate
share of the
stock of any class or series, or securities convertible into the
stock of any
class or series, of the corporation or the subsidiary that is
owned by the
Interested Stockholder, and (v) any receipt by the Interested
Stockholder of
the benefit (except proportionately as a stockholder) of any
loans, advances,
guarantees, pledges or other financial benefits provided by or
through the
corporation or a majority-owned subsidiary of the corporation.
Section 203 does not apply to a Business Combination if (i)
before a
person became an Interested Stockholder, the Board of Directors
of the
corporation approved either the transaction in which the
Interested Stockholder
became an Interested Stockholder or the Business Combination,
(ii) upon
consummation of the transaction that resulted in the person
becoming an
Interested Stockholder, the Interested Stockholder owned at least
85% of the
voting stock of the corporation outstanding at the time the
transaction
commenced (other than certain excluded shares), or (iii)
following a
transaction in which the person became an Interested Stockholder,
the Business
Combination is (a) approved by the Board of Directors of the
corporation and
(b) authorized at a regular or special meeting of stockholders
(and not by
written consent) by the affirmative vote of the holders of at
least two-thirds
of the outstanding voting stock of the corporation not owned by
the Interested
Stockholder.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the Company's Common
Stock is Mellon
Securities Transfer Services, Ridgefield Park, New Jersey.
DESCRIPTION OF SUBORDINATED FINANCING
GENERAL
The Company and the Investor have agreed pursuant to the
terms of a
Securities Purchase Agreement (the "Subordinated Financing
Agreement") to the
issuance by the Company and the purchase by the Investor of up to
$4.0 million
principal amount of Senior Secured Subordinated Notes (the
"Notes") at par in
increments of $500,000. The Notes are issuable by the Company
and, subject to
the terms and conditions of the Subordinated Financing Agreement,
must be
purchased by the Investor from time to time at the election of
the Company over
a one year period beginning on the date of closing by the Company
of the
Acquisition (the "Acquisition Closing Date"). The Notes will
mature on the
eighth anniversary of the Acquisition Closing Date, bear interest
payable semi-
annually in arrears at a rate of 13.5% per annum and be repaid in
six equal
semi-annual principal payments beginning six months after the
fifth anniversary
of the Acquisition Closing Date. The Notes may be prepaid in
whole or in part
in increments of at least $100,000, provided that partial
prepayments will be
applied first to accrued interest and then to the unpaid
principal installments
in the inverse order of maturity. The Notes must be prepaid in
full at par,
plus accrued interest, upon a change in control of the Company.
For these
purposes, a change in the control will be deemed to have occurred
if (i) there
is a change during any consecutive twenty-four month period in
the identity of
the persons constituting a majority of the Board of Directors of
the Company
other than a change approved by the Investor or caused by the
Investor and its
designees on the Board of Directors or (ii) the Investor's
designees are no
longer serving as directors of the Company for any reason, other
than their
death, resignation or refusal to stand for reelection or (iii)
Michael T.
Crimmins shall no longer be serving as Chief Executive Officer
for any reason,
other than death, permanent disability, refusal to serve or cause
as defined in
the Subordinated Financing Agreement or the rights or duties of
the Chief
Executive Officer shall have been reduced without the consent of
the Investor.
The Notes will be subordinated to the Company's existing
bank debt (the
"Senior Debt"), and will be secured by the capital stock of
Rogers. The assets
of Rogers, other than its net working capital, will not be
available for pledge
to secure the Senior Debt. The Secured Financing Agreement
contains certain
financial and nonfinancial covenants typical for a subordinated
financing.
WARRANTS
Pursuant to the terms of the Subordinated Financing
Agreement, the Company
will issue 100,000 warrants to purchase Common Stock (the
"Warrants") to the
Investor in exchange for a binding and irrevocable commitment
from the Investor
to purchase the Notes upon demand by the Company (the
"Commitment"), and will
pay $100,000 fee on the Acquisition Closing Date. Additional
Warrants will be
issued upon the purchase by the Investor of the Notes from time
to time at a
rate of 268,750 Warrants for each $500,000 of Notes purchased.
The Company
will also issue 20,000 Warrants to Gary R. Griffith, the
Investor's financial
advisor, upon receipt of the Commitment. Each Warrant will
entitle the holder
thereof to purchase one share of the Common Stock at any time and
from time to
time after the date of issuance thereof until the eighth
anniversary of the
Acquisition Closing Date. The exercise price of each Warrant
will be the
average of the closing prices for the Common Stock reported by
the AMEX during
the twenty trading days preceding the issuance of the Warrant.
The Warrants
will be transferable.
The number of Warrant Shares and the exercise price are
subject to
adjustment for stock splits, stock dividends and distributions,
subdivisions,
combinations and reclassification on, or of, the Common Stock and
in the event
of the issuance of Common Stock (or rights therefore or
securities convertible
thereto) at an effective price which is less than the market
price per share of
the Common Stock. In addition, the number of Warrant Shares is
subject to
adjustment for mergers, consolidations and sales of assets.
The purchase price of each Warrant will be 1/100th of $.01
(or an
aggregate of $227.00 for all of the Warrants to be issued), which
will be paid
in cash by the Investor or his financial advisor, as applicable.
The Warrants
issued on the Acquisition Closing Data shall have an exercise
price equal to
the average closing price of the Common Stock during the 20
trading days prior
to the Acquisition Closing Data. The exercise price of any other
Warrants
issued will be the average closing price of the Common Stock
during the 20
trading days prior to the date of issuance thereof. The Warrants
are payable
in cash or by the application of accrued interest on, and unpaid
principal of,
the Notes in an equivalent amount.
CONDITIONS TO THE PURCHASE OF THE NOTES
The obligation of the Investor to purchase the Notes is
subject to a
number of conditions, including (i) that there has been no
material adverse
change in the financial condition, business, operations or
prospects of the
Company and its subsidiaries or Rogers, (ii) that the issuance of
the Warrants
and the Warrant Shares is approved by the stockholders of the
Company, (iii)
that the Warrant Shares are approved for listing on AMEX, (iv) no
stockholder
other than Michael T. Crimmins or his affiliates owning
beneficially after the
Rights Offering more than 20% of the outstanding Common Stock of
the Company,
(v) that the Board of Directors of the Company determines that
sufficient funds
are available to the Company from the proceeds of the Rights
Offering, the sale
of the Notes and other sources to enable to complete the
Acquisition, (vi) the
absence of any litigation or proceeding challenging the legality
or validity of
the Rights Offering or the issuance or sale of the Notes or
Warrants or seeking
any change in control of the Company and (vii) the appointment of
Michael T.
Crimmins as the Chief Executive Officer of the Company.
REGISTRATION RIGHTS
The Company has agreed, upon demand, to provide one
registration under the
Securities Act of 1933, as amended (the "Securities Act"), for
the Notes, the
Warrants and the Warrant Shares and the other Common Stock of the
Investor and
to include all or a portion of the Warrant Shares and the other
Common Stock of
the Investor in any other registrations by the Company under the
Securities
Act, subject to certain conditions and exceptions.
LEGAL MATTERS
The legality of the Common Stock offered hereby has been
passed upon for
the Company by Nelson Mullins Riley & Scarborough, L.L.P.,
Atlanta, Georgia.
EXPERTS
The consolidated financial statements and related financial
statement
schedule incorporated by reference in this Prospectus from Kinark
Corporation's
Annual Report on Form 10-K for the year ended December 31, 1994
have been
audited by Deloitte & Touche LLP, independent auditors, as stated
in their
report which is incorporated by reference herein. The
consolidated financial
statements of Rogers Galvanizing Company as of and for the years
ended
September 30, 1994, and 1993, set forth in this Prospectus have
been audited by
Hogan & Slovacek, PC, independent auditors, as indicated in their
report set
forth herein and the financial statements of Rogers Galvanizing
Company for the
year ended September 30, 1992, set forth in this Prospectus have
been audited
by Arthur Andersen LLP, independent auditors, as indicated in
their report set
forth herein. The financial statements and financial statement
schedule
referred to above have been incorporated by reference or included
in reliance
upon the reports of such firms given upon their authority as
experts in
accounting and auditing.
<PAGE>
INDEX TO FINANCIAL STATEMENTS
Page
KINARK CORPORATION
Pro Forma
Unaudited Pro Forma Condensed Consolidated Balance Sheet as
of
June 30, 1995
F-3
Unaudited Pro Forma Condensed Consolidated Statement of
Operations for the Six Months Ended June 30, 1995, and
the
Year Ended December 31, 1994
F-4
Notes to Unaudited Pro Forma Condensed Consolidated
Financial
Statements
F-6
ROGERS GALVANIZING COMPANY
Unaudited
Unaudited Consolidated Balance Sheets as of June 30, 1995
F-8
Unaudited Consolidated Statements of Income and Retained
Earnings
for the Nine Months Ended June 30, 1995 and 1994
F-9
Unaudited Consolidated Statements of Cash Flows for the Nine
Months
Ended June 30, 1995 and 1994
F-10
Notes to Unaudited Consolidated Financial Statements
F-11
Audited
Independent Auditors' Report
F-12
Independent Auditors' Report
F-13
Consolidated Balance Sheets as of September 30, 1994, and
1993 F-14
Consolidated Statements of Income and Retained Earnings for
the
Years Ended September 30, 1994, 1993, and 1992
F-15
Consolidated Statements of Cash Flows for the Years Ended
September
30, 1994, 1993, and 1992
F-16
Notes to Consolidated Financial Statements
F-17
<PAGE>
PRO FORMA CONSOLIDATED FINANCIAL DATA
(UNAUDITED)
The following Pro Forma Consolidated Financial Data of
Kinark Corporation
and subsidiaries (the "Company") consist of a Pro Forma Condensed
Consolidated
Balance Sheet (unaudited) as of June 30, 1995 (the "Pro Forma
Balance Sheet"),
and the Pro Forma Condensed Consolidated Statements of Operations
(unaudited)
for the six-months ended June 30, 1995 and the year ended
December 31, 1994
(the "1995 Pro Forma Statement of Operations" and "1994 Pro Forma
Statement of
Operations," respectively).
The Pro Forma Balance Sheet reflects the combination of the
balance sheets
of the Company and Rogers Galvanizing Company ("Rogers") as of
June 30, 1995,
(i) as adjusted for the issuance 5,619,615 shares of the
Company's common stock
in the Rights Offering (the "100% Case") and (ii) as adjusted for
the issuance
of 2,809,807 shares of the Company's common stock in the Rights
Offering and
the issuance of the $4,000,000 Senior Secured Subordinated Notes
(the "50%
Case"). The Pro Forma Balance Sheet is presented as if the
Rogers acquisition
and the stock sale had been consummated on June 30, 1995.
The 1995 Pro Forma Statement of Operations reflects the
combination of the
income statements for the Company and Rogers for the six months
ended June 30,
1995, as if such transactions were consummated on January 1,
1995. The 1994
Pro Forma Statement of Operations reflects the combination of the
income
statements of the Company for the year ended December 31, 1994,
and of Rogers
for its fiscal year ended September 30, 1994, as if the
transaction was
consummated on January 1, 1994.
The acquisition of Rogers will be accounted for using the
purchase method.
The Company has not completed its assessment of the fair values
of Rogers'
assets and liabilities which are reflected in the accompanying
Pro Forma
Balance Sheet at historical cost. The Company expects to
finalize its fair
value assessment in 1995 and does not expect that fair values
will differ
materially from historical amounts. Accordingly, the final
consolidated
amounts may differ from those set forth herein.
The Pro Forma Consolidated Financial Data should be read in
conjunction
with the separate historical financial statements of the Company
and Rogers,
the related notes and the Management's Discussion and Analysis of
Financial
Condition and Results of Operations of the Company incorporated
by reference in
this Prospectus. The Pro Forma Consolidated Financial Data are
based upon
currently available information and upon certain assumptions that
the Company
believes are reasonable under the circumstances. The Pro Forma
Consolidated
Financial Data do not purport to represent what the Company's
financial
position or results of operations would actually have been if the
aforementioned transactions in fact had occurred on such date or
at the
beginning of the periods indicated or to project the Company's
financial
position or results of operations at any future date or for any
future period.<PAGE>
<TABLE>
KINARK
CORPORATION
PRO FORMA CONDENSED
CONSOLIDATED BALANCE SHEET
June 30,
1995
<CAPTION>
Kinark
100% Case 50% Case
Kinark Kinpak Adjusted
Rogers Pro Forma Pro Forma Pro Forma Pro Forma
Historical Elimination(b) Historical
Historical Adjustments Combined Adjustments Combined
(In thousands)
<S> <C> <C> <C>
<C> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash $37 $38 $75
$461 $10,854(c) $536 $9,175(j) $560
(9,151)(f) (9,151)(m)
(1,703)(g)
Receivables, net 5,016 (1,462) 3,554
2,554 -- 6,108 -- 6,108
Net asset of
discontined opertions -- 2,384 2,384
-- -- 2,384 -- 2,384
Inventories 3,030 (579) 2,451
861 -- 3,312 -- 3,312
Prepaid assets 478 (64) 414
72 -- 486 -- 486
Total current assets 8,561 317 8,878
3,948 -- 12,826 24 12,850
Fixed assets, net 10,765 (1,612) 9,153
3,432 -- 12,585 -- 12,585
Other assets:
Deferred income taxes 1,803 1,803
207 -- 2,010 -- 2,010
Other assets 769 (557) 212
-- -- 212 120(j) 332
Excess of cost over
fair value of net
assets acquired -- -- --
-- 4,865(f) 4,865 4,865(m) 4,865
Total other assets 2,572 (557) 2,015
207 4,847 7,087 4,967 7,207
Total Assets 21,898 (1,852) 20,046
7,587 4,847 32,498 4,991 32,642
LIABILITIES AND
SHAREHOLDERS EQUITY
Current liabilities:
Long-term debt-current 801 (210) 591
829 1,420 1,420
Accrued retirement
liabilities -- -- --
19 19 19
Accounts payable 1,536 (474) 1,062
780 1,842 1,842
Insurance reserves -- -- --
452 452 452
Accrued expenses-other 2,667 (199) 2,468
325 2,793 2,793
Accrued income taxes 140 -- 140
135 275 275
Total current
liabilities 5,144 (883) 4,261
2,540 6,801 6,801
Deferred income taxes
127 127 127
Long-term debt 7,454 (969) 6,485
243 (1,703)(g) 5,025 6,728
Accrued retirement -- -- --
84 -- 84 84
Lease obligations -- -- --
307 -- 307 307
Subordinated notes -- -- --
-- -- -- 4,000(j) 4,000
Total long-term
liabilities 7,454 (969) 6,485
761 (1,703) 5,543 4,000 11,246
Total liabilities 12,598 (1,852) 10,746
3,301 (1,703) 12,344 4,000 18,047
Shareholder's Equity:
Common Stock 520 -- 520
117 417(c) 937 136(j) 656
(117)(d) (117)(n)
Additional paid-in
capital 10,531 -- 10,531
104 4,460(c) 14,991 (818)(j) 9,713
(104)(d) (104)(j)
Treasury stock (5,977) -- (5,977)
-- 5,977(c) -- 5,977(j) --
Retained earnings 4,226 4,226
4,065 (4,065)(d) 4,226 (4,065)(n) 4,226
Total shareholders'
equity 9,300 9,300
4,286 6,550 20,154 991 14,595
Total liabilities and
shareholders equity 21,898 (1,852) 20,046
7,587 4,847 32,498 4,991 32,642
</TABLE>
<PAGE>
KINARK
CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF
OPERATIONS
<TABLE>
For the Six Months Ended
June 30, 1995 (Unaudited)
<CAPTION>
Kinark
100% Case 50% Case
Kinark Kinpak Adjusted
Rogers Pro Forma Pro Forma Pro Forma Pro Forma
Historical Elimination(b) Historical
Historical Adjustments Combined Adjustments Combined
(In
thousands, except per share data)
<S> <C> <C> <C>
<C> <C> <C>
SALES $17,029 $4,259 $12,770
$9,190 $21,960 $21,960
COSTS AND EXPENSES:
Costs of sales 12,716 2,319 10,397
6,774 17,171 17,171
Selling, general and
administrative 4,183 2,111 2,072
1,173 (180) 3,065 (180) 3,065
Depreciation and
amortization 946 150 796
425 97(e) 1,318 97(l) 1,318
Operating earnings
(loss) (816) (321) (495)
818 83 406 83 406
OTHER (INCOME) EXPENSE:
Interest expense (net) 355 45 310
80 (85)(g) 305 278(k) 668
Other (income) expense -- -- --
(60) -- (60) -- (60)
Other expenses, net 355 45 310
20 (85) 245 278 608
Earnings (loss) from
continuing operations
before income taxes (1,171) 366 (805)
798 168 161 (195) (202)
Income taxes (427) (134) (293)
240 (97)(h) (150) (36)(p) (89)
Earnings (loss) from
continuing operations (744) (232) (512)
558 265 311 (159) (113)
Earnings (loss) per
share (0.20) (0.14)
0.03 (0.02)
Weighted average shares
outstanding 3,747 3,747
5,620 9,366(i) 2,810 6,567(o)
</TABLE>
See notes to Pro Forma Condensed Consolidated Financial
Statements
<PAGE>
KINARK
CORPORATION
PRO FORMA CONDENSED CONSOLIDATED STATEMENT
OF OPERATIONS
<TABLE>
For the Year Ended
December 31, 1994
<CAPTION>
Kinark
100% Case 50% Case
Kinark Kinpak Adjusted
Rogers Pro Forma Pro Forma Pro Forma Pro Forma
Historical Elimination(b) Historical
Historical Adjustments Combined Adjustments Combined
(In
thousands, except per share data)
<S> <C> <C> <C>
<C> <C> <C> <C> <C>
SALES $34,782 $8,559 $26,223
$12,624 $38,847 $38,847
COSTS AND EXPENSES:
Costs of sales 23,646 4,646 19,000
9,448 28,448 28,448
Selling, general and
administrative 8,080 4,462 3,618
2,127 (404) 5,341 (404) 5,341
Depreciation and
amortization 1,771 302 1,469
671 195(e) 2,335 195(l) 2,335
Operating earnings
(loss) 1,285 (851) 2,136
378 209 2,723 209 2,723
OTHER (INCOME) EXPENSE:
Interest expense (net) 599 96 503
19 (153)(g) 369 555(k) 1,007
Other (income) expense 95 -- 95
(70) -- 25 -- 25
Other expenses, net 694 96 598
(51) (153) 394 555 1,102
Earnings (loss) from
continuing operations
before income taxes 591 (947) 1,538
429 362 2,329 (346) 1,621
Income taxes 181 (346) 527
104 203(h) 834 (55)(j) 576
Earnings (loss) from
continuing operations 410 (601) 1,011
325 159 1,495 (291) 1,045
Earnings (loss) per
share 0.11 0.27
0.16 0.16
Weighted average shares
outstanding 3,752 3,752
5,620 9,372(i) 2,810 6,562(o)
</TABLE>
See notes to Pro Forma Condensed Consolidated
Financial Statements
<PAGE>
KINARK CORPORATION
NOTES TO PROFORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
(a) The historical information for Rogers Galvanizing Company
("Rogers") in
the accompanying proforma condensed consolidated statement
of operations
for the year ended December 31, 1994 is based on that
company's September
30, 1994 fiscal year
(b) During August, 1995, management of Kinark Corporation (the
"Company")
finalized a formal plan to discontinue the operations of its
subsidiary,
Kinpak, Inc. The estimated pre-tax loss on disposal of this
subsidiary is
$1,525 including $185 of estimated operating losses to be
incurred during
the disposal period. This estimated loss is not reflected
in the
accompanying proforma financial statements. The Kinpak,
Inc. elimination
presented in the accompanying proforma financial statements
reflects
entity's assets, liabilities and operations based on
historical cost.
Pro Forma Adjustments - 100% Case:
(c) Reflects the issuance of 5,619,615 shares of the Company's
common stock at
$2.00 per share through the Rights Offering resulting in net
proceeds of
$10,854, an increase in common stock of $417 and additional
paid in
capital of $4,460 (net of cost of treasury stock issued and
stock issuance
costs of $385).
(d) To reflect the elimination of Rogers' shareholders' equity.
(e) Adjustments to reflect (i) the amortization of the excess of
cost over
fair value of net assets acquired in the Roger acquisition
using a
straight-line method over 25 years and (ii) the elimination
of salary and
benefits relating to Roger's Chairman of the Board who will
retire
effective upon the acquisition by the Company.
<PAGE>
(f) Adjustment to reflect the purchase of Rogers common stock.
For purposes
of these proforma statements, the historical amounts of
Rogers' assets and
liabilities have not been adjusted to fair value. Based
upon current
estimates, fair values are not expected to differ materially
from such
historical cost amounts. Adjustments based upon final
determination of
the fair values of assets acquired and liabilities assumed
will be made as
of the closing date. The excess of costs over fair value of
net assets
acquired is as follows:
Purchase cost:
Purchase price $8,321
Acquisition costs 830
Total cash expended 9,151
Liabilities assumed 3,301
Total purchase cost 12,452
Assets acquired 7,587
Excess of cost over fair value
of net assets acquired $4,865
(g) Adjustment reflects reduction of revolving line of credit
using excess
proceeds of Rights Offering and the resultant decrease in
interest
expense. Interest on the revolving line of credit is
assumed to have an
effective rate of 9% for the year ended December 31, 1994
and 10% for the
six months ended June 30, 1995.
(h) To reflect the tax effects of pro-forma adjustments using a
36% effective
tax rate.
(i) Reflects the historical weighted average shares outstanding
adjusted for
issuance of 5,619,615 shares under the Rights Offering.
Pro Forma Adjustments - 50% Case:
(j) Reflects the issuance of 2,809,807 shares of the Company's
common stock at
$2.00 per share through the Rights Offering resulting in net
proceeds of
$5,295, an increase in common stock of $136 and a decrease
to additional
paid in capital of $818 (net of cost of treasury stock
issued and stock
issuance costs of $325); and the issuance $4,000 Senior
Secured
Subordinated Notes. Debt issuance costs of $120 are
recorded in Other
Assets.
(k) To reflect additional interest expense and amortization of
debt issuance
costs of $4,000 of Senior Secured Subordinated Notes. The
Senior Secured
Subordinated Notes bear interest payable semi-annually in
arrears at a
rate of 13.5% per annum.
(l) Adjustments to reflect (i) the amortization of the excess of
cost over
fair value of net assets acquired in the Rogers acquisition
using a
straight-line method over 25 years and (ii) the elimination
of salary and
benefits relating to Roger's Chairman of the Board who will
retire
effective upon the acquisition by the Company.
(m) Adjustment to reflect the purchase of Rogers common stock.
For purposes
of these proforma statements, the historical cost amounts of
Rogers'
assets and liabilities have not been adjusted to fair value.
Based upon
current estimates, fair values are not expected to differ
materially from
such historical amounts. Adjustments based upon final
determination of
the fair values of assets acquired and liabilities assumed
will be made as
of the closing date. The excess of costs over fair value of
net assets
acquired is as follows:
Purchase cost:
Purchase price $8,321
Acquisition costs 830
Total cash expended 9,151
Liabilities assumed 3,301
Total purchase cost 12,452
Assets acquired 7,497
Excess of cost over fair
value of net
assets acquired $4,865
(n) To reflect the elimination of Rogers' shareholders' equity.
(o) Reflects the historical weighted average shares outstanding
adjusted for
issuance of 2,809,807 shares under the Rights Offering. For
purposes of
computing earnings (loss) per share, the effects of the
exercise of
Warrants issued in connection with the Senior Secured
Subordinated Notes
determined under the treasury stock method was antidilutive.
(p) To reflect the tax effects of pro-forma adjustments using a
36% effective
tax rate.
<PAGE>
ROGERS GALVANIZING COMPANY
Consolidated Balance Sheet (Unaudited)
June 30, 1995
1995
CURRENT ASSETS:
Cash
$ 461,042
Accounts receivable, less reserve for doubtful accounts of
$64,433 in 1995 and $51,138 in 1994
2,553,479
Inventories
861,225
Income taxes receivable
--
Deferred income taxes
207,000
Prepaid expenses
72,114
Total current assets
4,154,860
PROPERTY, PLANT AND EQUIPMENT, at cost:
Land
175,172
Galvanizing plants and equipment
6,682,642
Other
244,507
7,102,321
Less-accumulated depreciation
3,670,180
Total property, plant and equipment
3,432,141
$7,587,001
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt
$828,969
Accounts payable
780,360
Accrued workers' compensation liability
361,114
Accrued employee health liability
90,667
Accrued retirement
18,974
Accrued payroll and payroll taxes
309,757
Other accrued liabilities
15,492
Income taxes payable
134,810
Total current liabilities
2,540,143
DEFERRED INCOME TAXES
127,000
ACCRUED RETIREMENT
83,502
LONG-TERM DEBT
549,779
COMMITMENTS AND CONTINGENCIES
--
SHAREHOLDERS' EQUITY:
Common shares, $100 par value, 1,967 shares authorized,
1,172 shares outstanding
117,200
Capital surplus
103,451
Retained earnings
4,065,926
Total shareholders' equity
4,286,577
$7,587,001
The accompanying notes are an integral part of these financial
statements.<PAGE>
ROGERS GALVANIZING COMPANY
Consolidated Statements of Income and Retained Earnings
(Unaudited)
For the Nine Months Ended June 30, 1995 and 1994
1995
1994
Sales $13,284,968
$9,224,683
Costs and expenses:
Costs of sales 9,555,746
6,908,029
Selling, general & administrative 1,889,266
1,419,771
Depreciation 604,597
440,000
Operating earnings 1,235,359
456,883
Other (income) expense:
Interest expense, net 110,824
15,469
Other (94,730)
(51,483)
Earnings before income taxes 1,219,265
492,897
Income tax expense 452,053
110,186
Net earnings 767,212
382,711
Retained earnings, beginning of period 3,467,482
3,603,133
Dividends paid ($144 per share in 1993 and
$344 in 1994 (168,768)
(403,168)
Retained earnings, end of period $4,065,926
$3,582,676
The accompanying notes are an integral part of these financial
statements.
<PAGE>
ROGERS GALVANIZING COMPANY
Consolidated Statements of Cash Flows (Unaudited)
For The Nine Months Ended June 30, 1995 and 1994
1994
1993
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income
$767,212 $382,711
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation
660,438 494,850
Deferred income taxes
37,000 (34,000)
Changes in operating assets and
liabilities:
(Increase) decrease in accounts receivable
(396,903) 138,159
(Increase) in inventories
(221,730) (25,181)
(Increase) decrease in income taxes receivable
37,000 (25,811)
(Increase) in prepaid expenses
(14,003) (13,234)
Increase (decrease) in accounts payable
(78,456) 36,599
Increase in workers' compensation liability
50,434 99,397
Increase in accrued employee health liability
10,714 2,519
Increase (decrease) in accrued payroll and
payroll taxes
126,987 (155,423)
(Decrease) in other accrued liabilities
(1,023) (4,365)
Increase (decrease) in income taxes payable
134,810 (129,745)
(Decrease) in accrued retirement
(18,749) (17,671)
Total adjustments
326,519 366,094
Net cash provided by operating
activities
1,093,731 748,805
CASH FLOWS USED IN INVESTING ACTIVITIES:
Additions to property, plant and equipment
(711,511) (536,609)
Net cash used in investing activities
(711,511) (536,609)
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid
(168,768) (403,168)
Proceeds from debt
690,421 950,000
Payments on debt
(843,937) (539,513)
Net cash provided by (used in) financing
activities
(322,284) 7,319
NET INCREASE IN CASH
59,936 219,515
CASH, beginning of period
401,106 528,665
CASH, end of period
$461,042 $748,180
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Interest paid
$124,342 $ 25,346
Income taxes paid
$225,000 $295,000
The accompanying notes are an integral part of these financial
statements.<PAGE>
ROGERS GALVANIZING COMPANY
Notes to Consolidated Financial Statements
(Unaudited)
For the Nine Months Ended June 30, 1995 and 1994
1. BASIS OF PRESENTATION
The accompanying consolidated financial statements have been
prepared by Rogers
Galvanizing Company (the "Company") pursuant to the rules and
regulations of
the Securities and Exchange Commission for interim reporting and
include all
normal and recurring adjustments which are, in the opinion of
management,
necessary for a fair presentation. These financial statements
have not been
audited by an independent accountant. The consolidated financial
statements
include the accounts of the Company and its subsidiaries,
Reinforcing Services,
Inc. and Spin-Galv, Inc. All significant intercompany balances
and
transactions have been eliminated in consolidation.
Certain information and footnote disclosures normally included in
financial
statements prepared in accordance with generally accepted
accounting principles
have been condensed or omitted pursuant to such rules and
regulations for
interim reporting. The Company believes that the disclosures are
adequate to
make the information presented not misleading. However, these
financial
statements should be read in conjunction with the financial
statements and
notes thereto included elsewhere in this Registration Statement
for the years
ended September 30, 1994, 1993 and 1992. The financial data for
the interim
periods presented may not necessarily reflect the results to be
anticipated for
the complete year.
2. INVENTORIES
Inventories are composed, primarily, of raw zinc "pigs", molten
zinc in
galvanizing kettles and other chemicals and materials used in the
galvanizing
process. Molten zinc is stated at the lower of cost or market,
with cost
determined by the last-in, first-out (LIFO) method. All other
inventories are
stated at the lower of cost or market, with cost determined by
the first-in,
first-out (FIFO) method.
3. PLANNED ACQUISITION
The Company has recently entered into an agreement to purchase
the assets of a
small galvanizing company for cash and debt of approximately
$750,000 to
$925,000 depending on the amount of inventory on hand at the date
of closing.
The Company expects this acquisition to be consummated before
September 30,
1995.
<PAGE>
INDEPENDENT AUDITORS' REPORT
To the Board of Directors of
Rogers Galvanizing Company:
We have audited the accompanying consolidated balance sheets of
Rogers
Galvanizing Company and subsidiaries as of September 30, 1994 and
1993, and the
related consolidated statements of income and retained earnings
and cash flows
for each of the two years ended September 30, 1994. These
consolidated
financial statements are the responsibility of the Company's
management. Our
responsibility is to express an opinion on these consolidated
financial
statements based on our audits.
We conducted our audits in accordance with generally accepted
auditing
standards. Those standards require that we plan and perform the
audits to
obtain reasonable assurance about whether the financial
statements are free of
material misstatement. An audit includes examining, on a test
basis, evidence
supporting the amounts and disclosures in the financial
statements. An audit
also includes assessing the accounting principles used and
significant
estimates made by management, as well as evaluating the overall
financial
statement presentation. We believe that our audits provide a
reasonable basis
for our opinion.
In our opinion, the consolidated financial statements referred to
above present
fairly, in all material respects, the financial position of
Rogers Galvanizing
Company and subsidiaries as of September 30, 1994 and 1993, and
the results of
their operations and their cash flows for each of the two years
ended September
30, 1994, in conformity with generally accepted accounting
principles.
As discussed in Note 10 to the financial statements, management
has determined
that the appropriate accounting treatment for a certain building
lease entered
into in 1994 is an operating lease instead of a capital lease as
it was
originally presented in the financial statements as of September
30, 1994 and
for the year then ended. Accordingly, the 1994 financial
statements have been
restated to more appropriately reflect that particular lease.
/s/ Hogan & Slovacek
November 17, 1994,
except as to Note 10
which is August 16, 1995
Tulsa, Oklahoma
<PAGE>
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
To the Board of Directors
of Rogers Galvanizing Company:
We have audited the accompanying statements of income and cash
flows of Rogers
Galvanizing Company (a Delaware corporation) for the year ended
September 30,
1992. These financial statements are the responsibility of the
Company's
management. Our responsibility is to express an opinion on these
financial
statements based on our audit.
We conducted our audit in accordance with generally accepted
auditing
standards. Those standards require that we plan and perform the
audit to
obtain reasonable assurance about whether the statements of
income and cash
flows are free of material misstatement. An audit includes
examining on a test
basis, evidence supporting the amounts and disclosures in the
statements of
income and cash flows. An audit also includes assessing the
accounting
principles used and significant estimates made by management, as
well as
evaluating the overall financial statement presentation. We
believe that our
audit provides a reasonable basis for our opinion.
In our opinion, the statements of income and cash flows referred
to above
present fairly, in all material respects, the results of
operations and cash
flows of Rogers Galvanizing Company for the year ended September
30, 1992, in
conformity with generally accepted accounting principles.
/s/ Arthur Andersen, LLP
Tulsa, Oklahoma
October 26, 1992
<PAGE>
ROGERS GALVANIZING COMPANY
Consolidated Balance Sheets
September 30, 1994 and 1993
1994
1993
CURRENT ASSETS:
Cash $401,106
$528,665
Accounts receivable, less reserve for
doubtful accounts of $45,138 in 1994
and $44,925 in 1993 2,156,576
1,732,403
Inventories 639,495
453,870
Income taxes receivable 37,000
20,000
Deferred income taxes 178,500
162,000
Prepaid expenses 58,111
37,746
Total current assets 3,470,788
2,934,684
PROPERTY, PLANT AND EQUIPMENT, at cost:
Land 175,172
175,172
Galvanizing plants and equipment 5,997,857
4,622,936
Other 216,631
152,209
6,389,660
4,950,317
Less-accumulated depreciation 3,008,592
2,336,912
Total property, plant and equipment 3,381,068
2,613,405
$6,851,856 $5,548,089
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current maturities of long-term debt $877,464
$26,109
Accounts payable 858,816
537,445
Accrued workers' compensation liability 310,680
252,853
Accrued employee health liability 79,953
97,278
Accrued retirement 25,252
23,317
Accrued payroll and payroll taxes 182,770
325,645
Other accrued liabilities 16,515
27,351
Income taxes payable --
129,745
Total current liabilities 2,351,450
1,419,743
DEFERRED INCOME TAXES 61,500
74,000
ACCRUED RETIREMENT 95,973
121,225
LONG-TERM DEBT 654,800
109,337
COMMITMENTS AND CONTINGENCIES --
--
SHAREHOLDERS' EQUITY:
Common shares, $100 par value, 1,967 shares
authorized, 1,172 shares outstanding 117,200
117,200
Capital surplus 103,451
103,451
Retained earnings, per accompanying statements 3,467,482
3,603,133
Total shareholders' equity 3,688,133
3,823,784
$6,851,856 $5,548,089
The accompanying notes are an integral part of these
financial statements.
<PAGE>
ROGERS GALVANIZING COMPANY
Consolidated Statements of Income and
Retained Earnings
For the Years Ended September 30, 1994, 1993
and 1992
1994 1993
1992
Sales $12,624,796 $11,544,123
$10,907,159
Costs and expenses:
Costs of sales 9,447,974 7,806,927
8,190,603
Selling, general &
administrative 2,127,505 1,713,037
1,431,979
Depreciation 671,681 550,108
473,754
Operating earnings 377,636 1,474,051
810,823
Other (income) expense:
Interest expense, net 19,290 22,466
36,396
Other (69,427) (66,389)
(44,241)
Earnings before income taxes 427,773 1,517,974
818,668
Income tax expense 104,000 511,000
312,000
Net earnings 323,773 1,006,974
506,668
Retained earnings, beginning of
year 3,603,133 2,821,183
2,539,539
Dividends paid ($392 per share in
1994 and $192 in 1993 and 1992) (459,424) (225,024)
(225,024)
Retained earnings, end of year $3,467,482 $3,603,133
$2,821,183
The accompanying notes are an integral part of these
financial statements.
<PAGE>
ROGERS GALVANIZING COMPANY
Consolidated Statements of Cash
Flows
For The Years Ended September 30, 1994,
1993 and 1992
1994 1993
1992
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $323,773 $1,006,974
$506,668
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 671,681 550,108
473,754
Deferred income taxes (29,000) (61,000)
98,000
Changes in operating
assets and liabilities:
(Increase) decrease in
accounts receivable (424,173) (470,087)
123,945
(Increase) in
inventories (71,951) (62,672)
(70,918)
(Increase) decrease
in income taxes
receivable (17,000) 27,598
(47,598)
(Increase) decrease
in prepaid expenses (20,365) (19,638)
6,597
Increase (decrease)
in accounts payable 321,371 95,965
(88,612)
Increase in workers'
compensation liability 57,827 118,702
25,574
Increase (decrease)
in accrued employee
health liability (17,325) 97,278
--
Increase (decrease) in
accrued payroll and
payroll taxes (142,875) 130,255
80,218
Increase (decrease) in
other accrued
liabilities (10,836) 8,265
9,337
Increase (decrease)
in income taxes
payable (129,745) 129,745
(123,928)
(Decrease) in accrued
retirement (23,317) (88,170)
(75,751)
Total adjustments 164,292 456,349
410,618
Net cash provided by
operating activities 488,065 1,463,323
917,286
CASH FLOWS USED IN INVESTING ACTIVITIES:
Additions to property,
plant and equipment (972,825) (922,582)
(595,797)
Net cash used in
investing activities (972,825) (922,582)
(595,797)
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends paid (459,424) (225,024)
(225,024)
Proceeds from debt 900,000 --
550,000
Payments on debt (83,375) (24,554)
(750,610)
Net cash provided by
(used in) financing
activities 357,201 (249,578)
(425,634)
NET INCREASE (DECREASE) IN CASH (127,559) 291,163
(104,145)
CASH, beginning of year 528,665 237,502
341,647
CASH, end of year $401,106 $528,665
$237,502
SUPPLEMENTAL DISCLOSURES
OF CASH FLOW INFORMATION:
Interest paid $34,255 $29,941
$44,531
Income taxes paid $214,742 $414,657
$372,431
The accompanying notes are an integral part of these
financial statements.
<PAGE>
ROGERS GALVANIZING COMPANY
Notes to Consolidated Financial Statements
September 30, 1994, 1993 and 1992
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business
Rogers Galvanizing Company (the Parent Company) is engaged in the
hot dip
galvanizing of steel structures and components to customer
specifications.
During 1994, two new subsidiaries, Reinforcing Services, Inc. and
Spin-Galv,
Inc. were formed. They perform services similar to those of the
Parent
Company, but for more specialized areas.
Principles of Consolidation
The accompanying consolidated financial statements include the
accounts of
Rogers Galvanizing Company and its wholly-owned subsidiaries,
Reinforcing
Services, Inc. and Spin-Galv, Inc. All significant intercompany
balances and
transactions have been eliminated in consolidation.
Inventories
Inventories are composed, primarily, of raw zinc "pigs", molten
zinc in
galvanizing kettles and other chemicals and materials used in the
galvanizing
process. Molten zinc is stated at the lower of cost or market,
with cost
determined by the last-in, first-out (LIFO) method. All other
inventories are
stated at the lower of cost or market, with cost determined by
the first-in,
first-out (FIFO) method.
The molten zinc valued on a LIFO basis in the September 30, 1994
and 1993
financial statements was $503,623 and $372,440, respectively.
The
corresponding approximate replacement cost for this inventory was
$952,300 and
$809,500 at September 30, 1994 and 1993, respectively.
Property, Plant and Equipment
Depreciation is provided using accelerated and straight-line
methods over the
estimated useful lives of the related property, ranging from
three to 20 years.
During 1994, the Company capitalized $15,619 of interest incurred
after
entering into a capitalized equipment lease obligation until the
equipment was
placed in service.
Reclassifications
Certain amounts in the 1992 and 1993 financial statements have
been
reclassified to conform with the presentation in 1994.
2. INCOME TAXES
The provision for income taxes consists of the following for the
years ended
September 30, 1994, 1993 and 1992:
1994 1993 1992
Current:
Federal $133,000 $572,000 $214,000
State -- -- --
133,000 572,000 214,000
Deferred:
Federal (29,000) (61,000) 98,000
State -- -- --
$104,000 $511,000 $312,000
The income tax rate for financial reporting purposes varies from
the federal
statutory rate as follows:
1994 1993
1992
Percent of pretax income:
Federal statutory
income tax rate 34.0 % 34.0 %
34.0%
Non-deductible permanent
differences 1.7 .4
1.3
Adjustment of prior year's
estimated liability (9.7) --
--
Other items (1.7) (.7)
2.8
Effective income tax
rate for the year 24.3 % 33.7 %
38.1%
Significant components of the Company's deferred tax liabilities
and assets at
September 30, 1994 and 1993 are as follows:
1994
1993
Deferred tax liabilities:
Tax over book depreciation $98,500
$121,000
Deferred tax assets:
Accrued retirement 46,900
56,000
Self insured insurance
programs 151,100
135,600
Reserve for doubtful accounts 17,500
17,400
215,500
209,000
Net deferred tax assets $117,000
$88,000
Based on the Company's history of operating earnings and its
expectations for
future operation, management believes that operating income will
be sufficient
to allow the full realization of deferred tax assets.
Effective October 1, 1992, the Company adopted SFAS No. 109,
"Accounting for
Income Taxes." There was no significant cumulative effect of the
accounting
change.
3. ACCRUED RETIREMENT
At September 30, 1992, the Company was making monthly retirement
payments to
two retired company executives. During the year ended September
30, 1993, one
of the retired executives died. The liability to the remaining
executive was
adjusted to estimated remaining payments to be made as calculated
by an
insurance company using standard mortality tables and recorded at
net present
value using an 8 percent interest rate.
4. LINE OF CREDIT AND LONG-TERM DEBT
The Company's line of credit and long-term debt consisted of the
following at
September 30:
1994
1993
Combined revolving bank line of credit, up
to $2,500,000 through April 14, 1995,
interest payable monthly at floating prime
plus .5%, (8.25% at September 30, 1994)
secured by certain of the Company's
machinery and equipment, and its inventories
and accounts receivable, restricts payment
of cash dividends to not more than net
income, line is limited to $2,200,000 by
a $300,000 workers' compensation self-
insurance letter of credit required by
Oklahoma's Workers' Compensation Court
as discussed in Note 5. $650,000
$--
Note payable to bank in monthly
installments of $3,097 including interest
at 7.2%, final payment due October, 1996,
secured by specific equipment 69,029
--
Note payable to bank in monthly
installments of $4,684 including interest
at floating prime plus .5% (8.25% at
September 30, 1994), final payment due
June, 1997, secured by equipment,
receivables, and inventory 142,828
--
Note payable to an unrelated Company,
payable in monthly installments of $3,331
including interest at 3.5%, final payment
due July, 1997, unsecured 107,661
--
Capitalized lease obligation for equipment 453,422
--
Unsecured note payable to a Company,
payable in monthly installments of $3,000,
including interest at 8%, through March,
1998 109,324
135,446
1,532,264
135,446
Less current maturities 877,464
26,109
$654,800
$109,337
The aggregate maturities of this debt
are as follows:
1995 $877,464
1996 245,353
1997 209,261
1998 123,209
1999 76,977
$1,532,264
5. WORKERS' COMPENSATION INSURANCE
The Company utilizes a self-insurance program for workers'
compensation. This
program is limited to losses of $300,000 per claim, and aggregate
losses of
$5,000,000 over a two-year period through the use of a stop-loss
policy. As
required by Oklahoma's Workers' Compensation Court, the Company
has a $300,000
letter of credit with a bank to ensure the Company's ability to
pay workers'
compensation claims. This letter of credit is included in the
$2,500,000
revolving bank line of credit described in Note 4. Claims are
accrued based on
the Company's estimate of the aggregate liability for claims made
and for
potential claims. The Company provided $813,195, $329,499 and
$216,636 for
workers' compensation claims for the years ended September 30,
1994, 1993 and
1992, respectively. In addition, the Company incurred $67,546,
$68,573 and
$66,920 for reinsurance and administrative expenses for the years
ended
September 30, 1994, 1993 and 1992, respectively.
6. EMPLOYEE HEALTH INSURANCE
The Company adopted a self-insured program for employee health
benefits on June
1, 1993. Under this program, responsibility for employee health
care costs are
assumed by the Company with incurred costs above a specified
amount covered by
a stop-loss insurance policy. For the years ended September 30,
1994 and 1993,
respectively, the Company provided $475,615 and $155,228 for
employee health
care costs and paid out $334,699 and $1,404 in employee health
care claims and
incurred $158,241 and $56,725 in administrative costs and
stop-loss insurance
premiums.
7. NON-CASH TRANSACTIONS
During 1992, the company purchased certain real estate for
$190,000 by paying
$30,000 in cash and signing a $160,000 note payable to the
seller.
Accordingly, the $30,000 cash payment is included in the
statements of cash
flows as additions to the property, plant and equipment.
During 1994, the Company entered into a capital lease obligation
for equipment
totalling $466,519. In addition, the Company purchased inventory
of $113,673
by issuing a note payable to an unrelated company.
8. COMMITMENTS AND CONTINGENCIES
The Company is involved in various claims and legal actions
arising from time
to time in the ordinary course of business. In the opinion of
Management, the
ultimate disposition of these matters will not have a material
adverse effect
on the Company's financial position.
During 1994, the Company entered into long-term operating lease
agreements for
the use of facilities at its two subsidiaries. Future related
lease
obligations are as follows for the years ended September 30, 1995
- $127,986,
1996 - $127,986, 1997 - $109,986, 1998 - $103,986 and 1999 -
$86,665. Rent
expense for these facilities during 1994 was $29,210.
9. OBLIGATIONS UNDER CAPITAL LEASE
The Company acquired certain equipment under provisions of a
long-term lease.
For financial reporting purposes, minimum lease rentals for the
assets have
been capitalized. The following is a schedule of leased
equipment under the
capital lease:
Capitalized cost $466,519
Less accumulated depreciated 9,719
$455,800
<PAGE>
The following is a schedule by years of future minimum lease
payments,
including renewal options, together with the present value of the
net minimum
lease payments as of September 30, 1994:
Year Ended September 30,
1995 $116,514
1996 116,514
1997 116,514
1998 116,514
1999 73,990
Total minimum lease payments 540,046
Less amount representing interest 86,624
Present value of net minimum lease payments $453,422
Current portion $83,408
Long-term portion 370,014
$453,422
The present value of net minimum lease payments are combined with
other long-
term debt in the accompanying financial statements and Note 4.
10. CHANGE IN PREVIOUSLY-ISSUED FINANCIAL STATEMENTS
During the year ended September 30, 1994, the Company entered
into lease
agreements relating to certain equipment and real estate. Both
leases were
originally treated as capital leases for financial reporting
purposes.
Management has subsequently determined the real estate lease did
not meet the
requirements for capitalization. Accordingly the accompanying
financial
statements have been restated as of September 30, 1994 and for
the year then
ended. The effect of this restatement was to increase net income
by $11,130;
reduce net property, plant and equipment by $722,953 and reduce
recorded debt
by $734,083.
<PAGE>
KINARK
CORPORATION
7060 SOUTH YALE
TULSA, OKLAHOMA 74136
NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
NOTICE IS HEREBY GIVEN that the Special Meeting of
Stockholders (the
"Special Meeting") of Kinark Corporation (the "Company") will be
held on
____________, ____________, 1995, at 1:00 p.m., local time at the
Company's
offices at 7060 South Yale, Tulsa, Oklahoma 74136 for the purpose
of
considering and voting upon:
1. Approval of an amendment to the Company's Restated
Certificate
of Incorporation increasing the number of authorized shares
of the
Company's common stock to 18,000,000.
2. Approval of the issuance of warrants (the
"Warrants") covering
up to 2,270,000 shares of common stock of the Company (the
"Warrant
Shares") to be issued to the Chairman of the Board of the
Company, Michael
T. Crimmins (the "Investor") and his financial advisor, in
connection with
the Investor's purchase of up to $4.0 million principal
amount of senior
subordinated notes (the "Notes") to be issued by the
Company, and the
issuance of the Warrant Shares upon the exercise of the
Warrants.
3. Such other matters as may properly come before the
Special
Meeting or any adjournment thereof.
Only stockholders of record at 5:00 p.m. New York City time
on
____________, ____________, 1995, are entitled to notice of and
to vote at the
meeting or any adjournment thereof.
A Proxy Statement and a proxy solicited by the Board of
Directors are
enclosed herewith. To ensure a quorum for the meeting, please
sign, date and
return the proxy promptly to the Company's subscription agent for
the
accompanying rights offering, Mellon Securities Transfer
Services, 85
Challenger Road, Ridgefield park, New Jersey 07660-2108, in the
enclosed
business reply envelope. If you attend the meeting, you may
revoke your proxy
and vote in person.
By Order of the Board of Directors
Paul R. Chastain
President and Chief Executive
Officer
____________, 1995
PLEASE COMPLETE AND RETURN THE ENCLOSED PROXY PROMPTLY SO THAT
YOUR VOTE MAY BE
RECORDED.<PAGE>
KINARK
CORPORATION
7060 SOUTH YALE
TULSA, OKLAHOMA 74136
PROXY STATEMENT
FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE HELD
________________, 1995
This Proxy Statement is being furnished to the stockholders
of Kinark
Corporation (the "Company") in connection with the solicitation
of proxies by
the Board of Directors of the Company to be voted at a Special
Meeting of
Stockholders of the Company (the "Special Meeting") to be held on
____________,
____________, 1995, at the Company's offices located at 7060
South Yale, Tulsa,
Oklahoma 74136, at 1:00 p.m., local time, and at any adjournment
thereof. It
is anticipated that this Proxy Statement and the accompanying
proxy will be
mailed to stockholders on or about _________________, 1995.
VOTING
GENERAL
The securities that can be voted at the Special Meeting
consist of the
common stock, $.10 par value per share, of the Company (the
"Common Stock"),
with each share entitling its owner to one vote on each matter
submitted to the
stockholders. The record of stockholders entitled to vote at the
Special
Meeting was taken as of 5:00 p.m. New York City time on
____________,
____________, 1995. On that date the Company had outstanding and
entitled to
vote 3,746,410 shares of Common Stock. Shares of Common Stock
belonging to the
Company shall not be voted, directly or indirectly. The approval
of the
amendment to the Company's Restated Certificate of Incorporation
(the
"Certificate") requires the affirmative vote of a majority of the
shares of
Common Stock outstanding, and the approval of the issuance of the
Warrants and
Warrant Shares requires the affirmative vote of a majority of the
shares of
Common Stock represented at the Special Meeting.
QUORUM
The presence, in person or by proxy, of a majority of the
issued and
outstanding shares of Common Stock of the Company entitled to
vote at the
Special Meeting is necessary to constitute a quorum at the
Special Meeting.
Shares which are represented but which abstain or are withheld
from voting will
be treated as present at the Special Meeting for purposes of
determining a
quorum.
<PAGE>
PROXIES
All properly executed proxies delivered pursuant to this
solicitation and
not revoked will be voted at the Special Meeting in accordance
with the
directions given. If no specific instructions are given with
regard to the
matters to be voted upon, then the shares represented by a signed
proxy will be
voted "FOR" adoption of the amendment to the Company's
Certificate increasing
the number of authorized shares of Common Stock, and "FOR" the
issuance of the
Warrants and Warrant Shares. If any other matters properly come
before the
Special Meeting, the persons named as proxies will vote upon such
matters
according to their judgment.
All proxies delivered pursuant to this solicitation are
revocable at any
time at the option of the persons executing them by giving
written notice to
Mellon Securities Transfer Services, the Company's solicitation
agent for the
accompanying rights offering (the "Solicitation Agent"), at 85
Challenger Road,
Ridgefield Park, New Jersey 07660-2108, or by executing and
delivering to the
Solicitation Agent a later dated proxy, or by voting in person at
the Special
Meeting.
All expenses incurred in connection with the solicitation of
proxies will
be borne by the Company. Such costs include charges by brokers,
fiduciaries
and custodians for forwarding proxy materials to beneficial
owners of Common
Stock held in their names. The Company has appointed Morrow &
Co., Inc. (the
"Information Agent") as information agent for the solicitation of
proxies for
the Special Meeting. Solicitation may be undertaken by mail,
telephone and
personal contact by the Information Agent and, without additional
compensation,
directors, officers and employees of the Company. The Company
will pay the
Information Agent a fee of $________ plus expenses for its
service as
information agent for the solicitation of proxies for the Special
Meeting.
<PAGE>
PRINCIPAL STOCKHOLDERS, DIRECTORS, AND CERTAIN OFFICERS
The following table sets forth certain information
concerning the only
persons who are known to the Company to be beneficial owners of
more than 5% of
the Company's Common Stock as of ____________, 1995, and the
ownership of the
Common Stock as of that date by each director, certain executive
officers, and
by all directors and officers as a group.
Shares
Beneficially Percent of
Beneficial Owner Owned Class (1)
Michael T. Crimmins 363,300(2) 9.7%
Paul R. Chastain 57,572(3) 1.5%
Richard C. Butler 37,000(4) 1.0%
Ronald J. Evans 5,000 0.1%
Harry D. Jones 17,600 0.5%
Mark E. Walker 410,530(5) 11.0%
Dimensional Fund Advisors, Inc. 195,100(6) 5.2%
Robert G. And Pauline B. Walker
Revocable Trust 379,724(7) 10.1%
Steel Partners II, L.P. 528,100(8) 14.1%
Quest Advisory Corp. 365,200(9) 9.7%
All Directors and Officers
as a Group (9 persons) 907,660(10) 23.9%
(1) Based on 3,746,410 shares of the Company's Common Stock
outstanding as of
September 1, 1995, which does not include 54,625 shares
subject to
currently exercisable options as of September 1, 1995,
except with respect
to the holders of such currently exercisable options.
(2) Information based on Form 4 of Mr. Crimmins filed with the
SEC. The
address for Mr. Crimmins is 7060 South Yale Avenue, Tulsa,
Oklahoma 74136.
(3) Includes presently exercisable stock options as of September
1, 1995, to
acquire 46,500 shares. The stockholder's address is 7060
South Yale
Avenue, Tulsa, Oklahoma 74136.
(4) Information based on Form 4 of Mr. Butler filed with the
SEC. Includes
3,000 shares held by Maumelle Gardens, Inc., of which
company Mr. Butler
owns 60%. Mr. Butler disclaims beneficial ownership of
these shares.
(5) Information based on Form 5 of Mr. Walker filed with the
SEC. Includes
5,000 shares of Common Stock owned by a trust for Mr.
Walker's son, of
which Mr. Walker is trustee, and 379,724 shares owned by the
Robert G. and
Pauline B. Walker Revocable Trust (the "Trust"). Mr. Walker
provides
investment advice to the Trust and receives certain
compensation from the
Trust. Mr. Walker disclaims beneficial ownership of the
Trust's shares
and shares of Common Stock owned by other members of the
Walker family.
The stockholder's address is 2301 N. Central Expressway,
Suite 140, Plano,
Texas 75075.
(6) Information based on Schedule 13G of Dimensional Fund
Advisors, Inc.
("Dimensional") filed with the SEC. Dimensional, a
registered investment
advisor, is deemed to have beneficial ownership of these
shares of Common
Stock, all of which shares are held in portfolios of DFA
Investment
Dimensions Group Inc., a registered open-end investment
company, or in
series of the DFA Investment Trust Company, a Delaware
business trust, or
the DFA Group Trust and DFA Participation Group Trust,
investment vehicles
for qualified employee benefit plans, for all of which
Dimensional serves
as an investment manager. Dimensional disclaims beneficial
ownership of
all such shares. The stockholder's address is 1299 Ocean
Avenue, Santa
Monica, California 90401.
(7) Information based on Schedule 13D filed with the SEC. The
stockholder's
address is 2301 N. Central Expressway, Suite 140, Plano,
Texas 75075
(8) Information based on Schedule 13D of Steel Partners II, L.P.
filed with
the SEC. Includes 25,000 shares held by Steel Partners
Services, Ltd., an
affiliate of the stockholder, for the benefit of a foreign
investment
company. The stockholder's address is 750 Lexington Avenue,
27th Floor,
New York, New York 10029.
(9) Information based on Schedule 13G of Quest Advisory Corp.,
Quest Advisory
Co, a general partnership, and Charles M. Royce filed with
the SEC. The
stockholder's address is 1414 Avenue of the Americas, New
York, New York
10019.
(10) All directors and officers as a group held in the aggregate
presently
exercisable stock options to acquire 54,625 shares as of
September 1,
1995. On the record date, directors and officers as a group
owned 853,035
shares, or 22.8% of the 3,746,410 shares outstanding and
entitled to vote,
not including presently exercisable stock options.
INCREASE IN AUTHORIZED SHARES OF COMMON STOCK
The Board of Directors has approved an amendment to the
Certificate which
would increase the number of authorized shares of Common Stock of
the Company
from 12,000,000 to 18,000,000. Assuming that the Company issues
the maximum
number of shares of Common Stock in connection with the rights
offering
described in the accompanying Prospectus, all of the Warrant
Shares and all
shares subject to currently outstanding or issuable options under
the Company's
stock option plan, the Company will have only 28,975 shares of
Common Stock
authorized but not outstanding. The increase in the number of
authorized
shares of Common Stock is necessary to permit the Board of
Directors of the
Company to issue additional shares in the future to, among other
things, raise
capital and make other acquisitions. The Company does not
presently have any
plans to issue additional shares except as described herein and
in the
accompanying Prospectus; however, the Board of Directors believes
such an
increase is prudent to provide the Board of Directors with the
flexibility to
issue shares in the future if needed without having to incur the
delay
attendant with seeking the approval of the stockholders of the
Company.
The Amendment must be approved by the stockholders of the
Company by the
affirmative vote of a majority of the outstanding shares of the
Common Stock.
Consequently, any shares not voted (whether by abstention, broker
non-vote or
otherwise) have the effect of a vote against the Amendment.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ADOPTION OF
THE
AMENDMENT.
APPROVAL OF ISSUANCE OF THE WARRANTS AND WARRANT SHARES
The Board of Directors is soliciting the approval of the
holders of the
Common Stock of the Company for the issuance of certain Warrants
and Warrant
Shares (each as hereafter defined) to Michael T. Crimmins, the
Chairman of the
Board of the Company (the "Investor"), and his financial advisor.
The
Company's Common Stock is listed on the American Stock Exchange
(the "AMEX").
Pursuant to the rules of the AMEX, the issuance of the Warrants
and the Warrant
Shares requires the approval of the stockholders of the Company
because the
Investor is an officer and director of the Company and the
Warrant Shares may
constitute more than 20% of the shares of Common Stock then
outstanding at the
time they are issued.
SUBORDINATED FINANCING
The Company and the Investor have agreed pursuant to the
terms of a
Securities Purchase Agreement (the "Subordinated Financing
Agreement") to the
issuance by the Company and the purchase by the Investor of up to
$4.0 million
principal amount of Senior Subordinated Notes (the "Notes") at
par in
increments of $500,000. The Notes are issuable by the Company
and must be
purchased by the Investor from time to time at the election of
the Company over
a one year period beginning on the date of closing (the
"Acquisition Closing
Date") by the Company of its acquisition of Rogers Galvanizing
Company
("Rogers"). See "The Acquisition" in the accompanying
Prospectus. The Notes
will mature on the eighth anniversary of the Acquisition Closing
Date, bear
interest payable semi-annually in arrears at a rate of 13.5% per
annum and be
repaid in six equal semi-annual principal payments beginning six
months after
the fifth anniversary of the Acquisition Closing Date. The Notes
may be
prepaid in whole or in part in increments of at least $100,000,
provided that
partial prepayments will be applied first to accrued interest and
then to the
unpaid principal installments in the inverse order of maturity.
The Notes must
be prepaid in full at par, plus accrued interest, upon a change
in control of
the Company. For these purposes, a change in the control will be
deemed to
have occurred if (i) there is a change during any consecutive
twenty-four month
period in the identity of the persons constituting a majority of
the Board of
Directors of the Company other than a change approved by Investor
or caused by
the Investor and its designees on the Board of Directors or (ii)
the Investor's
designees are no longer serving as directors of the Company for
any reason,
other than their death, resignation or refusal to stand for
reelection or (iii)
Michael T. Crimmins shall no longer be serving as Chief Executive
Officer for
any reason, other than death, permanent disability, refusal to
serve or cause
as defined in the Subordinated Financing Agreement or the rights
or duties of
the Chief Executive Officer shall have been reduced without the
consent of the
Investor.
The Notes will be subordinated to the Company's existing
bank debt (the
"Senior Debt"), and will be secured by the capital stock of
Rogers. The assets
of Rogers, other than its net working capital, will not be
available for pledge
to secure the Senior Debt. See "Description of Subordinated
Financing" in the
accompanying Prospectus for a more complete description of the
terms of the
Subordinated Financing Agreement and the Notes.
WARRANTS
Pursuant to the terms of the Subordinated Financing
Agreement, the Company
will issue 100,000 warrants to purchase Common Stock (the
"Warrants") to the
Investor in exchange for a binding and irrevocable commitment
from the Investor
to purchase the Notes upon demand by the Company (the
"Commitment"), and will
pay $100,000 fee on the Acquisition Closing Date. Additional
Warrants will be
issued upon the purchase by the Investor of the Notes from time
to time at a
rate of 268,750 Warrants for each $500,000 of Notes purchased.
The Company
will also issue 20,000 Warrants to Gary R. Griffith, the
Investor's financial
advisor, upon receipt of the Commitment. Each Warrant will
entitle the holder
thereof to purchase one share of the Common Stock at any time and
from time to
time after the date of issuance thereof until the eighth
anniversary of the
Acquisition Closing Date. The exercise price of each Warrant
will be the
average of the closing prices for the Common Stock reported by
the AMEX during
the twenty trading days preceding the issuance of the Warrant.
The Warrants
will be transferable.
The number of Warrant Shares and the exercise price are
subject to
adjustment for stock splits, stock dividends and distributions,
subdivisions,
combinations and reclassification on, or of, the Common Stock and
in the event
of the issuance of Common Stock (or rights therefore or
securities convertible
thereto) at an effective price which is less than the market
price per share of
the Common Stock. In addition, the number of Warrant Shares is
subject to
adjustment for mergers, consolidations and sales of assets.
The purchase price of each Warrant will be 1/100th of $.01
(or an
aggregate of $227.00 for all of the Warrants to be issued), which
will be paid
in cash by the Investor or his financial advisor, as applicable.
The Warrants
issued on the Acquisition Closing Data shall have an exercise
price equal to
the average closing price of the Common Stock during the 20
trading days prior
to the Acquisition Closing Data. The exercise price of any other
Warrants
issued will be the average closing price of the Common Stock
during the 20
trading days prior to the date of issuance thereof. The Warrants
are payable
in cash or by the application of accrued interest on, and unpaid
principal of,
the Notes in an equivalent amount.
The Company has agreed, upon demand, to provide one
registration for the
Notes, the Warrants and the Warrant Shares and the other Common
Stock of the
Investor under the Securities Act of 1993, as amended (the
"Securities Act"),
and to include all or a portion of the Warrant Shares and the
other Common
Stock of the Investor in any other registrations by the Company
under the
Securities Act, subject to certain conditions and exceptions.
The issuance of the Warrant Shares must be approved by the
stockholders of
the Company by the affirmative vote of a majority of the shares
of the Common
Stock represented at the Special Meeting. Consequently, any
shares represented
at the Special Meeting but not voted (whether by abstention or
otherwise) have
the effect of a vote against the Amendment.
THE BOARD OF DIRECTORS RECOMMENDS APPROVAL OF THE ISSUANCE OF THE
WARRANTS AND
WARRANT SHARES AS DESCRIBED ABOVE.
STOCKHOLDERS' PROPOSALS FOR 1996 ANNUAL MEETING
Proposals of stockholders intended to be presented at the
Company's 1996
Annual Meeting of Stockholders should be submitted to the
Secretary of the
Company by certified mail, return receipt requested, and must be
received by
the Company at its offices in Tulsa, Oklahoma on or before
January 18, 1996, to
be eligible for inclusion in the Company's proxy statement and
form of proxy
for that meeting.
OTHER MATTERS WHICH MAY COME BEFORE THE MEETING
The Board of Directors knows of no matters other than those
stated above
which are to be brought before the meeting. Pursuant to
provisions of the
Bylaws, at any special meeting of the stockholders only such
business shall be
conducted as shall have been brought before the meeting by or at
the direction
of the Board of Directors of the Company. However, if any other
matter should
be presented for consideration and voting, it is the intention of
the persons
named in the enclosed form of Proxy to vote the Proxy in
accordance with their
judgment of what is in the best interest of the Company.
By order of the Board of Directors
Paul R. Chastain
President and Chief Executive Officer
Tulsa, Oklahoma
____________, 1995
<PAGE>
KINARK
CORPORATION
7060 SOUTH YALE
TULSA, OKLAHOMA 74136
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS OF KINARK
CORPORATION
(THE "COMPANY") FOR THE SPECIAL MEETING OF STOCKHOLDERS TO BE
HELD ON
____________, 1995 (THE "SPECIAL MEETING").
The undersigned hereby appoints Paul R. Chastain and T.
Bruce Lancaster
and each of them, with full power of substitution, as proxies to
vote all of
the shares of Common Stock of the Company which the undersigned
may be entitled
to vote at the Special Meeting, and at any adjournments thereof,
on the
following matters in the following manner:
1. Approval of an amendment to the Company's Restated
Certificate of
Incorporation increasing the number of authorized shares of the
Company's
common stock to 18,000,000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. Approval of the issuance of the Warrants covering up to
2,270,000 Warrant
Shares to the Investor and his financial advisor, in connection
with the
Investor's purchase of up to $4.0 million principal amount the
Notes to be
issued by the Company, and the issuance of the Warrant Shares
upon the exercise
of the Warrants.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. In accordance with their judgment, upon such other matters
as may properly
come before the Special Meeting or any adjournment thereof.
When this Proxy is properly executed and returned, and not
revoked, the
shares it represents will be voted at the meeting in accordance
with the
choices specified above. IF NO CHOICE IS SPECIFIED, IT WILL BE
VOTED FOR THE
AMENDMENT TO THE COMPANY'S RESTATED CERTIFICATE OF INCORPORATION
TO INCREASE
THE NUMBER OF AUTHORIZED SHARES OF COMMON STOCK AND FOR THE
ISSUANCE OF THE
WARRANTS AND WARRANT SHARES.
PLEASE DATE AND SIGN THIS PROXY EXACTLY AS YOUR NAME APPEARS
BELOW.
Date: , 1995
(Signature of
Stockholder)
(Signature of
Stockholder)
NOTE: When signing as
attorney,
trustee, administrator,
executor or
guardian, please give
your full title
as such. If a
corporation, please sign
in full corporate name by
President or
other authorized officer.
In the case
of joint tenants, each
joint owner must
sign.<PAGE>
No dealer, salesman or any other
person has been authorized to give
any information or to make any
representations other than those
contained in this Prospectus, and
any information or representation
not contained herein must not be
relied upon as having been
authorized by the Company. This
Prospectus does not constitute an
offer to sell or solicitation of an
offer to buy any securities other 5,619,615
SHARES
than the securities to which it
relates, or an offer to sell or a
solicitation of an offer to buy such
securities in any jurisdiction in
which such offer or solicitation may
not be legally made. Neither the KINARK
delivery of this Prospectus nor any
CORPORATION
sale made hereunder shall under any
circumstances create any implication
that the information herein is
correct as of any date subsequent to
the date hereof.
COMMON
STOCK
TABLE OF CONTENTS Page
Prospectus Summary 3
Summary Pro Forma and
Selected Consolidated
Financial Information 9
Risk Factors 12
Business Strategy 14
The Acquisition 15 PROSPECTUS
Use of Proceeds 16
Capitalization 17
Common Stock Dividends and
Price Range 18
The Rights Offering 18
Description of Capital Stock 23
Description of Subordinated
Financing 27
Legal Matters 28
Experts 28
Financial Statements F-1
Proxy Statement P-1
,
1995
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated expenses (other than underwriting commissions) of
the sale of
the shares of Common Stock are as follows:
Registration Fee $3,876
AMEX Application Fee 17,500
Blue Sky Fees and Expenses 1,000
Printing and Engraving 45,000
Subscription Agent's Fees and Expenses 10,000
Information Agent's Fees and Expenses 10,000
Legal Fees and Expenses 175,000
Accounting Fees and Expenses 55,000
Financial Advisors Fees and Expenses(1) 115,000
Miscellaneous Disbursements 2,624
TOTAL $385,000
(1) Including financial advisor fees related to the
Subordinated
Financing.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Certificate of Incorporation (the "Certificate") of
the Company
contains a provision which, subject to certain exceptions
described below,
eliminates the liability of a director to the Company or its
stockholders for
monetary damages for any breach of duty as a director. This
provision does not
eliminate the liability of the director (i) for violations of his
duty of
loyalty to the corporation or its stockholders, (ii) for acts or
omissions not
in good faith or involving intentional misconduct or a knowing
violation of
law, (iii) under Section 174 of the Delaware General Corporation
Law (the
"Delaware Corporation Law") relating to unlawful dividends and
distributions,
or (iv) for any transaction from which the director derived an
improper
personal benefit.
The Certificate and the Bylaws (the "Bylaws") of the
Company require
the Company to indemnify any person who was, is, or is threatened
to be made a
named defendant or respondent in any threatened, pending, or
completed action,
suit, or proceeding, whether civil, criminal, administrative, or
investigative,
by reason of service by such person as a director, officer,
employee or agent
of the Company or any other corporation for which he served as
such at the
request of the Company. Such persons are entitled to be
indemnified against
judgments, penalties, fines, settlements, and reasonable expenses
actually
incurred by the director in connection with the proceeding,
except that no
payments may be made with respect to liability which is not
eliminated pursuant
to the provision of the Certificate described in the preceding
paragraph. Such
persons are also entitled to have the Company advance any such
expenses prior
to final disposition of the proceeding, upon delivery of a
written undertaking
to repay the amounts advanced if it is ultimately determined that
the standard
of conduct has not been met.
In addition to the Certificate and Bylaws of the
Company, Section
145(c) of the Delaware Corporation Law requires the Company to
indemnify any
director who has been successful on the merits or otherwise in
defending any
proceeding described above. The Delaware Corporation Law also
provides that a
court may order indemnification of a director if it determines
that the
director is fairly and reasonably entitled to such
indemnification.
The Company has the power, under the Certificate and
Bylaws, to
obtain insurance on behalf of any director, officer, employee, or
agent of the
Company against any liability asserted against or incurred by
such person in
any such capacity, whether or not the Company has the power to
indemnify such
person against such liability at that time under the Certificate
or Bylaws.
ITEM 16. EXHIBITS
The following documents are filed as exhibits to this
Registration
Statement:
3.1 The Company's Restated Certificate of
Incorporation.
3.2 The Company's Bylaws (incorporated by reference to
Exhibit 3.1
to the Company's Quarterly Report on Form 10-Q
dated June 30,
1995).
4.1 Provisions in the Company's Restated Certificate
of
Incorporation and Bylaws defining the rights of
holders of the
Company's Common Stock.
4.2 Form of Letter to Stockholders.
4.3 Form of Letter to Securities Dealers, Commercial
Banks, Trust
Companies and other Nominees.
4.4 Form of Instructions as to the Use of Kinark
Corporation
Subscription Certificates.
4.5 Form of Subscription Certificate.
4.6 Form of Letter to Clients from Securities Dealers,
Commercial
Banks, Trust Companies and other Nominees.
4.7 Form of DTC Participant Oversubscription Exercise
Form.
4.8 Form of Notice of Guaranty Delivery.
4.9 Form of Nominee Holder Certification.
4.10 Form of Special Notice to Holders of Kinark
Corporation Common
Stock whose Addresses are Outside the United
States.
5.1 Opinion of Nelson Mullins Riley & Scarborough,
L.L.P. as to the
legality of the securities being registered.
10.1 Securities Purchase Agreement by and between the
Company and the
Investor.*
10.2 Form of Note by and between the Company and the
Investor.*
10.3 Form Warrant by and between the Company and the
Investor.*
10.4 Registration Rights Agreement by and between the
Company and the
Investor.*
10.5 Subordination Agreement by and between the
Company, the Investor
and Bank of Oklahoma.*
15.1 Letter Regarding Unaudited Interim Financial
Information.
23.1 Consent of Deloitte & Touche LLP, independent
auditors of the
Company.
23.2 Consent of Hogan & Slovacek, P.C., independent
auditors of
Rogers Galvanizing Company.
23.3 Consent of Arthur Andersen LLP, independent
auditors of Rogers
Galvanizing Company.
23.4 Consent of Nelson Mullins Riley & Scarborough,
L.L.P. (contained
in the opinion included at Exhibit 5.1).
24.1 Power of Attorney of certain officers and
directors of the
Company (see page II-5).
*To be filed by amendment.
ITEM 17. UNDERTAKINGS.
1. The undersigned registrant hereby undertakes:
(a) 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;
(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 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
and 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
20 percent change in the maximum aggregate offering
price set forth
in the "Calculation of Registration Fee" table in the
effective
registration statement.
(iii) To include any material information with
respect to the
plan of distribution not previously disclosed in the
registration
statement or any material change to such information in
the
registration statement;
(b) That, for the purpose of determining any liability
under the
Securities Act of 1933, each such post-effective amendment
shall be deemed
to be a new registration statement relating to the
securities offered
therein, and the offering of such securities at that time
shall be deemed
to be the initial bona fide offering thereof.
(c) 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.
(d) If the registrant is a foreign private issuer, to
file a post-
effective amendment to the registration statement to include
any financial
statements required by Rule 3-19 of this chapter at the
start of any
delayed offering or throughout a continuous offering.
Financial
statements and information otherwise required by Section
10(a)(3) of the
Act need not be furnished, provided, that the registrant
includes in the
prospectus, by means of a post-effective amendment,
financial statements
required pursuant to this paragraph (a)(4) and other
information necessary
to ensure that all other information in the prospectus is at
least as
current as the date of those financial statements.
Notwithstanding the
foregoing, with respect to registration statements on Form
F-3, a post-
effective amendment need not be filed to include financial
statements and
information required by Section 10(a)(3) of the Act or Rule
3-19 of this
chapter if such financial statements and information are
contained in
periodic reports filed with or furnished to the Commission
by the
registrant pursuant to section 13 or section 15(d) of the
Securities
Exchange Act of 1934 that are incorporated by reference in
the Form F-3.
2. The undersigned registrant hereby undertakes that, for
purposes of
determining any liability under the Securities Act of 1933, each
filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities
Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act
of 1934) that is incorporated by reference in the registration
statement shall
be deemed to be a new registration statement relating to the
securities offered
therein, and the offering of such securities at that time shall
be deemed to be
the initial bona fide offering thereof.
3. Insofar as indemnification for liabilities arising
under the
Securities Act may be permitted to directors, officers, and
controlling persons
of the registrant as described in Item 14 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.
4. The undersigned registrant hereby undertakes that:
(a) 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 the registrant pursuant to Rule
424(b)(1) or
(4) or 497(h) under the Securities Act shall be deemed to be
part of this
registration statement as of the time it was declared
effective.
(b) For the purpose of determining any liability under
the
Securities Act, each post-effective amendment that contains
a form of
prospectus shall be deemed to be a new registration
statement relating to
the securities offered therein, and the offering of such
securities at
that time shall be deemed to be the initial bona fide
offering thereof.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant
has duly caused this Registration Statement to be signed on its
behalf by the
undersigned, thereunto duly authorized, in the City of Tulsa,
State of
Oklahoma, on September 15, 1995.
KINARK CORPORATION
By: /s/ Paul R. Chastain
Paul R. Chastain
President and Chief Executive
Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears
below constitutes and appoints Paul R. Chastain and J. Bruce
Lancaster, and
each of them, his true and lawful attorneys-in-fact and agents,
with full power
of substitution and resubstitution, for him and in his name,
place and stead,
in any and all capacities, to sign any and all amendments to this
Registration
Statement, and to file the same, with all exhibits thereto, and
other documents
in connection therewith, with the Securities and Exchange
Commission, granting
unto said attorneys-in-fact and agents, full power and authority
to do and
perform each and every act and thing requisite or necessary to be
done in and
about the premises, as fully to all intents and purposes as he
might or could
do in person, hereby ratifying and confirming all that said
attorneys-in-fact
and agents, and each of them or their substitute or substitutes,
may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this
Registration Statement has been signed by the following in the
capacities and
on the dates indicated.
Signature Title
Date
/s/ Paul R. Chastain President and Chief Executive
September 15, 1995
Paul R. Chastain Officer (principal executive
officer) and Director
/s/ J. Bruce Lancaster Vice President, Finance
September 15, 1995
J. Bruce Lancaster (principalfinancial officer
and principal accounting
officer)
/s/ Richard C. Butler Director
September 15, 1995
Richard C. Butler
/s/ Michael T. Crimmins Director
September 15, 1995
Michael T. Crimmins
/s/ Ronald J. Evans Director
September 15, 1995
Ronald J. Evans
/s/ Harry D. Jones Director
September 15, 1995
Harry D. Jones
Director
September 15, 1995
Mark E. Walker<PAGE>
EXHIBIT INDEX
PAGE
3.1 The Company's Restated Certificate of Incorporation.
4.1 Provisions in the Company's Restated Certificate of
Incorporation and Bylaws defining the rights of holders
of
the Company's Common Stock.
4.2 Form of Letter to Stockholders.
4.3 Form of Letter to Securities Dealers, Commercial Banks,
Trust Companies and other Nominees.
4.4 Form of Instructions as to the Use of Kinark
Corporation
Subscription Certificates.
4.5 Form of Subscription Certificate.
4.6 Form of Letter to Clients from Securities Dealers,
Commercial Banks, Trust Companies and other Nominees.
4.7 Form of DTC Participant Oversubscription Exercise Form.
4.8 Form of Notice of Guaranty Delivery.
4.9 Form of Nominee Holder Certification.
4.10 Form of Special Notice to Holders of Kinark Corporation
Common Stock whose Addresses are Outside the United
States.
5.1 Opinion of Nelson Mullins Riley & Scarborough, L.L.P.
as to
the legality of the securities being registered.
15.1 Letter Regarding Unaudited Interim Financial
Information.
23.1 Consent of Deloitte & Touche LLP, independent auditors
of
the Company.
23.2 Consent of Hogan & Slovacek, P.C., independent auditors
of
Rogers Galvanizing Company.
23.3 Consent of Arthur Andersen LLP, independent auditors of
Rogers Galvanizing Company.
EXHIBIT 3.1<PAGE>
RESTATED CERTIFICATE OF INCORPORATION
Kinark Corporation, a corporation organized and existing
under and by
virtue of the General Corporation Law of the State of Delaware
(the
"Corporation"),
DOES HEREBY CERTIFY THAT:
1. The name of the Corporation is Kinark Corporation. Kinark
Corporation was
originally incorporated under the name The Kin-Ark Oil & Gas
Company and the
original Certificate of Incorporation was filed with the
Secretary of State of
the State of Delaware on January 27, 1955.
2. Pursuant to Sections 242 and 245 of the General Corporation
Law of the
State of Delaware, this Restated Certificate of Incorporation
restates and
integrates and further amends the Certificate of Incorporation of
the
Corporation.
3. At a meeting of the Board of Directors of the Corporation,
resolutions
were duly adopted setting forth proposed amendments of the
Restated Certificate
of Incorporation, as amended, of the Corporation, declaring said
amendments to
be advisable and calling a meeting of the stockholders of the
Corporation for
consideration thereof. The resolution setting forth the proposed
amendments is
as follows:
RESOLVED, that the Corporation's Restated Certificate of
Incorporation, as
amended, be amended and restated in its entirety as follows:
FIRST: The name of the Corporation is KINARK CORPORATION.
SECOND: The principal office or place of business of the
Corporation in
the State of Delaware is located at Corporation Trust Center,
1209 Orange
Street, in the City of Wilmington, County of New Castle. The
name and address
of its resident agent is The Corporation Trust Company,
Corporation Trust
Center, 1209 Orange Street, Wilmington, Delaware 19801.
THIRD: The purpose of the Corporation is to engage in any
lawful act or
activity for which corporations may be organized under the
General Corporation
Law of Delaware.
FOURTH: The aggregate number of shares of stock which the
Corporation
shall have authority to issue is Twelve Million (12,000,000)
shares of Common
Stock of a par value of Ten Cents ($.10) per share.
FIFTH: The minimum amount of capital with which the
Corporation will
commence business is One Thousand Dollars ($1,000).
SIXTH: All of any part of the shares of stock of any class
of the
Corporation may be issued and sold, from time to time, by the
Corporation,
without further action by the stockholders, for such
consideration (but in the
case of any class of stock having par value, not less than the
par value
thereof) and on such terms and to such person or persons as may,
from time to
time, be fixed by the Board of Directors of the Corporation.
The Board of Directors shall have the power at any time and
from time to
time (without any action by the stockholders of the Corporation)
to create and
issue, whether or not in connection with the issue or sale of any
shares of
stock or bonds, debentures or securities of the Corporation,
rights or options
entitling the holders thereof to purchase from the Corporation
shares of its
stock of any class, such rights or options to be evidenced by or
in such
warrants or other instruments as shall be approved by the Board
of Directors.
The terms upon which, the time or times, which may be limited or
unlimited in
duration, at or within which such rights or options shall be
issued shall be
such as shall be fixed and stated in the resolution or
resolutions adopted by
the Board of Directors providing for the creation and issue of
such rights or
options.
No stockholder shall be entitled as a matter of right to
subscribe for,
purchase or receive any shares of the stock or any rights or
options of the
Corporation which it may issue or sell, whether out of the number
of shares
authorized by this Certificate of Incorporation or by amendment
thereof, or
other proceedings, or out of the shares of the stock of the
Corporation
acquired by it after the issuance thereof, nor shall any
stockholder be
entitled as a matter of right to purchase or subscribe for or
receive any
bonds, debentures or other obligations which the Corporation may
issue or sell
that shall be convertible into or exchangeable for stock or to
which shall be
attached or appertain any warrant or warrants or other instrument
or
instruments that shall confer upon the holder or owner of such
obligation the
right to subscribe for or purchase from the Corporation any share
of its
capital stock. All such additional issues of stock, rights,
options, or of
bonds, debentures or other obligations convertible into or
exchangeable for
stock or to which warrants shall be attached or appertain or
which shall confer
upon the holder the right to subscribe for or purchase any shares
of stock, may
be issued and disposed of by the Board of Directors to such
persons, firms,
associations and corporations and upon such terms, subject to any
provisions of
law in regard thereto, as in their absolute discretion they may
deem advisable.
SEVENTH: The Corporation is to have perpetual existence.
EIGHTH: The private property of the stockholders shall not
be subject to
the payment of corporate debts to any extent whatsoever.
NINTH: The number of Directors of the Corporation which
shall constitute
the whole Board of Directors shall be such number as from time to
time shall be
fixed by or in the manner provided in the Bylaws, but in no case
shall the
number be less than three (3). Unless and until a different
number of
Directors is established by or in the manner provided in the
Bylaws, the number
shall be seven (7). Directors shall be elected for terms of
office to expire
at the annual meeting of stockholders after their election and
until their
successors shall be elected and shall be qualified. No decrease
in number
shall have the effect of removing a Director prior to the
expiration of his
term of office.
All corporate powers of the Corporation shall be exercised
by the Board of
Directors except as otherwise provided herein or by law.
IN FURTHERANCE AND NOT IN LIMITATION OF THE POWERS CONFERRED
BY STATUTE
THE BOARD OF DIRECTORS IS EXPRESSLY AUTHORIZED:
(a) To fix, determine and vary from time to time the
amount to be
maintained as surplus and the amount or amounts to be set apart
as working
capital.
(b) To set apart out of any of the funds of the
Corporation legally
available for dividends a reserve or reserves for any proper
purposes and/or to
abolish any such reserve or reserves in the manner in which
created.
(c) To make, amend, alter, change, add to or repeal
by-laws of the
Corporation, without any action on the part of the stockholders.
The by-laws
made by the directors may be amended, altered, changed, added to
or repealed by
a majority of a quorum of the stockholders.
(d) To authorize and cause to be executed mortgages
and liens, with
or without limit as to amount, upon the real or personal property
of the
Corporation.
(e) From time to time to determine whether and to what
extent, at
what time and place, and under what conditions and regulations
the accounts and
books of the Corporation, or any of them, shall be open to the
inspection of
any stockholder and no stockholder shall have any right to
inspect any account
or book or document of the Corporation except as conferred by
statute or by-
laws or as authorized by resolution of the stockholders or Board
of Directors.
(f) To authorize the payment of compensation to the
directors for
services to the Corporation, including fees and expenses for
attendance at
meetings of the Board of Directors, the Executive Committee and
other
committees and/or salaries for serving as such directors or
committee members,
and to determine the amount of such compensation.
(g) From time to time to formulate, establish, promote
and carry
out, and to amend, alter, change, revise, recall, repeal or
abolish a plan or
plans for the participation by all or any of the employees,
including directors
and officers, of the Corporation, or of any corporation, company,
association,
trust or organization in which or in the welfare of which the
Corporation has
any interest, and those actively engaged in the conduct of the
Corporation's
business, in the profits, gains or business of the Corporation or
of any branch
or division thereof, as part of the Corporation's legitimate
expenses and for
the furnishing to such employees, directors, officers or persons,
or any of
them, at the Corporation's expense, of medical services,
insurance against
accident, sickness or death, pensions during old age, disability
or
unemployment, education, housing, social services, recreation or
other similar
aids for their relief or general welfare, in such manner and upon
such terms
and conditions as the Board of Directors shall determine.
(h) By resolution passed by a majority of the whole
Board of
Directors, to designate one or more committees, each committee to
consist of
two or more of the directors of the Corporation, which, to the
extent provided
in the resolution or in the by-laws of the Corporation, shall
have and may
exercise the powers of the Board of Directors in the management
of the business
and affairs of the Corporation, and may authorize the seal of the
Corporation
to be affixed to all papers which may require it. Such committee
or committees
shall have such name or names as may be stated in the by-laws of
the
Corporation or as may be determined from time to time by
resolution adopted by
the Board of Directors.
TENTH: (a) No contract or other transaction between the
Corporation and
any other corporation and no other act of the Corporation with
relation to any
other corporation shall, in the absence of fraud, in any way be
invalidated or
otherwise affected by the fact that any one or more of the
directors of the
Corporation are pecuniarily or otherwise interested in, or are
directors or
officers of, such other corporations. Any director of the
Corporation may vote
upon any contract or other transaction between the Corporation
and any
subsidiary or affiliated corporation without regard to the fact
that he is also
a director of such subsidiary or affiliated corporation. Any
director of the
Corporation individually, or any firm or association of which any
director may
be a member, may be a party to, or may be pecuniarily or
otherwise interested
in any contract or transaction of the Corporation and shall not
be liable to
account to the Corporation for any profit realized by him from or
through any
such contract or transaction of the Corporation by reason of his
interest in
such contract or transaction, provided that the fact that he
individually or as
a member of such firm or association is such a party or so
interested shall be
disclosed or shall have been known to the Board of Directors or a
majority of
such members thereof as shall be present at any meeting of the
Board of
Directors at which action upon any such contract or transaction
shall be taken;
and in any case described in this paragraph (a) any such director
may be
counted in determining the existence of a quorum at any meeting
of the Board of
Directors which shall authorize any such contract or transaction
and may vote
thereat to authorize any such contract or transaction.
(b) Any contract, transaction or act of the
Corporation or of the
Board of Directors which shall be ratified by a majority of a
quorum of the
stockholders entitled to vote at any annual meeting or at any
special meeting
called for that purpose shall be as valid and binding as though
ratified by
every stockholder of the Corporation; provided, however, that any
failure of
the stockholders to approve or ratify such contract, transaction
or act, when
and if submitted, shall not be deemed in any way to invalidate
the same or to
deprive the Corporation, its directors or officers of their right
to proceed
with such contract, transaction or act.
(c) Regardless of any provision in this or any other
Article or
provision of this Certificate of Incorporation to the contrary,
no merger or
consolidation between this Corporation and an "Acquirer", as
defined in this
subparagraph, nor any sale, lease, or exchange (a "transfer"
herein) of all or
substantially all of the assets of this Corporation or such an
Acquirer to the
other may be effected unless: (i) two-thirds or more of the
whole Board of
Directors of this Corporation shall adopt a resolution approving
any such
action; and (ii) a meeting of the shareholders of this
Corporation is held to
act thereon and the votes of holders of voting securities of this
Corporation
representing not less than two-thirds of the votes entitled to
vote thereon
shall vote in favor of such action. As used in this
subparagraph, the term
"Acquirer" shall mean any person, firm, or corporation other than
this
Corporation which is a party or a proposed party to any merger,
consolidation,
or transfer as described herein, if such person, firm, or
corporation or any
person, firm, or corporation controlling, controlled by, or under
common
control with such party, or any group of which such person, firm,
or
corporation is a member, or any other group acting in concert
with such party,
owns in the aggregate of record and/or beneficially, directly or
indirectly,
more than ten percent (10%) of any class of equity security of
this
Corporation. As used in this subparagraph, the term "group"
includes persons,
firms, and corporations acting in concert, whether or not as a
formal group,
and the term "equity security" means any share of stock or
similar voting
security convertible, with or without consideration, into such a
security, or
carrying any warrant to subscribe to or purchase such a security,
or any such
warrant or right. The foregoing provision is in addition to the
requirements
of the General Corporation Law of the State of Delaware and may
not be amended
or repealed without a favorable vote of not less than two-thirds
of the holders
of the issued and outstanding stock of the Corporation entitled
to vote thereon
authorizing such amendment or repeal.
(d) The provisions of this Article TENTH shall be in
addition to and
not in limitation of any other rights, indemnities, or
limitations of liability
to which any director or officer may be entitled as a matter of
law or under
any by-law, agreement, vote of stockholders or otherwise.
ELEVENTH: Whenever a compromise or arrangement is proposed
between this
Corporation and its creditors or any class of them and/or between
this
Corporation and its stockholders or any class of them, any court
of equitable
jurisdiction within the State of Delaware may, on the application
in a summary
way of this Corporation or of any creditor or stockholder
thereof, or on the
application of any receiver or receivers appointed for this
Corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or
on the
application of trustees in dissolution or of any receiver or
receivers
appointed for this Corporation under the provisions of Section
279 of Title 8
of the Delaware Code order a meeting of the creditors or class of
creditors,
and/or of the stockholders or class of stockholders of this
Corporation, as the
case may be, to be summoned in such manner as the said Court
directs. If a
majority in number representing three-fourths in value of the
creditors or
class of creditors, and/or of the stockholders or class of
stockholders of this
Corporation, as the case may be, agree to any compromise or
arrangement and to
any reorganization of this Corporation as consequence of such
compromise or
arrangement, the said compromise or arrangement and the said
reorganization
shall, if sanctioned by the Court to which the said application
has been made,
be binding on all the creditors or class of creditors, and/or on
all the
stockholders or class of stockholders, of this Corporation, as
the case may be,
and also on this Corporation.
TWELFTH: Meetings of stockholders may be held outside the
State of
Delaware, if the by-laws so provide. The books of the
Corporation may be kept
(subject to any provision contained in the statutes) outside the
State of
Delaware at such place or places as may be designated from time
to time by the
Board of Directors or in the by-laws of the Corporation.
Elections of
directors need not be by ballot unless the by-laws of the
Corporation shall so
provide.
THIRTEENTH: The Corporation reserves the right to amend,
alter, change or
repeal any provision contained in this Certificate of
Incorporation, in the
manner now or hereafter prescribed by statute, and all rights
conferred upon
officers, directors and stockholders herein are granted subject
to this
reservation.
FOURTEENTH: (a) In addition to any affirmative vote
required by law, by
this Certificate of Incorporation, or otherwise, and except as
expressly
provided in paragraph (b) of this Article Fourteenth, approval of
any Business
Combination shall require the affirmative vote of at least
two-thirds of the
outstanding Voting Shares, notwithstanding that no vote may be
required or some
lesser percentage may be specified by law, agreement, or
otherwise.
(b) Paragraph (a) of this Article Fourteenth shall not
apply to a
particular Business Combination, if all of the conditions
specified in either
subparagraphs (1) or (2) below are met:
(1) The Business Combination has been approved by
two-thirds of
the whole Board of Directors; or
(2) Both of the following conditions are met:
(A) The aggregate amount of cash and the
Fair Market Value
of consideration other than cash, determined as of the date
of the
consummation of the Business Combination, to be received per
share by
holders of Common Stock in such Business Combination shall
be at least
equal to the highest of the following:
(i) The highest per share price
(including any
brokerage commissions, transfer taxes and soliciting
dealers' fees)
paid by the Interested Stockholder for any Voting
Shares acquired by
it (1) within the two-year period immediately prior to
the date of
the first public announcement of the proposed Business
Combination or
(2) in the transaction in which it became an Interested
Stockholder,
whichever is higher;
(ii) The Fair Market Value per
share of Common
Stock on the date of the first public announcement of
the proposed
Business Combination or on the date on which the
Interested
Stockholder became an Interested Stockholder, whichever
is higher;
and
(iii) The per share book value of
the Common Stock
as reported at the end of the fiscal quarter
immediately preceding
the date of the first public announcement of the
proposed Business
Combination; and
(B) The consideration to be received by
holders of Common
Stock in the Business Combination shall be either all cash
or cash and
noncash consideration in the same form as previously paid by
the
Interested Stockholder in connection with its acquisition of
Beneficial
Ownership of shares of Common Stock of the Corporation. If
the
consideration paid for the Common Stock by the Interested
Stockholder
varied as to form, the form of consideration to be paid in
the Business
Combination shall be either cash or the same type of
consideration used to
acquire the largest number of shares of Common Stock
previously acquired
by the Interested Stockholder. The noncash portion, if any,
of the
consideration to be paid in the Business Combination shall
not be greater
than the non-cash portion of consideration paid by the
Interested
Stockholder in connection with its acquisition of Beneficial
Ownership of
the largest number of shares of Common Stock of the
Corporation. The
value of any non-cash consideration to be paid in the
Business Combination
shall be determined as of the date of consummation of the
Business
Combination.
(C) For the purpose of this Article
Fourteenth, the
following terms when capitalized shall the following
meanings:
(1) "Affiliate" shall mean a Person that directly
or
indirectly, or through one or more intermediaries, controls,
or is
controlled by, or is under common control with the Person
including
without limitation an officer, director, general partner or
beneficial
owner of 10% or more of any class of equity securities of
such Person or
any parent or Subsidiary thereof, and the spouse or other
relative who has
the same home as such Person.
(2) "Beneficial Owner" of a Voting Share shall
mean a Person
and its Affiliates who, directly or indirectly, have:
(A) The power to vote or direct the voting
of a Voting
Share; or
(B) Investment power to dispose of or direct
the
disposition of a Voting Share; or
(C) The right to acquire Beneficial
Ownership of a Voting
Share within 60 days.
(3) "Business Combination" shall mean any of the
following:
(A) Any merger or consolidation of the
Corporation or any
subsidiary with or into (i) any Interested Stockholder or
(ii) any other
corporation which is, or after such merger or consolidation,
would be an
Interested Stockholder or an Affiliate of an Interested
Stockholder; or
(B) Any sale, lease, exchange, mortgage,
pledge, transfer
or other disposition to or with any Interested Stockholder
or any
Affiliate of any Interested Stockholder of any assets of the
Corporation
or any Subsidiary having an aggregate Fair Market Value of
$1,000,000 or
more in one transaction or a series of related transactions;
or
(C) The issuance or transfer by the
Corporation or any
Subsidiary of any securities of the Corporation or any
Subsidiary to any
Interested Stockholder or any Affiliate of any Interested
Stockholder in
exchange for cash, securities or other property (or a
combination thereof)
having an aggregate Fair Market Value of $1,000,000 or more
in one
transaction or a series of related transactions; or
(D) The adoption of any plan for the
liquidation or
dissolution of the Corporation proposed by or on behalf of
an Interested
Stockholder or any Affiliate of any Interested Stockholder;
or
(E) Any reclassification of securities
(including any
stock split or reverse stock split) or recapitalization of
the
Corporation, or any merger or consolidation of the
Corporation with any
Subsidiary or any similar transaction (whether or not with
or into or
otherwise involving an Interested Stockholder) which has the
effect,
directly or indirectly, of increasing the proportionate
share of the
outstanding shares of any class of equity or convertible
securities of the
Corporation or any Subsidiary which is directly or
indirectly owned by any
Interested Stockholder or any Affiliate of any Interested
Stockholder.
(4) "Fair Market Value" shall mean: (i) in the
case of stock,
the highest closing sale price during the 30-day period
immediately
preceding the date in question of a share of such stock on
the Composite
Tape for New York Stock Exchange-Listed Stocks, or, if such
stock is not
quoted on the Composite Tape, on the New York Stock
Exchange, or, if such
stock is not listed on such Exchange, on the principal
United States
securities exchange registered under the Securities Exchange
Act of 1934
on which such stock is listed, or, if such stock is not
listed on any such
exchange, the highest closing bid quotation with respect to
a share of
such stock during the 30-day period preceding the date in
question on the
National Association of Securities Dealers, Inc. Automated
Quotations
System or any system then in use, or if no such quotations
are available,
the fair market value on the date in question of a share of
such stock as
determined by a majority of the whole Board of Directors in
good faith;
and (ii) in the case of property other than cash or stock,
the fair market
value of such property on the date in question as determined
in good faith
by a majority of the whole Board of Directors.
(5) "Interested Stockholder" shall mean any
Person (other than
the Corporation or any corporation of which a majority of
each class of
equity securities is owned, directly or indirectly, by the
Corporation)
which, as of the record date for the determination of
stockholders
entitled to notice of and to vote on a Business Combination,
or
immediately prior to the consummation of any such
transaction;
(A) Is the Beneficial Owner, directly or
indirectly, of
more than 10% of the Voting Shares; or
(B) Is an Affiliate of the Corporation and
at any time
within two years prior thereto was the Beneficial Owner,
directly or
indirectly, of not less than 10% of the then outstanding
Voting Shares; or
(C) Is an assignee of or successor in
interest to any
shares of capital stock of the Corporation which were at any
time within
two years prior thereto Beneficially Owned by any Interested
Stockholder,
and such assignment or succession shall have occurred in the
course of a
transaction or series of transactions not involving a public
offering
within the meaning of the Securities Act of 1933.
The number of shares of Voting Shares deemed to be
outstanding
shall include shares deemed Beneficially Owned by the
Interested
Stockholder, but shall not include any other shares of
Voting Shares which
may be issuable to other persons pursuant to any agreement,
arrangement or
understanding, or upon exercise of conversion rights,
warrants or options,
or otherwise.
(6) "Person" shall mean any individual,
corporation,
partnership or other entity.
(7) "Subsidiary" shall mean any corporation of
which a majority
of the outstanding shares of any class of equity securities
is owned
directly or indirectly by the Corporation.
(8) "Voting Shares" shall mean all issued and
outstanding
shares of equity securities and all rights to acquire any
equity
securities which are generally entitled to vote in the
election of
directors.
(d) A majority of the whole Board of Directors shall
have the power
and duty to determine for the purposes of this Article Fourteenth
on the basis
of information known to them, (1) whether a Person is an
Interested
Stockholder, (2) the number of Voting Shares Beneficially Owned
by any Person,
(3) whether a Person is an Affiliate of another, (4) whether a
Person has the
power to vote or dispose of Voting Shares or to direct the voting
or
disposition of Voting Shares, (5) whether the assets subject to
any Business
Combination or the consideration received for the issuance or
transfer of
securities by the Corporation or any Subsidiary in any Business
Combination has
an aggregate Fair Market Value of $1,000,000 or more, or (6)
whether a Person
has the right to acquire Beneficial Ownership of Voting Shares.
(e) Nothing contained in this Article Fourteenth shall
be construed
to relieve any Interested Stockholder from any fiduciary
obligation imposed by
law.
(f) Notwithstanding any other provisions of this
Certificate of
Incorporation or the Bylaws of the Corporation (and
notwithstanding the fact
that a lesser percentage may be specified by law, this
Certificate of
Incorporation or the Bylaws of the Corporation), the affirmative
vote of the
holders of at least two-thirds of the Voting Shares shall be
required to amend
or repeal, or adopt any provisions inconsistent with, this
Article Fourteenth
or any provisions thereof.
FIFTEENTH: To the fullest extent permitted by the Delaware
General
Corporation Law, as the same exists or may hereafter be amended,
a director of
the Corporation shall not be liable to the Corporation or its
stockholders for
monetary damages for breach of fiduciary duty as a director. No
amendment to
or repeal of this Article Fifteenth shall apply to, or have any
effect on, the
liability or alleged liability of any director of the Corporation
for or with
respect to any acts or omissions of such director occurring prior
to such
amendment or repeal.
SIXTEENTH: (a) The Corporation shall indemnify any person
who is or was
a party (which shall include for purposes of this Article
Sixteenth the giving
of testimony or similar involvement) or is threatened to be made
a party to or
is involved in any threatened, pending or completed action, suit
or proceeding
whether civil, criminal, administrative, or investigative
(hereinafter a
"proceeding") by reason of the fact that such person was or is an
"authorized
representative" (as defined below) against expenses (which shall
include
attorneys' fees), judgments, ERISA excise taxes or penalties,
fines and amounts
paid in settlement actually and reasonably incurred by such
person in
connection with such proceeding to the fullest extent permitted
under the
Delaware General Corporation Law, as the same exists or may
hereafter be
amended (but, in the case of any such amendment, only to the
extent that such
amendment permits the Corporation to provide broader
indemnification rights
than said law permitted the Corporation to provide prior to such
amendment).
As used in this Article Sixteenth, the term "authorized
representative" shall
mean a Director, officer, employee or agent of the Corporation,
or a person
serving at the request of the Corporation as a director, officer,
employee, or
agent of another corporation, partnership, joint venture, trust
or other
enterprise, including service with respect to employee benefit
plans.
(b) Expenses incurred by a person in defending a
proceeding
(including permissive and compulsory counterclaims and
affirmative defenses)
brought by reason of the fact that such person is or was an
authorized
representative shall be paid by the Corporation in advance of the
final
disposition of such proceeding upon receipt of an undertaking by
or on behalf
of such person to repay such amount if it shall be ultimately
determined that
such person is not entitled to be indemnified under this Article
Sixteenth or
otherwise. The Corporation shall advance all expenses which the
person's
defense counsel certifies by an affidavit to the Corporation as
being
reasonable and incurred in defending a proceeding.
(c) If a claim under Sections (a) or (b) of this
Article Sixteenth
is not paid in full by the Corporation within thirty (30) days
after a written
claim has been received by the Corporation, the claimant may at
any time
thereafter bring suit against the Corporation to recover the
unpaid amount of
the claim and, if successful in whole or part, the claimant shall
be entitled
to be paid also the expense of prosecuting such claim. It shall
be a defense
to any such action (other than an action brought to enforce a
claim for
expenses incurred in defending any proceeding in advance of its
final
disposition where the required undertaking has been tendered to
the
Corporation) that the claimant has not met the standards of
conduct which make
it permissible under the Delaware General Corporation Law for the
Corporation
to indemnify the claimant for the amount claimed, but the burden
of proving
such defense shall be on the Corporation.
(d) The indemnification and advancement of expenses
authorized by
this Article Sixteenth shall (i) not be deemed exclusive of any
other rights to
which those seeking indemnification and advancement of expenses
may be entitled
under any statute, provision of the Certificate, agreement, vote
of
stockholders or directors or otherwise, (ii) continue as to a
person who has
ceased to be an authorized representative, and (iii) inure to the
benefit of
the heirs, executors and administrators of an authorized
representative.
(e) Each person who shall act as an authorized
representative of the
Corporation shall be deemed to be doing so in reliance upon the
rights of
indemnification and advancement of expenses provided by this
Article Sixteenth,
and the provisions of this Article Sixteenth shall be deemed a
contract between
the Corporation and the authorized representative. Any repeal or
modification
of the provisions of this Article Sixteenth shall not affect any
rights or
obligations then existing.
(f) The Corporation may, but shall not be obligated
to, purchase and
maintain insurance at its expense, to protect itself and any
person who is or
was an authorized representative against any liability asserted
against him in
such capacity or arising out of his status as such, whether or
not the
Corporation would have the power to indemnify him against such
liability.
4. Thereafter, pursuant to resolution of its Board of
Directors, an annual
meeting of the stockholders of the Corporation was duly called
and held, upon
notice in accordance with Section 222 of the General Corporation
Law of the
State of Delaware at which meeting the necessary number of shares
as required
by statute were voted in favor of the amendments.
5. The amendments were duly adopted in accordance with the
provisions of
Section 242 of the General Corporation Law of the State of
Delaware.
IN WITNESS WHEREOF, the Corporation has caused this Restated
Certificate
to be signed by Paul R. Chastain, its President, and Carolyn A.
Fredrich, its
Secretary, this 26th day of May, 1994.
By: /s/ Paul R. Chastain
Paul R. Chastain, President
Attest: /s/ Carolyn A. Fredrich
Carolyn A. Fredrich,
Secretary
EXHIBIT 4.1<PAGE>
EXHIBIT 4.1
INSTRUMENTS DEFINING THE RIGHTS
OF SECURITY HOLDERS
A. Relevant Portions of the Restated Certificate of
Incorporation of Kinark
Corporation:
FOURTH: The aggregate number of shares of stock which the
Corporation
shall have authority to issue is Twelve Million (12,000,000)
shares of Common
Stock of a par value of Ten Cents ($.10) per share.
SIXTH: All of any part of the shares of stock of any class
of the
Corporation may be issued and sold, from time to time, by the
Corporation,
without further action by the stockholders, for such
consideration (but in the
case of any class of stock having par value, not less than the
par value
thereof) and on such terms and to such person or persons as may,
from time to
time, be fixed by the Board of Directors of the Corporation.
The Board of Directors shall have the power at any time and
from time to
time (without any action by the stockholders of the Corporation)
to create and
issue, whether or not in connection with the issue or sale of any
shares of
stock or bonds, debentures or securities of the Corporation,
rights or options
entitling the holders thereof to purchase from the Corporation
shares of its
stock of any class, such rights or options to be evidenced by or
in such
warrants or other instruments as shall be approved by the Board
of Directors.
The terms upon which, the time or times, which may be limited or
unlimited in
duration, at or within which such rights or options shall be
issued shall be
such as shall be fixed and stated in the resolution or
resolutions adopted by
the Board of Directors providing for the creation and issue of
such rights or
options.
No stockholder shall be entitled as a matter of right to
subscribe for,
purchase or receive any shares of the stock or any rights or
options of the
Corporation which it may issue or sell, whether out of the number
of shares
authorized by this Certificate of Incorporation or by amendment
thereof, or
other proceedings, or out of the shares of the stock of the
Corporation
acquired by it after the issuance thereof, nor shall any
stockholder be
entitled as a matter of right to purchase or subscribe for or
receive any
bonds, debentures or other obligations which the Corporation may
issue or sell
that shall be convertible into or exchangeable for stock or to
which shall be
attached or appertain any warrant or warrants or other instrument
or
instruments that shall confer upon the holder or owner of such
obligation the
right to subscribe for or purchase from the Corporation any share
of its
capital stock. All such additional issues of stock, rights,
options, or of
bonds, debentures or other obligations convertible into or
exchangeable for
stock or to which warrants shall be attached or appertain or
which shall confer
upon the holder the right to subscribe for or purchase any shares
of stock, may
be issued and disposed of by the Board of Directors to such
persons, firms,
associations and corporations and upon such terms, subject to any
provisions of
law in regard thereto, as in their absolute discretion they may
deem advisable.
TENTH: (c) Regardless of any provision in this or any
other Article or
provision of this Certificate of Incorporation to the contrary,
no merger or
consolidation between this Corporation and an "Acquirer", as
defined in this
subparagraph, nor any sale, lease, or exchange (a "transfer"
herein) of all or
substantially all of the assets of this Corporation or such an
Acquirer to the
other may be effected unless: (i) two-thirds or more of the
whole Board of
Directors of this Corporation shall adopt a resolution approving
any such
action; and (ii) a meeting of the shareholders of this
Corporation is held to
act thereon and the votes of holders of voting securities of this
Corporation
representing not less than two-thirds of the votes entitled to
vote thereon
shall vote in favor of such action. As used in this
subparagraph, the term
"Acquirer" shall mean any person, firm, or corporation other than
this
Corporation which is a party or a proposed party to any merger,
consolidation,
or transfer as described herein, if such person, firm, or
corporation or any
person, firm, or corporation controlling, controlled by, or under
common
control with such party, or any group of which such person, firm,
or
corporation is a member, or any other group acting in concert
with such party,
owns in the aggregate of record and/or beneficially, directly or
indirectly,
more than ten percent (10%) of any class of equity security of
this
Corporation. As used in this subparagraph, the term "group"
includes persons,
firms, and corporations acting in concert, whether or not as a
formal group,
and the term "equity security" means any share of stock or
similar voting
security convertible, with or without consideration, into such a
security, or
carrying any warrant to subscribe to or purchase such a security,
or any such
warrant or right. The foregoing provision is in addition to the
requirements
of the General Corporation Law of the State of Delaware and may
not be amended
or repealed without a favorable vote of not less than two-thirds
of the holders
of the issued and outstanding stock of the Corporation entitled
to vote thereon
authorizing such amendment or repeal.
ELEVENTH: Whenever a compromise or arrangement is proposed
between this
Corporation and its creditors or any class of them and/or between
this
Corporation and its stockholders or any class of them, any court
of equitable
jurisdiction within the State of Delaware may, on the application
in a summary
way of this Corporation or of any creditor or stockholder
thereof, or on the
application of any receiver or receivers appointed for this
Corporation under
the provisions of Section 291 of Title 8 of the Delaware Code or
on the
application of trustees in dissolution or of any receiver or
receivers
appointed for this Corporation under the provisions of Section
279 of Title 8
of the Delaware Code order a meeting of the creditors or class of
creditors,
and/or of the stockholders or class of stockholders of this
Corporation, as the
case may be, to be summoned in such manner as the said Court
directs. If a
majority in number representing three-fourths in value of the
creditors or
class of creditors, and/or of the stockholders or class of
stockholders of this
Corporation, as the case may be, agree to any compromise or
arrangement and to
any reorganization of this Corporation as consequence of such
compromise or
arrangement, the said compromise or arrangement and the said
reorganization
shall, if sanctioned by the Court to which the said application
has been made,
be binding on all the creditors or class of creditors, and/or on
all the
stockholders or class of stockholders, of this Corporation, as
the case may be,
and also on this Corporation.
THIRTEENTH: The Corporation reserves the right to amend,
alter, change or
repeal any provision contained in this Certificate of
Incorporation, in the
manner now or hereafter prescribed by statute, and all rights
conferred upon
officers, directors and stockholders herein are granted subject
to this
reservation.
FOURTEENTH: (a) In addition to any affirmative vote
required by law, by
this Certificate of Incorporation, or otherwise, and except as
expressly
provided in paragraph (b) of this Article Fourteenth, approval of
any Business
Combination shall require the affirmative vote of at least
two-thirds of the
outstanding Voting Shares, notwithstanding that no vote may be
required or some
lesser percentage may be specified by law, agreement, or
otherwise.
(b) Paragraph (a) of this Article Fourteenth shall not
apply to a
particular Business Combination, if all of the conditions
specified in either
subparagraphs (1) or (2) below are met:
(1) The Business Combination has been approved by
two-thirds of
the whole Board of Directors; or
(2) Both of the following conditions are met:
(A) The aggregate amount of cash and the
Fair Market Value
of consideration other than cash, determined as of the date
of the
consummation of the Business Combination, to be received per
share by
holders of Common Stock in such Business Combination shall
be at least
equal to the highest of the following:
(i) The highest per share price
(including any
brokerage commissions, transfer taxes and soliciting
dealers' fees)
paid by the Interested Stockholder for any Voting
Shares acquired by
it (1) within the two-year period immediately prior to
the date of
the first public announcement of the proposed Business
Combination or
(2) in the transaction in which it became an Interested
Stockholder,
whichever is higher;
(ii) The Fair Market Value per
share of Common
Stock on the date of the first public announcement of
the proposed
Business Combination or on the date on which the
Interested
Stockholder became an Interested Stockholder, whichever
is higher;
and
(iii) The per share book value of
the Common Stock
as reported at the end of the fiscal quarter
immediately preceding
the date of the first public announcement of the
proposed Business
Combination; and
(B) The consideration to be received by
holders of Common
Stock in the Business Combination shall be either all cash
or cash and
noncash consideration in the same form as previously paid by
the
Interested Stockholder in connection with its acquisition of
Beneficial
Ownership of shares of Common Stock of the Corporation. If
the
consideration paid for the Common Stock by the Interested
Stockholder
varied as to form, the form of consideration to be paid in
the Business
Combination shall be either cash or the same type of
consideration used to
acquire the largest number of shares of Common Stock
previously acquired
by the Interested Stockholder. The noncash portion, if any,
of the
consideration to be paid in the Business Combination shall
not be greater
than the non-cash portion of consideration paid by the
Interested
Stockholder in connection with its acquisition of Beneficial
Ownership of
the largest number of shares of Common Stock of the
Corporation. The
value of any non-cash consideration to be paid in the
Business Combination
shall be determined as of the date of consummation of the
Business
Combination.
(C) For the purpose of this Article
Fourteenth, the
following terms when capitalized shall the following
meanings:
(1) "Affiliate" shall mean a Person that directly
or
indirectly, or through one or more intermediaries, controls,
or is
controlled by, or is under common control with the Person
including
without limitation an officer, director, general partner or
beneficial
owner of 10% or more of any class of equity securities of
such Person or
any parent or Subsidiary thereof, and the spouse or other
relative who has
the same home as such Person.
(2) "Beneficial Owner" of a Voting Share shall
mean a Person
and its Affiliates who, directly or indirectly, have:
(A) The power to vote or direct the voting
of a Voting
Share; or
(B) Investment power to dispose of or direct
the
disposition of a Voting Share; or
(C) The right to acquire Beneficial
Ownership of a Voting
Share within 60 days.
(3) "Business Combination" shall mean any of the
following:
(A) Any merger or consolidation of the
Corporation or any
subsidiary with or into (i) any Interested Stockholder or
(ii) any other
corporation which is, or after such merger or consolidation,
would be an
Interested Stockholder or an Affiliate of an Interested
Stockholder; or
(B) Any sale, lease, exchange, mortgage,
pledge, transfer
or other disposition to or with any Interested Stockholder
or any
Affiliate of any Interested Stockholder of any assets of the
Corporation
or any Subsidiary having an aggregate Fair Market Value of
$1,000,000 or
more in one transaction or a series of related transactions;
or
(C) The issuance or transfer by the
Corporation or any
Subsidiary of any securities of the Corporation or any
Subsidiary to any
Interested Stockholder or any Affiliate of any Interested
Stockholder in
exchange for cash, securities or other property (or a
combination thereof)
having an aggregate Fair Market Value of $1,000,000 or more
in one
transaction or a series of related transactions; or
(D) The adoption of any plan for the
liquidation or
dissolution of the Corporation proposed by or on behalf of
an Interested
Stockholder or any Affiliate of any Interested Stockholder;
or
(E) Any reclassification of securities
(including any
stock split or reverse stock split) or recapitalization of
the
Corporation, or any merger or consolidation of the
Corporation with any
Subsidiary or any similar transaction (whether or not with
or into or
otherwise involving an Interested Stockholder) which has the
effect,
directly or indirectly, of increasing the proportionate
share of the
outstanding shares of any class of equity or convertible
securities of the
Corporation or any Subsidiary which is directly or
indirectly owned by any
Interested Stockholder or any Affiliate of any Interested
Stockholder.
(4) "Fair Market Value" shall mean: (i) in the
case of stock,
the highest closing sale price during the 30-day period
immediately
preceding the date in question of a share of such stock on
the Composite
Tape for New York Stock Exchange-Listed Stocks, or, if such
stock is not
quoted on the Composite Tape, on the New York Stock
Exchange, or, if such
stock is not listed on such Exchange, on the principal
United States
securities exchange registered under the Securities Exchange
Act of 1934
on which such stock is listed, or, if such stock is not
listed on any such
exchange, the highest closing bid quotation with respect to
a share of
such stock during the 30-day period preceding the date in
question on the
National Association of Securities Dealers, Inc. Automated
Quotations
System or any system then in use, or if no such quotations
are available,
the fair market value on the date in question of a share of
such stock as
determined by a majority of the whole Board of Directors in
good faith;
and (ii) in the case of property other than cash or stock,
the fair market
value of such property on the date in question as determined
in good faith
by a majority of the whole Board of Directors.
(5) "Interested Stockholder" shall mean any
Person (other than
the Corporation or any corporation of which a majority of
each class of
equity securities is owned, directly or indirectly, by the
Corporation)
which, as of the record date for the determination of
stockholders
entitled to notice of and to vote on a Business Combination,
or
immediately prior to the consummation of any such
transaction;
(A) Is the Beneficial Owner, directly or
indirectly, of
more than 10% of the Voting Shares; or
(B) Is an Affiliate of the Corporation and
at any time
within two years prior thereto was the Beneficial Owner,
directly or
indirectly, of not less than 10% of the then outstanding
Voting Shares; or
(C) Is an assignee of or successor in
interest to any
shares of capital stock of the Corporation which were at any
time within
two years prior thereto Beneficially Owned by any Interested
Stockholder,
and such assignment or succession shall have occurred in the
course of a
transaction or series of transactions not involving a public
offering
within the meaning of the Securities Act of 1933.
The number of shares of Voting Shares deemed to be
outstanding
shall include shares deemed Beneficially Owned by the
Interested
Stockholder, but shall not include any other shares of
Voting Shares which
may be issuable to other persons pursuant to any agreement,
arrangement or
understanding, or upon exercise of conversion rights,
warrants or options,
or otherwise.
(6) "Person" shall mean any individual,
corporation,
partnership or other entity.
(7) "Subsidiary" shall mean any corporation of
which a majority
of the outstanding shares of any class of equity securities
is owned
directly or indirectly by the Corporation.
(8) "Voting Shares" shall mean all issued and
outstanding
shares of equity securities and all rights to acquire any
equity
securities which are generally entitled to vote in the
election of
directors.
(d) A majority of the whole Board of Directors shall
have the power
and duty to determine for the purposes of this Article Fourteenth
on the basis
of information known to them, (1) whether a Person is an
Interested
Stockholder, (2) the number of Voting Shares Beneficially Owned
by any Person,
(3) whether a Person is an Affiliate of another, (4) whether a
Person has the
power to vote or dispose of Voting Shares or to direct the voting
or
disposition of Voting Shares, (5) whether the assets subject to
any Business
Combination or the consideration received for the issuance or
transfer of
securities by the Corporation or any Subsidiary in any Business
Combination has
an aggregate Fair Market Value of $1,000,000 or more, or (6)
whether a Person
has the right to acquire Beneficial Ownership of Voting Shares.
(e) Nothing contained in this Article Fourteenth shall
be construed
to relieve any Interested Stockholder from any fiduciary
obligation imposed by
law.
(f) Notwithstanding any other provisions of this
Certificate of
Incorporation or the Bylaws of the Corporation (and
notwithstanding the fact
that a lesser percentage may be specified by law, this
Certificate of
Incorporation or the Bylaws of the Corporation), the affirmative
vote of the
holders of at least two-thirds of the Voting Shares shall be
required to amend
or repeal, or adopt any provisions inconsistent with, this
Article Fourteenth
or any provisions thereof.
FIFTEENTH: To the fullest extent permitted by the Delaware
General
Corporation Law, as the same exists or may hereafter be amended,
a director of
the Corporation shall not be liable to the Corporation or its
stockholders for
monetary damages for breach of fiduciary duty as a director. No
amendment to
or repeal of this Article Fifteenth shall apply to, or have any
effect on, the
liability or alleged liability of any director of the Corporation
for or with
respect to any acts or omissions of such director occurring prior
to such
amendment or repeal.
SIXTEENTH: (a) The Corporation shall indemnify any person
who is or was
a party (which shall include for purposes of this Article
Sixteenth the giving
of testimony or similar involvement) or is threatened to be made
a party to or
is involved in any threatened, pending or completed action, suit
or proceeding
whether civil, criminal, administrative, or investigative
(hereinafter a
"proceeding") by reason of the fact that such person was or is an
"authorized
representative" (as defined below) against expenses (which shall
include
attorneys' fees), judgments, ERISA excise taxes or penalties,
fines and amounts
paid in settlement actually and reasonably incurred by such
person in
connection with such proceeding to the fullest extent permitted
under the
Delaware General Corporation Law, as the same exists or may
hereafter be
amended (but, in the case of any such amendment, only to the
extent that such
amendment permits the Corporation to provide broader
indemnification rights
than said law permitted the Corporation to provide prior to such
amendment).
As used in this Article Sixteenth, the term "authorized
representative" shall
mean a Director, officer, employee or agent of the Corporation,
or a person
serving at the request of the Corporation as a director, officer,
employee, or
agent of another corporation, partnership, joint venture, trust
or other
enterprise, including service with respect to employee benefit
plans.
(b) Expenses incurred by a person in defending a
proceeding
(including permissive and compulsory counterclaims and
affirmative defenses)
brought by reason of the fact that such person is or was an
authorized
representative shall be paid by the Corporation in advance of the
final
disposition of such proceeding upon receipt of an undertaking by
or on behalf
of such person to repay such amount if it shall be ultimately
determined that
such person is not entitled to be indemnified under this Article
Sixteenth or
otherwise. The Corporation shall advance all expenses which the
person's
defense counsel certifies by an affidavit to the Corporation as
being
reasonable and incurred in defending a proceeding.
(c) If a claim under Sections (a) or (b) of this
Article Sixteenth
is not paid in full by the Corporation within thirty (30) days
after a written
claim has been received by the Corporation, the claimant may at
any time
thereafter bring suit against the Corporation to recover the
unpaid amount of
the claim and, if successful in whole or part, the claimant shall
be entitled
to be paid also the expense of prosecuting such claim. It shall
be a defense
to any such action (other than an action brought to enforce a
claim for
expenses incurred in defending any proceeding in advance of its
final
disposition where the required undertaking has been tendered to
the
Corporation) that the claimant has not met the standards of
conduct which make
it permissible under the Delaware General Corporation Law for the
Corporation
to indemnify the claimant for the amount claimed, but the burden
of proving
such defense shall be on the Corporation.
(d) The indemnification and advancement of expenses
authorized by
this Article Sixteenth shall (i) not be deemed exclusive of any
other rights to
which those seeking indemnification and advancement of expenses
may be entitled
under any statute, provision of the Certificate, agreement, vote
of
stockholders or directors or otherwise, (ii) continue as to a
person who has
ceased to be an authorized representative, and (iii) inure to the
benefit of
the heirs, executors and administrators of an authorized
representative.
(e) Each person who shall act as an authorized
representative of the
Corporation shall be deemed to be doing so in reliance upon the
rights of
indemnification and advancement of expenses provided by this
Article Sixteenth,
and the provisions of this Article Sixteenth shall be deemed a
contract between
the Corporation and the authorized representative. Any repeal or
modification
of the provisions of this Article Sixteenth shall not affect any
rights or
obligations then existing.
(f) The Corporation may, but shall not be obligated
to, purchase and
maintain insurance at its expense, to protect itself and any
person who is or
was an authorized representative against any liability asserted
against him in
such capacity or arising out of his status as such, whether or
not the
Corporation would have the power to indemnify him against such
liability.
B. Relevant provisions of the Amended and Restated Bylaws of
Kinark
Corporation:
ARTICLE I
Stockholder's Meetings
SECTION 5. Advance Notice of Stockholder Business. At an
annual meeting
of the stockholders, only such business shall be conducted as
shall have been
properly brought before the meeting. To be properly brought
before an annual
meeting business must be (a) specified in the notice of meeting
(or any
supplement thereto) given by or at the direction of the Board of
Directors,
(b) otherwise properly brought before the meeting by or at the
direction of the
Board of Directors, or (c) otherwise properly brought before the
annual meeting
by a stockholder of record and constitute a proper subject to be
brought before
such meeting. For business to be properly brought before an
annual meeting by
a stockholder (other than the election of directors), the
stockholder must have
given timely notice thereof in writing to the Secretary of the
Corporation. A
stockholder's notice to the Secretary shall set forth as to each
matter (other
than the election of directors) the stockholder proposes to bring
before the
annual meeting (a) a brief description of the business desired to
be brought
before the annual meeting and the reasons for conducting such
business at the
annual meeting, (b) the name and record address of the
stockholder proposing
such business, (c) the class and number of shares of the
Corporation which are
beneficially owned by the stockholder, (d) a representation that
the
stockholder is a holder of record of capital stock of the
Corporation entitled
to vote at such meeting and intends to appear in person or by
proxy at the
annual meeting to present such business, and (e) any material
interest of the
stockholder in such business. Notwithstanding anything in the
Bylaws to the
contrary, no business shall be conducted at an annual meeting
except in
accordance with the procedures set forth in this Section. The
Chairman of an
annual meeting shall, if the facts warrant, determine and declare
to the annual
meeting that business was not properly brought before the meeting
and in
accordance with the provisions of this Section, and if he should
so determine,
he shall so declare to the annual meeting and any such business
not properly
brought before the annual meeting shall not be transacted. At
any special
meeting of the stockholders, only such business shall be
conducted as shall
have been brought before the meeting by or at the direction of
the Board of
Directors.
With respect to stockholder business to be brought before an
annual
meeting of stockholders (other than a request for inclusion of a
proposal in
the Corporation's proxy statement pursuant to Rule 14a-8 of the
Securities
Exchange Act of 1934, as amended), to be timely, a stockholder's
notice must be
delivered to or mailed to and received at the principal executive
offices of
the Corporation, not less than ninety (90) days in advance of
such meeting.
For purposes of this Section, reference to a requirement to
deliver notice
to the Corporation a set number of days in advance of an annual
meeting shall
mean that such notice must be delivered such number of days in
advance of the
first anniversary of the preceding year's annual meeting;
provided, however,
that in the event that the date of the annual meeting is advanced
by more than
30 days or delayed more than 60 days from such anniversary,
notice by the
stockholder to be timely must be so delivered not later than the
close of
business on the later of the 60th day prior to such annual
meeting or the 10th
day following the day on which notice of such meeting is first
given to
stockholders. For the purposes of this Section, notice of an
annual meeting
shall be deemed to first be given to stockholders when disclosure
of such date
is first made in a press release reported by the Dow Jones News
Services,
Associated Press or comparable national news service or in a
document publicly
filed by the Corporation with the Securities and Exchange
Commission pursuant
to Sections 13, 14 and 15(d) of the Securities Exchange Act of
1934, as
amended.
SECTION 6. Quorum at Stockholders' Meetings. At any
meeting of the
stockholders, a majority in interest of the capital stock issued
and
outstanding and entitled to vote thereat represented by
stockholders of record
in person or by proxy, shall constitute a quorum, but if a quorum
is not
present, a majority in interest of those present may adjourn any
meeting from
time to time. When a quorum is present at any meeting, a
majority of the
number of shares of stock entitled to vote represented thereat
shall decide any
questions brought before such meeting unless the question is one
upon which by
express provision of law or of the Corporation's Restated
Certificate of
Incorporation or these Bylaws a larger or different vote is
required, in which
case such express provision shall govern.
SECTION 7. Proxy and Voting. The term "Certificate"
whenever used in
these Bylaws shall be deemed to refer to the Restated Certificate
of
Incorporation of the Corporation as from time to time amended.
Subject to the
provisions of Section 3 of Article VIII hereof, the holders of
record of the
capital stock of the Corporation shall be entitled to one vote
for each share
thereof so held by them of record. Shares of its own capital
stock belonging
to the Corporation shall not be voted, directly or indirectly.
Stockholders of
record entitled to vote may vote at any meeting either in person
or by proxy in
writing, which shall be filed with the Secretary of the meeting
before being
voted. Such proxies shall entitle the holders thereof to vote at
any
adjournment of such meeting. Stockholders entitled to vote may
also be
represented by a general power of attorney produced at any
meeting until it is
revoked. No proxy or power of attorney shall be voted after
three years from
its date, unless said proxy or power of attorney provides for a
longer period.
SECTION 9. Consent of Stockholders in Lieu of Meeting.
(a) Any action required to be taken at any annual or
special meeting of
stockholders of the Corporation, or any action which may be taken
at any annual
or special meeting of the stockholders, may be taken without a
meeting, without
prior notice and without a vote, if a consent or consents in
writing, setting
forth the action so taken, shall be signed by the holders of
outstanding stock
having not less than the minimum number of votes that would be
necessary to
authorize or take such action at a meeting at which all shares
entitled to vote
thereon were present and voted and shall be delivered to the
Corporation by
delivery to its registered office in Delaware, its principal
place of business,
or an officer or agent of the Corporation having custody of the
book in which
proceedings of meetings of stockholders are recorded. Delivery
made to the
Corporation's registered office shall be made by hand or by
certified or
registered mail, return receipt requested.
(b) Every written consent shall bear the date of the
signature of each
stockholder who signs the consent and no written consent shall be
effective to
take the corporate action referred to therein unless, within
sixty (60) days of
the date the earliest dated consent is delivered to the
Corporation, a written
consent or consents signed by a sufficient number of holders to
take action are
delivered to the Corporation in the manner prescribed in
paragraph (e) of this
Section.
(c) In order that the Corporation may determine the
stockholders entitled
to consent to corporate action in writing without a meeting, the
Board of
Directors may fix a record date, which record date shall not
precede the date
upon which the resolution fixing the record date is adopted by
the Board of
Directors, and which date shall not be more than ten (10) days
after the date
upon which the resolution fixing the record date is adopted by
the Board of
Directors. Any stockholder of record seeking to have the
stockholders
authorize or take corporate action by written consent shall, by
written notice
to the Secretary, request the Board of Directors to fix a record
date. The
Board of Directors shall promptly, but in all events within ten
(10) days after
the date on which such a request is received, adopt a resolution
fixing the
record date. If no record date has been fixed by the Board of
Directors within
ten (10) days of the date on which such a request is received,
the record date
for determining stockholders entitled to consent to corporate
action in writing
without a meeting, when no prior action by the Board of Directors
is required
by applicable law, shall be the first date on which a signed
written consent
setting forth the action taken or proposed to be taken is
delivered to the
Corporation in accordance with paragraphs (a) and (b) of this
Section. If no
record date has been fixed by the Board of Directors and prior
action by the
Board of Directors is required by applicable law, the record date
for
determining stockholders entitled to consent to corporate action
in writing
without a meeting shall be at the close of business on the date
on which the
Board of Directors adopts the resolution taking such prior
action.
(d) Within five (5) business days after receipt of the
earliest dated
consent delivered to the Corporation in the manner provided in
this Section,
the Corporation shall retain nationally recognized independent
inspectors of
election for the purpose of performing a ministerial review of
the validity of
consents and any revocations thereof. The cost of retaining
inspectors of
election shall be borne by the Corporation.
(e) At any time that stockholders soliciting consents in
writing to
corporate action have a good faith belief that the requisite
number of valid
and unrevoked consents to authorize or take the action specified
has been
received by them, the consents shall be delivered by the
soliciting
stockholders to the Corporation's registered office in the State
of Delaware or
principal place of business or to the Secretary of the
Corporation, together
with a certificate stating their belief that the requisite number
of valid and
unrevoked consents has been received as of a specific date, which
date shall be
identified in the certificate. In the event that delivery is
made to the
Corporation's registered office in Delaware, such delivery shall
be made by
hand or by certified or registered mail, return receipt
requested. Upon
receipt of such consents, the Corporation shall cause the
consents to be
delivered promptly to the inspectors of election. The
Corporation also shall
deliver promptly to the inspectors of election any revocations of
consents in
its possession, custody or control as of the time of receipt of
the consents.
(f) As promptly as practicable after the consents and
revocations are
received by them, the inspectors of election shall issue a
preliminary report
to the Corporation and the soliciting stockholders stating: (i)
the number of
shares represented by valid and unrevoked consents; (ii) the
number of shares
represented by valid revocations, (iii) the number of shares
represented by
invalid consents; (iv) the number of shares represented by
invalid revocations;
(v) the number of shares entitled to submit consents as of the
record date; and
(vi) whether, based on their preliminary count, the requisite
number of valid
and unrevoked consents has been obtained to authorize or take the
action
specified in the consents. Unless the Corporation and the
soliciting
stockholders agree to a shorter or longer period, the Corporation
and the
soliciting stockholders shall have five (5) days to review the
consents and
revocations and to advise the inspectors and the opposing party
in writing as
to whether they intend to challenge the preliminary report. If
no timely
written notice of an intention to challenge the preliminary
report is received,
the inspectors shall certify the preliminary report (as corrected
or modified
by virtue of the detection by the inspectors of clerical errors)
as their final
report and deliver it to the Corporation and the soliciting
stockholders. If
the Corporation or the soliciting stockholders give written
notice of an
intention to challenge the preliminary report, a challenge
session shall be
scheduled by the inspectors as promptly as practicable. A
transcript of the
challenge session shall be recorded by a certified court
reporter. Following
completion of the challenge session, the inspectors shall issue
as promptly as
practicable their final report and deliver it to the Corporation
and the
soliciting stockholders. A copy of the final report shall be
included in the
book in which the proceedings of meetings of stockholders are
recorded.
(g) The Corporation shall give prompt notice to the
stockholders of the
results of any consent solicitation or the taking of corporate
action without a
meeting by less than unanimous written consent.
(h) This Section shall in no way impair or diminish the
right of any
stockholder or director, or any officer whose title to office is
contested, to
contest the validity of any consent or revocation thereof, or to
take any other
action with respect thereto.
ARTICLE II
Board of Directors
SECTION 9. Notice of Stockholder Nominees. Only persons
who are
nominated in accordance with the procedures set forth in this
Section shall be
eligible for election as Directors. Nominations of persons for
election to the
Board of Directors of the Corporation may be made at a meeting of
stockholders
by or at the direction of the Board of Directors by any
nominating committee or
person appointed by the Board of Directors or by any stockholder
of the
Corporation entitled to vote for the election of Directors at the
meeting who
complies with the notice procedures set forth in this Section.
Such
nominations, other than those made by or at the direction of the
Board of
Directors, shall be made pursuant to timely notice in writing to
the Secretary
of the Corporation. Such stockholder's notice shall set forth
(a) as to each
person whom the stockholder proposes to nominate for election or
re-election as
a Director, (i) the name, age, business address and residence
address of such
person, (ii) the principal occupation or employment of such
person, (iii) the
class and number of shares of the Corporation which are
beneficially owned by
such person, and (iv) any other information relating to such
person that is
required to be disclosed in solicitations of proxies for election
of Directors,
or is otherwise required, in each case pursuant to Regulation 14A
promulgated
under the Securities Exchange Act of 1934, as amended (including
without
limitation such person's written consent to being named in the
proxy statement
as a nominee and to serving as a Director if elected); and (b) as
to the
stockholder giving the notice (i) the name and record address of
such
stockholder, and (ii) the class and number of shares of the
Corporation which
are beneficially owned by such stockholder. No person shall be
eligible for
election as a Director of the Corporation unless nominated in
accordance with
the procedures set forth in this Section. The Chairman of the
meeting shall,
if the facts warrant, determine and declare to the meeting that a
nomination
was not made in accordance with the procedures prescribed by the
Bylaws, and if
he should so determine, he shall so declare to the meeting and
the defective
nomination shall be disregarded.
With respect to an election to be held at an annual meeting
of
stockholders, to be timely, a stockholder's notice shall be
delivered to or
mailed and received at the principal executive offices of the
Corporation, not
less than ninety (90) days in advance of such meeting. With
respect to an
election to be held at a special meeting of stockholders for the
election of
directors, stockholder's notice shall be given before the close
of business on
the tenth day following the date on which notice of such meeting
is first given
to stockholders. For purposes of this Section, reference to a
requirement to
deliver notice to the Corporation a set number of days in advance
of an annual
meeting shall mean that such notice must be delivered such number
of days in
advance of the first anniversary of the preceding year's annual
meeting;
provided, however, that in the event that the date of the annual
meeting is
advanced by more than 30 days or delayed more than 60 days from
such
anniversary, notice by the stockholder to be timely must be so
delivered not
later than the close of business on the later of the 60th day
prior to such
annual meeting or the 10th day following the day on which notice
of such
meeting is first given to stockholders. For the purposes of this
Section,
notice of an annual or special meeting shall be deemed to first
be given to
stockholders when disclosure of such date is first made in a
press release
reported by the Dow Jones News Services, Associated Press or
comparable
national news service or in a document publicly filed by the
Corporation with
the Securities and Exchange Commission pursuant to Sections 13,
14 and 15(d) of
the Securities Exchange Act of 1934, as amended.
ARTICLE VIII
Capital Stock
SECTION 1. Certificates of Stock, Transfer Agents and
Registrars. Every
stockholder shall be entitled to a certificate or certificates of
capital stock
of the Corporation in such form as may be prescribed by the Board
of Directors,
duly numbered and setting forth the number and kind of shares.
Each
certificate shall be signed by the President or a Vice President
and by the
Secretary or an Assistant Secretary, and may have affixed thereto
an impression
of the corporate seal. Before issue, a record of each
certificate shall be
entered on the books of the Corporation. The Board of Directors
may also
appoint one or more Transfer Agents and/or Registrars for its
stock of any
class or classes and for the transfer and registration of
certificates
representing the same and may require stock certificates to be
countersigned by
one or more of them. If certificates of capital stock of the
Corporation are
signed by a Transfer Agent or by a Registrar, the signatures
thereon of the
President or a Vice President and of the Secretary or an
Assistant Secretary of
the Corporation and the corporate seal may be facsimiles,
engraved or printed.
Any provisions of these Bylaws with reference to the signing of
stock
certificates shall include, in cases above-permitted, such
facsimile
signatures. If any officer or officers who shall have signed, or
whose
facsimile signature or signatures shall have been used on, any
such certificate
or certificates, shall cease to be such officer or officers of
the Corporation,
whether because of death, resignation, or otherwise, before such
certificate or
certificates shall have been delivered by the Corporation, such
certificate or
certificates may nevertheless be adopted by the Corporation and
be issued and
delivered as though the person or persons who signed such
certificate or
certificates or whose facsimile signature or signatures shall
have been used
thereon had not ceased to be such officer or officers of the
Corporation. The
Board of Directors may, from time to time, make such additional
rules and
regulations as it may deem expedient concerning the issue,
transfer and
registration of certificates for shares of stock of the
Corporation.
SECTION 2. Transfers of Stock and Addresses of
Stockholders. Shares of
stock may be transferred by delivery of the certificate therefor
accompanied
either by an assignment in writing on the back of the certificate
or by a
written power of attorney to sell, assign and transfer the same
on the books of
the Corporation, signed by the person appearing by the
certificate to be the
owner of the shares represented thereby, and such shares of stock
shall be
transferable on the books of the Corporation upon surrender
thereof so assigned
or endorsed. The person registered on the books of the
Corporation as the
owner of any shares of stock shall exclusively be entitled as the
owner of such
shares to receive dividends, to vote and to exercise all other
rights and
privileges as such owner in respect thereof. It shall be the
duty of every
stockholder to notify the Corporation of his mailing address and
of any changes
thereto. The latest address furnished by each stockholder shall
be entered on
the books of the Corporation, and the latest address appearing on
such books
shall be conclusively deemed to be the mailing address and/or the
last known
mailing address of such stockholder. If any stockholder shall
fail to notify
the Corporation of his mailing address, it shall be sufficient to
send
corporate notices to such stockholder at the address, if any,
understood by the
Secretary to be his mailing address.
SECTION 3. Transfer Books. The Board of Directors shall
have power to
close the stock transfer books of the Corporation for a period
not exceeding
sixty (60) days preceding the date of any meeting of
stockholders, the date for
payment of any dividend, the date for the allotment of rights, or
the date when
any change or conversion or exchange of capital stock shall go
into effect, or
for a period not exceeding sixty (60) days in connection with
obtaining the
consent of the stockholders for any purpose; provided, however,
that in lieu of
closing the stock transfer books as aforesaid, the Board of
Directors may fix
in advance a date not exceeding sixty (60) days preceding the
date of any
meeting of stockholders, the date for the payment of any
dividend, the date for
the allotment of rights, the date when any change or conversion
or exchange of
capital stock shall go into effect, or a date in connection with
obtaining such
consent, as a record date for the determination of the
stockholders entitled to
notice of, and to vote at, any such meeting and any adjournment
thereof, to
receive payment of any such dividend, to any such allotment of
rights, to
exercise the rights in respect of any such change, conversion or
exchange of
capital stock, or to give such consent, and such stockholders and
only such
stockholders as shall be stockholders of record on the date so
fixed shall be
entitled to such notice of, and to vote at, such meeting and any
adjournment
thereof, or to receive payment of such dividend, or to receive
such allotment
of rights, or to exercise such rights, or to give such consent,
as the case may
be, notwithstanding any transfer of any stock on the books of the
Corporation
after such record date is fixed as aforesaid. Except where the
transfer books
of the Corporation shall have been closed or a date shall have
been fixed as
the record date for the determination of the stockholders
entitled to vote, as
hereinbefore provided, no share of stock shall be voted at any
election for
Directors which shall have been transferred on the books of the
Corporation
within twenty (20) days next preceding such election of
Directors.
ARTICLE X
Indemnification and Insurance
SECTION 1. Right to Indemnification. The Corporation shall
indemnify any
person who is or was a party (which shall include for purposes of
this Article
X the giving of testimony or similar involvement) or is
threatened to be made a
party to or is involved in any threatened, pending or completed
action, suit or
proceeding whether civil, criminal, administrative, or
investigative
(hereinafter a "proceeding") by reason of the fact that such
person was or is
an "authorized representative" (as defined below) against
expenses (which shall
include attorneys' fees), judgments, ERISA excise taxes or
penalties, fines and
amounts paid in settlement actually and reasonably incurred by
such person in
connection with such proceeding to the fullest extent permitted
under the
Delaware General Corporation Law, as the same exists or may
hereafter be
amended (but, in the case of any such amendment, only to the
extent that such
amendment permits the Corporation to provide broader
indemnification rights
than said law permitted the Corporation to provide prior to such
amendment).
As used in this Article X, the term "authorized representative"
shall mean a
Director, officer, employee or agent of the Corporation, or a
person serving at
the request of the Corporation as a director, officer, employee,
or agent of
another corporation, partnership, joint venture, trust or other
enterprise,
including service with respect to employee benefit plans.
SECTION 2. Advancing Expenses. Expenses incurred by a
person in
defending a proceeding (including permissive and compulsory
counterclaims and
affirmative defenses) brought by reason of the fact that such
person is or was
an authorized representative shall be paid by the Corporation in
advance of the
final disposition of such proceeding upon receipt of an
undertaking by or on
behalf of such person to repay such amount if it shall be
ultimately determined
that such person is not entitled to be indemnified under this
Article X or
otherwise. The Corporation shall advance all expenses which the
person's
defense counsel certifies by an affidavit to the Corporation as
being
reasonable and incurred in defending a proceeding.
SECTION 3. Right of Claimant to Bring Suit. If a claim
under Sections 1
or 2 of this Article X is not paid in full by the Corporation
within thirty
(30) days after a written claim has been received by the
Corporation, the
claimant may at any time thereafter bring suit against the
Corporation to
recover the unpaid amount of the claim and, if successful in
whole or part, the
claimant shall be entitled to be paid also the expense of
prosecuting such
claim. It shall be a defense to any such action (other than an
action brought
to enforce a claim for expenses incurred in defending any
proceeding in advance
of its final disposition where the required undertaking has been
tendered to
the Corporation) that the claimant has not met the standards of
conduct which
make it permissible under the Delaware General Corporation Law
for the
Corporation to indemnify the claimant for the amount claimed, but
the burden of
proving such defense shall be on the Corporation.
SECTION 4. Scope of Article. The indemnification and
advancement of
expenses authorized by this Article X shall (i) not be deemed
exclusive of any
other rights to which those seeking indemnification and
advancement of expenses
may be entitled under any statute, provision of the Certificate,
agreement,
vote of stockholders or directors or otherwise, (ii) continue as
to a person
who has ceased to be an authorized representative, and (iii)
inure to the
benefit of the heirs, executors and administrators of an
authorized
representative.
SECTION 5. Reliance on Provisions. Each person who shall
act as an
authorized representative of the Corporation shall be deemed to
be doing so in
reliance upon the rights of indemnification and advancement of
expenses
provided by this Article X, and the provisions of this Article X
shall be
deemed a contract between the Corporation and the authorized
representative.
Any repeal or modification of the provisions of this Article X
shall not affect
any rights or obligations then existing.
SECTION 6. Insurance. The Corporation may, but shall not
be obligated
to, purchase and maintain insurance at its expense, to protect
itself and any
person who is or was an authorized representative against any
liability
asserted against him in such capacity or arising out of his
status as such,
whether or not the Corporation would have the power to indemnify
him against
such liability.
EXHIBIT 5.1<PAGE>
LAW OFFICES
NELSON MULLINS RILEY & SCARBOROUGH, L.L.P.
A REGISTERED LIMITED LIABILITY PARTNERSHIP INCLUDING PROFESSIONAL
CORPORATIONS
400 COLONY SQUARE
SUITE 2200
1201 PEACHTREE STREET, N.E.
ATLANTA, GEORGIA 30361
TELEPHONE (404) 817-6000
TELECOPIER (404) 817-6050
OTHER OFFICES:
Charleston, South Carolina
Columbia, South Carolina
Greenville, South Carolina
Lexington, South Carolina
Myrtle Beach, South Carolina
September 18, 1995
Kinark Corporation
7060 South Yale
Tulsa, Oklahoma 74136
Ladies and Gentlemen:
We have acted as counsel to Kinark Corporation (the
"Company") in
connection with the filing of a Registration Statement on Form
S-3 (the
"Registration Statement") under the Securities Act of 1933, as
amended,
covering the offering of up to 5,619,615 shares (the "Shares") of
the Company's
common stock, $.10 par value per share. In connection therewith,
we have
examined such corporate records, certificates of public officials
and other
documents and records as we have considered necessary or proper
for the purpose
of this opinion.
This opinion is limited by and is in accordance with the
January 1, 1992,
edition of the Interpretive Standards applicable to Legal
Opinions to Third
Parties in Corporate Transactions adopted by the Legal Opinion
Committee of the
Corporate and Banking Law Section of the State Bar of Georgia.
Based on the foregoing, and having regard to legal
considerations which we
deem relevant, we are of the opinion that the Shares, when issued
and delivered
as described in the Registration Statement, will be legally
issued, fully paid
and nonassessable.
We hereby consent to the filing of this opinion as an
exhibit to the
Registration Statement and to the reference to our firm under the
caption
"Legal Matters" in the Prospectus contained in the Registration
Statement.
Very truly yours,
NELSON MULLINS RILEY & SCARBOROUGH, L.L.P.
A REGISTERED LIMITED LIABILITY PARTNERSHIP
INCLUDING
PROFESSIONAL CORPORATIONS
EXHIBIT 15.1
<PAGE>
September 15, 1995
Kinark Corporation
7060 South Yale
Tulsa, Oklahoma
We have made a review, in accordance with standards established
by the American
Institute of Certified Public Accountants, of the unaudited
interim financial
information of Kinark Corporation and subsidiaries for the
periods ended March
31, 1995 and 1994 and June 30, 1995 and 1994, as indicated in our
reports dated
May 8, 1995 and July 27, 1995, respectively; because we did not
perform an
audit, we expressed no opinion on that information.
We are aware that our reports referred to above, which were
included in your
Quarterly Reports on Form 10-Q for the quarters ended March 31,
1995 and June
30, 1995, are being incorporated by reference in this
Registration Statement.
We also are aware that the aforementioned reports, pursuant to
Rule 436(c)
under the Securities Act of 1933, are not considered a part of
the Registration
Statement prepared or certified by an accountant or a report
prepared or
certified by an accountant within the meaning of Sections 7 and
11 of that Act.
/s/ Deloitte & Touche LLP
Tulsa, Oklahoma
EXHIBIT 23.1<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of
Kinark Corporation on Form S-3 of our report dated January 30,
1995 (except as
to the second paragraph of the Long-Term Debt footnote, for which
the date is
March 2, 1995) appearing in the Annual Report on Form 10-K of
Kinark
Corporation for the year ended December 31, 1994 and to the
reference to us
under the heading "Experts" in the Prospectus, which is a part of
this
Registration Statement.
/s/ Deloitte & Touche LLP
Tulsa, Oklahoma
September 15, 1995
EXHIBIT 23.2<PAGE>
INDEPENDENT AUDITORS' CONSENT
We consent to the use in this Registration Statement of Kinark
Corporation on
Form S-3 of our report dual-dated November 17, 1994 and August
15, 1995, on the
consolidated financial statements of Rogers Galvanizing Company
for the years
ended September 30, 1994 and 1993, appearing in the Prospectus
which is part of
this Registration Statement.
We also consent to the reference to us under the heading
"Experts" in such
Prospectus.
/s/ Hogan & Slovacek, PC
Tulsa, Oklahoma
September 15, 1995
EXHIBIT 23.3<PAGE>
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the use
of our report
included in or made a part of this Registration Statement filed
September 15,
1995.
/s/ Arthur Andersen LLP
Tulsa, Oklahoma
September 15, 1995
EXHIBIT 4.2<PAGE>
KINARK CORPORATION
5,619,615 Shares of Common Stock
Offered Pursuant to Rights
Distributed to Stockholders of
Kinark Corporation
_______________, 1995
This notice is being distributed to all holders of shares of
the Common
Stock, par value $.10 per share (the "Common Stock"), of record
on
______________, 1995 (the "Record Date"), of Kinark Corporation
(the
"Company"), in connection with a distribution of nontransferable
subscription
rights (the "Rights") to acquire shares of the Common Stock at a
subscription
price of $2.00 per share.
Each beneficial owner of Common Stock is entitled to three
Rights for each
two shares of Common Stock owned on the Record Date. No
fractional Rights will
be issued and no cash in lieu thereof will be paid.
Enclosed are copies of the following documents:
1. The Prospectus and Proxy Statement;
2. A Subscription Certificate representing your Rights;
3. The "Instructions as to Use of Kinark Corporation
Subscription
Certificates" (including Guidelines For Certification
of Taxpayer
Identification Number on Substitute Form W-9);
4. A Notice of Guaranteed Delivery for Subscription
Certificates issued
by Kinark Corporation; and
5. A return envelope addressed to Mellon Securities
Transfer Services,
the Subscription Agent.
Your prompt action is requested. The Rights will expire at
5:00 PM., New
York City time, on ____________, 1995, unless extended by the
Company (the
"Expiration Date").
To exercise the Rights, properly completed and executed
Subscription
Certificates (unless the guaranteed delivery procedures are
complied with) and
payment in full for all Rights exercised must be delivered to the
Subscription
Agent as indicated in the Prospectus and Proxy Statement prior to
5:00 PM., New
York City time, on the Expiration Date.
Additional copies of the enclosed materials may be obtained
from Morrow &
Co., Inc. the Information Agent. The Information Agent's
toll-free telephone
number is (800) ___-____.
By Order of the Board of Directors
EXHIBIT 4.3<PAGE>
KINARK CORPORATION
5,619,615 Shares of Common Stock
Offered Pursuant to Rights
Distributed to Stockholders of
Kinark Corporation
To Securities Dealers, Commercial Banks,
Trust Companies and Other Nominees:
This letter is being distributed to securities dealers,
commercial banks,
trust companies and other nominees in connection with the
offering by Kinark
Corporation (the "Company") of 5,619,615 shares of common stock,
par value $.10
per share (the "Common Stock"), of the Company, at a subscription
price of
$2.00 per share, pursuant to nontransferable subscription rights
(the "Rights")
distributed to holders of record of Common Stock as of the close
of business on
_________________, 1995 (the "Record Date"). The Rights are
described in the
Prospectus and Proxy Statement and evidenced by a Subscription
Certificate
registered in your name or the name of your nominee.
Each beneficial owner of Common Stock registered in your
name or the name
of your nominee is entitled to three Rights for each two shares
of Common Stock
owned by such beneficial owner. No fractional Rights will be
issued and no
cash in lieu thereof will be paid.
We are asking you to contact your clients for whom you hold
Common Stock
registered in your name or in the name of your nominee to obtain
instructions
with respect to the Rights.
Enclosed are copies of the following documents:
1. The Prospectus and Proxy Statement;
2. Subscription Certificate(s) evidencing Rights;
3. The "Instructions as to Use of Kinark Corporation
Subscription
Certificates" (including Guidelines For Certification
of Taxpayer
Identification Number on Substitute Form W-9);
4. A form of letter which may be sent to your clients for
whose accounts
you hold Common Stock registered in your name or the
name of your
nominee, with space provided for obtaining such
clients' instructions
with regard to the Rights;
5. A Notice of Guaranteed Delivery for Subscription
Certificates issued
by Kinark Corporation;
6. A return envelope addressed to Mellon Securities
Transfer Services,
the Subscription Agent;
7. A DTC Participant Oversubscription Form; and
8. Nominee Holder Certification.
Your prompt action is requested. The Rights will expire at
5:00 PM., New
York City time, on ______________, 1995, unless extended by the
Company (the
"Expiration Date").
To exercise the Rights, properly completed and executed
Subscription
Certificates (unless the guaranteed delivery procedures are
complied with) and
payment in full for all Rights exercised must be delivered to the
Subscription
Agent as indicated in the Prospectus and Proxy Statement prior to
5:00 PM., New
York City time, on the Expiration Date.
Additional copies of the enclosed materials, as well as the
certification
needed to round up fractional shares, may be obtained from Morrow
& Co., Inc.,
the Information Agent. The Information Agent's toll-free
telephone number is
(800) ___-____.
Very truly yours,
KINARK CORPORATION
NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE
YOU OR ANY
OTHER PERSON AS AN AGENT OF KINARK CORPORATION OR ANY OTHER
PERSON MAKING OR
DEEMED TO BE MAKING OFFERS OF THE COMMON SHARES ISSUABLE UPON
VALID EXERCISE OF
THE RIGHTS, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY
STATEMENTS ON
BEHALF OF ANY OF THEM WITH RESPECT TO THE OFFERING EXCEPT FOR
STATEMENTS MADE
IN THE PROSPECTUS.
EXHIBIT 4.4<PAGE>
INSTRUCTIONS AS TO USE OF KINARK CORPORATION
SUBSCRIPTION CERTIFICATES
___________________
CONSULT THE INFORMATION AGENT, YOUR BANK OR
BROKER
AS TO ANY QUESTIONS
The following instructions relate to a rights offering (the
"Rights
Offering") by Kinark Corporation, a Delaware corporation (the
"Company"), to
the holders of shares of its common stock, par value $.10 per
share (the
"Common Stock"), as described in the Company's Prospectus and
Proxy Statement
dated ________________, 1995, (the "Prospectus"). Holders of
record of Common
Stock at the close of business on ________________, 1995, (the
"Record Date"),
are receiving three nontransferable subscription rights
(collectively, the
"Rights") for each two shares of Common Stock held by them on the
Record Date.
No fractional Rights will be issued and no cash in lieu thereof
will be paid.
Each Right is exercisable, upon payment of $2.00 in cash (the
"Subscription
Price"), to purchase one share of Common Stock (the "Basic
Subscription
Privilege"). In addition, each Right also carries the right to
subscribe (the
"Oversubscription Privilege") at the Subscription Price for
shares of Common
Stock in an aggregate amount up to 50% of the shares that the
holder is
entitled to purchase under the Basic Subscription Privilege and
only to the
extent that all the shares are not subscribed for through the
exercise of the
Basic Subscription Privilege by the Expiration Date (the "Excess
Shares"). No
fractional shares will be issued pursuant to the exercise of the
Oversubscription Privilege. If the number of Excess Shares is
not sufficient
to satisfy all subscriptions pursuant to the Oversubscription
Privilege, the
Excess Shares will be allocated pro rata (subject to the
elimination of
fractional shares) among the holders of Rights who exercise the
Oversubscription Privilege in proportion to the number of shares
such holders
have purchased pursuant to the Basic Subscription Privilege. See
"The Rights
Offering" in the Prospectus and Proxy Statement.
The Rights will expire at 5:00 p.m., New York City time, on
____________________, 1995, unless extended (the "Expiration
Date").
The number of Rights to which you are entitled and the
number of shares
purchaseable thereunder are printed on the face of your
Subscription
Certificate. You should indicate your wishes with regard to the
exercise of
your Rights by completing the Subscription Certificate and
returning it to the
Subscription Agent in the envelope provided.
YOUR SUBSCRIPTION CERTIFICATES MUST BE RECEIVED BY THE
SUBSCRIPTION AGENT,
OR GUARANTEED DELIVERY REQUIREMENTS WITH RESPECT TO YOUR
SUBSCRIPTION
CERTIFICATES MUST BE COMPLIED WITH, AND PAYMENT OF THE
SUBSCRIPTION PRICE,
INCLUDING FINAL CLEARANCE OF ANY CHECKS, MUST BE RECEIVED BY THE
SUBSCRIPTION
AGENT, ON OR BEFORE 5:00 PM., NEW YORK CITY TIME, ON THE
EXPIRATION DATE. YOU
MAY NOT REVOKE ANY EXERCISE OF A RIGHT.
1. SUBSCRIPTION PRIVILEGES.
To exercise Rights, send your properly completed and
executed Subscription
Certificate, together with payment in full of the Subscription
Price for each
share of Common Stock subscribed for pursuant to the Basic
Subscription
Privilege and the Oversubscription Privilege, to the Subscription
Agent.
Payment of the Subscription Price must be made in U.S. dollars
for the full
number of shares of Common Stock being subscribed for by (a)
check or bank
draft drawn upon a U.S. bank or postal, telegraphic or express
money order
payable to Mellon Securities Transfer Services, as Subscription
Agent, or (b)
wire transfer of same day funds to the account maintained by the
Subscription
Agent for such purpose at Mellon Bank, N.A., ABA No.
____________, Account No.
_____________ (marked: "Kinark Corporation Subscription"). The
Subscription
Price will be deemed to have been received by the Subscription
Agent only upon
(i) the clearance of any uncertified check, (ii) the receipt by
the
Subscription Agent of any certified check or bank draft drawn
upon a U.S. bank
or any postal, telegraphic or express money order or (iii) the
receipt of good
funds in the Subscription Agent's account designated above. IF
PAYING BY
UNCERTIFIED PERSONAL CHECK, PLEASE NOTE THAT THE FUNDS PAID
THEREBY MAY TAKE AT
LEAST FIVE BUSINESS DAYS TO CLEAR. ACCORDINGLY, HOLDERS OF
RIGHTS WHO WISH TO
PAY THE SUBSCRIPTION PRICE BY MEANS OF UNCERTIFIED PERSONAL CHECK
ARE URGED TO
MAKE PAYMENT SUFFICIENTLY IN ADVANCE OF THE EXPIRATION DATE TO
ENSURE THAT SUCH
PAYMENT IS RECEIVED AND CLEARS BY SUCH DATE AND ARE URGED TO
CONSIDER PAYMENT
BY MEANS OF CERTIFIED OR CASHIER'S CHECK, MONEY ORDER OR WIRE
TRANSFER OF
FUNDS. Alternatively, you may cause a written guarantee
substantially in the
form delivered with these instructions (the "Notice of Guaranteed
Delivery")
from a member firm of a registered national securities exchange
or a member of
the National Association of Securities Dealers, Inc. or a
commercial bank or
trust company having an office or correspondent in the United
States (each of
the foregoing being an "Eligible Institution"), to be received by
the
Subscription Agent at or prior to the Expiration Date together
with payment in
full of the applicable Subscription Price. Such Notice of
Guaranteed Delivery
must state your name, the number of Rights represented by your
Subscription
Certificate and the number of shares of Common Stock being
purchased pursuant
to the Basic Subscription Privilege and the Oversubscription
Privilege, and
will guarantee the delivery to the Subscription Agent of your
properly
completed and executed Subscription Certificate within three
American Stock
Exchange trading days following the date of the Notice of
Guaranteed Delivery.
If this procedure is followed, your Subscription Certificates
must be received
by the Subscription Agent within three American Stock Exchange
trading days of
the Notice of Guaranteed Delivery. Additional copies of the
Notice of
Guaranteed Delivery may be obtained upon request from the
Information Agent at
the address, or by calling the telephone number, indicated below.
BANKS, BROKERS AND OTHER NOMINEE HOLDERS OF RIGHTS WHO
EXERCISE RIGHTS ON
BEHALF OF BENEFICIAL OWNERS OF RIGHTS WILL BE REQUIRED TO CERTIFY
TO THE
SUBSCRIPTION AGENT AND THE COMPANY (BY DELIVERING TO THE
SUBSCRIPTION AGENT A
NOMINEE HOLDER CERTIFICATION SUBSTANTIALLY IN THE FORM AVAILABLE
FROM THE
SUBSCRIPTION AGENT) THE AGGREGATE NUMBER OF RIGHTS THAT HAVE BEEN
EXERCISED,
AND THE NUMBER OF SHARES THAT ARE BEING SUBSCRIBED FOR PURSUANT
TO THE
OVERSUBSCRIPTION PRIVILEGE, BY EACH BENEFICIAL OWNER OF RIGHTS ON
WHOSE BEHALF
SUCH NOMINEE HOLDER IS ACTING. If more shares of Common Stock
are subscribed
for pursuant to the Oversubscription Privilege than are available
for sale,
such shares will be allocated, as described above, among persons
exercising the
Oversubscription Privilege in proportion to such persons'
exercise of Rights
pursuant to the Basic Subscription Privilege.
The address and telecopier numbers of the Subscription Agent
are as
follows:
Mellon Securities Transfer Services
85 Challenger Road
Ridgefield Park, New Jersey 07660-2188
Telecopier: ________________________
The address and telephone number of Morrow & Co., Inc., the
Information
Agent, is as follows:
Morrow & Co., Inc.
909 Third Avenue
20th Floor
New York, New York 10022-4799
CALL TOLL-FREE
(800) ___-____
If you have not indicated the number of Rights being exercised,
or if you have
not forwarded full payment of the Subscription Price for the
number of Rights
that you have indicated are being exercised, you will be deemed
to have
exercised the Basic Subscription Privilege with respect to the
maximum number
of whole Rights which may be exercised for the Subscription Price
payment
delivered by you and to the extent that the Subscription Price
payment
delivered by you exceeds the product of the Subscription Price
multiplied by
the number of Rights evidenced by the Subscription Certificates
delivered by
you (such excess being the "Subscription Excess"), you will be
deemed to have
exercised your Oversubscription Privilege to purchase, to the
extent available,
that number of whole shares of Common Stock equal to the quotient
obtained by
dividing the Subscription Excess by the Subscription Price, up to
the maximum
number of shares purchasable by you pursuant to your
Oversubscription
Privilege. Any portion of the Subscription Excess not applied
toward the
purchase of shares of Common Stock pursuant to the exercise of
your
Oversubscription Privilege will be refunded to you.
2. DELIVERY OF COMMON SHARES.
The following deliveries and payments will be made to the
address shown on
the face of your Subscription Certificate unless you provide
instructions to
the contrary in Part II of the Subscription Certificate.
(a) Shares of Common Stock. As soon as practicable after
the Expiration
Date, the Subscription Agent will mail to each Rights holder who
validly
exercises Rights the number of shares of Common Stock issuable to
such Rights
holder pursuant to the Basic Subscription Privilege and the
Oversubscription
Privilege. See "The Rights Offering - Subscription Privileges"
in the
Prospectus and Proxy Statement.
(b) Cash Payments. As soon as practicable after the
Expiration Date, the
Subscription Agent will mail to each Rights holder who exercises
the
Oversubscription Privilege any excess funds received in payment
of the Exercise
Price for Excess Shares that are subscribed for by such Rights
holder but not
allocated to such Rights holder pursuant to the Oversubscription
Privilege.
3. EXECUTION.
(a) Execution by Registered Holder. The signature on the
Subscription
Certificate must correspond with the name of the registered
holder exactly as
it appears on the face of the Subscription Certificate without
any alteration
or change whatsoever. Persons who sign the Subscription
Certificate in a
representative or other fiduciary capacity must indicate their
capacity when
signing and, unless waived by the Subscription Agent in its sole
and absolute
discretion, must present to the Subscription Agent satisfactory
evidence of
their authority to so act.
(b) Execution by Person Other than Registered Holder. If
the
Subscription Certificate is executed by a person other than the
holder named on
the face of the Subscription Certificate, proper evidence of
authority of the
person executing the Subscription Certificate must accompany the
same unless,
for good cause, the Subscription Agent dispenses with proof of
authority.
(c) Signature Guarantees. Your signature must be
guaranteed by an
Eligible Institution if you specify special payment or delivery
instructions
pursuant to Part II of the Subscription Certificate.
4. METHOD OF DELIVERY.
The method of delivery of Subscription Certificates and
payment of the
Exercise Price to the Subscription Agent will be at the election
and risk of
the Rights holder, but, if sent by mail, it is recommended that
they be sent by
registered mail, properly insured, with return receipt requested,
and that a
sufficient number of days be allowed to ensure delivery to the
Subscription
Agent and the clearance of any checks sent in payment of the
Exercise Price
prior to 5:00 p.m., New York City time, on the Expiration Date.
5. SPECIAL PROVISIONS RELATING TO THE DELIVERY OF RIGHTS
THROUGH THE
DEPOSITORY TRUST COMPANY.
In the case of holders of Rights that are held of record
through The
Depository Trust Company ("DTC"), exercises of the Basic
Subscription Privilege
(but not the Oversubscription Privilege) may be effected by
instructing DTC to
transfer Rights (such Rights being "DTC Exercised Rights") from
the DTC account
of such holder to the DTC account of the Subscription Agent,
together with
payment of the Subscription Price for each Common Share
subscribed for pursuant
to the Basic Subscription Privilege. The Oversubscription
Privilege in respect
of DTC Exercised Rights may not be exercised through DTC. The
holder of a DTC
Exercised Right may exercise the Oversubscription Privilege in
respect of such
DTC Exercised Right by properly executing and delivering to the
Subscription
Agent at or prior to 5:00 p.m., New York City time on the
Expiration Date, a
DTC Participant Oversubscription Exercise Form, in the form
available from the
Subscription Agent, together with payment of the appropriate
Subscription Price
for the number of shares of Common Stock for which the
Oversubscription
Privilege is to be exercised.
If a Notice of Guaranteed Delivery relates to Rights with
respect to which
exercise of the Basic Subscription Privilege will be made through
DTC and such
Notice of Guaranteed Delivery also relates to the exercise of the
Oversubscription Privilege, a DTC Participant Oversubscription
Exercise Form
must also be received by the Subscription Agent in respect of
such exercise of
the Oversubscription Privilege on or prior to the Expiration
Date.
6. SUBSTITUTE FORM W-9.
Each Rights holder who elects to exercise Rights should
provide the
Subscription Agent with a correct Taxpayer Identification Number
("TIN") on
Substitute Form W-9, which is included as Exhibit A hereto.
Additional copies
of Substitute Form W-9 may be obtained upon request from the
Subscription Agent
or the Information Agent indicated above. Failure to provide the
information
on the form may subject such holder to 31% federal income tax
withholding with
respect to dividends or other distributions that may be paid by
the Company on
shares of Common Stock purchased upon the exercise of Rights.
<PAGE>
EXHIBIT A
IMPORTANT TAX INFORMATION
Under United States federal income tax law, dividend
payments and other
distributions that may be made by the Company on Common Shares
issued upon the
exercise of Rights may be subject to backup withholding, and each
Rights holder
who either exercises Rights should provide the Subscription Agent
(as the
Company's agent) with such Rights holder's correct taxpayer
identification
number on Substitute Form W-9 below. If such Rights holder is an
individual,
the taxpayer identification number is his social security number
If the
Subscription Agent, which is also the transfer agent for the
Company, is not
provided with the correct taxpayer identification number in
connection with
such payments, the Rights holder may be subject to a $50 penalty
imposed by the
Internal Revenue Service.
Exempt Rights holders (including, among others, all
corporations and
certain foreign individuals) are not subject to these backup
withholding and
reporting requirements. In general, in order for a foreign
individual to
qualify as an exempt recipient, such Rights holder must submit a
statement,
signed under the penalties of perjury, attesting to that
individual's exempt
status. Such statements can be obtained from the Subscription
Agent. See the
enclosed Guidelines for Certification of Taxpayer Identification
Number on
Substitute Form W-9 for additional instructions.
If backup withholding applies, the Company or the
Subscription Agent, as
the case may be, will be required to withhold 31 percent of any
such payments
made to the Rights holder. Backup withholding is not an
additional tax.
Rather, the tax liability of persons subject to backup
withholding will be
reduced by the amount of tax withheld. If withholding results in
an
overpayment of taxes, a refund may be obtained.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding, a Rights holder is required
to notify the
Subscription Agent of his correct taxpayer identification number
by completing
the form below certifying that the taxpayer identification number
provided on
Substitute Form W-9 is correct (or that such Rights holder is
awaiting a
taxpayer identification number).
WHAT NUMBER TO GIVE THE SUBSCRIPTION AGENT
Each Rights holder is required to give the Subscription
Agent the social
security number or employer identification number of the record
owner of the
Rights. If the Rights are in more than one name or are not in
the name of the
actual owner, consult the enclosed Guidelines for Certification
of Taxpayer
Identification Number on Substitute Form W-9 for additional
guidelines on which
number to report.
PAYER'S NAME: Mellon Securities Transfer Services
SUBSTITUTE PART I - Taxpayer Identification No. Part
II - For
Payees
FORM W-9
Exempt from
Backup Withholding
Department of the TreasuryEnter your taxpayer identification(see
enclosed
Internal Revenue Servicenumber in the appropriate box. For
Guidelines)
most individuals, this is your
social_______________
security number. If you do not have aSocial
Security
number, see How to Obtain a "TIN" in
Number
the enclosed Guidelines.
Payer's Request for Note: If the account is in more
than_______________
Taxpayer one name, see the chart on page 2 of
Employer
Identification Numberenclosed Guidelines to determine what
Identification
(TIN) number to give. Number
Certification - Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer
Identification
Number (or I am waiting for a number to be
issued to me), and
(2) I am not subject to backup withholding either because I
have not been
notified by the Internal Revenue Service
("IRS") that I am subject to backup withholding as a
result of a
failure to report all interest or dividends, or
the IRS has notified me that I am no longer subject to
backup
withholding.
Certification Guidelines - You must cross out item (2) above if
you have been
notified by the IRS that you are subject to backup
withholding because of underreporting interest or dividends on
your tax return.
However, if after being notified by the IRS that
you were subject to backup withholding you received another
notification from
the IRS that you are no longer subject to backup
withholding, do not cross out item (2).
SIGNATURE ____________________________________
DATE_______________, 1995
NOTE: FAILURE TO COMPLETE THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31%
OF ANY PAYMENTS MADE TO YOU. PLEASE REVIEW ENCLOSED
GUIDELINES FOR
CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON
SUBSTITUTE FORM W-
9 FOR ADDITIONAL DETAILS.
<PAGE>
GUIDELINES FOR CERTIFICATE OF TAXPAYER
IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Guidelines for Determining the Proper Identification Number
to Give the
Payer. Social Security numbers have nine digits separated by two
hyphens: i.e.
000-00-0000. Employer identification numbers have nine digits
separated by
only one hyphen: i.e. 00-0000000. The table below will help
determine the
number to give the payer.
GIVE
THE NAME AND
FOR THIS TYPE OF ACCOUNT: SOCIAL
SECURITY NUMBER
1. Individual The individual
2. Two or more individuals (joint account) The actual owner of
the account or,
if combined funds,
the first individual
on the
account (1)
3. Custodian account of a minor (Uniform Gift to Minors Act)The
minor (2)
4. a. The usual revocable savings trust (grantor is also
trustee)The grantor-
trustee (1)
b. The so-called trust account that is not a legal or
validThe actual owner
(1)
trust under State law
5. Sole proprietorship The owner (4)
GIVE
THE NAME AND
FOR THIS TYPE OF ACCOUNT: EMPLOYER
IDENTIFICATION NUMBER OF
6. A valid trust, estate or pension trust Legal entity (do not
furnish the
identification number
of the personal
representative or
trustee unless the
legal entity itself
is not designat
ed in the account
title) (3)
7. Corporation The corporation
8. Association, club, religious, charitable, education orThe
organization
other tax-exempt organization
9. Partnership The partnership
10. A broker or registered nominee The broker or
nominee
11. Account with the department of Agriculture in the name ofThe
public entity
a public entity (such as a State or local government,
school district, or prison) that receives agricultural
program payments.
(1) List first and circle the name of the person whose number
you furnish.
(2) Circle the minor's name and furnish the minor's social
security number.
(3) List first and circle the name of the legal trust, estate or
pension
trust.
(4) Show the name of the owner.
Note: If no name is circled when there is more than one
name, the number
will be considered to be that of the first name listed.
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you
don't know your
number, obtain Form SS-5, Application for a Social Security
Number Card, or
Form SS-4, Application for Employer Identification Number, at the
local office
of the Social Security Administration or the Internal Revenue
Service and apply
for a number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL
payments
include the following:
* A corporation.
* A financial institution.
* An organization exempt from tax under section 501(a),
or an
individual retirement plan, or a custodial account
under section
403(b)(7).
* The United States or any agency or instrumentality
thereof.
* A State, the District of Columbia, a possession of the
United States,
or any subdivision or instrumentality thereof.
* A foreign government, a political subdivision of a
foreign
government, or any agency or instrumentality thereof.
* An international organization or any agency or
instrumentality
thereof.
* A dealer in securities or commodities registered in the
United States
or a possession of the United States.
* A real estate investment trust.
* A common trust fund operated by a bank under section
584(a).
* An exempt charitable remainder trust, or a non-exempt
trust described
in section 4947(a)(1).
* An entity registered at all times under the Investment
Company Act of
1940.
* A foreign central bank of issue.
Payment of dividends and patronage dividends not generally
subject to backup
withholding include the following:
* Payments to nonresident aliens subject to withholding
under section
1441.
* Payments to partnerships not engaged in a trade or
business in the
United States and which have at least one non-resident
partner.
* Payments of patronage dividends where the amount
received is not paid
in money.
* Payments made by certain foreign organizations.
* Payments made to a nominee.
Payments of interest not generally subject to backup withholding
include the
following:
* Payments of interest on obligations issued by
individuals. Note: You
may be subject to backup withholding if this interest
is $600 or more
and is paid in the course of the Payer's trade or
business and you
have not provided your correct taxpayer identification
number to the
payer.
* Payments of tax-exempt interest (including
exempt-interest dividends
under section 852).
* Payments described in section 6049(b)(5) to nonresident
aliens.
* Payments on tax-free covenant bonds under section 1451.
* Payments made by certain foreign organizations.
Exempt payees described above should file Form W-9 to avoid
possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR
TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM,
SIGN AND DATE
THE FORM AND RETURN IT TO THE PAYER.
Payments that are not subject to information reporting are
also not
subject to backup withholding. For details, see the regulations
under sections
6041, 6041(a), 6042, 6044, 6045, 6049, 6050A and 6060N. Privacy
Act Notice.
Section 6109 requires most recipients of dividends, interest or
other payments
to give taxpayer identification numbers to payers who must report
the payments
to IRS. The IRS uses the numbers for identification purposes,
and to help
verify the accuracy of your tax return. Payers must be given the
numbers
whether or not recipients are required to file tax returns.
Payers must
generally withhold 31% of taxable interest, dividends, and
certain other
payments to a payee who does not furnish a taxpayer
identification number to a
payer. Certain penalties may also apply.
PENALTIES
(1) Penalty for Failure to Furnish Taxpayer Identification
Number. If
you fail to furnish your taxpayer identification number to a
payer, you are
subject to a penalty of $50 for each such failure unless your
failure is due to
reasonable cause and not to willful neglect.
(2) Civil Penalty for False Information With Respect to
Withholding. If
you make a false statement with no reasonable basis which results
in no
imposition of backup withholding, you are subject to a penalty of
$500.
(3) Criminal Penalty for Falsifying Information.
Falsifying
certifications or affirmations may subject you to criminal
penalties including
fines and/or imprisonment.
FOR ADDITIONAL INFORMATION, CONTACT YOUR TAX
CONSULTANT
OR THE INTERNAL REVENUE SERVICE
EXHIBIT 4.5<PAGE>
KINARK [ADDRESS LABEL]
CORPORATION
SUBSCRIPTION CERTIFICATE FOR RIGHTS OFFERING FOR HOLDERS OF
RECORD ON
____________, 1995.
Kinark Corporation (the "Company") is conducting a rights
offering (the
"Rights Offering") which entitles each holder of the Company's
common stock,
$.10 par value per share (the "Common Stock"), on
______________________, 1995
(the "Record Date"), to receive three nontransferable rights (the
"Rights") for
each two shares of Common Stock held of record on the Record
Date. No
fractional Rights will be issued and no cash in lieu thereof will
be paid.
Each Right is exercisable, upon payment of $2.00 in cash (the
"Subscription
Price"), to purchase one share of Common Stock (the "Basic
Subscription
Privilege"). In addition, each Right also carries the right to
subscribe (the
"Oversubscription Privilege") at the Subscription Price for
shares of Common
Stock in an amount up to 50% of the shares that the holder is
entitled to
purchase under the Basic Subscription Privilege and only to the
extent that all
the shares are not subscribed for through the exercise of the
Basic
Subscription Privilege by the Expiration Date (the "Excess
Shares"). Set forth
on the label above is the registered holder's name and address as
it appears on
the books of the Company's transfer agent and three numbers: the
upper number
is the number of shares of Common Stock held by such holder; the
middle number
is the number of shares to which such holder is entitled to
subscribe pursuant
to the Basic Subscription Privilege; and the lower number is the
number of
shares to which such holder is entitled to subscribe pursuant to
the
Oversubscription Privilege.
FOR A MORE COMPLETE DESCRIPTION OF THE TERMS AND CONDITIONS
OF THE RIGHTS
OFFERING, PLEASE REFER TO THE PROSPECTUS AND PROXY STATEMENT
DATED
___________________, 1995, (THE "PROSPECTUS"), WHICH IS
INCORPORATED HEREIN BY
REFERENCE. COPIES OF THE PROSPECTUS ARE AVAILABLE UPON REQUEST
FROM MORROW &
CO., INC. (THE "INFORMATION AGENT") AT 909 THIRD AVENUE, 20TH
FLOOR, NEW YORK,
NEW YORK 10072-4799, (TOLL FREE (800) ___-____). CAPITALIZED
TERMS USED BUT
NOT DEFINED HEREIN SHALL HAVE THE RESPECTIVE MEANINGS SET FORTH
IN THE
PROSPECTUS.
THIS SUBSCRIPTION ORDER FORM MUST BE RECEIVED BY MELLON
SECURITIES
TRANSFER SERVICES (THE "SUBSCRIPTION AGENT") WITH PAYMENT IN FULL
BY 5:00 PM.,
NEW YORK TIME, ON _________________, 1995, UNLESS EXTENDED IN THE
SOLE
DISCRETION OF THE COMPANY TO A TIME NOT LATER THAN 5:00 PM., NEW
YORK TIME, ON
_________________, 1995 (AS IT MAY BE EXTENDED, THE "EXPIRATION
DATE"). ANY
RIGHTS NOT EXERCISED PRIOR TO THE EXPIRATION DATE WILL EXPIRE.
ANY
SUBSCRIPTION FOR SHARES OF COMMON STOCK IN THE RIGHTS OFFERING
MADE HEREBY IS
IRREVOCABLE.
INFORMATION: Complete Part I of the Subscription
Certificate and, if
applicable, the Part II special issuance and delivery
instructions, SIGN THIS
SUBSCRIPTION CERTIFICATE, and complete the enclosed Substitute
Form W-9. All
questions concerning the timeliness, validity, form and
eligibility of
Subscription Certificate received or any exercise of Rights will
be determined
by the Company, whose determination will be final and binding.
SUBSCRIPTION PRICE: $2.00 PER SHARE
PART I - SUBSCRIPTION FOR SHARES OF COMMON STOCK IN THE RIGHTS
OFFERING: The
undersigned hereby irrevocably subscribes for shares of Common
Stock in the
Rights Offering as indicated below, on the terms and subject to
the conditions
specified herein and in the Prospectus, receipt of which is
hereby
acknowledged.
NUMBER OF SUBSCRIPTION
SHARES PRICE PAYMENT
Basic Subscription Right: X $ 2.00 = $
(Line 1)
Oversubscription Right: X $ 2.00 = $
(Line 2)
Total Payment Required=$ (Sum of
Lines 1 and 2;
must equal
total of
amounts in
Lines 3 and
4 below)
*If the aggregate Subscription Price paid by an exercising Rights
Holder is
insufficient or exceeds the amount necessary to
purchase the number of Shares of Common Stock that such holder
indicates are
being subscribed for, or if an exercising Rights
Holder does not specify the number of shares of Common Stock to
be purchased,
then such Rights Holder will be deemed to have
exercised the Subscription Privilege to the full extent of the
payment
tendered, subject to the limits set forth in the Prospectus.
If the aggregate Subscription Price paid by a Rights Holder
exceeds the amount
necessary to purchase the number of shares of Common
Stock for which the Rights Holder has indicated an intention to
subscribe, the
Rights Holder will receive promptly by mail a refund
equal to the excess payment without interest or deduction.
Method of Payment (check and complete appropriate box(es)):
[ ] Uncertified, certified or cashier's check, bank draft or
money order
payable to Mellon Bank, N.A. in the amount of:
(Line 3)
$____________
[ ] Wire transfer directed to Mellon Bank, N.A. ABA
___________________
(Marked: Kinark Corporation Subscription by [Name of Rights
Holder]")
(Indicate name of the institution wire transferring
funds:_________________________________):(Line 4) $____________
Total
Payments:
$____________
PART II - SPECIAL ISSUANCE OR DELIVERY INSTRUCTIONS FOR RIGHTS
HOLDERS: Unless
otherwise indicated below, the Subscription Agent
is hereby authorized to issue and deliver certificates for Common
Stock to
Rights Holders at the address on the label above.
(a) To be completed ONLY if the certificate representing the
Common Stock is
to be issued in a name other than the registered
holder shown above. (See Paragraphs 2 and 3(c) of the
Instructions.)
COMPLETE THE GUARANTEE OF SIGNATURE(S) SECTION
BELOW.
Name(s) in which stock is to be registered (Please Print)Street
Address
Social Security or Tax ID# City State
Zip Code
(b) To be completed ONLY if the certificate representing the
Common Stock is
to be sent to an address other than that shown
above. (See Paragraphs 2 and 3(c) of the Instructions.)
COMPLETE THE
GUARANTEE OF SIGNATURE(S) SECTION BELOW.
Mail and deliver to:
Name:
(Please Print) Street Address
Social Security or Tax ID# City State
Zip Code
ACKNOWLEDGEMENT
THE SUBSCRIPTION ORDER FORM IS NOT VALID UNLESS YOU SIGN BELOW
I/We acknowledge receipt of the Prospectus and understand
that after
delivery to the Company, I/we may not modify or revoke
this Subscription Certificate. Unnder penalties of perjury, I/we
certify that
the information contained herein, including the
social security number or taxpayer identification number given
above, is
correct. If Part II Special Issuance Instructions are
completed, I/we certify that although the certificate
representing the Common
Stock is to be issued in a name other than the
registered holder, beneficial ownership of the Common Stock will
not change.
The signature below must correspond with the name of the
registered holder
exactly as it appears on the books of the
Company's transfer agent without any alteration or change
whatsoever.
SIGN HERE
SIGN HERE
Signature(s) of Registered Holder
Dated: , 1995
If signature is by trustee(s), executor(s), administrator(s),
guardian(s),
attorney(s)-in-fact, agent(s), officer(s) of a
corporation or another acting in a fiduciary or representative
capacity, please
provide the following information (Please Print).
See Instructions.
Name(s): Daytime Phone: ( )
Evening Phone: ( )
Capacity (Full Title) Taxpayer Identification
Address
(Including Zip Code)or Social Security Number:
GUARANTEE OF SIGNATURE(S)
All Rights Holders who specify special issuance or delivery
instructions
pursuant to Part II of this Subscription Order
Form must have their signatures guaranteed by an Eligible
Institution. An
"Eligible Institution" for this purpose is a bank,
stockbroker, savings and loan association and credit union with
membership in
an approved signature guaranteed medallion program,
pursuant to Rule 17Ad-15 of the Securities Exchange Act of 1934.
Authorized Signature Name of Firm
Name Address
Title Area Code and Telephone Number
Dated: , 1995
EXHIBIT 4.6<PAGE>
KINARK CORPORATION
5,619,615 SHARES OF COMMON STOCK
OFFERED PURSUANT TO RIGHTS
DISTRIBUTED TO STOCKHOLDERS OF
KINARK CORPORATION
To Our Clients:
Enclosed for your consideration are a Prospectus and Proxy
Statement,
dated ________________, 1995, and the "Instructions as to Use of
Kinark
Corporation Subscription Certificates" relating to the offer by
Kinark
Corporation (the "Company") of 5,619,615 shares of Common Stock,
par value $.10
per share (the "Common Stock"), of the Company, at a subscription
price of
$2.00 per share for each share of Common Stock, in cash, pursuant
to
nontransferable subscription rights (the "Rights") initially
distributed to
holders of record ("Record Owners") of Common Stock as of the
close of business
on _________________, 1995 (the "Record Date").
As described in the accompanying Prospectus and Proxy
Statement, you will
receive three nontransferable Rights for each two shares of
Common Stock
carried by us in your account as of the Record Date. Each Right
will entitle
you to subscribe for one share of Common Stock (the "Basic
Subscription
Privilege") at a subscription price of $2.00 per share (the
"Subscription
Price"). In addition, if you elect to exercise all or part of
your Basic
Subscription Privilege, you will also have the right (the
"Oversubscription
Privilege") to subscribe for any shares of Common Stock available
after
satisfaction of all subscriptions pursuant to Basic Subscription
Privileges
("Excess Shares"), in an amount up to 50% of the shares that the
holder is
entitled to purchase under the Basic Subscription Privilege,
subject to
proration, at the Subscription Price. If there are insufficient
Excess Shares
to satisfy all exercised Oversubscription Privileges, Excess
Shares will be
allocated pro rata among all holders of Rights exercising
Oversubscription
Privileges. Such pro rata allocation will be based upon the
number of shares
of Common Stock subscribed for pursuant to each holder's Basic
Subscription
Privilege relative to the aggregate shares of Common Stock
subscribed for
pursuant to Basic Subscription Privileges by all such holders
then being
prorated.
THE MATERIALS ENCLOSED ARE BEING FORWARDED TO YOU AS THE
BENEFICIAL OWNER
OF COMMON STOCK CARRIED BY US IN YOUR ACCOUNT BUT NOT REGISTERED
IN YOUR NAME.
EXERCISES OF RIGHTS MAY BE MADE BY ONLY US AS THE RECORD OWNER
AND PURSUANT TO
YOUR INSTRUCTIONS. Accordingly, we request instructions as to
whether you wish
us to elect to subscribe for any shares of Common Stock, to which
you are
entitled pursuant to the terms and subject to the conditions set
forth in the
enclosed Prospectus and Proxy Statement and the related
Instructions as to Use
of Kinark Corporation Subscription Certificates. However, we
urge you to read
these documents carefully before instructing us to exercise
Rights.
YOUR INSTRUCTIONS TO US SHOULD BE FORWARDED AS PROMPTLY AS
POSSIBLE IN
ORDER TO PERMIT US TO EXERCISE RIGHTS ON YOUR BEHALF IN
ACCORDANCE WITH THE
PROVISIONS OF THE OFFERING. THE OFFERING WILL EXPIRE AT 5:00
P.M., NEW YORK
CITY TIME, ON __________________, 1995, UNLESS THE OFFERING IS
EXTENDED BY THE
COMPANY. ONCE YOU HAVE EXERCISED A RIGHT, SUCH EXERCISE MAY NOT
BE REVOKED.
If you wish to have us, on your behalf, exercise the Rights
for any shares
of Common Stock, please so instruct us by completing, executing
and returning
to us the instruction form on the reverse side of this letter.
ANY QUESTIONS OR REQUESTS FOR ASSISTANCE CONCERNING THE OFFERING
SHOULD BE
DIRECTED TO MORROW & CO., INC., THE INFORMATION AGENT, AT THE
FOLLOWING
TELEPHONE NUMBER: (800) ___-____.
<PAGE>
INSTRUCTIONS
The undersigned acknowledge(s) receipt of your letter and
the enclosed
materials referred to therein relating to the offering of shares
of common
stock, par value $.10 per share (the "Common Stock"), of Kinark
Corporation
(the "Company").
This will instruct you whether to exercise Rights to
purchase shares of
Common Stock distributed with respect to the Company's Common
Stock held by you
for the account of the undersigned, pursuant to the terms and
subject to the
conditions set forth in the Prospectus and Proxy Statement and
the related
Instructions as to Use of Kinark Corporation Subscription
Certificates.
Box 1. [ ] Please DO NOT EXERCISE RIGHTS for shares of
Common Stock.
Box 2. [ ] Please EXERCISE RIGHTS for shares of Common Stock
as set forth
below.
NUMBER OF SUBSCRIPTION
SHARES PRICE PAYMENT
Basic Subscription Right:X $ 2.00= $ (Line 1)
Oversubscription Right: X $ 2.00= $ (Line 2)
Total Payment Required=$ (Sum of Lines 1 and 2; must
equal total of
amounts in
Boxes 3 and 4)
Box 3. [ ] Payment in the amount of $________________ has been
arranged
by:
[ ] enclosing a check
(bank and account number:)
[ ] wire transfer of funds
(name of transferor institution:)
Box 4. [ ] Please deduct payment from the following account
maintained by
you as follows:
Type of Account Account No.
Amount to be deducted: $
Date: , 1995
Signature(s)
Please type or print
name(s) below
EXHIBIT 4.7<PAGE>
KINARK CORPORATION
RIGHTS OFFERING
DTC PARTICIPANT OVERSUBSCRIPTION EXERCISE FORM
THIS FORM IS TO BE USED ONLY BY DEPOSITORY TRUST COMPANY
PARTICIPANTS TO
EXERCISE THE OVERSUBSCRIPTION PRIVILEGE IN RESPECT OF RIGHTS WITH
RESPECT TO
WHICH THE BASIC SUBSCRIPTION PRIVILEGE WAS EXERCISED AND
DELIVERED THROUGH THE
FACILITIES OF THE DEPOSITORY TRUST COMPANY. ALL OTHER EXERCISES
OF
OVERSUBSCRIPTION PRIVILEGES MUST BE EFFECTED BY THE DELIVERY OF
SUBSCRIPTION
CERTIFICATES.
THE TERMS AND CONDITIONS OF THE RIGHTS OFFERING ARE SET
FORTH IN THE COM-
PANY'S PROSPECTUS AND PROXY STATEMENT DATED ___________________,
1995 (THE
"PROSPECTUS") AND ARE INCORPORATED HEREIN BY REFERENCE. COPIES
OF THE
PROSPECTUS ARE AVAILABLE UPON REQUEST FROM THE INFORMATION AGENT
AND THE
SUBSCRIPTION AGENT.
VOID UNLESS RECEIVED BY THE SUBSCRIPTION AGENT WITH PAYMENT
IN FULL BY
5:00 P.M., NEW YORK CITY TIME, ON ___________________, 1995,
UNLESS EXTENDED
(THE "EXPIRATION DATE").
1. The undersigned hereby certifies to the Company and the
Subscription
Agent that it is a participant in The Depository Trust Company
("DTC") and that
it has either (i) exercised the Basic Subscription Privilege in
respect of
Rights and delivered such exercised Rights to the Subscription
Agent by means
of transfer to the DTC account of the Subscription Agent or (ii)
delivered to
the Subscription Agent a Notice of Guaranteed Delivery in respect
of the
exercise of the Basic Subscription Privilege and will deliver the
Rights called
for in such Notice of Guaranteed Delivery to the Subscription
Agent by means of
transfer to such DTC account of the Subscription Agent.
2. The undersigned hereby exercises the Oversubscription
Privilege to
purchase, to the extent available, _______________ shares of
Common Stock and
certifies to the Company and the Subscription Agent that such
Oversubscription
Privilege is being exercised for the account or accounts of
persons (which may
include the undersigned) on each of whose behalf has been
exercised at least
two Rights for each share of Common Stock being purchased
pursuant to the
Oversubscription Privilege.
3. The undersigned understands that payment of the
Subscription Price of
$2.00 per share for each share of Common Stock subscribed for
pursuant to the
Oversubscription Privilege must be received by the Subscription
Agent at or
before 5:00 p.m. New York City time on the Expiration Date and
represents that
such payment, in the aggregate amount of $___________, either
(check
appropriate box):
[ ] has been or is being delivered to the
Subscription Agent
pursuant to the Notice of Guaranteed Delivery
referred to
above;
or
[ ] is being delivered to the Subscription Agent
herewith;
or
[ ] has been delivered separately to the
Subscription Agent;
and, in the case of funds not delivered pursuant
to a Notice of
Guaranteed Delivery, is or was delivered in the
manner set forth
below (check appropriate box and complete
information relating
thereto):
[ ] wire transfer of funds
- name of transferor institution
- date of transfer
- confirmation number (if available)
[ ] uncertified check
[ ] certified check
[ ] bank draft (cashier's check)
Basic
Subscription
Confirmation Number
DTC Participant
Number
Name of DTC
Participant
By
Name:
Title:
Dated: , 1995
PARTICIPANTS EXERCISING THE OVERSUBSCRIPTION PRIVILEGE PURSUANT
HERETO MUST
SEPARATELY SUBMIT A NOMINEE HOLDER CERTIFICATION TO THE
SUBSCRIPTION AGENT.
EXHIBIT 4.8<PAGE>
NOTICE OF GUARANTEED DELIVERY
for
SUBSCRIPTION CERTIFICATIONS
issued by
KINARK CORPORATION
This form, or one substantially equivalent hereto, must be
used to
exercise Rights pursuant to the Rights Offering described in the
Prospectus and
Proxy Statement dated _______________________, 1995, (the
"Prospectus"), of
Kinark Corporation, a Delaware corporation (the "Company"), if a
holder of
Rights cannot deliver the Subscription Certificate(s) evidencing
the Rights
(the "Subscription Certificate(s)"), to the Subscription Agent
listed below
(the "Subscription Agent") at or prior to 5:00 p.m. New York City
time on
____________________, 1995, unless extended (the "Expiration
Date"). Such form
must be delivered by hand or sent by facsimile transmission or
mail to the
Subscription Agent, and must be received by the Subscription
Agent on or prior
to the Expiration Date. See "The Rights Offering - Exercise of
Rights" in the
Prospectus. Payment of the Subscription Price of $2.00 per share
for each
share of Common Stock subscribed for upon exercise of such Rights
must be
received by the Subscription Agent in the manner specified in the
Prospectus at
or prior to 5:00 p.m. New York City time on the Expiration Date
even if the
Subscription Certificate evidencing such Rights is being
delivered pursuant to
the procedure for guaranteed delivery thereof.
The Subscription Agent is
Mellon Securities Transfer Services
85 Challenger Road
Ridgefield Park, New Jersey 07660-2108
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE OTHER THAN AS SET
FORTH ABOVE DOES
NOT CONSTITUTE A VALID DELIVERY.
<PAGE>
Gentlemen:
The undersigned hereby represents that he or she is the
holder of
Subscription Certificate(s) representing ____________ Rights and
that such
Subscription Certificate(s) cannot be delivered to the
Subscription Agent at or
before 5:00 p.m., New York City time on the Expiration Date.
Upon the terms
and subject to the conditions set forth in the Prospectus,
receipt of which is
hereby acknowledged, the undersigned hereby elects to exercise
(i) the Basic
Subscription Privilege to subscribe for one share of Common Stock
per Right
with respect to each of ___________ Rights represented by such
Subscription
Certificate and (ii) the Oversubscription Privilege relating to
each such Right
to subscribe, subject to the limits set forth in the Prospectus
and only to the
extent that Excess Shares (as defined in the Prospectus) are
available
therefor, for an aggregate of up to __________________. The
undersigned
understands that payment of the Subscription Price of $2.00 per
share for each
Common Share subscribed for pursuant to the Basic Subscription
Privilege and
Oversubscription Privilege must be received by the Subscription
Agent at or
before 5:00 p.m. New York City time on the Expiration Date and
represents that
such payment, in the aggregate amount of $__________, either
(check appropriate
box):
[ ] is being delivered to the Subscription Agent herewith;
or
[ ] has been delivered separately to the Subscription
Agent;
and is or was delivered in the manner set forth below (check
appropriate box
and complete information relating thereto):
[ ] wire transfer of funds
- name of transferor institution
- date of transfer
- confirmation number (if available)
[ ] uncertified check (Payment by uncertified check will
not be deemed to
have been received by the Subscription Agent until such
check has
cleared. Holders paying by such means are urged to
make payment
sufficiently in advance of the Expiration Date to
ensure that such
payment clears by such date.)
[ ] certified check
[ ] bank draft (cashier's check)
[ ] money order
- name of maker
- date of check, draft or money order
- check, draft or money order number
- bank on which check is drawn or issuer of money
order
Signature(s) Address
Name(s)
Area Code and Tel No(s).
Please Type or Print
Subscription Certificate
No(s). (if available)
GUARANTEE OF DELIVERY
(Not to be used for Subscription Certificate signature guarantee)
The undersigned, a member firm of a registered national
securities
exchange or a member of the National Association of Securities
Dealers, Inc. or
a commercial bank or trust company having an office or
correspondent in the
United States, guarantees that the undersigned will deliver to
the Subscription
Agent the certificates representing the Rights being exercised
hereby, with any
required signature guarantees and any other required documents,
all within
three American Stock Exchange trading days after the date hereof.
Dated: ,
1995
(Name
of Firm)
(Address)
(Authorized
Signature)
(Area Code and Telephone Number)
The institution which completes this form must communicate
the guarantee
to the Subscription Agent and must deliver the Subscription
Certificate(s) to
the Subscription Agent within the time period shown herein.
Failure to do so
could result in a financial loss to such institution.
EXHIBIT 4.9<PAGE>
KINARK CORPORATION
NOMINEE HOLDER CERTIFICATION
The undersigned, a bank, broker or other nominee holder of
Rights
("Rights") to purchase shares of common stock, par value $.10 per
share (the
"Common Stock"), of Kinark Corporation (the "Company") pursuant
to the Rights
Offering described and provided for in the Company's Prospectus
and Proxy
Statement dated _________________, 1995, (the "Prospectus"),
hereby certifies
to the Company and to Mellon Securities Transfer Services, as
Subscription
Agent for such Rights Offering, that the undersigned has
exercised, on behalf
of the beneficial owners thereof (which may include the
undersigned), the
number of Rights specified below pursuant to the Basic
Subscription Privilege
(as described in the Prospectus) and such beneficial owners
thereof wish to
subscribe for the purchase of that number of additional shares of
Common Stock
specified below pursuant to the Oversubscription Privilege (as
described and
limited in the Prospectus), listing separately below each such
Basic
Subscription and the corresponding Oversubscription (without
identifying any
such beneficial owner):
Number of Shares Number of Shares
Purchased Pursuant Purchased Pursuant
to Exercise of to Exercise of Rights
Basic Subscription Oversubscription Certificate
Privilege Privilege Number
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
(Attach additional beneficial owner list if necessary)
Name of Nominee Holder
Address
By:
(Please Print Name)
(Title)
(Date)
Provide the following information if applicable:
Depository Trust Company ("DTC")
Participant Number
DTC Basic Subscription Confirmation Number(s)
Dated: , 1995
EXHIBIT 4.10<PAGE>
SPECIAL NOTICE TO HOLDERS OF
KINARK CORPORATION
Common Stock
WHOSE ADDRESSES ARE OUTSIDE
THE UNITED STATES
Dear Shareholder:
Enclosed you will find materials relating to the rights
offering (the
"Offering") of Kinark Corporation (the "Company"). Holders of
Common Stock at
the close of business on ________________________, 1995, (the
"Record Date")
will receive nontransferable rights ("Rights") to subscribe for
and purchase
shares of Common Stock on the basis of three Rights for each two
shares of
Common Stock held of record on the Record Date. A Subscription
Order Form
representing Rights to subscribe for shares of the Company's
Common Stock at
$2.00 per share is not included in this mailing, but instead is
being held on
your behalf by the Subscription Agent, Mellon Securities Transfer
Services. If
you wish to exercise any or all of these Rights, you must so
instruct the
Subscription Agent in the manner described in the accompanying
Prospectus and
Instructions as to Use of Subscription Order Form by 5:00 p.m.,
New York time,
on ______________________, 1995, unless the Offering is extended
by the Company
to a date not later than 5:00 p.m., New York time on
_______________________,
1995. Rights not exercised by such time will expire and become
worthless.
ANY QUESTIONS OR REQUESTS FOR ASSISTANCE CONCERNING THE OFFERING
SHOULD BE
DIRECTED TO MORROW & CO., INC., THE INFORMATION AGENT, AT (800)
___-____.
