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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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CARAUSTAR INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
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NORTH CAROLINA 2631 58-1388387
(State or other jurisdiction (Primary Standard Industrial (I.R.S. Employer
of incorporation or organization) Classification Code Number) Identification Number)
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3100 JOE JERKINS BOULEVARD
AUSTELL, GEORGIA 30106
(770) 948-3101
(Address, including zip code, and telephone number, including area
code, of registrant's principal executive offices)
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H. LEE THRASH, III
VICE PRESIDENT AND CHIEF FINANCIAL OFFICER
CARAUSTAR INDUSTRIES, INC.
3100 JOE JERKINS BOULEVARD
AUSTELL, GEORGIA 30106
(770) 948-3101
(Address, including zip code, and telephone number,
including area code, of agent for service)
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WITH COPIES TO:
PATRICK S. BRYANT
ROBINSON, BRADSHAW & HINSON, P.A.
101 NORTH TRYON STREET, SUITE 1900
CHARLOTTE, NORTH CAROLINA 28246
(704) 377-2536
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From
time to time after this Registration Statement becomes effective.
If the securities being registered on this form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, 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, please check the following box. [X]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, 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(d) 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. [ ] _______________
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CALCULATION OF REGISTRATION FEE
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Proposed Maximum Proposed Maximum
Title Of Each Class Of Amount To Be Offering Price Per Aggregate Offering Amount Of
Securities To Be Registered Registered Share(1) Price(1) Registration Fee
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Common Stock, par value $.10 per 4,000,000 $16.375 $65,500,000 $17,292
share, including preferred stock
purchase rights(2)
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(1) Estimated for the sole purpose of calculating the registration fee
pursuant to Rule 457(c) under the Securities Act of 1933, based on the
average of the high and low price of the Common Stock, as reported on
the NASDAQ national market on March 1, 2000.
(2) Each share of Common Stock issued by the Company has one attached
preferred stock purchase right under the Rights Agreement dated as of
April 9, 1995 between the Company and its Rights Agent.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED.
WE MAY NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH
THE SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN
OFFER TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
SUBJECT TO COMPLETION, DATED MARCH 2, 2000
Prospectus
CARAUSTAR INDUSTRIES, INC.
[LOGO]
4,000,000 SHARES
COMMON STOCK
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- - We may use this prospectus from - All of the common stock offered by
time to time to offer and sell our this prospectus may, subject to
common stock to the owners of certain conditions, also be
businesses we may acquire in the offered and resold from time to
future. time pursuant to this prospectus
by the persons who receive this
- - The specific terms upon which we common stock in acquisitions.
will issue these shares will be
determined by negotiation with the - We are based in Austell, Georgia
owners of the businesses we and primarily manufacture
acquire. packaging products from recycled
paper.
- - We expect the price of the shares
we issue in an acquisition to be - Our common stock is quoted on the
reasonably related to the NASDAQ Stock Market under the
prevailing market prices of our trading symbol "CSAR."
common stock at or near the time
we enter an acquisition agreement
or consummate the acquisition.
- - In addition to certain resale --------------------------------
limitations imposed by federal Before making any investment
securities laws, we may require in our Company, you should
persons receiving our common stock consider carefully the risk
in connection with an acquisition factors beginning on page 4.
to agree to hold such stock for a
certain period from the date of
acquisition.
- - We will pay all expenses of this --------------------------------
offering. We will not pay
underwriting discounts or
commissions in connection with
issuing our stock in acquisitions,
although we may pay finders fees
in specific acquisitions. Any
person receiving a finder's fee
may be deemed an "underwriter"
within the meaning of the
Securities Act of 1933.
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Neither the SEC nor any state securities commission has approved any of the
securities offered by this prospectus or determined that this prospectus is
accurate or complete. Any representation to the contrary is a criminal offense.
_______________, 2000
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WHERE YOU CAN FIND MORE INFORMATION; INCORPORATION BY REFERENCE
We file annual, quarterly and special reports, proxy statements and
other information with the Securities and Exchange Commission (the "SEC"). You
may read and copy (upon the payment of fees prescribed by the SEC) any document
that we file with the SEC at its public reference rooms in Washington, D.C.
(450 Fifth Street, N.W. 20549), New York, New York, (7 World Trade Center,
Suite 1300 10048) and Chicago, Illinois (500 West Madison Street, Suite 1400
60661). You may call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. Our filings are also available to the public on the
internet, through the SEC's EDGAR database. You may access the EDGAR database
at the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" into this prospectus
the information we file with them. This means that we can disclose important
business, financial and other information in our SEC filings by referring you
to the documents containing this information. All information incorporated by
reference is part of this prospectus, unless and until that information is
updated and superseded by the information contained in this prospectus or any
information incorporated later. Any information that we subsequently file with
the SEC that is incorporated by reference will automatically update and
supersede any previous information that is part of this prospectus. We
incorporate by reference the documents listed below and any future filings we
make with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities
Exchange Act of 1934 until we sell all the securities we offer with this
prospectus:
- Annual Report on Form 10-K for the year ended December 31,
1998;
- Quarterly Reports on Form 10-Q for the quarters ended March 31,
1999, June 30, 1999 and September 30, 1999;
- Current Reports on Form 8-K filed March 5, 1999, May 14, 1999
and June 1, 1999; and
- The description of our common stock contained in our
registration statement on Form 8-A that we filed with the SEC
on September 17, 1992 to register our common stock under the
Securities Exchange Act of 1934, along with any future update
of this description that we file.
This prospectus is part of a registration statement (on Form S-4) we
have filed with the SEC relating to the shares offered by this prospectus. As
permitted by SEC rules, this prospectus does not contain all the information
contained in the registration statement and accompanying exhibits and schedules
we file with the SEC. You may refer to the registration statement, the exhibits
and schedules for more information about us and our common stock. The
registration statement, exhibits and schedules are available at the SEC's
public reference rooms or through its EDGAR database on the internet.
You may obtain a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Caraustar Industries, Inc.
3100 Joe Jerkins Boulevard
Austell, Georgia 30106
Attn: Corporate Secretary
Telephone: (770) 948-3101
To ensure timely delivery of these materials, you should make any
request no later than five business days prior to the date on which you intend
to vote on or otherwise consent to or approve our acquisition of your business.
Materials will be sent via first class mail within one business day after we
receive a request.
You should rely only on the information provided in this prospectus or
incorporated by reference. We have not authorized anyone else to provide you
with different information. We are not making an offer of these securities in
any state where the offer is not permitted. Information is accurate only as of
the date of the documents containing the information, unless the information
specifically indicates that another date applies.
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RISK FACTORS
In addition to the other information contained in this prospectus, you
should consider carefully the following risk factors before investing in any of
our common stock.
POSSIBLE FUTURE INCREASES IN RAW MATERIAL COSTS; ECONOMIC CONDITIONS
Our primary raw material is recycled paper, which is known in our
industry as "recovered fiber." The cost of recovered fiber has at times
fluctuated greatly because of factors such as shortages or surpluses created by
market or industry conditions. Although in the past we have raised the selling
prices of our products in response to raw material price increases, sometimes
raw material prices have increased so quickly or to such levels that we have
been unable to maintain our operating margins or pass the price increases
through to our customers on a timely basis. We cannot assure you that we will
be able to maintain our margins in the face of raw material price fluctuations
or that we will be able to pass such price changes through to our customers on
a timely basis. Demand for our products generally is dependent upon production
levels and consumer demand, which fluctuate with U.S. and global economic
conditions and cycles. Demand is generally higher during periods of economic
strength and lower during periods of economic weakness or uncertainty. Adverse
economic conditions could have a material adverse effect on us.
ABILITY TO CONTROL GROWTH; EXPANSION AND ACQUISITION RISKS
We intend to increase our production capacity in the next several
years. This strategy involves risks and depends on the availability of funds to
permit us to make capital expenditures and acquisitions. We have made numerous
acquisitions in recent years and actively seek new acquisitions that meet our
criteria. Acquired businesses may not achieve the same levels of revenue,
profit or productivity as our existing locations and may not otherwise perform
as we expect. To make acquisitions, we might incur additional debt, issue
additional stock (which would dilute the relative stock holdings of our
existing shareholders), or both.
Acquisitions also involve special risks. Some of these risks include:
- assumption of unanticipated liabilities and contingencies
- diversion of management's attention
- possible reduction of our reported earnings because of:
> increased goodwill write-offs
> increased interest costs
> issuances of additional securities
> difficulties of integrating acquired business
As we grow, we can give no assurance that we will be able to:
- use increased production capacity at our facilities
- identify suitable acquisition candidates
- complete additional acquisitions
- integrate acquired businesses into our operations
ENVIRONMENTAL LIABILITIES OR COSTS
Compliance with the environmental requirements of federal, state and
local governments significantly affects our business. Among other things, these
requirements regulate the discharge of materials into the water, air
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and land and govern the use and disposal of hazardous substances. Under
environmental laws, we can be held strictly liable if hazardous substances are
found on real property we have ever owned or operated or used as a disposal
site. In recent years, we have adopted a policy of assessing real property for
environmental risks prior to purchase. We are aware of issues regarding
hazardous substances at some of our facilities and one of our disposal sites,
and we have put into place a remedial plan at each site where we believe such a
plan is necessary. We regularly make capital and operating expenditures to stay
in compliance with environmental laws. Despite these compliance efforts, risk
of environmental liability is part of the nature of our business. We cannot
assure you that environmental liabilities, including compliance and remediation
costs, will not have a material adverse effect on us in the future. In
addition, future events may lead to additional compliance or other costs that
could have a material adverse effect on us. Such future events could include
changes in, or new interpretations of, existing laws or enforcement policies or
further investigation of the potential health hazards of certain products or
business activities.
HIGHLY COMPETITIVE MARKETS
The manufacture and sale of our products are highly competitive. We
compete with a variety of companies, some of which are larger and have greater
resources than we do. In most of our markets, our competitors are capable of
supplying products that would meet the needs of our customers. We cannot assure
you that we will be able to compete successfully in the future.
POTENTIAL DETERRENTS TO TAKEOVERS
Certain provisions of our articles of incorporation and bylaws, as
well as a shareholder rights plan, could make it more difficult for a third
party to acquire, or discourage a third party from acquiring, a controlling
interest in our outstanding voting stock. As a result, these provisions could
discourage bids for our common stock at a premium and might adversely affect
the market price of our common stock.
Our articles of incorporation authorize 5,000,000 shares of preferred
stock, which may be issued in the future without further shareholder approval
with such terms and rights as our board of directors may determine. The rights
of the holders of our common stock may be adversely affected by the rights of
the holders of any preferred stock that may be issued in the future.
Our board of directors is divided into three classes with staggered
terms. This means that, as a general matter, only one-third of our board of
directors must stand for re-election at any annual meeting of shareholders. Our
articles of incorporation provide that directors may be removed only for cause.
These provisions make it more difficult and time consuming for a potential
acquiror of our company to replace our board of directors.
Our shareholder rights plan generally authorizes our board of directors
and shareholders to substantially dilute the share ownership position of any
person who acquires 20% or more of our common stock.
DEPENDENCE ON KEY PERSONNEL
We depend on the continued efforts of our executive officers and
senior management. In addition, we depend on the performance and productivity
of our local managers. The loss of executive officers, members of senior
management or key local managers could have a material adverse effect on our
operations, including our ability to establish and maintain customer
relationships. We maintain no key person insurance policies on any of our
executive officers or other senior managers. If we are unable to attract or
retain key employees to perform these services, our business could be
materially and adversely affected.
STOCK PRICE FLUCTUATION
From time to time, there may be significant fluctuations in the market
price of our common stock, which could be caused by the occurrence of, or
announcements or rumors related to:
- changes in our or our competitors' operating results
- changes in cost of recovered fiber
- changes in market conditions for paper industry stocks or
manufacturing stocks in general
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- changes in general conditions in the U.S. or foreign economies or
financial markets
- natural disasters or other newsworthy events, including
developments of a political or social nature
In addition, the stock market in recent years has experienced extreme
price and volume fluctuations that often have been unrelated or
disproportionate to the operating performance of affected companies. These
types of fluctuations may adversely affect the market price of our common stock
or other securities.
SPECIAL NOTE OF CAUTION REGARDING FORWARD-LOOKING STATEMENTS
Certain statements in this prospectus under the caption "Risk Factors"
and the documents incorporated by reference into this prospectus may constitute
"forward-looking statements" within the meaning of federal securities laws.
Forward-looking statements are based on our management's beliefs, assumptions,
and expectations of our future economic performance, taking into account the
information currently available to them. These statements are not statements of
historical fact. Forward-looking statements involve risks and uncertainties
that may cause our actual results, performance or financial condition to be
materially different from the expectations of future results, performance or
financial condition we express or imply in any forward-looking statements. Some
of the important factors that could cause our actual results, performance or
financial condition to differ materially from our expectations are:
- Fluctuations in our raw material prices
- Our ability to identify and complete acquisitions and successfully
integrate the businesses we acquire
- Changes in government regulations, particularly environmental
regulations
- Changes in demand for our products
- Changes in the industrial sector or the general domestic or global
economy
- Degree and nature of our competition
- Other factors described in this prospectus or the documents we file
with the SEC and incorporate by reference into this prospectus
When used in our documents or oral presentations, the words
"anticipate," "estimate," "expect," "objective," "projection," "forecast,"
"goal" or similar words are intended to identify forward-looking statements. We
qualify any such forward-looking statements entirely by these cautionary
factors.
THE COMPANY
Caraustar Industries, Inc. is a major manufacturer of recycled
paperboard and converted paperboard products. Our executive offices are located
at 3100 Joe Jerkins Boulevard, Austell, Georgia 30106. Our phone number is
(770) 948-3101.
ACQUISITION TERMS
This prospectus covers the offer and sale of up to 4,000,000 shares of
our common stock that we may issue from time to time in connection with the
future direct and indirect acquisitions of other businesses, properties or
securities in business combination transactions. We will furnish this
prospectus to the securityholders or owners of the businesses we acquire in
exchange for the shares we offer by this prospectus.
We expect that the terms upon which we issue the shares will be
determined through negotiations with the securityholders or principal owners of
the businesses whose securities or assets we acquire. We expect that the
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shares we issue in an acquisition will be valued at prices reasonably related
to the market prices for our common stock prevailing at or near the time we
enter into an acquisition agreement or consummate the acquisition.
We will pay all expenses of the offering of these shares. We will pay
no underwriting discounts or commissions in connection with the issuance of
these shares, although we may pay finder's fees with respect to specific
acquisitions. Any person receiving a finder's fee may be deemed to be an
"underwriter" within the meaning of the Securities Act of 1933.
We will use this prospectus in connection with the issuance of our
shares only in those acquisitions that would be exempt from registration except
for the possibility of integration with other transactions. If an acquisition
would not be so exempt, we will furnish those offerees this prospectus, as
amended by a post-effective amendment to the Registration Statement (on Form
S-4) of which this prospectus is a part.
If we consummate an acquisition (or series of acquisitions since the
date of our most recently audited financial statements) that would have a
material financial effect on us, we will file a Current Report on Form 8-K
containing the financial and other information about the acquisition(s) that
would be material to subsequent purchasers of the shares we offer through this
prospectus.
Our common stock is quoted on the NASDAQ Stock Market. The shares we
issue in acquisitions may be subject to restrictions on resale imposed by Rules
144 and 145 under the Securities Act of 1933. In addition, we may impose
certain contractual holding period requirements upon persons acquiring our
shares in acquisitions.
SELLING SHAREHOLDERS
This prospectus may also be used for reoffers and resales by persons
who receive our common stock in acquisition transactions and who may be
entitled to reoffer such common stock under circumstances requiring the use of
a prospectus. However, no person will be authorized to use this prospectus for
an offer of such common stock without first obtaining our consent. We may
consent to the use of this prospectus by such selling shareholders for a
limited period of time and subject to limitations and conditions, which may be
varied by agreement between us and such selling shareholders. A supplement to
this prospectus will set forth information identifying any such selling
shareholders and disclosing the information about such selling shareholders and
the securities to be sold as may then be required by the Securities Act of 1933
and the rules of the Securities and Exchange Commission.
PLAN OF DISTRIBUTION BY SELLING SHAREHOLDERS
Resales of our common stock may be made on NASDAQ or such national
securities exchange or other quotation service on which our common stock may be
listed or quoted at the time of sale, in the over-the-counter market, in
private transactions or pursuant to underwriting agreements. Such resales may
be effected in one or more of the following methods:
- ordinary brokers' transactions, which may include long or short
sales;
- transactions involving cross or block trades or otherwise on
NASDAQ;
- purchases by brokers, dealers or underwriters as principal and
resale for their own accounts pursuant to this prospectus;
- "at the market" to or through market makers or into an existing
market for the common stock;
- in other ways not involving market makers or established trading
markets, including direct sales to purchasers or sales effected
through agents;
- through transactions in options, swaps or other derivatives; or
- any combination of the methods listed above, or by any other
legally available means.
Agreements with selling shareholders permitting use of this prospectus
may provide that any such offering be effected in an orderly manner through
securities dealers, acting as broker or dealer, selected by us; that selling
shareholders enter into custody agreements with one or more banks with respect
to the common stock offered; and
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that sales be made only by one or more of the methods described in this
prospectus, as appropriately supplemented or amended when required. The selling
shareholders may be deemed to be "underwriters" within the meaning of the
Securities Act of 1933.
Brokers, dealers, underwriters or agents participating in the sale of
our common stock as principals or agents may receive compensation in the form
of commissions, discounts or concessions from the selling shareholders and/or
purchasers of the common stock for whom such broker-dealers may act as agent,
or to whom they may sell as principal, or both (which compensation as to a
particular broker-dealer may be less than or in excess of customary
commissions). Sales of common stock by such broker, dealer, underwriter or
agent may be made on NASDAQ or any securities exchange from time to time at
prices related to prices then prevailing, at negotiated prices or at fixed
prices, which may be changed. Any such sales may be by block trade. Any such
broker/dealer or agent may be deemed to be an "underwriter" within the meaning
of the Securities Act of 1933, and any commissions earned by such member firm
may be deemed to be underwriting discounts and commissions under the Securities
Act of 1933.
Upon our being notified by a selling shareholder that it proposes to
make a block trade, a prospectus supplement, if required, will be filed
pursuant to Rule 424 under the Securities Act of 1933, disclosing the name of
the broker or dealer, the number of shares of common stock involved, the price
at which such shares of common stock are being sold by such selling
shareholder, and the commissions to be paid by such selling shareholder to such
broker or dealer.
To comply with the securities laws of certain jurisdictions, if
applicable, the common stock will be offered or sold in such jurisdictions only
through registered or licensed brokers or dealers. In addition, in certain
jurisdictions, such securities may not be offered or sold unless they have been
registered or qualified for sale in such jurisdictions or any exemption from
registration or qualification is available and is complied with.
REGISTRAR AND TRANSFER AGENT
The registrar and transfer agent for our common stock is The Bank of
New York, New York, New York.
LEGAL MATTERS
Robinson, Bradshaw & Hinson, P.A., Charlotte, North Carolina, will
issue an opinion for us regarding the validity of the common stock offered by
this prospectus and certain other legal matters. Russell M. Robinson, II, a
shareholder in the firm of Robinson, Bradshaw & Hinson, P.A., is Chairman of
our Board of Directors. Robinson, Bradshaw & Hinson, P.A. is our principal
outside legal counsel. Certain members of such firm beneficially owned
approximately 115,000 shares of our common stock as of the date of this
prospectus.
EXPERTS
The financial statements and schedules incorporated by reference in
this prospectus and elsewhere in the registration statement have been audited
by Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect to such financial statements and schedules, and are
incorporated by reference in reliance upon the authority of such firm as
experts in giving such reports.
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CARAUSTAR INDUSTRIES, INC.
4,000,000 Shares
TABLE OF CONTENTS
COMMON STOCK
Page
---- [CARAUSTAR LOGO]
WHERE YOU CAN FIND MORE INFORMATION;
INCORPORATION BY REFERENCE..........................3
RISK FACTORS........................................4
SPECIAL NOTE OF CAUTION REGARDING ==============
FORWARD-LOOKING STATEMENTS..........................6
THE COMPANY.........................................6 PROSPECTUS
ACQUISITION TERMS...................................6
==============
SELLING SHAREHOLDERS................................7
PLAN OF DISTRIBUTION BY SELLING
SHAREHOLDERS........................................7
___________, 2000
REGISTRAR AND TRANSFER AGENT........................8
LEGAL MATTERS.......................................8
EXPERTS.............................................8
====================================================== ==========================================================
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 55-2-02 of the North Carolina Business Corporation Act (the
"Business Corporation Act") enables a corporation in its articles of
incorporation to eliminate or limit, with certain exceptions, the personal
liability of a director for monetary damages for breach of duty as a director.
No such provision is effective to eliminate or limit a director's liability for
(i) acts or omissions that the director at the time of the breach knew or
believed to be clearly in conflict with the best interests of the corporation,
(ii) improper distributions as described in Section 55-8-33 of the Business
Corporation Act, (iii) any transaction from which the director derived an
improper personal benefit or (iv) acts or omissions occurring prior to the date
the exculpatory provision became effective. The Company's articles of
incorporation limit the personal liability of its directors to the fullest
extent permitted by the Business Corporation Act.
Sections 55-8-50 through 55-8-58 of the Business Corporation Act
permit a corporation to indemnify its directors, officers, employees or agents
under either or both a statutory or nonstatutory scheme of indemnification.
Under the statutory scheme, a corporation may, with certain exceptions,
indemnify a director, officer, employee or agent of the corporation who was,
is, or is threatened to be made, a party to any threatened, pending or
completed legal action, suit or proceeding, whether civil, criminal,
administrative, or investigative because of the fact that such person was or is
a director, officer, agent or employee of the corporation, or is or was serving
at the request of such corporation as a director, officer, employee or agent of
another corporation or enterprise. This indemnity may include the obligation to
pay any judgment, settlement, penalty, fine (including an excise tax assessed
with respect to an employee benefit plan) or reasonable expenses incurred in
connection with a proceeding (including counsel fees), but no such
indemnification may be granted unless such director, officer, employee or agent
(i) conducted himself in good faith, (ii) reasonably believed (1) that any
action taken in his official capacity with the corporation was in the best
interests of the corporation or (2) that in all other cases his conduct was not
opposed to the corporation's best interests, and (iii) in the case of any
criminal proceeding, had no reasonable cause to believe his conduct was
unlawful. Whether a director has met the requisite standard of conduct for the
type of indemnification set forth above is determined by the board of
directors, a committee of directors, special legal counsel or the shareholders
in accordance with Section 55-8-55 of the Business Corporation Act. A
corporation may not indemnify a director under the statutory scheme in
connection with a proceeding by or in the right of the corporation in which a
director was adjudged liable to the corporation or in connection with any other
proceeding in which a director was adjudged liable on the basis of having
received an improper personal benefit.
In addition to, and notwithstanding the conditions of and limitations
on, the indemnification described above under the statutory scheme, Section
55-8-57 of the Business Corporation Act permits a corporation to indemnify, or
agree to indemnify, any of its directors, officers, employees or agents against
liability and expenses (including counsel fees) in any proceeding (including
proceedings brought by or on behalf of the corporation) arising out of their
status as such or their activities in such capacities, except for any
liabilities or expenses incurred on account of activities that were, at the
time taken, known or believed by the person to be clearly in conflict with the
best interests of the corporation.
Because the Company's bylaws provide for indemnification to the
fullest extent permitted under the Business Corporation Act, the Company may
indemnify its directors, officers, employees and agents in accordance with
either the statutory or nonstatutory standard. Sections 55-8-52 and 55-8-56 of
the Business Corporation Act require a corporation, unless its articles of
incorporation provide otherwise, to indemnify a director or officer who has
been wholly successful, on the merits or otherwise, in the defense of any
proceeding to which such director or officer was, or was threatened to be, made
a party because he is or was a director or officer of the corporation. Unless
prohibited by the articles of incorporation, a director or officer also may
make application and obtain court-ordered indemnification if the court
determines that such director or officer is fairly and reasonably entitled to
such indemnification as provided in Sections 55-8-54 and 55-8-56 of the
Business Corporation Act.
Additionally, Section 55-8-57 of the Business Corporation Act
authorizes a corporation to purchase and maintain insurance on behalf of an
individual who is or was a director, officer, employee or agent of the
corporation against certain liabilities incurred by such a person, whether or
not the corporation is otherwise authorized by the Business Corporation Act to
indemnify that person. The Company has purchased and maintains such insurance.
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ITEM 21. EXHIBITS.
The following is a list of all the exhibits filed as part of the
Registration Statement. References to the Company mean Caraustar Industries,
Inc.
EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NO. EXHIBIT
- ------- -------
<S> <C>
3.01 Amended and Restated Articles of Incorporation of the Company (Incorporated by reference -
Exhibit 3.01 to Annual Report for 1992 on Form 10-K [SEC File No. 0-20646])
3.02 Second Amended and Restated Bylaws of the Company (Incorporated by reference - Exhibit 3.02
to Registration Statement on Form S-4 [SEC File No. 333-29937])
4.01 Specimen Common Stock Certificate (Incorporated by reference - Exhibit 4.01 to Registration
Statement on Form S-1 [SEC File No. 33-50582])
4.02 Articles 3 and 4 of the Company's Amended and Restated Articles of Incorporation (included in
Exhibit 3.01)
4.03 Article II of the Company's Second Amended and Restated Bylaws (included in Exhibit 3.02)
4.04 Rights Agreement, dated as of April 9, 1995, between Caraustar Industries, Inc. and The Bank of
New York, as Successor Rights Agent (Incorporated by reference - Exhibit 1 to Current Report on
Form 8-K dated April 19, 1995 [SEC File No. 0-20646])
4.05 Indenture, dated as of June 1, 1999, between Caraustar Industries, Inc. and The Bank of New
York, as Trustee (Incorporated by reference - Exhibit 4.05 to report on Form 10-Q for the quarter
ended June 30, 1999 [SEC File No. 0-20646])
4.06 First Supplemental Indenture, dated as of June 1, 1999, between Caraustar Industries, Inc. and The
Bank of New York, as Trustee (Incorporated by reference - Exhibit 4.06 to report on Form 10-Q
for the quarter ended June 30, 1999 [SEC File No. 0-20646])
5.01 Opinion of Robinson, Bradshaw & Hinson, P.A.
10.01 Note Agreement, dated as of October 1, 1992, between the Company and the Prudential Insurance
Company of America, regarding the Company's 7.89% Senior Subordinated Notes (Incorporated
by reference - Exhibit 10.02 to Annual Report for 1992 on Form 10-K [SEC File No. 0-20646])
10.02 Amendment Agreement, dated as of June 2, 1995, between the Company and the Prudential
Insurance Company of America regarding the Company's 7.89% Senior Subordinated Notes
(Incorporated by reference - Exhibit 10.03 to Report on Form 10-Q for the quarter ended
September 30, 1995 [SEC File No. 0-20646])
10.03 Amendment Agreement, dated as of July 23, 1997, between the Company and the Prudential
Insurance Company of America regarding the Company's 7.89% Senior Subordinated Notes
(Incorporated by reference - Exhibit 10.03 to Report on Form 10-Q for the quarter ended June 30,
1997 [SEC File No. 0-20646])
10.04 Amendment Agreement, dated as of August 12, 1998, between the Company and the Prudential
Insurance Company of America regarding the Company's 7.89% Senior Subordinated Notes
(Incorporated by reference - Exhibit 10.04 to report on Form 10-Q for the quarter ended
September 30, 1998 [SEC File No. 0-20646])
</TABLE>
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<PAGE> 12
<TABLE>
<S> <C>
10.05 Employment Agreement, dated December 31, 1990, between the Company and Thomas V. Brown
(Incorporated by reference - Exhibit 10.06 to Registration Statement on Form S-1 [SEC File No.
33-50582])
10.06 Asset Purchase Agreement, dated August 7, 1992, between the Company and Domtar Gypsum
Inc. (Incorporated by reference - Exhibit 10.07 to Registration Statement on Form S-1 [SEC File
No. 33-50582])
10.07 Deferred Compensation Plan, together with copies of existing individual deferred compensation
agreements (Incorporated by reference - Exhibit 10.08 to Registration Statement on Form S-1
[SEC File No. 33-50582])
10.08 1987 Executive Stock Option Plan (Incorporated by reference - Exhibit 10.09 to Registration
Statement on Form S-1 [SEC File No. 33-50582])
10.09 1993 Key Employees' Share Ownership Plan (Incorporated by reference - Exhibit 10.10 to
Registration Statement on Form S-1 [SEC File No. 33-50582])
10.10 Energy Purchase Agreement, dated December 18, 1989, between Camden Paperboard Corporation
and Camden Cogen, L.P. (Incorporated by reference - Exhibit 10.11 to Registration Statement on
Form S-1 [SEC File No. 33-50582])
10.11 Incentive Bonus Plan of the Company (Incorporated by reference - Exhibit 10.10 to Annual
Report for 1993 on Form 10-K [SEC File No. 0-20646])
10.12 1996 Director Equity Plan of the Company (Incorporated by reference - Exhibit 10.12 to Report
on Form 10-Q for the quarter ended March 31, 1996 [SEC File No. 0-20646])
10.13 Amendment No. 1 to the Company's 1996 Director Equity Plan, dated July 16, 1998 (Incorporated
by reference - Exhibit 10.2 to Current Report on Form 8-K dated June 1, 1999 [SEC File No.
0-20646])
10.14 Credit Agreement, dated as of July 23, 1997, by and among the Company, as Borrower, the banks
listed therein, Bankers Trust Company, as Administrative Agent, NationsBank, N.A., as
Syndication Agent, SunTrust Bank, Atlanta, as Documentation Agent, First Union National Bank,
as Managing Agent and each of Credit Lyonnais, The Bank of New York, The Bank of Nova
Scotia, The Bank of Tokyo - Mitsubishi, Ltd., and Wachovia Bank, as Co-Agents (Incorporated by
reference - Exhibit 10.13 to Report on Form 10-Q for the Quarter Ended June 30, 1997 [SEC File
No. 0-20646])
10.15 Amendment No. 1 to Credit Agreement, dated as of October 8, 1997, by and among the Company,
as Borrower, the banks listed therein, Bankers Trust Company, as Administrative Agent,
NationsBank, N.A., as Syndication Agent, SunTrust Bank, Atlanta, as Documentation Agent, First
Union National Bank, as Managing Agent and each of Credit Lyonnais, The Bank of New York,
The Bank of Nova Scotia, The Bank of Tokyo - Mitsubishi, Ltd., and Wachovia Bank, as Co-
Agents (Incorporated by reference - Exhibit 10.15 to report on Form 10-Q for the quarter ended
September 30, 1998 [SEC File No. 0-20646])
10.16 Amendment No. 2 to Credit Agreement, dated as of October 30, 1998, by and among the
Company, as Borrower, the banks listed therein, Bankers Trust Company, as Administrative
Agent, NationsBank, N.A., as Syndication Agent, SunTrust Bank,Atlanta, as Documentation
Agent, First Union National Bank, as Managing Agent and each of Credit Lyonnais, The Bank of
New York, The Bank of Nova Scotia, The Bank of Tokyo - Mitsubishi, Ltd., and Wachovia Bank,
as Co-Agents (Incorporated by reference - Exhibit 10.16 to report on Form 10-Q for the quarter
ended September 30, 1998 [SEC File No. 0-20646])
10.17 1998 Key Employee Incentive Compensation Plan (Incorporated by reference - Exhibit 10.14 to
Annual Report for 1997 on Form 10-K [SEC File No. 0-20646])
</TABLE>
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<PAGE> 13
<TABLE>
<S> <C>
10.18 Asset Purchase Agreement between Caraustar Industries, Inc., Sprague Paperboard, Inc. and
International Paper Company, dated as of March 4, 1999 (Incorporated by reference - Exhibit
10.17 to report on Form 10-Q for the quarter ended March 31, 1999 [SEC File No. 0-20646])
23.01 Consent of Arthur Andersen LLP
23.02 Consent of Robinson, Bradshaw & Hinson, P.A. (included in Exhibit 5.01)
24.01 Power of Attorney (included on the signature pages of the Registration Statement as initially
filed).
</TABLE>
ITEM 22. UNDERTAKINGS
The undersigned registrant hereby undertakes as follows:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(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 end of
the estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
provided, however, that the undertakings in subparts (i) and (ii) above do not
apply if the information required to be included in a post-effective amendment
by such subparts is contained in periodic reports filed with or furnished to
the Commission by the registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference into this
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(4) 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 Section 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.
(5) That prior to any public reoffering of the securities
registered hereunder through use of a prospectus which is a part of this
registration statement, by any person or party who is deemed to be an
underwriter within the meaning of Rule 145(c), the registrant undertakes that
such reoffering prospectus will contain the information called for by the
applicable registration form with respect to reoffering by persons who may be
deemed underwriters, in addition to the information called for by the other
Items of the applicable form.
II-4
<PAGE> 14
(6) That every prospectus (i) that is filed pursuant to paragraph
(5) immediately preceding, or (ii) that purports to meet the requirements of
Section 10(a)(3) of the Securities Act and is used in connection with an
offering of securities subject to Rule 415, will be filed as a part of an
amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(7) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
(8) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this
Form, within one business day of receipt of such request, and to send the
incorporated documents by first class mail or other equally prompt means. This
includes information contained in documents filed subsequent to the effective
date of the registration statement through the date of responding to the
request.
(9) To supply by means of a post-effective amendment all
information concerning a transaction, and the company being acquired involved
therein, that was not the subject of and included in the registration statement
when it became effective.
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<PAGE> 15
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant has duly caused this Registration Statement or amendment thereto to
be signed on its behalf by the undersigned, thereunto duly authorized, in the
City of Austell, State of Georgia on February 29, 2000.
CARAUSTAR INDUSTRIES, INC.
By: /s/ H. Lee Thrash, III
---------------------------------------------
H. Lee Thrash, III
Vice President and Chief Financial Officer
POWER OF ATTORNEY
Each of the undersigned hereby constitutes and appoints H. Lee Thrash, III and
Thomas V. Brown, and each of them, with full power to act without the other and
with full power of substitution and resubstitution, his true and lawful
attorneys-in-fact and agents, for him and in his name, place, and stead, in any
and all capacities, to sign on his behalf any and all amendments (including
post-effective amendments and amendments thereto) to this Registration
Statement and any related registration statement (and any amendments thereto)
filed pursuant to Rule 462(b) under the Securities Act of 1933, and to file the
same, with all exhibits thereto and other documents in connection therewith,
with the Commission, and grants unto said attorneys-in-fact and agents, and
each of them, full power and authority to do and perform each and every act and
thing requisite and necessary to be done in and about the premises as fully as
to all intents and purposes as he might or could do in person, and hereby
ratifies and confirms all that such attorneys-in-fact or agents, or any of
them, or their substitutes shall lawfully do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement or amendment thereto has been signed by the following
persons and in the capacities indicated on February 29, 2000.
<TABLE>
<CAPTION>
SIGNATURE TITLE
<S> <C>
/s/ Thomas V. Brown Director, President and Chief Executive Officer
- ------------------------------------------------- (Principal Executive Officer)
Thomas V. Brown
/s/ Lee Thrash, III Director, Vice President and Chief Financial Officer (Principal
- ------------------------------------------------- Financial Officer and Principal Accounting Officer)
H. Lee Thrash, III
/s/ Russell M. Robinson, II Chairman of the Board of Directors
- -------------------------------------------------
Russell M. Robinson, II
/s/ Bob M. Prillaman Director
- -------------------------------------------------
Bob M. Prillaman
/s/ Ralph M. Holt, Jr. Director
- -------------------------------------------------
Ralph M. Holt, Jr.
/s/ James H. Hance, Jr. Director
- -------------------------------------------------
James H. Hance, Jr.
/s/ John D. Munford Director
- -------------------------------------------------
John D. Munford
/s/ James E. Rogers Director
- -------------------------------------------------
James E. Rogers
Director
/s/ Dennis Love
- -------------------------------------------------
Dennis Love
</TABLE>
II-6
<PAGE> 1
EXHIBIT 5.01
ROBINSON, BRADSHAW & HINSON, P.A.
ATTORNEYS AT LAW
SOUTH CAROLINA OFFICE
101 NORTH TRYON STREET, SUITE 1900 THE GUARDIAN BUILDING
CHARLOTTE, NORTH CAROLINA 28246 ONE LAW PLACE - SUITE 600
TELEPHONE (704) 377-2536 P.O. DRAWER 12070
FAX (704) 378-4000 ROCK HILL, S.C. 29731
TELEPHONE (803) 325-2900
FAX (803) 325-2929
March 2, 2000
Caraustar Industries, Inc.
3100 Washington Street
Austell, Georgia 30001
Re: Registration Statement on Form S-4
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-4 filed herewith (the
"Registration Statement") of Caraustar Industries, Inc., a North Carolina
corporation (hereinafter referred to as the "Company"), filed with the
Securities and Exchange Commission for the purpose of registering under the
Securities Act of 1933, as amended (the "Act"), up to 4,000,000 shares of the
Company's Common Stock, par value $.10 per share (the "Shares"), for issuance
from time to time in connection with business acquisitions. We have examined
the Amended and Restated Articles of Incorporation and the Second Amended and
Restated Bylaws, as amended, of the Company, records of proceedings of the
Board of Directors of the Company, and other Company records, together with
applicable certificates of public officials and other documents that we have
deemed relevant.
Based upon the foregoing and subject to the conditions set forth
below, it is our opinion that the Shares, when issued and sold as contemplated
by the Registration Statement, will be legally issued, fully paid and
nonassessable.
The opinions expressed herein are contingent upon the Registration
Statement, as amended, becoming effective under the Securities Act and the
Company's Amended and Restated Articles of Incorporation and Second Amended and
Restated Bylaws not being further amended prior to the issuance of the Shares.
We hereby consent to the filing of this opinion as an exhibit to said
Registration Statement and to being named therein and in the prospectus that
constitutes a part thereof as attorneys who will pass upon certain legal
matters in connection with the validity of the Shares. In giving such consent,
we do not hereby admit we are in the category of persons whose consent is
required under Section 7 of the Act.
Very truly yours,
ROBINSON, BRADSHAW & HINSON, P.A.
/s/ Patrick S. Bryant
------------------------------
Patrick S. Bryant
<PAGE> 1
EXHIBIT 23.01
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement on Form S-4 of our
reports dated January 28, 1999 included in Caraustar Industries, Inc.'s Form
10-K for the year ended December 31, 1998, and to all references to our firm
included in or made a part of this registration statement.
ARTHUR ANDERSEN LLP
/s/ Arthur Andersen LLP
Atlanta, Georgia
March 3, 2000
