As filed with the Securities and Exchange Commission on July 26, 1996
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
EAGLE PACIFIC INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
Minnesota 41-1642846
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
333 South Seventh Street
2430 Metropolitan Centre
Minneapolis, Minnesota 55402
(612) 371-9650
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
WILLIAM H. SPELL, President
Eagle Pacific Industries, Inc.
333 South Seventh Street
2430 Metropolitan Centre
Minneapolis, Minnesota 55402
(612) 371-9650
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copies to:
DOBSON WEST
DANIEL A. YARANO
Fredrikson & Byron, P.A.
1100 International Centre
900 Second Avenue South
Minneapolis, Minnesota 55402
(612) 347-7000
Approximate date of commencement of proposed sale to the public:
From time to time after the effective date of this Registration Statement
as determined by market conditions and other factors.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being offered 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 ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
================================================================================================================================
Proposed
Proposed Maximum Maximum Amount of
Title of Each Class of Amount Offering Price per Aggregate Registration
Securities to be Registered to be Registered Unit(1) Offering Price(1) Fee(1)
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock to be offered by 894,710 $3.50 $3,131,485 $1,080
Selling Shareholders
- --------------------------------------------------------------------------------------------------------------------------------
Common Stock to be offered 200,000 $3.50 $700,000 $241
by Selling Warrantholders Upon
Exercise of Outstanding Options(2)
- --------------------------------------------------------------------------------------------------------------------------------
Total 1,094,710 $3,831,485 $1,321
================================================================================================================================
</TABLE>
<PAGE>
(1) For purposes of calculating the registration fee pursuant to Rule
457(c) under the Securities Act of 1933, such amount is based upon the
average of the high and low prices of the registrant's Common Stock on
July 19, 1996 (a date within five business days prior to the date of
filing).
(2) Options are exercisable at $3.125 per share.
The registrant 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 this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
PROSPECTUS
EAGLE PACIFIC INDUSTRIES, INC.
1,094,710 Shares of Common Stock
This Prospectus relates to the offer and sale of up to 1,094,710 shares
of Common Stock par value of $.01 per share, (the "Shares"), of Eagle Pacific
Industries, Inc., a Minnesota corporation (the "Company") by certain Selling
Shareholders (the "Selling Shareholders"). Of such Shares, (i) an aggregate of
894,710 Shares may be offered and sold by certain Selling Shareholders of the
Company's Common Stock, and (ii) an aggregate of 200,000 Shares may be offered
and sold by certain Selling Shareholders who may exercise outstanding Options
and resell the Shares pursuant to this Prospectus. See "Principal and Selling
Shareholders." The Company will receive proceeds from any Options that may be
exercised in connection herewith, but will not receive any proceeds from the
sale of any Shares by the Selling Shareholders.
The Selling Shareholders have advised the Company that all or a portion
of the Shares offered by them may be sold from time to time by the Selling
Shareholders or by pledgees, donees, transferees or other successors in
interest. Such sales may be made in the over-the-counter market or otherwise at
prices and at terms then prevailing or at prices related to the then current
market price, or in negotiated transactions. The Shares may be sold through one
or more of the following: (a) ordinary brokerage or market making transactions
and transactions in which the broker or dealer solicits purchasers; (b) a block
trade in which the broker or dealer so engaged will attempt to sell the Shares
as agent but may position and resell a portion of the block as principal to
facilitate the transaction; and (c) purchase by a broker or dealer as principal
and resale by such broker or dealer for its account pursuant to this Prospectus.
In effecting sales, brokers or dealers engaged by the Selling Shareholders may
arrange for other brokers or dealers to participate. Brokers or dealers will
receive commissions or discounts from the Selling Shareholders in amounts to be
negotiated immediately prior to the sale. Such brokers or dealers and any other
participating brokers or dealers may be deemed to be "underwriters" within the
meaning of the Securities Act of 1933, as amended, (the "Securities Act") in
connection with such sales. In addition, any Shares covered by this Prospectus
which qualify for sale pursuant to Rule 144 under this Securities Act may be
sold under Rule 144 rather than pursuant to this Prospectus. The Company has
agreed to maintain this registration until the earlier of the date the Selling
Shareholders sell all of their Shares, Rule 144 is available to such Selling
Shareholders or two years from the date of this Prospectus. See "Plan of
Distribution."
The Company will bear all expenses of the offering (estimated to be
$15,000), except that the Selling Shareholders will pay any applicable
underwriter's commissions and expenses, brokerage fees or transfer taxes, as
well as any fees and disbursements of counsel and experts for the Selling
Shareholders. The Company and the Selling Shareholders have agreed to indemnify
each other against certain liabilities, including liabilities arising under the
Securities Act.
<PAGE>
The Company's Common Stock is traded on the Nasdaq SmallCap Market
under the symbol "EPII." The closing bid price of the Company's Common Stock on
July 19, 1996, as reflected on the Nasdaq SmallCap Market was $3.50 per share.
-----------------------
FOR INFORMATION CONCERNING CERTAIN RISKS RELATING
TO AN INVESTMENT IN THE COMPANY'S COMMON STOCK
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.
The date of this Prospectus is July ____, 1996.
2
<PAGE>
No person is authorized to give any information or to make any
representations, other than those contained or incorporated by reference in this
Prospectus, in connection with the offering contemplated hereby, and, if given
or made, such information or representations must not be relied upon as having
been authorized by the Company. This Prospectus does not constitute an offer to
sell or a solicitation of an offer to buy any securities other than the
registered securities to which it relates. This Prospectus does not constitute
an offer to sell or a solicitation of an offer to buy any securities in any
jurisdiction to any person to whom it is unlawful to make such offer or
solicitation in such jurisdiction. Neither the delivery of this Prospectus nor
any sale made hereunder shall, under any circumstances, create any implication
that there has been no change in the affairs of the Company since the date
hereof or that the information contained or incorporated by reference herein is
correct as of any time subsequent to its date.
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 at the public reference
facilities maintained by the Commission at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C., 20549, and at the Commission's regional offices in New York (7
World Trade Center, Suite 1300, New York, New York 10048) and Chicago (Suite
1400, Northwestern Atrium Center, 500 West Madison, Chicago, Illinois 60661).
Copies of such material can be obtained from the Public Reference Section of the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed by the Company with the Commission are
hereby incorporated by reference in this Prospectus:
1. The Company's annual report on Form 10-KSB (Commission File No.
0-18050) for its 1995 fiscal year ended December 31, 1995.
2. The Company's quarterly report on Form 10-QSB (Commission File No. 0-
18050) for its fiscal quarter ended March 31, 1996.
3. The description of the Company's Common Stock, $.01 par value, which
is contained or incorporated by reference in the Company's
Registration Statement on Form 8-A (Commission File No. 0-18050) filed
under the Securities Exchange Act of 1934, as amended, including any
amendment or report filed for the purpose of updating such
description.
3
<PAGE>
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 of the Shares 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 statement contained in a document incorporated by
reference or deemed to be incorporated by reference in this Prospectus shall be
deemed to be modified or superseded for all purposes of this Prospectus to the
extent that a statement contained herein, therein or in any subsequently filed
document which also is incorporated or deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon the
written or oral request of such person, a copy of any or all of the documents
incorporated herein by reference (not including the exhibits to such documents,
unless such exhibits are specifically incorporated by reference in such
documents). Requests for such copies should be directed to William H. Spell,
President, Eagle Pacific Industries, Inc., 333 South Seventh Street, 2430
Metropolitan Centre, Minneapolis, Minnesota 55402; Telephone (612) 371-9650.
THE COMPANY
Eagle Pacific Industries, Inc., a Minnesota corporation, (the
"Company") is a holding company of Eagle Plastics, Inc. ("Eagle"), Pacific
Plastics, Inc., ("Pacific") and Arrow Plastics, Inc., ("Arrow") (collectively
the "Subsidiaries") leading extruders of polyvinyl chloride (PVC) pipe and
polyethylene (PE) tubing products. The Company ranks among the top six producers
of small to medium diameter plastic pipe and tubing products in the United
States. The Company operates manufacturing facilities in Hastings, Nebraska,
Hillsboro, Oregon and Midvale, Utah. The Company produces an average of 150
miles of pipe each day on 34 extrusion lines, using an estimated 120 million
pounds of resin annually. The Company's diverse customer base includes more than
1,000 purchasers of products for the building and construction, commercial and
residential plumbing, turf irrigation, municipal water and sewage, natural gas
distribution and telecommunications industries. The Company's products are sold
in 30 states throughout the continental United States, Alaska and Hawaii and in
three western Canadian provinces. The Company's principal executive offices are
located at 333 South Seventh Street, 2430 Metropolitan Centre, Minneapolis,
Minnesota 55402 and its telephone number is (612) 371-9650.
4
<PAGE>
RISK FACTORS
Prospective investors should carefully consider the following risk factors.
1. Raw Material Cost Fluctuations. The Company's operating results and
financial condition may be adversely affected by uncontrollable market
fluctuations in the availability and cost of its primary raw material: resin.
While supplies are readily available, the Company has experienced, in the past,
significant cost increases in resin prices. For example, in 1995, the Company's
gross margins were adversely affected by fluctuations in resin prices. The
Company believes that its competitors have also experienced similar price
increases. The Company has historically attempted to pass such price increases
onto its customers but has not always been able to do so due to its large
inventories of resin. The Company has reduced its inventory of resin and
instituted inventory control policies to control its inventory of resin. As a
result, the Company believes it will be able to pass price increases of resin
onto its customers, however, there is no assurance that it will be able to do
so. If resin prices decline substantially and rapidly, the Company's gross
margins may be adversely affected as in 1995. The Company's operations will be
adversely affected if it is not able to pass on resin price increases to its
customers. Furthermore, resin price increases may adversely affect the Company's
sales as customers purchase less of its products due to the increase in prices.
2. Leveraged Purchase. To acquire the operations of its Subsidiaries,
it was necessary for the Company to raise a substantial amount of debt resulting
in the Company and its Subsidiaries being highly leveraged. If Eagle's,
Pacific's and/or Arrow's businesses do not perform as anticipated, or consistent
with past performance and it fully utilizes the funds available under its
line-of-credit, the cash flow generated by the Company's Subsidiaries may not be
sufficient to pay the Company's debt service obligations. In such event, the
holder of such debt could foreclose on the assets of the Company's Subsidiaries
and the Company's shareholders could lose their entire investment.
3. Competition. The business in which the Company is engaged is highly
competitive and some of the Company's competitors have greater resources than
the Company. There can be no assurance that the Company will be able to compete
in the future. In particular, price is a very important competitive factor in
the sale of plastic pipe and there can be no assurance that the Company will
continue to be price competitive.
4. Failure to Successfully Implement Acquisition Strategy. The Company
has developed a strategy to expand the Company through internal growth and
expansion of the basic business, by selling its existing products into new
market niches and by the acquisition of other companies in the industry. Failure
to successfully acquire any companies, in light of the consolidation that is
occurring within the industry, may adversely affect the Company's
competitiveness. In addition, the Company's operations may be adversely affected
should it pay too much consideration for an acquired company, incur unforeseen
liabilities, or the acquired company fails to perform as the Company
anticipated. Current shareholders may experience substantial dilution of their
investment if the Company issues shares of its Common Stock or Warrants or other
rights to purchase Common Stock pursuant to an acquisition.
5
<PAGE>
5. Possible Need for Additional Financing. In order to successfully
implement the Company's acquisition strategy the Company may be required to find
additional sources of financing. Such additional financing may be sought from a
number of sources, including possible future sales of equity securities or loans
from banks or other financial institutions. No assurance can be given that the
Company will be able to sell future securities or obtain additional financing
from any source. If the Company is able to sell additional shares of its
securities, it may be required to do so at a price that is less than the price
of the Shares offered hereby. Sales of equity securities could therefore result
in substantial additional dilution to investors in the Shares offered hereby.
Finally, additional debt financing could be very difficult to obtain due to the
Company's highly leveraged financial condition as a result of its acquisition of
Eagle, Pacific and Arrow.
6. Dependence on Construction Industry. Many of Company's products are
used in the construction of residential and business properties. In the event
such construction slows for any reason including poor economic conditions or
weather, the sale of Company products used in the construction of residential
and business properties could be adversely affected. Early Spring flooding in
the Midwest in 1995 caused a delay in many construction projects and resulted in
Company sales and income being less than projected. There can be no assurance
that Company will not encounter similar problems in the future.
7. Company Net Operating Loss. As of December 31, 1995, the Company has
a net operating loss carry-forward of approximately $44,400,000 million (the
"NOL") that it intends to use to offset a substantial portion of future taxable
income of the Company, if any. The rules concerning the availability of the NOL
are complicated and include rules concerning ownership changes in Company Common
Stock. If the rules applicable to the NOL are violated, the availability of the
NOL may be limited or extinguished. Further, current holders of Eagle Common
Stock, along with persons who may obtain Eagle Common Stock through exercise of
options or warrants, could hold in the aggregate over 20% of the Eagle
outstanding Common Stock. If ownership by persons, other than the Company, in
Eagle's outstanding Common Stock exceeds 20%, the Company may not file a
consolidated income tax return with Eagle resulting in the Company not receiving
the benefit of the NOL.
8. Sufficiency of Working Capital. As of March 31, 1996, the Company had a
zero cash balance and $591,295 in available working capital. The Company
estimates that as of March 31, 1996, there is an additional $5.5 million that
could be drawn under its bank lines of credit. The amount available under the
bank lines of credit fluctuates daily based on the Company's eligible accounts
receivable and inventory. The Company's lines of credit and term note are
subject to a loan agreement containing standard covenants, representations and
warranties, are secured by all the assets of Eagle and Pacific, except real
property and guaranteed by the Company. A violation of the loan agreement could
result in termination of the loan agreement which would require the Company to
repay the loans in full. The Company has been in default of the financial
covenants in the past and the bank has waived such violations. The Company and
bank have amended the loan agreement to adjust the financial covenants. Although
the Company believes it will be able to meet the requirements of the amended
loan agreement in the future, there is no assurance that the Company will not
violate the covenants or that the bank will waive any violations. In addition,
the Company's ability to obtain additional equity capital may be limited and, if
obtainable at all, would result in substantial dilution. Therefore, the
Company's ability to fund its working capital requirements in the future will be
almost entirely dependent on generating sales which equal or exceed the
Company's fiscal 1995 sales and in achieving profitable operations in fiscal
1996. In addition, any unforeseen expense of a material nature could materially
and adversely affect the Company's ability to fund its ongoing operations.
6
<PAGE>
9. Immediate Substantial Dilution. Investors purchasing Shares in this
offering pursuant to exercise of the options will experience an immediate and
substantial dilution of their investment in the Company.
10. Dividends. The Company has never paid a cash dividend on its Common
Stock and intends to retain any earnings to finance the development of its
business.
11. Prior Market for Common Stock
The Company's Common Stock is traded on the Nasdaq SmallCap Market under
the symbol "EPII." While the Common Stock has been admitted for trading on the
Nasdaq SmallCap Market and the Company currently satisfies the requirements for
continued listing, such trading could be halted in the future for failure to
meet Nasdaq maintenance requirements. No assurances can be given that the
Company will be able to continually satisfy the requirements for continued
listing on the Nasdaq SmallCap Market. The high and low bid prices for shares of
the Company's Common Stock for the quarter ended June 30, 1996 were $4.25 and
$1.50 per share, respectively. On July 19, 1996, the closing price for the
Company's Common Stock as quoted on the Nasdaq SmallCap Market was $3.50 per
share.
12. Anti-Takeover Provisions
The Company's Articles of Incorporation provide that the Board of Directors
may issue up to 50,000,000 shares, which shall consist of 30,000,000 shares of
Common Stock and 20,000,000 Undesignated Shares with such rights and preferences
as may be determined from time to time by the Board of Directors, without
further shareholder approval. In September 1993, the Company authorized the
establishment and issuance of 2,000,000 Series A 7% Convertible Preferred Stock
from the Undesignated Shares, which were subsequently converted to shares of
Common Stock. As a result, the Company has 18,000,000 Undesignated Shares
remaining unissued. Issuance of additional Preferred or Common Stock could
result in dilution of the voting power of Common Stock, adversely affect its
holders in the event of liquidation of the Company, or delay or prevent a change
in control of the Company. In addition, Section 302A.671 of the Minnesota
Statutes, among other things, denies voting rights with respect to certain
"control share" acquisitions of the Company's Common Stock without prior
approval of the Company's shareholders and Section 302A.673 of the Minnesota
Statutes prohibits business combinations with any shareholder within five years
of that shareholder's control share acquisition, made without approval of a
committee of the Company's Board of Directors. The ability of the Board of
Directors to issue additional Preferred or Common Stock and Minnesota Statutes
could impede or deter a tender offer or takeover proposal regarding the Company.
7
<PAGE>
USE OF PROCEEDS
Assuming certain Selling Shareholders listed in this Prospectus
exercise their Options to purchase an aggregate of 200,000 shares of Common
Stock, the estimated net proceeds to be received by the Company are
approximately $625,000 net of expenses. There is no obligation on the part of
Selling Shareholders to exercise all or any portion of the outstanding Options.
Based upon the current market price of the Company's Common Stock there is no
assurance that the Warrants will be exercised. Thus, there can be no assurance
that the Company will receive the estimated net proceeds or any proceeds from
this offering. Any proceeds received will be used to repay existing debt and for
general working capital purposes.
SELLING SHAREHOLDERS
The following table sets forth, as of the date of this Prospectus,
certain information the Selling Shareholders.
<TABLE>
<CAPTION>
Before the Offering After the Offering
---------------------------------------- -------------------------------------
Shares Percentage of Shares Shares Percentage of
Beneficially Outstanding Being Beneficially Outstanding
Name and Address of Owned(1) Shares(1)(2) Offered(3) Owned(1) Shares(1)(2)
Beneficial Owner
SELLING SHAREHOLDERS(3)
<S> <C> <C> <C> <C> <C>
Kenneth G. Bryfogle 5,500 * 5,500 --- *
Keith Oehlschlager 6,000 * 6,000 --- *
Jones University Retirement Fund 12,000 * 12,000 --- *
Edith Von Bibra 25,000 * 25,000 --- *
Conrad Von Bibra 20,000 * 20,000 --- *
Beachlawn Mortgage 25,000 * 25,000 --- *
Amguard Ins. Co. 6,400 * 6,400 --- *
Norguard Ins. Co. 10,400 * 10,400 --- *
James R. Savage 24,000 * 24,000 --- *
Hayes & Associates 4,500 * 4,500 --- *
Thomas E. Rassieur 8,000 * 8,000 --- *
Citizens Auto Corp. 16,000 * 16,000 --- *
William Vesey 4,100 * 4,100 --- *
James L. Vesey 4,100 * 4,100 --- *
Carolyn H. Vesey 12,000 * 12,000 --- *
Martha R. Morgan 6,000 * 6,000 --- *
Miriam Foundation 2,500 * 2,500 --- *
Urmil & Ananad Dhanda 3,500 * 3,500 --- *
Barnard J. Gottstein 5,000 * 5,000 --- *
Okabena Partnership K 425,000 7.4% 400,000 25,000 *
Loyal Sorensen (4) 190,650 3.3% 190,650 --- *
Zelda Sorensen 45,849 * 45,849 --- *
Jarred Thompson (5) 185,256 3.2% 185,256 --- *
Sharron Sorensen 40,455 * 40,455 ___ *
David Paul Schnase (6) 10,000 * 10,000 ___ *
Richard Alan Schnase 2,500 * 2,500 ___ *
James Edward Schnase 10,000 * 10,000 ___ *
Joan Elizabeth Johnson 10,000 * 10,000 ___ *
</TABLE>
8
<PAGE>
* Less than one percent
(1) Shares not outstanding but deemed beneficially owned by virtue of the
individual's right to acquire them as of the date of this Prospectus,
or within 60 days of such date, are treated as outstanding when
determining the percent of the class owned by such individual and when
determining the percent owned by the group. For purposes of
calculation, the percent of class owned after this offering, it was
assumed that the officers, directors and principal shareholders will
not be purchasing shares in this offering, unless otherwise indicated,
each person named or included in the group has sole voting and
investment power with respect to the shares of Common Stock set forth
opposite his/her name.
(2) Based on 5,734,090 shares of common stock issued and outstanding as of
July 22, 1996. Each percentage calculation assumes the exercise of only
those options and warrants held by the corresponding person or persons
which are exercisable as of July 22, 1996.
(3) Selling Shareholder may sell, at each Selling Shareholder's discretion,
all or a portion of the Common Stock being offered pursuant to this
Prospectus. There is no obligation on the part of the Selling
Shareholders to sell any Shares pursuant to this offering or exercise
any outstanding Warrants or sell the Common Stock received by such
exercise.
(4) Mr. Sorensen is a Senior Vice President of Pacific Plastics, Inc. This
amount includes options to purchase 100,000 shares of Common Stock at
$3.125 per share.
(5) Mr. Thompson is a Vice President of Pacific Plastics, Inc. This amount
includes options to purchase 100,000 shares of Common Stock at $3.125
per share.
(6) Mr. David Paul Schnase is a Senior Vice President of Sales and
Marketing for Eagle Plastics, Inc. He is the son of Larry Schnase, a
director of the Company. Richard Alan Schnase, James Edward Schnase and
Joan Elizabeth Johnson are affiliates of David Schnase.
9
<PAGE>
PLAN OF DISTRIBUTION
The Selling Shareholders have advised the Company that all or a portion
of the Shares offered by the Selling Shareholders hereby may be sold from time
to time by the Selling Shareholders or by pledges, donees, transferees or other
successors in interest. Such sales may be made in the over-the-counter market or
otherwise at prices and at terms then prevailing or at prices related to the
then current market price, or in negotiated transactions. The Shares may be sold
by one or more of the following means: (a) ordinary brokerage or market making
transactions and transactions in which the broker or dealer solicits purchasers;
(b) block trades in which the broker or dealer so engaged will attempt to sell
the Shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction; and (c) purchases by a broker or dealer
as principal and resales by such broker or dealer for its account pursuant to
this Prospectus. In effecting sales, brokers or dealers engaged by the Selling
Shareholders may arrange for other brokers or dealers to participate. Brokers or
dealers will receive commissions or discounts from the Selling Shareholders in
amounts to be negotiated immediately prior to the sale. Such brokers or dealers
and any other participating brokers or dealers may be deemed to be
"underwriters" within the meaning of the Securities Act in connection with such
sales. In addition, any securities covered by this Prospectus which qualify for
sale pursuant to Rule 144 under the Act may be sold under Rule 144 rather than
pursuant to this Prospectus.
The Company and the Selling Shareholders have agreed to indemnify each
other against certain liabilities, including liabilities arising under the
Securities Act.
10
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following expenses will be paid by the Company in connection with
the distribution of the shares registered hereby. The Company is paying all
Selling Shareholder's expenses related to this offering, except the Selling
Shareholders will pay any applicable broker's commissions and expenses, transfer
taxes, as well as fees and disbursements of counsel and experts for the Selling
Shareholder. All of such expenses, except for the SEC Registration Fee, are
estimated.
SEC Registration Fee ............................................$ 1,321
NASD Fee ................................................................0
Nasdaq listing fee ......................................................0
Legal Fees and Expenses .............................................6,000
Accountants' Fees and Expenses ......................................2,500
Printing Expenses ...................................................1,000
Blue Sky Fees and Expenses ........................................ 3,500
Miscellaneous ...................................................... 679
Total ..........................................................$15,000
Item 15. Indemnification of Directors and Officers.
Section 302A.521, subd. 2, of the Minnesota Statutes requires the
Company to indemnify a person made or threatened to be made a party to a
proceeding by reason of the former or present official capacity of the person
with respect to the Company, against judgments, penalties, fines, including,
without limitation, excise taxes assessed against the person with respect to an
employee benefit plan, settlements, and reasonable expenses, including
attorneys' fees and disbursements, incurred by the person in connection with the
proceeding with respect to the same acts or omissions if such person (1) has not
been indemnified by another organization or employee benefit plan for the same
judgments, penalties or fines; (2) acted in good faith; (3) received no improper
personal benefit, and statutory procedure has been followed in the case of any
conflict of interest by a director; (4) in the case of a criminal proceeding,
had no reasonable cause to believe the conduct was unlawful; and (5) in the case
of acts or omissions occurring in the person's performance in the official
capacity of director or, for a person not a director, in the official capacity
of officer, board committee member or employee, reasonably believed that the
conduct was in the best interests of the Company, or, in the case of performance
by a director, officer or employee of the Company involving service as a
director, officer, partner, trustee, employee or agent of another organization
or employee benefit plan, reasonably believed that the conduct was not opposed
to the best interests of the Company. In addition, Section 302A.521, subd. 3,
requires payment by the Company, upon written request, of reasonable expenses in
advance of final disposition of the proceeding in certain instances. A decision
as to required indemnification is made by a disinterested majority of the Board
of Directors present at a meeting at which a disinterested quorum is present, or
by a designated committee of the Board, by special legal counsel, by the
shareholders, or by a court. Article 8 of the Company's Amended Articles of
Incorporation provide that directors shall be personally liable to the Company
or its shareholders for monetary damages for breach of fiduciary duty as a
director tot he fullest extent permitted by Minnesota statutes.
II - 1
<PAGE>
Item 16. Exhibits
Exhibit No. Document
5 Opinion and Consent of Fredrikson & Byron, P.A.
23.1 Consent of Deloitte & Touche, LLP.
23.2 Consent of Fredrikson & Byron, P.A. (included
in their opinion filed as Exhibit 5).
24 Power of Attorney from certain directors
and officers (included on the "Signatures"
pages hereto).
Item 17. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(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, represents a fundamental change in the
information set forth in the Registration Statement;
II - 2
<PAGE>
(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 paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the information required
to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by
the Registrant pursuant to section 13 or section
15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration
Statement.
(2) That, for the purposes of determining any liability under
the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new Registration Statement relating to
the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) 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 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.
(c) 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 Act and will be governed by final
adjudication of such issue.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Minneapolis, State of Minnesota, on the __th day of
July, 1996.
EAGLE PACIFIC INDUSTRIES, INC.
By/s/ William H. Spell
William H. Spell, President
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed below by the following persons in the
capacities and on the date indicated.
(Power of Attorney)
Each person whose signature appears below constitutes and appoints
William H. Spell and Bruce A. Richard, and each of them, as his true and lawful
attorneys-in-fact and agents, each acting alone, with full power of substitution
and resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any or all amendments to the Registration Statement on Form
S-3 of Eagle Pacific Industries, Inc. 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, each
acting alone, 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 and
for all intent and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, each acting alone, or
their substitute or substitutes, may lawfully do or cause to be done by virtue
thereof.
Signature Title Date
/s/ Harry W. Spell Chairman of the Board and July 24, 1996
Harry W. Spell Chief Executive Officer
(Signatures on following page)
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<PAGE>
/s/ Bruce A. Richards Vice Chairman, July 24, 1996
Bruce A. Richards Treasurer, and Secretary and
Director
/s/ G. Peter Koren Director July 24, 1996
G. Peter Koren
/s/ George R. Long Director July 24, 1996
George R. Long
/s/ Richard W. Perkins Director July 24, 1996
Richard W. Perkins
/s/ Larry D. Schnase Director July 24, 1996
Larry D. Schnase
/s/ William H. Spell Director July 24, 1996
William H. Spell
II - 5
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
EXHIBITS
to
Form S-3 Registration Statement
Eagle Pacific Industries, Inc.
(Exact name of Registrant as specified in its charter)
INDEX
Sequential Page
Number in Sequential
Exhibit Numbered Form S-3
5 Opinion and consent of Fredrikson & Byron, P.A......
23.1 Consent of Deloitte & Touche, LLP...................
23.2 Consent of Fredrikson & Byron, P.A.................. See Exhibit 5
24 Power of attorney from directors (Included in signature
page of this Registration Statement)................
EXHIBIT 5
July 25, 1996
Eagle Pacific Industries, Inc.
333 South Seventh Street
2430 Metropolitan Centre
Minneapolis, MN 55412
Re: EXHIBIT 5 to Registration Statement on Form S-3
Ladies/Gentlemen:
We are acting as corporate counsel to Eagle Pacific Industries, Inc. (the
"Company") in connection with the preparation and filing of a Registration
Statement on Form S-3 (the "Registration Statement") relating to the
registration under the Securities Act of 1933, as amended (the "Act") of
1,094,710 shares of the Company's Common Stock (the "Shares") which may be
offered for sale by certain shareholders (the "Selling Shareholders"), some of
whom acquire the Shares upon exercise of outstanding Options.
In acting as such counsel for the purpose of rendering this opinion, we have
reviewed copies of the following, as presented to us by the Company:
1. The Company's Articles of Incorporation, as amended.
2. The Company's Bylaws.
3. Certain corporate resolutions of the Company's Board of
Directors pertaining to the issuance by the Company of
the Shares.
4. The Registration Statement.
Based on, and subject to, the foregoing and upon representations and information
provided by the Company or its officers or directors, it is our opinion as of
this date that:
1. The Shares are validly authorized by the Company's Articles of
Incorporation.
2. The Shares, when issued in accordance with the terms of outstanding
options, will be validly issued and outstanding, fully paid and nonassessable.
We hereby consent to the filing of this opinion as Exhibit 5 to the
Registration Statement.
Very truly yours,
FREDRIKSON & BYRON, P.A.
By/s/ Thomas R. King
Thomas R. King
Fredrikson & Byron, P.A.
1100 International Centre
900 Second Avenue South
Minneapolis, Minnesota 55402
Telephone: 612-347-7000
Fax: 612-347-7077
EXHIBIT 23.1
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in this Registration Statement
of Eagle Pacific Industries, Inc. on Form S-3 of our report dated March 6, 1996
(April 1, 1996 as to the last paragraph of Note 5), appearing in the Annual
Report on Form 10-KSB of Eagle Pacific Industries, Inc. for the years ended
December 31, 1995 and 1994.
/s/ Deloitte & Touche, LLP
Deloitte & Touche, LLP
Minneapolis, Minnesota
July 24, 1996
