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Registration No. 333-4570
Filed pursuant to Rule
424(b)(3) of the
Securities Act of 1933, as
amended
PROSPECTUS
385,000 SHARES
[LOGO] THE SHAW GROUP INC.
COMMON STOCK
----------------------
The 385,000 shares of common stock, no par value (the "Common Stock")
of The Shaw Group Inc. ("Shaw" or the "Company") offered hereby may be sold
from time to time by certain stockholders of the Company described herein (the
"Selling Stockholders") in transactions on the National Stock Market of the
National Association of Securities Dealers Automated Quotation System (the
"Nasdaq Stock Market"), otherwise in the over-the-counter market or otherwise
at prices and at terms prevailing at the time of sale, at prices related to the
then current market price or in negotiated transactions. The Company will not
receive any of the proceeds from the sale of the shares of Common Stock by the
Selling Stockholders. All of the shares of the Common Stock owned by the
Selling Stockholders have been "restricted securities" under the Securities Act
of 1933, as amended (the "Securities Act"), prior to their registration
hereunder.
In transactions effective as of January 15, 1996, and February 20,
1996, the Company's wholly-owned subsidiary, Word Industries Fabricators, Inc.
("WIFI"), delivered an aggregate of 385,000 shares of the Common Stock to the
Selling Stockholders in partial payment for various assets acquired by WIFI
used in the pipe fabrication business of the Selling Stockholders (and
affiliates) located in Tulsa and Cleveland, Oklahoma. Pursuant to an agreement
between the Company and the Selling Stockholders, the Company agreed to prepare
and file a shelf registration statement on Form S-3 with the Securities and
Exchange Commission (the "Commission") to register the shares of Common Stock
offered hereby. This Prospectus has been prepared for use in connection with
future sales of the shares of Common Stock by the Selling Stockholders under
the shelf registration statement on Form S-3. For more information concerning
the Selling Stockholders and related matters, see "Selling Stockholders and
Plan of Distribution." The shares of Common Stock may be sold from time to
time by the Selling Stockholders pursuant to this Prospectus or in transactions
exempt from the registration requirements of the Securities Act. In
connection with any sales, the Selling Stockholders and any brokers
participating in such sales may be deemed to be "underwriters" within the
meaning of the Securities Act. See "Selling Stockholders and Plan of
Distribution". Outstanding shares of Common Stock of the Company are reported
on the Nasdaq Stock Market under the symbol "SHAW".
SEE "RISK FACTORS" FOR A DISCUSSION OF CERTAIN FACTORS THAT SHOULD BE
CONSIDERED IN CONNECTION WITH AN INVESTMENT IN THE COMMON STOCK.
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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 8, 1996.
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THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR
ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, previously filed by the Company with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act") are hereby incorporated by reference:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended August 31, 1995;
(b) The Company's Quarterly Report on Form 10-Q for the quarter
ended November 30, 1995;
(c) The Company's Quarterly Report on Form 10-Q for the quarter
ended February 29, 1996;
(d) The Company's Current Report on Form 8-K dated January 30,
1996, as amended by Amendment No. 1 on Form 8-K/A-1 filed on
March 29, 1996;
(e) The Company's Current Report on Form 8-K dated April 17, 1996,
as amended by Amendment No. 1 on Form 8-K/A-1 filed on June 19,
1996;
(f) The Company's Proxy Statement dated December 29, 1995 in
connection with the Company's Annual Meeting of Shareholders
held on February 2, 1996; and
(g) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A (including any
amendments or reports filed for the purpose of updating such
description).
All reports and any definitive proxy or information statements filed
by the Company with the Commission pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering of the securities made hereby 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 or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other 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.
Upon written or oral request, the Company will provide without charge
to each person to whom a copy of this Prospectus is delivered, a copy of any
and all of the documents incorporated herein by reference (other than exhibits
to such documents, unless such exhibits are specifically incorporated by
reference into such documents). Written requests shall be directed to The Shaw
Group Inc., 11100 Mead Road, Baton Rouge, LA 70816, Attention: Bret M. Talbot,
Chief Financial Officer, telephone (504) 296-1140.
AVAILABLE INFORMATION
Shaw is subject to the informational requirements of the Exchange Act,
and in accordance therewith, files reports, proxy statements and other
information with the Commission. Such reports, proxy statements and other
information can be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the following regional offices of the
Commission: Seven World Trade Center, Suite 1300, New York, New York 10048 and
the Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Copies of such material may also be obtained by mail from the
Public Reference Section of the Commission at Room 1024, Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549, upon payment of
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prescribed rates. In addition, reports, proxy statements and other information
concerning Shaw may be inspected at the offices of the National Association of
Securities Dealers, Inc., 1735 K Street, N.W., Washington, D.C. 20006.
This Prospectus constitutes a part of a Registration Statement filed
by the Company with the Commission on Form S-3 under the Securities Act of
1933, as amended (the "Securities Act"). This Prospectus omits certain of the
information set forth in the Registration Statement, and reference is hereby
made to the Registration Statement and related exhibits for further information
with respect to the Company and the securities offered hereby. Statements
contained herein concerning the provisions of any such document are not
necessarily complete and, in each instance, reference is made to the copy of
such document filed as an exhibit to the Registration Statement or otherwise
filed with the Commission. These documents may be inspected without charge at
the office of the Commission at Judiciary Plaza, 450 Fifth Street, N.W.,
Washington, D.C. 25049, and copies thereof may be obtained at fees and charges
prescribed by the Commission.
THE COMPANY
Shaw is a leading fabricator of piping systems in the United States,
purchasing pipe from manufacturers and cutting, bending and welding fittings on
the pipe to precise customer specifications. At its strategically located
plants, Shaw specializes in production of complex piping systems for new
construction and retrofit projects throughout the world primarily for electric
power, refining, chemical, gas processing, coal gassification and related fuel
industries. Shaw's ability to prefabricate piping systems at its facilities
allows major construction projects to be completed more quickly and at a lower
cost than if the systems were fabricated at the construction site. The pipe
utilized by the Company is principally carbon steel, as well as stainless and
other alloys, and ranges in diameter from 1 inch to 72 inches with overall wall
thicknesses from 1/8 inch to 7 inches. In addition, the Company has
subsidiaries that manufacture pipe fittings, distribute pipe fittings and
flanges, design complex piping systems and design and fabricate pipe support
systems that are used to support the complex piping systems that the Company
fabricates.
The Company was founded in 1987 to purchase the assets of Benjamin F.
Shaw Company, a century-old pipe fabricator. The Company has grown
substantially, increasing its domestic market share and developing
international business. From fiscal year 1988 to fiscal year 1995, sales
increased from $29.3 million to $135.3 million, and net income increased from
$0.6 million to $4.3 million.
The Company was incorporated in Louisiana in August 1987. The
Company's executive offices are located at 11100 Mead Road, Baton Rouge,
Louisiana 70816, and its telephone number is (504) 296-1140.
RISK FACTORS
Prospective purchasers of the Common Stock should consider carefully
the matters set forth below, as well as the other information contained in this
Prospectus (or incorporated herein by reference), in evaluating an investment
in the Common Stock.
CYCLICALITY OF CUSTOMER PROJECTS
The demand for pipe fabrication services depends primarily on the
existence of construction and retrofit projects, particularly in the chemical,
power plant and refinery industries. These industries historically have been,
and will likely continue to be, cyclical in nature and vulnerable to general
downturns in the economy. The Company's results of operations may vary
depending on the availability of future projects from such industries.
DEPENDENCE ON MAJOR CUSTOMERS
Projects in the chemical, power plant and refinery industries
frequently involve a lengthy and complex bidding and selection process, and the
ability of the Company to obtain future contracts is difficult to predict.
Because a significant portion of the Company's revenues are generated from
large projects, its results of operations can fluctuate from quarter to
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quarter. In the fiscal year ended August 31, 1995, contracts with two
customers accounted for 32% of the Company's sales. While a concentration of
customers has been historically prevalent, because of the nature of the
Company's business, the significant customers vary between years.
CONTROL BY MANAGEMENT
As of May 31, 1996, the executive officers and directors of the
Company and its key subsidiaries beneficially owned approximately 47% of the
outstanding Common Stock but controlled approximately 76% of the voting
power. Consequently, these persons will be able to exercise effective control
over the corporate actions and the outcomes of matters requiring a shareholder
vote, including election of the directors.
VOTING RIGHTS TIED TO DURATION OF STOCK OWNERSHIP; ANTI-TAKEOVER EFFECTS
The Company's articles of incorporation, as restated, generally
provides that each share of Common Stock that has been held by the same person
for at least four consecutive years is entitled to five votes on each matter to
be voted upon at stockholders' meetings, and all shares held for less than four
years are entitled to one vote per share for each such matter. This charter
provision could concentrate control in existing stockholders of the Company,
increase the difficulty of removing the incumbent Board of Directors or
management, diminish the likelihood that a potential acquirer would make an
offer for the Common Stock, and impede a transaction favorable to the interests
of certain stockholders. Each purchaser of shares of Common Stock offered
hereby will be entitled to one vote for each such share at all stockholder's
meetings until such shares have been, in accordance with the Company's articles
of incorporation, as restated, continuously owned for a period of four years,
in which case the holder will be entitled to five votes for each share on all
matters submitted to stockholders. See "Description of Capital Stock - Common
Stock".
POTENTIAL FOR PRODUCT LIABILITY CLAIMS
Certain of the Company's products are used in potentially hazardous
environments. Although the Company has not been required to pay any products
liability claims to date, catastrophic occurrences at locations where the
Company's products are used could in the future result in significant products
liability claims against the Company.
DEPENDENCE ON KEY MANAGEMENT
The success of the Company's business will be materially dependent
upon the continued services of its founder, Chairman and Chief Executive
Officer, Mr. James M. Bernhard, Jr., and other key officers and employees. The
loss of Mr. Bernhard or such other key personnel due to death, disability or
termination of employment could have a material adverse effect on the
operations or financial condition, or both, of the Company.
INTERNATIONAL CONTRACTS, OPERATIONS AND EXPANSION
The success of the Company's contracts with, operations in and
expansion into foreign markets depends on numerous factors, many of which are
beyond its control. In addition, foreign contracts, operations and expansion
may increase the Company's exposure to certain risks inherent in doing business
outside the United States, including currency fluctuations, restrictions on the
repatriation of profits and assets, compliance with foreign laws and standards
and political risks. Although the majority of the Company's contracts with
respect to international sales to date have been denominated in United States
dollars, the Company from time to time enters into contracts denominated in
foreign currency and no assurance can be made that future contracts will be
denominated solely in United States dollars; therefore, the Company is from
time to time subject to foreign exchange risks.
POSSIBLE VOLATILITY OF STOCK PRICE
The market price of the Common Stock may experience fluctuations that
are unrelated to the operating performance of the Company, such as market
conditions generally and developments specifically related to the pipe
fabrication industry.
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Additionally, the volume of daily trading in the Common Stock to date has been
limited, and as a result, the sale of a significant number of shares of Common
Stock by one or more stockholders within a relatively short time period could
adversely affect the market price for the Common Stock.
USE OF PROCEEDS
The shares of Common Stock offered hereby are being offered by the
Selling Stockholders. See "Selling Stockholders and Plan of Distribution".
The Company will not receive any of the proceeds from the sale of the Common
Stock by the Selling Stockholders.
SELLING STOCKHOLDERS AND PLAN OF DISTRIBUTION
The 385,000 shares of Common Stock (the "Shares") being registered
under the shelf registration statement of which this Prospectus forms a part
were acquired by the Selling Stockholders either directly or indirectly from a
wholly-owned subsidiary of the Company, Word Industries Fabricators, Inc.
("WIFI"), in connection with the acquisition by WIFI of (i) substantially all
of the equipment and rolling stock of Word Industries Pipe Fabricating, Inc.
("WIPF"), as well as certain real estate owned or used by WIPF in connection
with its pipe fabrication business in Tulsa, Oklahoma; and (ii) certain real
estate, facilities and related assets used by WIPF as its paint and sand
blasting facility located in Cleveland, Oklahoma. In connection with the
transactions described above, the Company agreed to file a registration
statement with the Commission for the Shares and the Company did file such
registration statement on May 3, 1996. The Shares are being registered to
facilitate their sale under the Securities Act. Pursuant to such registration
statement, the Selling Stockholders may choose to sell all or a portion of the
Shares from time to time in transactions reported on the Nasdaq Stock Market,
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 table below reflects the number of shares of
Common Stock owned prior to the offering, the number of shares being offered
hereby for the Selling Stockholders account, and the percentage of outstanding
shares to be held by them before and following completion of the offering.
Although the following table is presented on the assumption that all of the
Selling Stockholders will sell all of their shares, the Company cannot predict
whether this in fact will occur (and the Selling Stockholders have indicated
that they do not presently intend to sell all of their shares of Common Stock),
the timing or amount of any actual sales, or the impact thereof or the market
price of the Company's Common Stock. One of the Selling Stockholders, Sharron
Stuart, is married to Louis V. Stuart, who is an officer of a Shaw subsidiary
and a shareholder of one of WIPF's affiliates. In addition, T.N. Word has
entered into an employment agreement with Shaw's subsidiary, WIFI, pursuant to
which T.N. Word will serve as President of WIFI.
<TABLE>
<CAPTION>
=====================================================================================================================
BENEFICIAL OWNERSHIP BENEFICIAL OWNERSHIP
BEFORE THE OFFERING AFTER THE OFFERING(1)
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NAME OF SELLING STOCKHOLDER SHARES PERCENT(2) SHARES TO BE SOLD SHARES PERCENT(2)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Word Industries Pipe Fabricating, 115,000 1.21% 115,000 0 0%
Inc.
- ---------------------------------------------------------------------------------------------------------------------
T.N. Word 183,315 1.93% 183,315 0 0%
- ---------------------------------------------------------------------------------------------------------------------
Martha Plunk 28,895 .03% 28,895 0 0%
- ---------------------------------------------------------------------------------------------------------------------
Marilyn Choate 28,895 .03% 28,895 0 0%
- ---------------------------------------------------------------------------------------------------------------------
Sharron Stuart 61,881(3) .065% 28,895 32,986 .035%
=====================================================================================================================
</TABLE>
____________________
(1) Assumes that the Selling Stockholders will sell all of their shares of
Common Stock offered hereby, which they may or may not do.
(2) Based upon 9,489,552 shares, the number of shares of Common Stock
outstanding as of May 31, 1996.
(3) Includes 32,986 shares beneficially owned an by immediate family member,
6,250 of which may be acquired upon the exercise of options within 60 days
and are thus deemed beneficially owned pursuant to Rule 13d-3(a) of the
Exchange Act.
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The Shares owned by the Selling Stockholders may be sold from time to time
by the Selling Stockholders, on one or more exchanges or in the over-the-counter
market, or otherwise at prices and on terms then prevailing or at prices then
related to the then current market price, or in negotiated transactions. The
Shares may be sold by or through broker- dealers in one or more of the following
transactions: (a) 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 any transaction, (b) purchases by a broker or
dealer as principal and resale by such broker or dealer for its account pursuant
to the Registration Statement relating thereto, and (c) ordinary brokerage
transactions and transactions in which the broker solicits purchasers. In
effecting sales, brokers and dealers engaged by the Selling Stockholders may
arrange for other brokers or dealers to participate. Brokers or dealers will
receive commissions or discounts from the Selling Stockholders in amounts to be
negotiated (and, if such broker-dealer acts as agent for the purchaser of such
shares, from such purchaser). Broker-dealers may agree with the Selling
Stockholders to sell a specified number of Shares at a stipulated price per
Share, and, to the extent such a broker-dealer is unable to do so acting as
agent for a Selling Stockholders, to purchase as principal any unsold shares at
the price required to fulfill the broker-dealer commitment to such Selling
Stockholder. Broker-dealers who acquire Shares as principal may thereafter
resell such Shares from time to time in transactions (which may involve crosses
and book transactions and which may involve sales to and through other
broker-dealers, including transactions, of the nature described above) in the
over-the-counter market, in negotiated transactions or otherwise, at market
prices prevailing at the time of sale or at negotiated prices, and in connection
with such resales may pay to or receive from the purchasers of such Shares
commissions as described above. Pursuant to the registration agreement entered
into in connection with the transactions described above, the Company has agreed
to indemnify the Selling Stockholders against certain liabilities, including
liabilities under the Securities Act.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of 50,000,000 shares
of Common Stock, no par value; and 5,000,000 shares of Preferred Stock, no par
value. The following summary of certain provisions of the Company's capital
stock describes all material provisions of, but does not purport to be complete
and is subject to and is qualified in its entirety by, the Restated Articles of
Incorporation and the Amended and Restated By-Laws of the Company that are
incorporated herein by reference as exhibits to the Registration Statement of
which this Prospectus forms a part and by the provisions of applicable law.
COMMON STOCK
As of May 31, 1996, there were 9,489,552 shares of Common Stock
outstanding. In addition, 838,625 shares of Common Stock are reserved for
issuance pursuant to the Company's 1993 Employee Stock Option Plan. Cumulative
voting is prohibited in the election of directors. The holders of Common Stock
are entitled to receive ratably such dividends, if any, as may be declared from
time to time by the Board of Directors out of funds legally available therefor.
In the event of a liquidation, dissolution or winding up of the Company, the
holders of Common Stock are entitled to share equally and ratably in the assets
available for distribution after payment of all liabilities, and subject to any
prior rights of any holders of preferred stock that at the time may be
outstanding. The Common Stock is not redeemable, does not have any conversion
rights and is not subject to call. Holders of shares of Common Stock have no
preemptive rights to maintain their respective percentage of ownership in future
offerings or sales of stock by the Company. The shares of Common Stock presently
outstanding are fully paid and non-assessable. The Common Stock is quoted on
the Nasdaq Stock Market under the symbol "SHAW".
Each outstanding share of Common Stock will entitle the holder thereof to
five votes on each matter properly submitted to the shareholders of the Company
for their vote, waiver, release or other action; except that no holder of
outstanding shares of Common Stock will be entitled to exercise more than one
vote on any such matter in respect of any share of Common Stock with respect to
which there has been a change in beneficial ownership during the four years
immediately preceding the date on which a determination is made of the
shareholders of the Company who are entitled to vote or to take any other
action. A change in beneficial ownership of an outstanding share of Common
Stock will be deemed to have occurred
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whenever a change occurs in any person or persons who, directly or indirectly,
through any contract, agreement, arrangement, understanding, relationship or
otherwise has or shares any of the following:
(a) voting power, which includes, without limitation, to vote or the
power to direct the voting power of such share of Common Stock;
(b) investment power, which includes, without limitation, the power to
direct the sale or other disposition of such share of Common Stock;
(c) the right to receive or to retain the proceeds of any sale or other
disposition of such share of Common Stock; or
(d) the right to receive or to retain any distributions, including,
without limitation, cash dividends, in respect of such share of
Common Stock.
Without limiting the generality of the foregoing, the following events or
conditions will be deemed to involve a change in beneficial ownership of a
share of Common Stock:
(a) in the absence of proof to the contrary provided in accordance with
certain procedures set forth below, a change in beneficial
ownership will be deemed to have occurred (i) whenever an
outstanding share of Common Stock is transferred of record into the
name of any other person, and (ii) upon the issuance of shares in a
public offering;
(b) in the case of an outstanding share of Common Stock held of record
in the name of a corporation, general partnership, limited
partnership, voting trustee, bank, trust company, broker, nominee
or clearing agency, if it has not been established pursuant to the
procedures set forth below that there has been no change in the
person or persons who or that direct the exercise of the rights
referred to in (a) through (d), inclusive, above with respect to
such outstanding share of Common Stock during the four years
immediately preceding the date on which a determination is made of
the shareholders of the Company entitled to vote or to take any
other action, then a change in beneficial ownership of such share
of Common Stock shall be deemed to have occurred during such
period;
(c) in the case of an outstanding share of Common Stock held of record
in the name of any person as a trustee, agent, guardian or
custodian under the Uniform Gifts to Minors Act as in effect in any
jurisdiction, a change in beneficial ownership will be deemed to
have occurred whenever there is a change in the beneficiary of such
trust, the principal of such agent, the ward of such guardian, the
minor for whom such custodian is acting or a change in such
trustee, agent, guardian or custodian; or
(d) in the case of outstanding shares of Common Stock beneficially
owned by a person or group of persons, who, after acquiring,
directly or indirectly, the beneficial ownership of 5% of the
outstanding shares of Common Stock, fails to notify the Company of
such ownership within ten days after such acquisition, a change in
beneficial ownership of such shares of Common Stock will be deemed
to occur on each day while such failure continues.
Notwithstanding any other provisions in the Company's Restated Articles of
Incorporation to the contrary, no change in beneficial ownership of an
outstanding share of Common Stock shall be deemed to have occurred solely as a
result of:
(a) any transfer of any interest in an outstanding share of Common
Stock pursuant to a bequest or inheritance, by operation of law
upon the death of any individual or by any other transfer without
valuable consideration, including, without limitation, a gift that
is made in good faith and not for the purpose of circumventing the
provisions of the Company's Restated Articles of Incorporation;
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(b) any changes in beneficiary of any trust, or any distribution of an
outstanding share of Common Stock from trust, by reason of the
birth, death, marriage or divorce of any natural person; the
adoption of any natural person prior to age 18; or the passage of a
given period of time or the attainment by any natural person of a
specific age; or the creation or termination of any guardianship or
custodial arrangement;
(c) any appointment of a successor trustee, agent, guardian or
custodian with respect to an outstanding share of Common Stock if
neither such successor has nor its predecessor had the power to
vote or to dispose of such share of Common Stock without further
instructions from others;
(d) any change in the person to whom dividends or other distributions
in respect of an outstanding share of Common Stock are to be paid
pursuant to the issuance or modification of a revocable dividend
payment order;
(e) any issuance of a share of Common Stock by the Company or any
transfer by the Company of a share of Common Stock held in
treasury other than in a public offering thereto, unless otherwise
determined by the Board of Directors at the time of authorizing
such issuance or transfer;
(f) any giving of a proxy in connection with a solicitation of proxies
subject to the provisions of Section 14 of the Securities Exchange
Act of 1934, as amended, and the rules and regulations thereunder
promulgated;
(g) any transfer, whether or not with consideration, among individuals
related or formerly related by blood, marriage or adoption
("relatives") or between a relative and any person controlled by
one or more relatives where the principal purpose for the transfer
is to further the estate tax planning objectives of the transferor
or of relatives of the transferor;
(h) any appointment of a successor trustee as a result of the death of
the predecessor trustee (which predecessor trustee shall have been
a natural person);
(i) any appointment of a successor trustee who or which was
specifically named in a trust instrument prior to the effective
date of this Offering; or
(j) any appointment of a successor trustee as a result of the
resignation, removal or failure to qualify of a predecessor trustee
or as a result of mandatory retirement pursuant to the express
terms of a trust instrument; provided, that less than 50% of the
trustees administering any single trust will have changed
(including in such percentage the appointment of the successor
trustee) during the four-year period preceding the appointment of
such successor trustee.
All determinations concerning changes in beneficial ownership, or the
absence of any such change, are made by the Board of Directors of the Company
or, at any time when the Company employs a transfer agent with respect to the
shares of Common Stock, at the Company's request, by such transfer agent on the
Company's behalf. Written procedures designated to facilitate such
determinations are to be established and may be amended, from time to time, by
the Board of Directors. Such procedures will provide, among other things, the
manner of proof of facts that will be accepted and the frequency with which
such proof may be required to be renewed. The Company and any transfer agent
will be entitled to rely on any and all information concerning beneficial
ownership of the outstanding shares of Common Stock coming to their attention
from any source and in any manner reasonably deemed by them to be reliable, but
neither the Company nor any transfer agent shall be charged with any other
knowledge concerning the beneficial ownership of outstanding shares of Common
Stock.
In the event of any stock split or stock dividend with respect to the
outstanding shares of Common Stock, each share of Common Stock acquired by
reason of such split or dividend will be deemed to have been beneficially owned
by the same person from the same date as that on which beneficial ownership of
the outstanding share or shares of Common Stock, with respect to which such
share of Common Stock was distributed, was acquired.
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Each outstanding share of Common Stock, whether at any particular time the
holder thereof is entitled to exercise five votes or one vote, shall be
identical to all other shares of Common Stock in all respects, and together the
outstanding shares of Common Stock will constitute a single class of shares of
the Company.
PREFERRED STOCK
The Board of Directors is authorized to provide for the issuance of
5,000,000 shares of Preferred Stock in one or more series and to fix the number
of shares constituting any such series, the voting powers, designations,
preferences and relative, participating, optional or other special rights and
qualifications, limitations or restrictions thereof, including the dividend
rights, dividend rate, terms of redemption, redemption price or prices,
conversion rights and liquidation preferences of the shares constituting any
series, without any further vote or action by the shareholders of the Company.
The issuance of Preferred Stock by the Board of Directors could adversely
affect the rights of holders of Common Stock. For example, issuance of
Preferred Stock could result in a series of securities outstanding that would
have preferences over the Common Stock with respect to dividends and in
liquidation and that could (upon conversion or otherwise) enjoy all of the
rights appurtenant to the Common Stock. The authority possessed by the Board
of Directors to issue Preferred Stock could potentially be used to discourage
attempts by others to obtain control of the Company through merger, tender
offer, proxy, consent or otherwise by making such attempts more difficult to
achieve or more costly. The Board of Directors may issue Preferred Stock
without shareholder approval and with voting and conversion rights which could
adversely affect the voting owner of holders of Common Stock. There are no
agreements or understandings for the issuance of Preferred Stock, and the Board
of Directors has no present intention to issue any shares of Preferred Stock.
LOUISIANA FAIR PRICE AND CONTROL ACQUISITION STATUTES
Under Louisiana law, the acquisition of voting power (a "control share
acquisition") of an "issuing public corporation" that results in the purchaser
acquiring voting power in excess of 20%, 33 1/3% or 51% of the total voting
power of the issuing public corporation requires approval of a majority of the
voting power of the issuing public corporation and each class entitled to vote
separately on the proposal, excluding the shares of the acquiring person, any
officer of the issuing public corporation and any employee of the issuing
public corporation who is also a director of such corporation. Shares acquired
in a control share acquisition without such approval will have no voting rights
and under certain circumstances may be subject to a redemption by the
corporation. The restrictions imposed under such law are applicable to all
Louisiana corporations that fall within the definition of an "issuing public
corporation" (as does the Company) unless the issuing public corporation's
articles of incorporation or by-laws, as in effect before the acquisition has
occurred, provide that such provisions do not apply. The Company's Restated
Articles of Incorporation and Amended and Restated Bylaws do not contain such a
provision; therefore, the above restrictions contained in Louisiana law do
apply to the Company.
In addition, if certain elections were to be made by the Company's Board of
Directors under the Louisiana Business Corporation Law, unless certain price
and procedural requirements are met, certain business combinations involving
the Company and any holder of 20% or more of the Company's outstanding voting
stock may be required to be approved by at least (i) 80% of the votes entitled
to be cast by holders of the outstanding voting stock and (ii) two-thirds of
the votes entitled to be cast by the holders of voting stock other than the
voting stock held by such holder. This provision could be regarded as a
deterrent to a takeover of the Company and could be applied selectively by the
Board of Directors.
LIMITATION OF DIRECTOR AND OFFICER LIABILITY
The Company's Restated Articles of Incorporation contain provisions which
eliminate the personal liability of its directors and officers, for monetary
damages resulting from breaches of their fiduciary duty other than liability
for breaches of the duty of loyalty, acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, for
violations under Section 92(D) of the Louisiana Business Corporation Law or any
transaction from which the director or officer derived an improper personal
benefit. The Restated Articles of Incorporation contain provisions requiring
the indemnification of the Company's directors and officers to the fullest
extent permitted by Section 83 of the Louisiana Business Corporation Law,
including circumstances in which indemnification is otherwise discretionary.
The Company agents believe that these provisions are necessary to attract and
retain qualified persons as directors and officers.
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CLASSIFIED BOARD OF DIRECTORS
The Company's Restated Articles of Incorporation provide that if the number
of directors constituting the entire Board of Directors is increased to twelve
or more members, then at the next meeting of shareholders at which directors
are to be elected, the Board of Directors shall be divided into three classes,
the members of which will serve staggered three-year terms. The Company
believes that a classified board of directors could help to assure the
continuity and stability of the Board's and Shaw's business strategies and
policies as determined by the Board of Directors. The classified board
provision, if implemented, could have the effect of making the removal of
incumbent directors more time-consuming and, therefore, discouraging a third
party from making a tender offer or otherwise attempting to obtain control of
Shaw, even though such an attempt might be beneficial to Shaw and its
shareholders. Thus, the classified board provision could increase the
likelihood that incumbent directors would retain their positions.
ADVANCE NOTICE PROVISIONS FOR CERTAIN SHAREHOLDER ACTIONS
The Company's Amended and Restated By-Laws establish an advance notice
procedure with regard to the nomination, other than by or at the direction of
the Board or a committee thereof, of candidates for election as directors (the
"Nomination Procedure") and with regard to certain matters to be brought before
an annual meeting of shareholders of the Company (the "Business Procedure").
Under the Business Procedure, a shareholder seeking to have any business
conducted at an annual meeting must give prior written notice, in proper form,
to the Secretary of the Company. The requirements as to the form and timing of
that notice are specified in the Company's Amended and Restated By-Laws. If
the Chairman or other officer presiding at a meeting determines that other
business was not properly brought before such meeting in accordance with the
Business Procedure, such business will not be conducted at the meeting.
The Nomination Procedure requires that a shareholder give prior written
notice, in proper form, of a planned nomination for the Company's Board of
Directors to the Secretary of the Company. The requirements as to the form and
timing of that notice are specified in the By-Laws. If the election inspectors
determine that a person was not nominated in accordance with the Nomination
Procedure, such person will not be eligible for election as a director.
Although the By-Laws do not give the Board of Directors any power to
approve or disapprove shareholder nominations for the election of directors or
of any other business desired by shareholders to be conducted at an annual or
any other meeting, the Company's Amended and Restated By-Laws (i) may have the
effect of precluding a nomination for the election of directors or precluding
the conduct of business at a particular annual meeting if the proper procedures
are not followed, or (ii) may discourage or deter a third party from conducting
a solicitation of proxies to elect its own slate of directors or otherwise
attempting to obtain control of the Company, even if the conduct of such
solicitation or such attempt might be beneficial to the Company and its
shareholders.
SUPER MAJORITY PROVISIONS
The Company's Restated Articles of Incorporation contain provisions
requiring the affirmative vote of the holders of at least 75% of voting power
of the Company's capital stock to amend certain provisions of the Articles,
including provisions relating to the removal of directors.
The Company's Restated Articles of Incorporation require the approval of
the holders of at least 75% of the Company's outstanding shares of Common Stock,
not including shares held by a Related Person (as defined below), to approve
certain Business Combinations (as defined below) and related transactions. The
term "Related Person" is defined to include any individual, corporation,
partnership or other entity which owns beneficially, directly or indirectly,
more than 5% of the outstanding shares of Common Stock of the Company. The term
"Business Combination" is defined to include, among other things, (i) any merger
of consolidation of the Company or a subsidiary of the Company which constitutes
more than 50% of the assets of the Company, other than a merger or consolidation
which results in the voting securities of the Company outstanding immediately
prior thereto continuing to represent more than 50% of the combined voting power
of the voting
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securities of the surviving entity; (ii) any sale, lease, exchange, transfer or
other disposition of more than 50% of the assets of the Company; (iii) any
reclassification of the Common Stock of the Company; and (iv) any liquidation
or dissolution of the Company.
TRANSFER AGENT AND REGISTRAR
The transfer agent and registrar for the Common Stock is First Union
National Bank, Charlotte, North Carolina.
LEGAL MATTERS
The legality of the shares of Common Stock offered hereby will be passed
upon for the Company by the law firm of Kantrow, Spaht, Weaver & Blitzer (A
Professional Law Corporation), P.O. Box 2997, Baton Rouge, Louisiana, 70821.
As of May 31, 1996, members of the firm of Kantrow, Spaht, Weaver & Blitzer
(A Professional Law Corporation) owned, directly or indirectly, approximately
100 shares of the Company's Common Stock.
EXPERTS
The consolidated financial statements and the related financial statement
schedules incorporated in this Prospectus by reference from the Company's
Annual Report on Form 10-K for the fiscal year ended August 31, 1995 have been
audited by Arthur Andersen LLP and Hannis T. Bourgeois & Co., L.L.P.,
independent auditors, as stated in their report, which is incorporated herein
by reference, and have been so incorporated in reliance upon the report of such
firm given upon their authority as experts in accounting and auditing. The
single, jointly signed auditor's report is considered to be the equivalent of
two separately signed auditor's reports. Thus, each firm represents that it
has complied with generally accepted auditing standards and is in a position
that would justify being the only signatory of the report.
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NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THIS OFFERING
OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH OTHER
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN SO
AUTHORIZED BY THE COMPANY OR THE SELLING STOCKHOLDERS. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS OR AN OFFER
TO SELL OR THE SOLICITATION OF AN OFFER TO ANY SUCH SECURITIES IN ANY
CIRCUMSTANCES IN WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
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TABLE OF CONTENTS
<TABLE>
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Page
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<S> <C>
Incorporation of Certain Documents
by Reference . . . . . . . . . . . . . 2
Available Information . . . . . . . . . . 2
The Company . . . . . . . . . . . . . . . 3
Risk Factors . . . . . . . . . . . . . . 3
Use of Proceeds . . . . . . . . . . . . . 5
Selling Stockholders and Plan of
Distribution . . . . . . . . . . . . . 5
Description of Capital Stock . . . . . . 6
Legal Matters . . . . . . . . . . . . . . 11
Experts . . . . . . . . . . . . . . . . . 11
</TABLE>
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385,000 SHARES
THE SHAW GROUP INC.
COMMON STOCK
[LOGO]
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PROSPECTUS
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JULY 8, 1996
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