SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): October 13, 1994
Boise Cascade Corporation
____________________________________________________________
(Exact Name of Registrant as Specified in Its Charter)
Delaware 1-5057 82-0100960
______________________________________________________________________
(State or Other Jurisdiction of (Commission (I.R.S. Employer
Incorporation or Organization) File Number) Identification No.)
One Jefferson Square, Boise, Idaho 83702
______________________________________________________________________
(Address of Principal Executive Offices) (ZIP Code)
Registrant's Telephone Number, Including Area Code: 208/384-6161
Item 2. Acquisition or Disposition of Assets
On October 13, 1994, the Company's Canadian subsidiary, Rainy
River Forest Products Inc., ("Rainy River"), completed an initial
public offering of units (the "Units") of its equity and debt
securities. Concurrently with the sale of the Units, Rainy River
also sold to the public U.S. $110 million aggregate principal
amount of 10 3/4% Senior Secured Notes due 2001 (the "Senior
Notes").
The sale of Cdn. $420 million of Units consisted of 14 million
newly issued common shares of Rainy River sold to the public for
an aggregate offering price of Cdn. $210 million and Cdn. $210
million principal amount 8.0% Convertible Unsecured Subordinated
Debentures due October 15, 2004 (the "Convertible Debentures")
sold to the public at 100% of the principal amount thereof plus
accrued interest, if any. Net proceeds to Rainy River, after
payment of underwriters' fees, from the Unit offering was Cdn.
$199.5 million with respect to the common shares and Cdn. $199.5
with respect to the Convertible Debentures. The initial public
offering price of the Units was determined through negotiations
between Rainy River and the underwriters. The Units were
separated into common shares and Convertible Debentures at the
closing of the Unit offering.
The common shares sold represent approximately 51% of the total
outstanding voting common shares and approximately 40.34% of the
total outstanding equity of Rainy River. As a result, the
Company now owns 49% of the outstanding voting common shares and
59.66% of the total equity of Rainy River.
Rainy River owns and operates a newsprint mill in Kenora,
Ontario, Canada, and an uncoated groundwood papers mill in Fort
Frances, Ontario, Canada. On September 28, 1994, Rainy River
acquired as part of its reorganization and refinancing, including
the sale of the Units and the Senior Notes, the Company's West
Tacoma, Washington, newsprint mill and its associated working
capital. On the same date, Rainy River also acquired the news-
print and uncoated groundwood papers marketing and sales
organization of the Company. The Company received approximately
U.S. $148 million from Rainy River as consideration for these
transactions. Rainy River and the Company also entered into an
agreement whereby Rainy River will purchase from the Company, at
a brokerage discount for resale to customers of Rainy River, all
of the newsprint produced at the Company's mill located at
DeRidder, Louisiana, for which orders have been received by Rainy
River.
Item 7.Financial Statements, Pro Forma Financial Information and
Exhibits.
(b) Pro forma financial information:
The unaudited pro forma Boise Cascade Corporation and
Subsidiaries financial information giving effect to the
transactions discussed in Item 2 of this report on Form 8-K
are set forth in Exhibit 20 attached hereto and filed
herewith.
(c) Exhibits:
2 Underwriting Agreement, dated September 29, 1994,
between Rainy River and certain underwriters, with
respect to the common shares and Convertible Debentures
of Rainy River (incorporated herein by reference to
Exhibit 10.18 to the registration statement on Form F-1
(Registration No. 33-79104) of Rainy River Forest
Products Inc.).
20 Unaudited pro forma Boise Cascade Corporation and
Subsidiaries financial information, including:
condensed balance sheet as of September 30, 1994;
consolidated statement of income (loss) for the nine
months ended September 30, 1994; consolidated statement
of income (loss) for the twelve months ended
December 31, 1993; and notes to unaudited pro forma
financial information.
SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly
authorized.
BOISE CASCADE CORPORATION
IRVING LITTMAN
Irving Littman
Vice President and Treasurer
Date: October 24, 1994
Exhibit Index
Exhibit No. Description Page
2 Underwriting Agreement, dated
September 29, 1994, between Rainy River
and certain underwriters, with respect
to the common shares and Convertible
Debentures of Rainy River (incorporated
herein by reference to Exhibit 10.18 to
the registration statement on Form F-1
(Registration No. 33-79104) of Rainy
River Forest Products Inc.).
20 Unaudited pro forma Boise Cascade
Corporation and Subsidiaries financial
information, including: condensed
balance sheet as of September 30, 1994;
consolidated statement of income (loss)
for the nine months ended September 30,
1994; consolidated statement of income
(loss) for the twelve months ended
December 31, 1993; and notes to
unaudited pro forma financial
information.
Exhibit No. 20
Unaudited pro forma Boise Cascade Corporation and
Subsidiaries financial information, including: condensed balance
sheet as of September 30, 1994; consolidated statement of income
(loss) for the nine months ended September 30, 1994; consolidated
statement of income (loss) for the twelve months ended
December 31, 1993; and notes to unaudited pro forma financial
information.
Unaudited Pro Forma Boise Cascade Corporation
and Subsidiaries
Financial Information
The following unaudited pro forma consolidated condensed balance
sheet as of September 30, 1994, and the unaudited pro forma
consolidated statements of income (loss) for the nine months
ended September 30, 1994, and the twelve months ended
December 31, 1993, give effect to the following transactions:
On October 13, 1994, the Company's Canadian subsidiary, Rainy
River Forest Products Inc., ("Rainy River"), completed an initial
public offering of units (the "Units") of its equity and debt
securities. Concurrently with the sale of the Units, Rainy
River also sold to the public U.S. $110 million aggregate
principal amount of 10 3/4% Senior Secured Notes due 2001 (the
"Senior Notes").
The sale of Cdn. $420 million of Units consisted of 14 million
newly issued common shares of Rainy River sold to the public for
an aggregate offering price of Cdn. $210 million and
Cdn. $210 million principal amount 8.0% Convertible Unsecured
Subordinated Debentures due October 15, 2004 (the "Convertible
Debentures") sold to the public at 100% of the principal amount
thereof plus accrued interest, if any. Net proceeds to Rainy
River, after payment of underwriters' fees, from the Unit
offering was Cdn. $199.5 million with respect to the common
shares and Cdn. $199.5 with respect to the Convertible
Debentures. The initial public offering price of the Units was
determined through negotiations between Rainy River and the
underwriters. The Units were separated into common shares and
Convertible Debentures at the closing of the Unit offering.
The common shares sold represent approximately 51% of the total
outstanding voting common shares and approximately 40.34% of the
total outstanding equity of Rainy River. As a result, the
Company now owns 49% of the outstanding voting common shares and
59.66% of the total equity of Rainy River.
Rainy River owns and operates a newsprint mill in Kenora,
Ontario, Canada, and an uncoated groundwood papers mill in Fort
Frances, Ontario, Canada. On September 28, 1994, Rainy River
acquired as part of its reorganization and refinancing, including
the sale of the Units and the Senior Notes, the Company's West
Tacoma, Washington, newsprint mill and its associated working
capital. On the same date, Rainy River also acquired the news-
print and uncoated groundwood papers marketing and sales
organization of the Company. The Company received approximately
U.S. $148 million from Rainy River as consideration for these
transactions. Rainy River and the Company also entered into an
agreement whereby Rainy River will purchase from the Company, at
a brokerage discount for resale to customers of Rainy River, all
of the newsprint produced at the Company's mill located at
DeRidder, Louisiana, for which orders have been received by Rainy
River.
On October 13, 1994 the Company received cash of $181,724,000
from Rainy River which included payment of the consideration for
these transactions and repayment of cash advances.
Since the Company will no longer exercise control, Rainy River
has been accounted for on the equity method retroactive to
January 1, 1994, in the Company's historical consolidated
financial statements.
The unaudited pro forma consolidated financial information is
presented as if these transactions had been completed as of
September 30, 1994, for the pro forma consolidated condensed
balance sheet and as of the first day of each period for which
pro forma consolidated statements of income (loss) are presented.
The pro forma financial information does not purport to be
indicative of the actual financial position as it will finally be
recorded, or the results of operations which would actually have
been reported if the transactions had occurred on the dates or
for the periods indicated, or which may be reported in the
future. The pro forma financial information should be read in
conjunction with the separate historical consolidated financial
statements and the related notes to such financial statements of
Boise Cascade and Rainy River.
Boise Cascade Corporation and Subsidiaries
Pro Forma Condensed Balance Sheet
September 30, 1994
(expressed in thousands)
(unaudited)
Historical Pro Forma
Boise Cascade Boise Cascade
Corporation and Pro Forma Corporation and
Subsidiaries Rainy River Adjustments Subsidiaries
(Note 1) (Note 1) (Note 2)
ASSETS
Current
Cash and cash items $ 30,644 $ - $ (9,639)(b) $ 21,005
Short-term investments 4,972 - - 4,972
__________ __________ __________ __________
35,616 - (9,639) 25,977
Receivables, net 393,530 - - 393,530
Receivables from equity
affiliates 181,834 - (181,724)(a) 9,749
- - 9,639(b) -
Inventories 397,519 - - 397,519
Deferred income tax benefits 44,522 - - 44,522
Other 18,112 - - 18,112
__________ __________ __________ __________
1,071,133 - (181,724) 889,409
__________ __________ __________ __________
Property
Property and equipment 4,526,595 - - 4,526,595
Accumulated depreciation (2,025,993) - - (2,025,993)
__________ __________ __________ __________
2,500,602 - - 2,500,602
Timber, timberlands, and timber
deposits 403,914 - - 403,914
__________ __________ __________ __________
2,904,516 - - 2,904,516
__________ __________ __________ __________
Investments in equity affiliates 214,585 - - 214,585
Other assets 268,140 - - 268,140
__________ __________ __________ __________
Total assets $4,458,374 $ - $ (181,724) $4,276,650
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Notes payable $ 62,000 $ - $ - $ 62,000
Current portion of long-term
debt 83,010 - - 83,010
Accounts payable 306,631 - - 306,631
Accrued liabilities 240,807 - - 240,807
__________ __________ __________ __________
692,448 - - 692,448
__________ __________ __________ __________
Debt
Long-term debt, less current
portion 1,768,527 - (181,724)(a) 1,586,803
Guarantee of ESOP debt 245,027 - - 245,027
__________ __________ __________ __________
2,013,554 - (181,724) 1,831,830
__________ __________ __________ __________
Other
Deferred income taxes 128,953 - - 128,953
Other long-term liabilities 263,923 - - 263,923
__________ __________ __________ __________
392,876 - - 392,876
__________ __________ __________ __________
Shareholders' equity
Preferred stock 762,941 - - 762,941
Deferred ESOP benefit (245,027) - - (245,027)
Common stock 95,582 - - 95,582
Retained earnings 746,000 - - 746,000
__________ __________ __________ __________
Total shareholders' equity 1,359,496 - - 1,359,496
__________ __________ __________ __________
Total liabilities and
shareholders' equity $4,458,374 $ - $ (181,724) $4,276,650
The accompanying notes are an integral part of this pro forma information.
Boise Cascade Corporation and Subsidiaries
Pro Forma Statement of Income (Loss)
Nine Months Ended September 30, 1994
(expressed in thousands)
(unaudited)
Historical Pro Forma
Boise Cascade Boise Cascade
Corporation and Pro Forma Corporation and
Subsidiaries Rainy River Adjustments Subsidiaries
(Note 1) (Note 1) (Note 2)
Revenues
Sales $3,031,510 $ - $ (5,450)(a) $3,026,060
Other income, net 6,930 - - 6,930
__________ __________ __________ __________
3,038,440 - (5,450) 3,032,990
__________ __________ __________ __________
Cost and expenses
Materials, labor, and other
operating expenses 2,537,910 - 1,460 (b) 2,539,370
Depreciation and cost of
company timber harvested 176,380 - - 176,380
Selling and administrative
expenses 285,580 - (10,070)(c) 275,510
__________ __________ __________ __________
2,999,870 - (8,610) 2,991,260
__________ __________ __________ __________
Equity in net income (loss)
of affiliates (24,160) 26,590 (16,890)(d) (14,460)
__________ __________ __________ __________
Income (loss) from operations 14,410 26,590 (13,730) 27,270
__________ __________ __________ __________
Interest expense (110,030) - 5,810 (e) (104,220)
Interest income 790 - - 790
Foreign exchange loss (130) - - (130)
Loss on sale of subsidiary's
stock (10,200) - 10,200 (f) -
__________ __________ __________ __________
(119,570) - 16,010 (103,560)
__________ __________ __________ __________
Income (loss) before income taxes (105,160) 26,590 2,280 (76,290)
Income tax provision (benefit) (16,690) 6,500 (20,200)(g) (23,500)
- - 6,890 (h) -
__________ __________ __________ __________
Net income (loss) $ (88,470) $ 20,090 $ 15,590 $ (52,790)
Primary and fully diluted
net loss per share $ (3.40) $ (2.53)
Average common shares
outstanding 38,057 38,057
The accompanying notes are an integral part of this pro forma information.
Boise Cascade Corporation and Subsidiaries
Pro Forma Statement of Income (Loss)
Twelve Months Ended December 31, 1993
(expressed in thousands)
(unaudited)
Historical Pro Forma
Boise Cascade Boise Cascade
Corporation and Pro Forma Corporation and
Subsidiaries Rainy River Adjustments Subsidiaries
(Note 1) (Note 1) (Note 2)
Revenues
Sales $3,958,300 $ (309,950) $ (7,310)(a) $3,641,040
Other income (expense), net 10,570 (1,140) - 9,430
__________ __________ __________ __________
3,968,870 (311,090) (7,310) 3,650,470
__________ __________ __________ __________
Cost and expenses
Materials, labor, and other
operating expenses 3,373,300 (306,800) (950)(b) 3,065,550
Depreciation and cost of
company timber harvested 267,710 (33,790) - 233,920
Selling and administrative
expenses 321,650 (930) (13,040)(c) 307,680
__________ __________ __________ __________
3,962,660 (341,520) (13,990) 3,607,150
__________ __________ __________ __________
Equity in net income (loss)
of affiliates 13,570 - (15,940)(d) (2,370)
__________ __________ __________ __________
Income (loss) from operations 19,780 30,430 (9,260) 40,950
__________ __________ __________ __________
Interest expense (148,310) 5,510 6,880 (e) (135,920)
Interest income 1,330 (80) - 1,250
Foreign exchange gain (loss) 1,610 (2,830) - (1,220)
__________ __________ __________ __________
(145,370) 2,600 6,880 (135,890)
__________ __________ __________ __________
Income (loss) before income taxes (125,590) 33,030 (2,380) (94,940)
Income tax provision (benefit) (48,450) 26,790 5,270 (h) (16,390)
__________ __________ __________ __________
Net income (loss) $ (77,140) $ 6,240 $ (7,650) $ (78,550)
Primary and fully diluted
net loss per share $ (3.17) $ (3.20)
Average common shares outstanding 37,958 37,958
The accompanying notes are an integral part of this pro forma information.
Boise Cascade Corporation and Subsidiaries
Notes to Pro Forma Financial Information
(unaudited)
1. Basis of Reporting
The accompanying pro forma consolidated condensed balance
sheet as of September 30, 1994, and the pro forma consoli-
dated statements of income (loss) for the nine months ended
September 30, 1994, and the year ended December 31, 1993,
give effect to the following transactions:
On October 13, 1994, the Company's Canadian subsidiary,
Rainy River Forest Products Inc., ("Rainy River"), completed
an initial public offering of units (the "Units") of
its equity and debt securities. Concurrently with the sale
of the Units, Rainy River also sold to the public
U.S. $110 million aggregate principal amount of 10 3/4% Senior
Secured Notes due 2001 (the "Senior Notes").
The sale of Cdn. $420 million of Units consisted of 14 million
newly issued common shares of Rainy River sold to the public
for an aggregate offering price of Cdn. $210 million and
Cdn. $210 million principal amount 8.0% Convertible Unsecured
Subordinated Debentures due October 15, 2004 (the "Convertible
Debentures") sold to the public at 100% of the principal amount
thereof plus accrued interest, if any. Net proceeds to Rainy
River, after payment of underwriters' fees, from the Unit
offering was Cdn. $199.5 million with respect to the common
shares and Cdn. $199.5 with respect to the Convertible
Debentures. The initial public offering price of the Units
was determined through negotiations between Rainy River and
the underwriters. The Units were separated into common shares
and Convertible Debentures at the closing of the Unit offering.
The common shares sold represent approximately 51% of the
total outstanding voting common shares and approximately
40.34% of the total outstanding equity of Rainy River. As a
result, the Company now owns 49% of the outstanding voting
common shares and 59.66% of the total equity of Rainy River.
Rainy River owns and operates a newsprint mill in Kenora,
Ontario, Canada, and an uncoated groundwood papers mill in
Fort Frances, Ontario, Canada. On September 28, 1994, Rainy
River acquired as part of its reorganization and refinanc-
ing, including the sale of the Units and the Senior Notes,
the Company's West Tacoma, Washington, newsprint mill and
its associated working capital. On the same date, Rainy
River also acquired the newsprint and uncoated groundwood
papers marketing and sales organization of the Company. The
Company received approximately U.S. $148 million from Rainy
River as consideration for these transactions. Rainy River
and the Company also entered into an agreement whereby Rainy
River will purchase from the Company, at a brokerage dis-
count for resale to customers of Rainy River, all of the
newsprint produced at the Company's mill located at
DeRidder, Louisiana, for which orders have been received by
Rainy River.
On October 13, 1994 the Company received cash of
$181,724,000 from Rainy River which included payment of the
consideration for these transactions and repayment of cash
advances.
Since the Company will no longer exercise control, Rainy
River has been accounted for on the equity method retro-
active to January 1, 1994, in the Company's historical
consolidated financial statements.
The unaudited pro forma consolidated financial information
is presented as if these transactions had been completed as
of September 30, 1994, for the pro forma consolidated con-
densed balance sheet and as of the first day of each period
for which pro forma consolidated statements of income (loss)
are presented.
The pro forma financial information does not purport to be
indicative of the actual financial position as it will
finally be recorded, or the results of operations which
would actually have been reported if the transactions had
occurred on the dates or for the periods indicated, or which
may be reported in the future. The pro forma financial
information should be read in conjunction with the separate
historical consolidated financial statements and the related
notes to such financial statements of Boise Cascade and
Rainy River.
The computation of fully diluted net loss per share was
antidilutive in each of the periods presented; therefore,
the amounts reported for primary and fully diluted loss are
the same.
2. Pro Forma Balance Sheet Adjustments
The pro forma consolidated condensed balance sheet gives effect
to the adjustment described below:
(a) To record Boise Cascade's use of proceeds from the
transaction to reduce long-term debt.
(b) To record additional cash advances to Rainy River from
September 30, 1994 to October 13, 1994.
3. Pro Forma Statements of Income (Loss) Adjustments
The pro forma consolidated statements of income (loss) give
effect to the adjustments described below:
(a) To record the reduction in revenues resulting from the
Newsprint Marketing Agreement between Boise Cascade and
Rainy River. Rainy River will purchase all newsprint
produced at Boise Cascade's DeRidder mill, at a brokerage
discount of up to 5%, for resale to Rainy River customers.
(b) To record the adjustment in "Materials, labor, and other
operating expenses" resulting from the Pulp Sale Agreement
between Boise Cascade and Rainy River, whereby Rainy River's
Fort Frances mill will continue to sell market pulp to Boise
Cascade. The price paid by Boise Cascade for the pulp as
defined in the agreement may have been more or less than the
historical price paid by Boise Cascade. Beginning in June
1994, the effects of this agreement have already been
included in the historical balances as presented herein.
(c) To record the reduction in "Selling and administrative
expenses" to reflect the amount which Rainy River would have
reimbursed Boise Cascade for the performance of certain
administrative services.
(d) To adjust to Boise Cascade's 59.66% equity in net losses of
Rainy River's pro forma net loss assuming the effects of the
transactions.
(e) To record the reduction in interest expense resulting from
interest expense saved due to reducing long-term debt by the
amount of proceeds received.
(f) To eliminate the nonrecurring charge related to the loss
recognized for the sale of Rainy River securities
(g) To eliminate the nonrecurring charge associated with Boise
Cascade's recognition of a charge for U.S. taxes on
undistributed Canadian earnings now required to be
recognized as a result of the transaction.
(h) To record the tax effects of pro forma adjustments (a), (b),
(c), (e) and (f).
