Item 1. Business
As used in this annual report, the term "Company" includes Boise Cascade Corporation and its consolidated subsidiaries and predecessors. The terms "Boise Cascade" and "Company" refer, unless the context otherwise requires, to Boise Cascade Corporation and its consolidated subsidiaries.
Boise Cascade Corporation is an integrated paper and forest products company headquartered in Boise, Idaho, with operations located throughout the United States. The Company manufactures and distributes paper and paper products, office products, and building products and owns and manages timberland to support these operations. The Company was incorporated under the laws of Delaware in 1931 under the name Boise Payette Lumber Company of Delaware, as a successor to an Idaho corporation formed in 1913; in 1957, its name was changed to its present form.
The Company is a participant with equity affiliates in connection with certain of its businesses. The Company's principal equity affiliate is Rainy River Forest Products Inc. ("Rainy River"), which is managed independently by Rainy River. The Company holds approximately a 60% equity interest and 49% voting interest. Rainy River is accounted for on the equity method. (See Note 8 of the Notes to Financial Statements of the Company's 1994 Annual Report. This information is incorporated herein by this reference.)
Financial information pertaining to each of the Company's industry segments and to each of its geographic areas for the years 1994, 1993, and 1992 is presented in Note 9, "Segment Information," of the Notes to Financial Statements of the Company's 1994 Annual Report and is incorporated herein by this reference.
The Company's sales and income are affected by the industry supply of product relative to the level of demand and by changing economic conditions in the markets it serves. Demand for paper and paper products and for office products correlates closely with real growth in the gross domestic product. Paper and paper products operations are also affected by demand in international markets and by inventory levels of users of these products. The Company's building products businesses are dependent on repair-and-remodel activity, housing starts, and commercial and industrial building, which in turn are influenced by the availability and cost of mortgage funds. Declines in building activity that may occur during winter affect the Company's building products businesses. In addition, energy and some operating costs may increase at facilities affected by cold weather. However, seasonal influences are generally not significant.
The management practices followed by the Company with respect to working capital conform to those of the paper and forest products industry and common business practice in the United States.
The Company occasionally engages in acquisition discussions with other companies and makes acquisitions from time to time. It is the Company's policy to review its operations periodically and to dispose of assets which fail to meet its criteria for return on investment or which cease to warrant retention for other reasons. (See Notes 1 and 8 of the Notes to Financial Statements of the Company's 1994 Annual Report. This information is incorporated herein by this reference.)
Paper and Paper Products
The products manufactured by the Company, made both from virgin and recycled fibers, include uncoated business, printing, forms, and converting papers; coated white papers for magazines, catalogs, and direct-mail advertising; newsprint; containerboard; and market pulp. These products are available for sale to the related paper markets, and certain of these products are sold through the Company's office products distribution operations. In addition, containerboard is used by the Company in the manufacture of corrugated containers.
The Company is a major North American pulp and paper producer with 7 paper mills. The total annual practical capacity of the mills was approximately 3.2 million tons at December 31, 1994. The Company's products are sold to distributors and industrial customers primarily by the Company's own sales personnel.
The Company's paper mills are supplied with pulp principally from the Company's own integrated pulp mills. Pulp mills in the Northwest manu- facture chemical pulp primarily from wood waste produced as a byproduct of wood products manufacturing. Pulp mills in the Midwest, Northeast, and South manufacture chemical, thermomechanical, and groundwood pulp mainly from pulpwood logs and, to some extent, from purchased wood waste. Wood waste is provided by Company sawmills and plywood mills in the Northwest and, to a lesser extent, in the South, and the remainder is purchased from outside sources.
In October 1994, the Company's Canadian subsidiary, Rainy River, sold a portion of its equity and certain debt securities to the public. Boise Cascade holds approximately a 60% equity interest and 49% voting interest. Rainy River was deconsolidated as of January 1, 1994, and is accounted for on the equity method.
Rainy River owns and operates a newsprint mill in Kenora, Ontario, Canada, an uncoated groundwood paper mill in Fort Frances, Ontario, Canada, and a newsprint mill in West Tacoma, Washington, which was purchased from the Company. Rainy River and the Company have an agreement whereby Rainy River will purchase from the Company, at a brokerage discount for resale to the customers of Rainy River, the newsprint produced at the Company's mill located at DeRidder, Louisiana.
The Company currently manufactures corrugated containers at 7 plants, which have annual practical capacity of approximately 3.9 billion square feet. The containers produced at the Company's plants are used to package fresh fruit and vegetables, processed food, beverages, and many other industrial and consumer products. The Company sells its corrugated containers primarily through its own sales personnel. The Company is building a full-line corrugated container plant in Utah, which is scheduled for completion in early 1996 and will replace an existing plant.
The following table sets forth sales volumes of paper and paper products for the years indicated:
1994 1993 1992 1991 1990 Paper (thousands of short tons)
Uncoated free sheet papers 1,271 1,215 1,110 1,050 934 Containerboard 595 559 560 540 529 Coated papers 447 418 397 371 365 Newsprint(1) 415 860 831 838 873 Market pulp 212 205 260 284 307 Uncoated groundwood papers(1) - 299 319 319 314 ______ ______ ______ ______ ______ 2,940 3,556 3,477 3,402 3,322
Rainy River
Newsprint 450 Uncoated groundwood 318 Market pulp 115 ______
(millions of square feet)
Corrugated containers(2) 3,237 2,961 4,715 6,478 7,087
(1) Indicated line items for 1994 exclude Rainy River, which is reported on the equity method as of January 1, 1994.
(2) On June 30, 1992, the Company sold 11 of its corrugated container plants.
Office Products
The Company distributes a broad line of items for the office, including office and computer supplies, office and computer furniture, and photocopy paper. All of the products sold by this segment are purchased from other manufacturers or from industry wholesalers, except for copier and similar papers, which are sourced primarily from the Company's paper operations. The Company sells these office products directly to corporate, government, and other offices nationwide, as well as to individuals, home offices, and small and medium-sized business offices.
Customers with multisite locations across the country are often serviced via national contracts that provide for consistent pricing and product offerings and, if desired, summary billings, usage reporting, and other special services. The Company operates 26 contract stationer distribution centers, including a center in Colorado that was started up in 1994 and a center in Georgia that was acquired during 1994. Late in 1994 and in early 1995, the Company acquired distribution businesses in Florida and Ohio which will be consolidated into existing locations. The Company also acquired the direct-mail distribution business of The Reliable Corporation in 1994, including four direct-mail distribution centers located in Delaware, Georgia, Illinois, and Nevada. The Company's distribution centers are located across the United States to provide next- day delivery to substantially all domestic locations. The Company also operates 4 retail office supply stores in Hawaii. In December 1994, the Company announced plans to sell a minority interest in its office products distribution business through an initial public offering of equity securities. A registration statement on Form S-1 for Boise Cascade Office Products Corporation was filed with the Securities and Exchange Commission on February 22, 1995.
The following table sets forth sales dollars for the office products distribution business for the years indicated:
1994 1993 1992 1991 1990
Sales (millions) $ 909 $ 683 $ 672(1) $1,039 $1,079
(1) Early in 1992, the Company sold essentially all of its wholesale office products distribution operations, enabling the Company to focus on the consumer channel on a national basis. In 1991, sales of the 13 distribution centers and 1 minidistribution center that comprised the wholesale operations were approximately $400 million.
Building Products
The Company is a major producer of lumber, plywood, and particle- board, together with a variety of specialty wood products. The Company also manufactures engineered wood products consisting of laminated veneer lumber (LVL), which is a high-strength engineered structural lumber product, and wood I-joists that incorporate the LVL technology. Most of its production is sold to independent wholesalers and dealers and through the Company's own wholesale building materials distribution outlets. The Company's wood products are used primarily in housing, industrial construction, and a variety of manufactured products. Wood products manufacturing trade sales for 1994, 1993, and 1992 were $933 million, $879 million, and $761 million.
The following table sets forth annual practical capacities of the Company's wood products facilities as of December 31, 1994:
Number of Mills(1) Practical Capacity (millions)
Plywood 12 1,940 square feet (3/8" basis) Lumber 12 760 board feet Particleboard 1 195 square feet (3/4" basis) Engineered Wood Products 1 4 cubic feet
(1) The Company closed a sawmill in Oregon during 1994 and will close a sawmill in Idaho in early 1995.
The Company operates 9 wholesale building materials distribution facilities and 2 satellite locations. These operations market a wide range of building materials, including lumber, plywood, particleboard, engineered wood products, fiberboard siding, roofing, gypsum board, insulation, ceiling tile, paneling, molding, windows, doors, builders' hardware, and related products. These products are distributed to retail lumber dealers, home centers specializing in the do-it-yourself market, and industrial customers. A portion (approximately 38% in 1994) of the wood products required by the Company's Building Materials Distribution Division are provided by the Company's manufacturing facilities, and the balance are purchased from outside sources.
The following table sets forth sales volumes of wood products and sales dollars for engineered wood products and the building materials distribution business for the years indicated:
1994 1993 1992 1991 1990 (millions)
Plywood (square feet - 3/8" basis) 1,894 1,760 1,788 1,621 1,682 Lumber (board feet) 754 760 805 815 782 Particleboard (square feet - 3/4" basis) 194 182 186 182 179 Engineered wood products (sales dollars) $ 82 $71 $38 $13 $ 1 Building materials distribution (sales dollars) $657 $590 $447 $328 $289
Timber Resources
Boise Cascade owns or controls approximately 3 million acres of timberland in North America. The amount of timber harvested each year by the Company from its timber resources, compared with the amount it purchases from outside sources, varies according to the price and supply of timber for sale on the open market and according to what the Company deems to be in the interest of sound management of its timberlands. During 1994, the Company's mills processed approximately 1.2 billion board feet of sawtimber and 1.9 million cords of pulpwood; 39% of the sawtimber and 43% of the pulpwood were harvested from the Company's timber resources, and the balance was acquired from various private and government sources. Approximately 79% of the 1.1 million bone-dry tons of wood chips consumed by the Company's Northwest pulp and paper mills in 1994 were provided from the Company's Northwest wood products manufacturing facilities as residuals from the processing of solid wood products and from a whole-log chipping facility. Of the 727,000 bone-dry tons of residual chips used in the South, 47% were provided by the Company's Southern wood products manu- facturing facilities.
At December 31, 1994, the acreages of owned or controlled timber resources by geographic area and the approximate percentages of total fiber requirements available from the Company's respective timber resources in these areas and from the residuals from processed purchased logs are shown in the table below. Timber resources do not include approximately 3 million acres of Canadian provincial timberland under long-term lease to Rainy River.
New Northwest Midwest England South Total (thousands of acres)
Fee 1,318 308 665 419 2,710 Leases and contracts 46 - - 291 337 ______ ______ ______ ______ ______ Total 1,364(1) 308(2) 665(2) 710(3) 3,047(4)
Approximate percentage of total fiber requirements available from: (5) Owned and controlled timber resources 22% 23% 55% 26% 27% Residuals from processed purchased logs 16 - - 9 10 ______ ______ ______ ______ ______ Total 38% 23% 55% 35% 37%
(1) Principally sawtimber. (2) Principally pulpwood. (3) Sawtimber and pulpwood. (4) On December 31, 1994, the Company's inventory of merchantable sawtimber was approximately 9 billion board feet, and its inventory of pulpwood was approximately 15.8 million cords. (5) Assumes harvesting of Company-owned and controlled timber resources on a sustained timber yield basis and operation of the Company's paper and wood products manufacturing facilities at practical capacity. Percentages shown represent weighted average consumption on a cubic volume basis.
Long-term leases generally provide the Company with timber harvesting rights and carry with them the responsibility for management of the timberlands. The average remaining life of all leases and contracts is in excess of 40 years. In addition, the Company has an option to purchase approximately 203,000 acres of the timberland it currently has under leases and contracts in the South.
The Company seeks to maximize the utilization of its timberlands through efficient management so that the timberlands will provide a continuous supply of wood for future needs. Site preparation, planting, fertilizing, thinning, and logging techniques are continually improved through a variety of methods, including genetic research and computerization.
The Company assumes substantially all risks of loss from fire and other casualties on all the standing timber it owns, as do most owners of timber tracts in the U.S.
Additional information pertaining to the Company's timber resources is presented under the caption "Timber Supply" of the Financial Review of the Company's 1994 Annual Report. This information is incorporated herein by this reference.
Competition
The markets served by the Company are highly competitive, with various substantial companies operating in each. The Company competes in its markets principally through price, service, quality, and value-added products and services.
Environmental Issues
The Company's discussion of environmental issues is presented under the caption "Environmental Issues" of the Financial Review of the Company's 1994 Annual Report. This information is incorporated herein by this reference.
Employees
As of December 31, 1994, the Company and its subsidiaries had 16,618 employees, 7,610 of whom were covered under collective bargaining agreements. During 1994, the Company and its union employees at the Company's four Pacific Northwest pulp and paper facilities and one converting operation agreed to six-year labor contracts. The new contracts expire in 1999 and replace contracts that expired in the spring of 1993. The Company and the union representing the Company's employees at its Northwest wood products facilities ratified new four-year contracts which will expire in 1998. An early settlement was reached with union employees at the Company's DeRidder, Louisiana, pulp and paper mill. The new agreement is for a five-year term expiring in 2000. The new agreement replaces a contract that would have expired in February 1995.
Among the negotiations scheduled for 1995 are labor contracts covering the Company's pulp and paper facilities in Jackson, Alabama, and Rumford, Maine.
Identification of Executive Officers
The information with respect to the executive officers of the registrant, which is set forth in Item 10 of this annual report on Form 10-K, is incorporated into this Part I by this reference.
Capital Investment
The Company's capital expenditures in 1994 were $272 million, compared with $221 million in 1993 and $283 million in 1992. Details of 1994 spending by segment and by type are as follows:
Replacement, Quality/ Timber and Environmental, Expansion Efficiency(1)Timberlands and Other Total (expressed in millions)
Paper and paper products $ 7 $ 43 $ - $ 89 $ 139 Office products 84 1 - 1 86 Building products 10 7 - 18 35 Timber and timberlands - - 5 - 5 Other 3 - - 4 7 _____ _____ _____ _____ _____ Total $ 104 $ 51 $ 5 $ 112 $ 272
(1) Quality and efficiency projects include quality improvements, modernization, energy, and cost-saving projects.
The level of capital investment in 1995 is expected to be about $400 million, excluding acquisitions. The 1995 capital budget will be allocated to cost-saving, modernization, expansion, replacement, maintenance, environmental, and safety projects.
Energy
The paper and paper products segment is the primary energy user of the Company. Self-generated energy sources in this segment, such as wood wastes, pulping liquors, and hydroelectric power, provided 66% of total 1994 energy requirements, compared with 55% in 1993 and 54% in 1992. The energy requirements fulfilled by purchased sources in 1994 were as follows: natural gas, 52%; electricity, 28%; residual fuel oil, 10%; and other sources, 10%.
Item 2.
Item 2. Properties
The Company owns substantially all of its operating facilities. Regular maintenance, renewal, and new construction programs have preserved the operating suitability and adequacy of those properties.
Following is a list of the Company's facilities by segment as of December 31, 1994. Information concerning timber resources is presented in Item 1 of this Form 10-K.
Paper and Paper Products
7 pulp and paper mills located in Alabama, Louisiana, Maine, Minnesota, Oregon, and Washington (2).
6 regional service centers located in California, Georgia, Illinois, New Jersey, Oregon, and Texas.
1 converting facility located in Oregon.
7 corrugated container plants located in Idaho (2), Nevada, Oregon, Utah, and Washington (2).
Office Products
26 contract stationer distribution centers located in Arizona, California (2), Colorado, Connecticut, Florida, Georgia, Hawaii (4), Illinois, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, Ohio, Oregon, Pennsylvania, South Carolina, Texas (2), Utah, and Washington.
4 direct-mail distribution facilities located in Delaware, Georgia, Illinois, and Nevada.
4 retail outlets located in Hawaii.
Building Products
12 sawmills located in Alabama, Idaho (3), Louisiana, Oregon (4), and Washington (3). The Company has announced the closure of a sawmill in Idaho in early 1995.
12 plywood and veneer plants located in Idaho, Louisiana (2), Oregon (7), and Washington (2).
1 particleboard plant located in Oregon.
1 engineered wood products plant located in Oregon.
1 wood beam plant located in Idaho.
9 wholesale building materials units located in Arizona, Colorado, Idaho (2), Montana, Utah, and Washington (3).
2 satellite building materials facilities located in Colorado and Washington.
Rainy River -- Unconsolidated Equity Affiliate
3 pulp and paper mills located in Washington and Ontario, Canada (2).
Item 3.
Item 3. Legal Proceedings
The Company has been notified that it is a "potentially responsible party" under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) or similar federal and state laws with respect to a number of sites where hazardous substances or other contaminants are located. In 1993, the Company filed a lawsuit in State District Court in Boise, Idaho, against its current and previous insurance carriers seeking insurance coverage for response costs the Company has incurred or may incur at these sites. The Company amended this complaint in January 1994 and again in December 1994. The Company cannot predict with certainty the total response and remedial costs, the Company's share of the total costs, the extent to which contributions will be available from other parties, the amount of time necessary to complete the cleanups, or the availability of insurance coverage. However, based on the Company's investigations, the Company's experience with respect to cleanup of hazardous substances, the fact that expenditures will, in many cases, be incurred over extended periods of time, and the number of solvent potentially responsible parties, the Company does not presently believe that the known actual and potential response costs will, in the aggregate, have a material adverse effect on its financial condition or the results of operations.
As previously reported in the Company's report on Form 10-K for the year ended December 31, 1993, the Company has been involved in an action with the Maine Department of Environmental Protection to resolve alleged violations of the state's environmental laws at the Company's facility in Rumford, Maine. On June 3, 1994, the Company entered into a Consent Agreement with the Maine Department of Environmental Protection, resolving alleged violations of air emissions, water discharges, and hazardous waste laws at the Rumford facility between 1991 and January 1, 1994. The Company has agreed to settle the matter by, among other items, paying a $316,655 penalty.
The Company is involved in other litigation and administrative proceedings primarily arising in the normal course of its business. In the opinion of management, the Company's recovery, if any, or the Company's liability, if any, under any pending litigation or administrative proceeding, including that described in the preceding paragraphs would not materially affect its financial condition or operations.
Item 4.
Item 4. Submission of Matters to a Vote of Security Holders
Not applicable.
PART II
Item 5.
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters
The Company's common stock is listed on the New York, the Chicago, and the Pacific Stock Exchanges. The high and low sales prices for the Company's common stock, as well as the frequency and amount of dividends paid on such stock, are presented in the tables captioned "Common Stock Prices" and "Common Stock Dividends -- Paid Per Share" in the Company's 1994 Annual Report. Additional information concerning dividends on common stock is presented under the caption "Dividends" of the Financial Review, and information concerning restrictions on the payments of dividends is included in Note 4, "Debt," of the Notes to Financial Statements in the Company's 1994 Annual Report. The approximate number of common shareholders, based upon actual record holders at year-end, is presented under the caption "Financial Highlights" of the Company's 1994 Annual Report. The information under these captions is incorporated herein by this reference.
Net Loss Per Common Share
Net loss per common share was determined by dividing net loss, as adjusted below, by applicable shares outstanding. 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.
Year Ended December 31 1994 1993 1992 (expressed in thousands)
Net loss as reported $ (62,610) $ (77,140) $(227,480) Preferred dividends (54,586) (43,076) (27,711) _________ _________ _________ Primary loss (117,196) (120,216) (255,191) Assumed conversions: Preferred dividends eliminated 43,776 33,407 27,711 Interest on 7% debentures eliminated 3,439 3,644 4,108 Supplemental ESOP contribution (12,573) (12,381) (10,285) _________ _________ _________ Fully diluted loss $ (82,554) $ (95,546) $(233,657)
Average number of common shares Primary 38,110 37,958 37,942 Fully diluted 61,407 55,825 53,283
Primary loss includes the aggregate amount of dividends on the Company's preferred stock. The dividend attributable to the Company's Series D convertible preferred stock held by the Company's ESOP (employee stock ownership plan) is net of a tax benefit. To determine the fully diluted loss, dividends and interest, net of any applicable taxes, have been added back to primary loss to reflect assumed conversions. The fully diluted loss was increased by the after-tax amount of additional contributions that the Company would be required to make to its ESOP if the Series D ESOP preferred shares were converted to common stock.
For the years ended December 31, 1994, 1993, and 1992, primary average shares include only common shares outstanding. For these periods, common stock equivalents attributable to stock options, Series E conversion preferred stock, and Series G conversion preferred stock subsequent to issuance in September 1993 were excluded because they were antidilutive. Excluded common equivalent shares were 16,391,000 at December 31, 1994, compared with 10,840,000 and 7,998,000 shares at December 31, 1993 and 1992. In addition to common and common equivalent shares, fully diluted average shares include common shares that would be issuable upon conversion of the Company's other convertible securities.
Series E Preferred Stock Conversion
On January 15, 1995, the depositary shares of Series E preferred stock converted to 8,625,000 shares of the Company's common stock.
Shareholder Rights Plan
Pursuant to the shareholder rights plan adopted in December 1988 and as amended in September 1990, holders of common stock received a distribution of one right for each common share held. The rights become exercisable ten days after a person or group acquires 15% of the Company's outstanding voting securities or ten business days after a person or group commences or announces an intention to commence a tender or exchange offer that could result in the acquisition of 15% of these securities. If a person acquires 15% or more of the Company's outstanding voting securities, on the tenth day thereafter, unless this time period is extended by the board of directors, each right would, subject to certain adjustments and alternatives, entitle the rightholder to purchase common stock of the Company or the acquiring company having a market value of twice the $175 exercise price of the right (except that the acquiring person or group and other related holders would not be able to purchase common stock of the Company on these terms). The rights are nonvoting, may be redeemed by the Company at a price of 1 cent per right at any time prior to the tenth day after an individual or group acquires 15% of the Company's voting stock, unless extended, and expire in 1998. Additional details are set forth in the Amended and Restated Rights Agreement filed as Exhibit 1 in the Company's Form 8-K with the Securities and Exchange Commission on September 25, 1990.
Item 6.
Item 6. Selected Financial Data
The following table sets forth selected financial data of the Company for the years indicated and should be read in conjunction with the disclosures in Item 7
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
Management's discussion and analysis of financial condition and results of operations are presented under the caption "Financial Review" of the Company's 1994 Annual Report and are incorporated herein by this reference.
Item 8.
Item 8. Financial Statements and Supplementary Data
The Company's consolidated financial statements and related notes, together with the report of the independent public accountants, are presented in the Company's 1994 Annual Report and are incorporated herein by this reference. Selected quarterly financial data is presented under the caption "Quarterly Results of Operations" in the Company's 1994 Annual Report and is incorporated herein by this reference.
The consolidated income (loss) statement for the three months ended December 31, 1994, is presented in the Company's Fact Book for the fourth quarter of 1994 and is incorporated herein by this reference.
The 10.125% Notes issued in December 1990, the 9.85% Notes issued in June 1990, the 9.9% Notes issued in March 1990, and the 9.45% Debentures issued in October 1989 each contain a provision under which in the event of the occurrence of both a designated event, as defined, and a rating decline, as defined, the holders of these securities may require the Company to redeem the securities.
Item 9.
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
Not applicable.
PART III
Item 10.
Item 10. Directors and Executive Officers of the Registrant
Directors
The directors and nominees for directors of the Company are pre- sented under the caption "Election of Directors" in the Company's definitive proxy statement dated March 7, 1995. All of the nominees are presently directors. This information is incorporated herein by this reference.
Executive Officers as of February 28, 1995 Date First Elected as Name Age Position or Office an Officer
George J. Harad 50 President and Chief Executive Officer, Director 5/11/82
Peter G. Danis Jr. 63 Executive Vice President 7/26/77
Theodore Crumley 49 Senior Vice President and Chief Financial Officer 5/10/90
A. Ben Groce 53 Senior Vice President 2/8/91
Alice E. Hennessey 58 Senior Vice President 10/28/71
Terry R. Lock 53 Senior Vice President 2/17/77
Richard B. Parrish 56 Senior Vice President 2/27/80
N. David Spence 59 Senior Vice President 12/8/87
A. James Balkins III 42 Vice President and Corporate Secretary 9/5/91
J. Ray Barbee 47 Vice President 9/26/89
Stanley R. Bell 48 Vice President 9/25/90
John C. Bender 54 Vice President 2/13/90
Charles D. Blencke 51 Vice President 12/11/92
Tom E. Carlile 43 Vice President and Controller 2/4/94
J. Michael Gwartney 54 Vice President 4/25/89
John W. Holleran 40 Vice President and General Counsel 7/30/91
H. John Leusner 59 Vice President 12/11/92
Irving Littman 54 Vice President and Treasurer 11/1/84
Jeffrey G. Lowe 53 Vice President 12/11/92
Christopher C. Milliken 49 Vice President 2/3/95
Carol B. Moerdyk 44 Vice President 5/10/90
D. Ray Ryden 61 Vice President 4/26/88
Donald F. Smith 53 Vice President 12/8/87
J. Kirk Sullivan 59 Vice President 9/30/81
Gary M. Watson 47 Vice President 2/5/93
All of the officers named above except A. Ben Groce and Gary M. Watson (see below) have been employees of the registrant or one of its subsidiaries for at least five years. Mr. Groce rejoined the Company in 1991 after resigning in June 1989. Prior to his resignation, he had served as an officer of the Company since December 1987.
Christopher C. Milliken was elected a vice president in February 1995. Mr. Milliken received a B.S. degree in industrial management in 1970 from Clemson University. He joined the Company in 1977 and held a variety of positions in the office products distribution business before becoming Eastern Region Manager in 1991.
Gary M. Watson was elected vice president in February 1993. Dr. Watson received a B.S. degree in chemistry from Western Washington University in 1969. He also received an M.S. degree in 1972 and a Ph.D. degree in chemical physics in 1974, both from Lawrence University in connection with the Institute of Paper Science and Technology. He joined Boise Cascade in 1992 as director of the Company's Paper Research and Development Center in Portland, Oregon.
Item 11.
Item 11. Executive Compensation
Information concerning compensation of the Company's executive officers for the year ended December 31, 1994, is presented under the caption "Compensation Tables" in the Company's definitive proxy statement dated March 7, 1995. This information is incorporated herein by this reference.
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management
(a) Information concerning the security ownership of certain benefi- cial owners as of December 31, 1994, is set forth under the caption "Beneficial Ownership" in the Company's definitive proxy statement dated March 7, 1995, and is incorporated herein by this reference.
(b) Information concerning security ownership of management as of December 31, 1994, is set forth under the caption "Security Ownership of Directors and Executive Officers" in the Company's definitive proxy statement dated March 7, 1995, and is incorpo- rated herein by this reference.
Item 13.
Item 13. Certain Relationships and Related Transactions
Information concerning certain relationships and related transactions during 1994 is set forth under the caption "Consulting Services" in the Company's definitive proxy statement dated March 7, 1995, and is incorporated herein by this reference.
PART IV
Item 14.
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K
(a) The following documents are filed as a part of this annual report on Form 10-K for Boise Cascade Corporation and subsidiaries:
(1) (i) The Income (Loss) Statement for the three months ended December 31, 1994, is incorporated herein by this reference from the Company's Fact Book for the fourth quarter of 1994.
(ii) The Financial Statements, the Notes to Financial Statements, and the Report of Independent Public Accountants listed below are incorporated herein by this reference from the Company's 1994 Annual Report.
- Balance Sheets as of December 31, 1994 and 1993. - Statements of Income (Loss) for the years ended December 31, 1994, 1993, and 1992. - Statements of Cash Flows for the years ended December 31, 1994, 1993, and 1992. - Statements of Shareholders' Equity for the years ended December 31, 1994, 1993, and 1992. - Notes to Financial Statements. - Quarterly Results of Operations for the years 1994 and 1993. - Report of Independent Public Accountants.
(2) Financial Statement Schedules.
- Consent of Independent Public Accountants.
(3) Exhibits.
A list of the exhibits required to be filed as part of this report is set forth in the Index to Exhibits, which immediately precedes such exhibits, and is incorporated herein by this reference.
(b) Reports on Form 8-K.
On October 4, 1994, the Company filed a Form 8-K with the Securities and Exchange Commission to report that the Company issued a news release announcing the impact of securities sales by Rainy River Forest Products Inc.
On October 24, 1994, the Company filed a Form 8-K with the Securities and Exchange Commission to file the unaudited pro forma Boise Cascade Corporation and Subsidiaries financial information as of September 30, 1994, and to file, by reference, the Rainy River Underwriting Agreement regarding common shares and Convertible Debentures.
(c) Exhibits.
See Index to exhibits.
(d) The following documents are filed as a part of this annual report on Form 10-K for Rainy River Forest Products Inc., an unconsolidated equity affiliate of the Company:
(1) The Financial Statements, the Notes to Financial Statements, and the Report of Independent Chartered Accountants listed below are incorporated herein by this reference from Rainy River Forest Products Inc.'s 1994 Annual Report:
- Consolidated Balance Sheets as of December 31, 1994 and 1993. - Consolidated Statements of Operations for the years ended December 31, 1994, 1993, and 1992. - Consolidated Statements of Changes in Financial Position for the years ended December 31, 1994, 1993, 1992. - Consolidated Statements of Owners' Equity for the years ended December 31, 1994, 1993, 1992. - Auditors' Report. - Notes to Consolidated Financial Statements.
For the purpose of complying with the rules governing Form S-8 under the Securities Act of 1933, the undersigned registrant hereby undertakes as follows, which undertaking shall be incorporated by reference into registrant's Registration Statements on Form S-8 Nos. 33-47892 (filed May 14, 1992), 33-28595 (filed May 8, 1989), 33-21964 (filed June 6, 1988), 33-31642 (filed November 7, 1989), 2-96196 (filed March 25, 1985), and 33-45675 (filed February 12, 1992):
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 Securities Act of 1933 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 the final adjudication of such issue.
SIGNATURES Pursuant to the requirements of Section 13 or 15(d) 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
By George J. Harad George J. Harad President and Chief Executive Officer Dated: March 14, 1995
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on March 14, 1995.
Signature Capacity
(i) Principal Executive Officer:
George J. Harad President and George J. Harad Chief Executive Officer
(ii) Principal Financial Officer:
Theodore Crumley Senior Vice President and Theodore Crumley Chief Financial Officer
(iii) Principal Accounting Officer
Tom E. Carlile Vice President Tom E. Carlile and Controller
(iv) Directors:
John B. Fery A. William Reynolds John B. Fery A. William Reynolds
Anne L. Armstrong Jane E. Shaw Anne L. Armstrong Jane E. Shaw
Robert E. Coleman Frank A. Shrontz Robert E. Coleman Frank A. Shrontz
George J. Harad Edson W. Spencer George J. Harad Edson W. Spencer
Robert K. Jaedicke Robert H. Waterman, Jr. Robert K. Jaedicke Robert H. Waterman, Jr.
James A. McClure Ward W. Woods, Jr. James A. McClure Ward W. Woods, Jr.
Paul J. Phoenix Paul J. Phoenix
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of our report dated January 30, 1995, incorporated by reference in this Form 10-K for the year ended December 31, 1994, into Boise Cascade Corporation's previously filed post-effective amendment No. 1 to Form S-8 registration statement (File No. 33-28595); the registration statement on Form S-8 (File No. 33-47892); post-effective amendment No. 1 to Form S-8 registration statement (File No. 2-96196); post-effective amendment No. 1 to Form S-8 registration statement (File No. 33-21964); the registration statement on Form S-8 (File No. 33-31642); the registration statement on Form S-8 (File No. 33-45675); the registration statement on Form S-3 (File No. 33-54533); and the registration statement on Form S-3 (File No. 33-55396).
ARTHUR ANDERSEN LLP
Boise, Idaho March 14, 1995
BOISE CASCADE CORPORATION
INDEX TO EXHIBITS Filed with the Annual Report on Form 10-K for the Year Ended December 31, 1994
Page Number Description Number (1)
2 Inapplicable - 3.1 (2) Restated Certificate of Incorporation, as amended - 3.2 (3) Certificate of Designation of Convertible Preferred Stock, Series D, dated July 10, 1989 - 3.3 (4) Certificate of Designation of Conversion Preferred Stock, Series E, dated January 21, 1992 - 3.4 (5) Certificate of Designation of Cumulative Preferred Stock, Series F, dated January 29, 1993 - 3.5 (6) Bylaws, as amended, September 29, 1994 - 3.6 (5) Certificate of Designation of Conversion Preferred Stock, Series G, dated September 17, 1993 - 4.1 (7) Trust Indenture between Boise Cascade Corporation and Morgan Guaranty Trust Company of New York, Trustee, dated October 1, 1985, as amended - 4.2 (8) 1994 Revolving Loan Agreement -- $650,000,000, dated April 15, 1994 - 4.3 (9) Shareholder Rights Plan, as amended September 25, 1990 - 9 Inapplicable - 10.1 Key Executive Performance Plan for Executive Officers, as restated February 2, 1995, with the 1994 and 1995 Performance Criteria - 10.2 (5) 1986 Executive Officer Deferred Compensation Plan, as amended July 29, 1993 - 10.3 (5) 1983 Board of Directors Deferred Compensation Plan, as amended July 29, 1993 - 10.4 (5) 1982 Executive Officer Deferred Compensation Plan, as amended July 29, 1993 - 10.5 (5) Executive Officer Severance Pay Policy - 10.6 (5) Supplemental Early Retirement Plan for Executive Officers - 10.7 Boise Cascade Corporation Supplemental Pension Plan, effective as of January 1, 1994 10.8 (5) 1987 Board of Directors Deferred Compensation Plan, as amended July 29, 1993 - 10.9 1984 Key Executive Stock Option Plan and Form of Agreement, as amended through July 28, 1994 10.10 (5) Executive Officer Group Life Insurance Plan description - 10.11 (5) Executive Officer Split-Dollar Life Insurance Plan - 10.12 (5) Form of Agreement with Executive Officers, as amended - 10.13 (5) Supplemental Health Care Plan for Executive Officers - 10.14 (5) Nonbusiness Use of Corporate Aircraft Policy, as amended - 10.15 (5) Executive Officer Financial Counseling Program description - 10.16 (5) Family Travel Program description - 10.17 (5) Form of Directors' Indemnification Agreement - 10.18 (5) Deferred Compensation and Benefits Trust, as amended through June 30, 1989 - 10.19 Director Stock Compensation Plan, as amended December 15, 1994 10.20 Boise Cascade Corporation Director Stock Option Plan 11 Inapplicable - 12 Ratio of Earnings to Fixed Charges 13.1 Incorporated sections of the Boise Cascade Corporation 1994 Annual Report 13.2 Incorporated sections of the Boise Cascade Corporation Fact Book for the fourth quarter of 1994 16 Inapplicable - 18 Inapplicable - 21 Significant subsidiaries of the registrant 22 Inapplicable - 23 Consent of Arthur Andersen LLP (See page __) - 24 Inapplicable - 27 Financial Data Schedule 28 Inapplicable - 99 Incorporated sections of the Rainy River Forest Products Inc. 1994 Annual Report
(1) This information appears only in the manually signed original of the Annual Report on Form 10-K.
(2) Exhibit 3.1 was filed under the same exhibit number in the Company's 1987 Annual Report on Form 10-K and is incorporated herein by this reference.
(3) The Certificate of Designation of Convertible Preferred Stock, Series D, dated July 10, 1989, was filed as Exhibit 4.4 in the Company's Quarterly Report on Form 10-Q for the quarter ended June 30, 1989, and is incorporated herein by this reference.
(4) Exhibit 3.3 was filed under the same exhibit number in the Company's 1991 Annual Report on Form 10-K and is incorporated herein by this reference.
(5) Exhibits 3.4, 3.6, 10.2, 10.3, 10.4, 10.5, 10.6, 10.8, 10.10, 10.11, 10.12, 10.13, 10.14, 10.15, 10.16, 10.17, and 10.18 were filed under the same exhibit numbers in the Company's 1993 Annual Report on Form 10-K and are incorporated herein by this reference.
(6) The Bylaws, as amended September 29, 1994, were filed as Exhibit 3 in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 1994, and are incorporated herein by this reference.
(7) The Trust Indenture between Boise Cascade Corporation and Morgan Guaranty Trust Company of New York, Trustee, dated October 1, 1985, as amended, was filed as Exhibit 4 in the Registration Statement on Form S-3 No. 33-5673, filed May 13, 1986. The First Supplemental Indenture, dated December 20, 1989, to the Trust Indenture between Boise Cascade Corporation and Morgan Guaranty Trust Company of New York, Trustee, dated October 1, 1985, was filed as Exhibit 4.2 in the Pre-Effective Amendment No. 1 to the Registration Statement on Form S-3 No. 33-32584, filed December 20, 1989. The Second Supplemental Indenture, dated August 1, 1990, to the Trust Indenture was filed as Exhibit 4.1 in the Company's Current Report on Form 8-K filed on August 10, 1990. Each of the documents referenced in this footnote is incorporated herein by this reference.
(8) The 1994 Revolving Loan Agreement was filed as Exhibit 4.2 in the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 1994, and is incorporated herein by this reference.
(9) The Rights Agreement, dated as of December 13, 1988, as amended September 25, 1990, was filed as Exhibit 1 in the Company's Form 8-K filed with the Securities and Exchange Commission on September 25, 1990, and is incorporated herein by this reference.