e424b2
Filed
Pursuant to Rule 424(b)(2)
Registration No. 333-156031
PROSPECTUS
750,000 Shares
CSS INDUSTRIES, INC.
Common Stock
The selling stockholder, Delv, L.P., or its donees, pledgees, assignees and
successors-in-interest, is offering up to 750,000 shares of our common stock for resale to the
public. Of these shares, 500,000 shares initially were issued by us in connection with the merger
of Philadelphia Industries, Inc. into CSS Industries, Inc. in 1993 or in connection with a 2-for-1
stock split in 1993, and were subsequently acquired by the selling stockholder. The remaining
250,000 shares were acquired by the selling stockholder as a result of a 3-for-2 stock split in
2003. See Selling Stockholder for further information.
We will not receive any proceeds from the resale of shares of our common stock by the selling
stockholder. We are paying the expenses of this offering.
Our common stock is listed on the New York Stock Exchange under the symbol CSS. On December
8, 2008, the last reported sale price of our common stock on the New York Stock Exchange was $22.53
per share.
An investment in our common stock involves risk. You should carefully consider the risks
described under Risk Factors in Item 1A of our Annual Report on Form 10-K for the fiscal year
ended March 31, 2008 (which is incorporated by reference in this prospectus), as well as other
information contained in or incorporated by reference in this prospectus or in any supplement to
this prospectus before making a decision to invest in our common stock.
Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities, or determined if this prospectus is accurate or
complete. Any representation to the contrary is a criminal offense.
The date of this prospectus is December 18, 2008
TABLE OF CONTENTS
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You should rely only on the information contained or incorporated by reference in this
prospectus and in any accompanying prospectus supplement. We have not authorized anyone to provide
you with information different from that contained in this prospectus. The shares of common stock
offered under this prospectus are offered only in jurisdictions where offers and sales are
permitted. The information contained in this prospectus is accurate only as of the date of this
prospectus, regardless of the time of delivery of this prospectus or any sale of the common stock.
CAUTIONARY STATEMENT
CONCERNING FORWARD-LOOKING STATEMENTS
This prospectus, including the documents incorporated by reference into this prospectus,
contain certain forward-looking statements within the meaning of Section 27A of the Securities Act
of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements
include all statements other than statements of historical fact, including continued use of
acquisitions to stimulate further growth; plans and objectives of management for future operations,
the anticipated effect of measures we take to respond to cost and price pressures, and anticipated
financial impact of restructurings and other events. The words anticipate, enable, estimate,
intend, expect, believe, potential, may, will, should, project and similar
expressions as they relate to us are intended to identify forward-looking statements. We caution
investors that all forward-looking statements involve risks and uncertainties, which may cause
actual results to differ from those expressed in the forward-looking statements. Such risks and
uncertainties include, without limitation, general market conditions; increased competition;
increased operating costs, including labor-related and energy costs and costs relating to the
imposition or retrospective application of duties on imported products; currency risks and other
risks associated with international markets; risks associated with acquisitions, including
acquisition integration costs; risks associated with the restructuring plans to close our
facilities including the risk that the restructuring related costs may exceed expected amounts and
the risk that the closures will adversely affect our ability to fulfill our customers orders on
time; risks associated with our enterprise resource planning systems standardization project,
including the risk that the cost of the project will exceed expectations, the risk that the
expected benefits of the project will not be realized and the risk that implementation of the
project will interfere with and adversely affect our operations and financial performance; the risk
that customers may become insolvent; costs of compliance with government regulations and government
investigations; liability associated with non-compliance with government regulations, including
regulations pertaining to the environment, Federal and state employment laws, and import and export
controls and customs laws; and other factors described more fully in our annual report on Form 10-K
for the fiscal year ended March 31, 2008 and elsewhere in our filings with the Securities and
Exchange Commission, which we refer to in this prospectus as the SEC. As a result of these
factors, readers are cautioned not to place undue reliance on any forward-looking statements
included herein or that may be made elsewhere from time to time by, or on behalf of, the Company.
Although we undertake no obligation to revise or update any forward-looking statements,
whether as a result of new information, future events or otherwise, except as required by law, you
are advised to consult any additional disclosures we make in our quarterly reports on Form 10-Q,
annual report on Form 10-K and current reports on Form 8-K filed with the SEC. See Where You Can
Find Additional Information. We provide a cautionary discussion of selected risks and
uncertainties regarding an investment in our common stock in our periodic reports and in other
documents that we subsequently file with the SEC.
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OUR COMPANY
We are a consumer products company primarily engaged in the design, manufacture, procurement,
distribution and sale of seasonal and all occasion social expression products, principally to mass
market retailers. These seasonal and all occasion products include:
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gift wrap
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gift bags |
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gift boxes
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boxed greeting cards |
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gift tags
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decorative tissue paper |
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decorations
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classroom exchange Valentines |
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decorative ribbons & bows
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Halloween masks |
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costumes
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make-up and novelties |
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Easter egg dyes and novelties
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craft products |
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educational products
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memory books |
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journals
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notecards |
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stationery
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infant and wedding photo
albums and scrapbooks |
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foil paper and waxed tissue
products for the floral and
horticulture industries
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other gift items that commemorate lifes celebrations |
A substantial portion of our products are manufactured, packaged and/or warehoused in
facilities located in the United States, with the remainder purchased primarily from manufacturers
in Asia and Mexico. Our customers generally are mass market retailers, discount department stores,
specialty chains, warehouse clubs, drug and food chains, dollar stores, independent card, gift and
floral shops, and retail teachers stores. Our operating businesses include Paper Magic Group,
Inc., BOC Design Group (consisting of Berwick Offray LLC and Cleo Inc) and C.R. Gibson, LLC. We
acquired the C.R. Gibson business on December 3, 2007.
We are a Delaware corporation. Our principal executive offices are located at 1845 Walnut
Street, Philadelphia, Pennsylvania 19103 and our telephone number is (215) 569-9900. Our website
is located at www.cssindustries.com. The information contained on our website is not a part of
this prospectus and the reference to our website is intended to be an inactive textual reference
only.
RISK FACTORS
An investment in our common stock involves significant risks. Before investing in our common
stock, you should read and consider the risk factors described in the periodic reports and other
information that we file with the SEC and that are incorporated by reference in this prospectus,
including, without limitation, the matters discussed under Risk Factors in Item 1A of our Annual
Report on Form 10-K for the fiscal year ended March 31, 2008.
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USE OF PROCEEDS
All of the shares of common stock to which this prospectus relates may be sold by the selling
stockholder. The selling stockholder will receive the proceeds from the resale of the shares of
common stock. We will not receive any proceeds from the resale of the shares of common stock by
the selling stockholder.
SELLING STOCKHOLDER
This prospectus relates to the resale of our common stock by the selling stockholder, Delv,
L.P., a Delaware limited partnership. Of the shares now held by the selling stockholder, 500,000
shares were initially acquired by our Chairman, Jack Farber, either in connection with the merger
of Philadelphia Industries, Inc. (PII) into our company in 1993 or in connection with a 2-for-1
stock split in the form of a stock dividend later in 1993. Mr. Farber contributed the 500,000
shares to the selling stockholder in 1997. In July 2003, Mr. Farber sold the limited partnership
interests in the selling stockholder, constituting 99.9 percent of its outstanding limited
partnership interests, to the 2003 Farber Family Trust, of which his daughter, Ellen B. Farber
(formerly known as Ellen B. Kurtzman), is the sole trustee. In addition, Mr. Farber sold all of
the outstanding shares of stock of Delv, Inc., the general partner of the selling stockholder (the
General Partner), in equal share amounts to each of the Trust FBO Ellen B. Farber under the 2002
Farber Childrens Trusts dated December 12, 2002 (the Ellen Farber Trust) and the Trust FBO David
M. Farber under the 2002 Farber Childrens Trusts dated December 12, 2002 (collectively with the
Ellen Farber Trust, the Childrens Trusts). The General Partner owns a 0.1 percent limited
partnership interest in the selling stockholder. Ms. Farber is the sole trustee of each of the
trusts identified above, and is the President, Secretary and Treasurer of the General Partner. As
a result of a 3-for-2 stock split in the form of a stock dividend we paid to our stockholders in
July 2003, the selling stockholder holds 750,000 shares of our common stock.
Under the terms of a Registration Rights Grant that we provided to former holders of PII
shares, including Mr. Farber, his heirs and certain related entities, we will pay all expenses of
the registration of the common stock held by the selling stockholder, except that the selling
stockholder will pay all underwriting discounts and commissions. Our expenses for registration of
the shares of common stock are estimated to be $24,152.
The table below sets forth certain information known to us, based upon information provided by
the selling stockholder, with respect to the beneficial ownership of our shares of common stock
held by the selling stockholder as of December 5, 2008. Because the selling stockholder may sell,
transfer or otherwise dispose of all, some or none of the shares of our common stock covered by
this prospectus, we cannot determine the number of such shares that will be sold, or the amount or
percentage of shares of our common stock that will be held by the selling stockholder upon
termination of any particular offering. See Plan of Distribution. For the purposes of the table
below, we assume that the selling stockholder will sell all of its shares of common stock covered
by this prospectus. The shares may be sold by the selling stockholder or its donees, pledgees,
assignees and other successors-in-interest.
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Number of |
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Maximum |
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Beneficial Ownership |
Name of |
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Shares |
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Percent of |
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Number of |
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After Resale of Shares |
Selling |
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Beneficially |
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Shares |
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Shares Being |
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Number |
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Stockholder |
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Owned(1) |
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Outstanding(2) |
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Offered |
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of Shares |
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Percent |
Delv, L.P.(3)
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750,000 |
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7.7 |
% |
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750,000 |
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0 |
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0 |
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(1) |
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Beneficial ownership is determined in accordance with SEC regulations.
Therefore, the table lists all shares as to which a person listed has or shares
voting power or investment power. |
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(2) |
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This percentage is calculated based upon a total of 9,686,084 shares of our
common stock outstanding at November 30, 2008. |
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(3) |
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Ellen B. Farber exercises voting and investment power through the General
Partner, which has the sole voting and investment power with regard to shares of
common stock owned by the selling stockholder. One-half of the outstanding common
stock of the General Partner is held by each of the Childrens Trusts, for which
Ellen B. Farber serves as sole trustee. As a result, the Childrens Trusts may be
deemed to have shared voting and investment power with regard to the shares held by
the selling stockholder. Ms. Farber also is the sole director of the General Partner
and serves as the President, Secretary and Treasurer of the General Partner. In that
capacity, Ms. Farber has the power to act on behalf of the General Partner to vote
and dispose of shares held by the selling stockholder. Ms. Farber may be deemed to
be the beneficial owner of 1,098,233 shares of our common stock, including the shares
held by the selling stockholder. Of the remaining shares, Ms. Farber owns 83,667
shares directly and may be deemed to beneficially own the following: 66,457 shares
held by BLK Investments L.P., of which the sole General Partner is the Ellen Farber
Trust, of which Ms. Farber is the sole trustee; 66,732 shares held by Oliver Ernest
LP (OELP); and 131,377 shares held by the Farber Family Foundation, Inc., a
charitable foundation, the members, officers and directors of which are Ms. Farber,
her mother, her father and her brother. Ms. Farber has sole voting and investment
power over the shares owned by the Farber Family Foundation, Inc. As a matter of
policy, the Farber Family Foundation, Inc. will not vote the shares of common stock
that it owns. With regard to the shares held by OELP, Ms. Farber has voting and
investment power over these shares in her capacity as manager of a limited liability
company that serves as the general partner of OELP. Ms. Farber disclaims beneficial
ownership of all shares held by the selling stockholder, the Farber Family
Foundation, Inc., OELP and the aforementioned trusts to the extent that she does not
have a pecuniary interest in them. Ms. Farber has a business address at 801 Cassatt
Road, Suite 111, Berwyn, PA 19312. |
PLAN OF DISTRIBUTION
The shares of common stock listed in the table appearing in the Selling Stockholder section
of this prospectus are being registered to permit public secondary trading of these shares by the
holder of such shares from time to time after the date of this prospectus. This does not mean,
however, that those shares of common stock necessarily will be offered or sold.
The selling stockholder and any of its donees, pledgees, assignees and successors-in-interest
may, from time to time, sell any or all of its respective shares of common stock on any stock
exchange, market or trading facility on which the shares are traded or in private transactions.
These sales may be at fixed or negotiated prices. The selling stockholder may use any one or more
of the following methods when selling shares:
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ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers; |
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block trades in which the broker-dealer will attempt to sell the
shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction; |
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purchases by a broker-dealer as principal and resale by the
broker-dealer for its account; |
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an exchange distribution in accordance with the rules of the
applicable exchange; |
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privately negotiated transactions; |
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settlement of short sales entered into after the effective date of
the registration statement of which this prospectus is a part; |
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broker-dealers may agree with the selling stockholder to sell a
specified number of such shares at a stipulated price per share; |
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through the writing or settlement of options or other hedging
transactions, whether through an options exchange or otherwise; |
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a combination of any such methods of sale; or |
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any other method permitted pursuant to applicable law. |
The selling stockholder may also sell shares under Rule 144 under the Securities Act, if
available, rather than under this prospectus.
Broker-dealers engaged by the selling stockholder may arrange for other brokers-dealers to
participate in sales. Broker-dealers may receive commissions or discounts from the selling
stockholder (or, if any broker-dealer acts as agent for the purchaser of shares, from the
purchaser) in amounts to be negotiated. The selling stockholder does not expect these commissions
and discounts to exceed what is customary in the types of transactions involved.
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In connection with the sale of the common stock or interests therein, the selling stockholder
may enter into hedging transactions with broker-dealers or other financial institutions, which may
in turn engage in short sales of the common stock in the course of hedging the positions they
assume. The selling stockholder also may sell shares of the common stock short and deliver these
securities to close out their short positions, or loan or pledge the common stock to broker-dealers
that in turn may sell these securities. The selling stockholder also may enter into option or
other transactions with broker-dealers or other financial institutions or the creation of one or
more derivative securities that require the delivery to such broker-dealer or other financial
institution of shares offered by this prospectus, which shares such broker-dealer or other
financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect
such transaction).
The selling stockholder may from time to time pledge or grant a security interest in some or
all the shares of common stock it owns and, if it defaults in the performance of its secured
obligations, the pledgees or secured parties may offer and sell the shares of common stock from
time to time under this prospectus, or under an amendment to this prospectus under Rule 424(b)(3)
or other applicable provision of the Securities Act amending the list of selling stockholders to
include the pledgee, transferee or other successors-in-interest as selling stockholders under this
prospectus.
The selling stockholder and any broker-dealers or agents that are involved in selling the
shares of common stock may be deemed to be underwriters, within the meaning of the Securities
Act, in connection with such sales. In such event, any commissions received by such broker dealers
or agents and any profit on the resale of the shares of common stock purchased by them may be
deemed to be underwriting commissions or discounts under the Securities Act.
The selling stockholder has advised us that it has not entered into any agreements,
understandings or arrangements with any underwriters or broker-dealers regarding the distribution
of its shares of common stock, nor is there an underwriter or coordinating broker acting in
connection with a proposed sale of shares of common stock by the selling stockholder. If we are
notified by the selling stockholder that any material arrangement has been entered into with an
underwriter or a broker-dealer for the sale of shares of common stock, if required, we will file a
supplement to this prospectus. If the selling stockholder uses this prospectus for any sale of the
shares of common stock, it will be subject to the prospectus delivery requirements of the
Securities Act, including Rule 172 thereunder.
The selling stockholder and any other person participating in such distribution will be
subject to applicable provisions of the Securities Exchange Act, and the rules and regulations
thereunder, including, without limitation, Regulation M, which may limit the timing of purchases
and sales of any of the shares of common stock by the selling stockholder and any other
participating person. Regulation M may also restrict the ability of any person engaged in the
distribution of the shares of common stock to engage in market-making activities with respect to
the shares of common stock.
In order to comply with the securities laws of some states, if applicable, the shares of
common stock may be sold in these jurisdictions only through registered or licensed brokers or
dealers.
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We are required to pay certain fees and expenses incurred by us incident to the registration
of the shares. We have agreed to indemnify the selling stockholder against certain losses, claims,
damages, and liabilities, including liabilities under the Securities Act.
LEGAL MATTERS
The validity of the shares of common stock that may be offered by this prospectus will be
passed upon for us by Morgan, Lewis & Bockius LLP, Philadelphia, Pennsylvania.
EXPERTS
The consolidated financial statements of CSS Industries, Inc. as of March 31, 2008 and 2007,
and for each of the years in the three-year period ended March 31, 2008, have been incorporated by
reference herein in reliance upon the report of KPMG LLP, independent registered public accounting
firm, incorporated by reference herein, and upon the authority of said firm as experts in
accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We are subject to the information requirements of the Securities Exchange Act of 1934, which
we refer to below on the Exchange Act, and we therefore file periodic reports, proxy statements
and other information with the SEC relating to our business, financial statements and other
matters. The reports, proxy statements and other information we file may be inspected and copied
at prescribed rates at the SECs Public Reference Room located at 100 F Street, N.E., Washington,
D.C. 20549. You may obtain information on the operation of the SECs Public Reference Room by
calling the SEC at 1-800-SEC-0330. The SEC also maintains an Internet web site at www.sec.gov that
contains reports, proxy statements and other information regarding issuers like us that file
electronically with the SEC.
This prospectus constitutes part of a registration statement on Form S-3 filed under the
Securities Act with respect to the securities. This prospectus does not contain all of the
information as set forth in the registration statement, certain parts of which are omitted in
accordance with the SECs rules and regulations. You may read and copy the information omitted
from this prospectus but contained in the registration statement, as well as the periodic reports
and other information we file with the SEC, at the public reference facilities maintained by the
SEC at the address set forth in the preceding paragraph.
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Statements contained in this prospectus as to the contents of any contract or other document
are not necessarily complete, and in each instance we refer you to the copy of the contract or
document filed or incorporated by reference as an exhibit to the registration statement or as an
exhibit to our Exchange Act filings, each such statement being qualified in all respects by such
reference.
DOCUMENTS INCORPORATED BY REFERENCE
The SEC allows us to incorporate by reference into this prospectus the information we file
with the SEC. This enables us to disclose important information to you by referring you to these
documents. The information incorporated by reference is deemed to be part of this prospectus, and
the information we file with the SEC after the date of this prospectus will automatically update,
modify and, where applicable, supersede any information included in this prospectus or incorporated
by reference in this prospectus. We incorporate by reference into this prospectus the following
documents filed with the SEC (other than, in each case, documents or information deemed to be filed
and not furnished in accordance with SEC rules). The SEC file number for these documents is
1-02661.
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Annual Report on Form 10-K for the fiscal year ended March 31, 2008; |
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Quarterly Reports on Form 10-Q for the fiscal quarters ended June
30, 2008 and September 30, 2008; |
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Current Reports on Form 8-K filed April 23, 2008, June 9, 2008, June
18, 2008, August 6, 2008 (excluding information furnished under Item
7.01 and Exhibit 99.1), September 9, 2008 (excluding information
furnished under Item 7.01 and Exhibit 99.1) and November 26, 2008; |
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The description of our common stock set forth in our Registration
Statement on Form 8-A, filed with the SEC on June 7, 1993. |
We also incorporate by reference into this prospectus all documents filed by us pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 between the date of this
prospectus and the termination of the offering of securities under this prospectus. To the extent
that any information contained in any current report on Form 8-K, or any exhibit to the report, was
furnished to, rather than filed with the SEC, the information or exhibit is specifically not
incorporated by reference in this prospectus. Any statement made in a document incorporated by
reference will be deemed to be modified or superseded for purposes of this prospectus to the extent
that a statement contained in this prospectus or in any subsequently filed document that also is or
is deemed to be incorporated by reference in this prospectus modifies or supersedes such statement.
Any statement made in this prospectus will be deemed to be modified or superseded to the extent
that a statement contained in any subsequently filed document that also is or is deemed to be
incorporated by reference in this prospectus modifies or
supersedes such statement. Any statement so modified or superseded will not be deemed, except
as so modified or superseded, to constitute a part of this prospectus.
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To obtain a copy of any or all of the documents incorporated by reference in this prospectus,
you may write or telephone us at the following address and telephone number:
CSS Industries, Inc.
1845 Walnut Street, Suite 800
Philadelphia, PA 19103
Attention: Secretary
(215) 595-9900
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