RULE NO. 424(b)(5)
REGISTRATION NO. 33-51675
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PROSPECTUS SUPPLEMENT
(To Prospectus dated January 10, 1994)
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$250,000,000
Hoechst Celanese Corporation
6 1/8% Notes Due 2004
Interest payable February 1 and August 1 Due February 1, 2004
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The Notes are not redeemable prior to maturity and no sinking fund is
provided for the Notes. The Notes are unsecured debt obligations of Hoechst
Celanese Corporation (the "Company") and will be represented by one or
more global Notes registered in the name of the nominee of The
Depository Trust Company ("DTC"), which will act as the Depositary.
Interests in the Notes represented by one or more global Notes will
be shown on, and transfers thereof will be effected only through,
records maintained by the Depositary and its direct and indirect
participants. Except as described herein, Notes in
certificated form will not be issued in exchange for global
Notes.
Settlement for the Notes will be made in immediately available funds. The
Notes will trade in DTC's Same-Day Funds Settlement System until maturity,
and secondary market trading activity for the Notes will therefore
settle in immediately available funds. All payments of principal and
interest to DTC will be made by the Company in immediately
available funds. See "Description of the Notes" herein.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COM- MISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE PROSPECTUS. ANY REPRE- SENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
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Price to Underwriting Proceeds to
Public(1) Discount Company(1)(2)
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Per Note 99.52% .65% 98.87%
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Total $248,800,000 $1,625,000 $247,175,000
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(1) Plus accrued interest, if any, from February 2, 1994.
(2) Before deduction of expenses payable by the Company estimated at $198,000.
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The Notes are offered by the several Underwriters when, as and if issued by
the Company, delivered to and accepted by the Underwriters and subject to
their right to reject orders in whole or in part. It is expected that the
Notes will be ready for delivery in book-entry form only through the
facilities of DTC, on or about February 2, 1994 against payment in immediately
available funds.
CS First Boston
Dillon, Read & Co. Inc.
Goldman, Sachs & Co.
J.P. Morgan Securities Inc.
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The date of this Prospectus Supplement is January 26, 1994.
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE SECURITIES
OFFERED HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
THE COMPANY
The Company was formed in 1918 and was renamed Hoechst Celanese Corporation
in February 1987. The Company manufactures and sells, principally to industrial
customers, a diversified line of products including textile and technical
fibers; acetate cigarette filter tow; specialty and bulk chemicals;
prescription drugs; crop protection products; veterinary pharmaceuticals and
animal-feed additives; engineering plastics; presensitized offset printing
plates; dyes and pigments; and polyester film. The Company's operations are
currently segmented as follows: Fibers and Film; Chemicals; Specialties and
Advanced Materials (comprised of the Advanced Materials Group, Specialty
Chemicals Group and Advanced Technology Group); and Life Sciences.
The Company is wholly owned by Hoechst Corporation, which in turn is wholly
owned by Hoechst Aktiengesellschaft ("Hoechst AG"), a large chemical company
headquartered in Frankfurt, Federal Republic of Germany. Hoechst AG and its
consolidated entities (the "Hoechst Group") consist of approximately 280
companies. The Hoechst Group operates in more than 120 countries. The Hoechst
Group's sales in 1992 were approximately $29.4 billion. The Hoechst Group is
one of the largest manufacturers of prescription drugs and one of the four
largest producers and marketers of chemicals and chemical-related products in
the world.
The Company owns 40% of Celanese Mexicana, S.A. ("Celmex") and, together with
Hoechst AG, owns 51% of the outstanding voting shares of Celmex. The Company
also owns approximately 56% of Celanese Canada Inc. ("Celanese Canada").
DESCRIPTION OF BUSINESS SEGMENTS
Fibers and Film Segment--This segment is comprised of the following business
areas: Polyester Resins and Films, Textile Fibers and Technical Fibers. The
Fibers and Film segment operates plants in the United States and abroad.
Segment sales were $3.2 billion in 1992, and operating income was $279 million,
which included $87 million in restructuring charges. The major product lines
include: polyester staple, filament, resins, monofilament, spunbond and film;
acetate filament and tow; purified terephthalic acid; dimethylterephthalate and
polybenzimidazole. The Company is one of the largest producers of manufactured
fibers in the United States. It is also one of the leading producers of
polyester film. The Company sells most of its fibers and yarns directly to
textile mills, tire manufacturers, cigarette makers and other intermediate
processors. Among the internationally registered trademarks are: Trevira (R),
Celebrate! (R), Hostaphan (R) and Trespaphan (R).
Polyester staple and filament, commonly recognized by their Trevira (R)
trademark, are principally used in wearing apparel, upholstery, floor
coverings, home furnishings, and woven and non-woven fabrics. Polyester staple
and filament are also used in tires, belts, hoses, thread and plastic
reinforcement. The Company is one of the largest producers in the United States
of cellulose acetate products. Cellulose acetate flake is produced for
conversion to acetate tow for use in cigarette filters and to filament used in
apparel and industrial applications.
Chemicals Segment--This segment consists of Hoechst Celanese Chemical Group,
Inc., the chemical operations of Celmex and the chemical operations of Celanese
Canada. This segment produces more than 60 different chemicals. Segment sales
were $1.8 billion in 1992, and operating income was $142 million.
S-2
The segment produces chemicals by upgrading hydrocarbons such as ethylene,
propylene, natural gas and butane. The hydrocarbon raw materials are purchased
on the open market, principally under long-term contracts. The major chemicals
produced fall into two broad product groups: (1) methyl chemicals, oxo-alcohols
and solvents; and (2) acetyl chemicals, monomers and ethylene oxide/glycol.
Methyl chemicals are principally used in plastics, polyesters, adhesives,
solvents, synthetic lubricants, fuel additives and coatings. Ethylene
oxide/glycol, oxo-alcohols and solvents are principally used in surfactants,
coatings, rocket propellants, antifreeze, herbicides and polyesters. Monomers
and acetyl chemicals are primarily used in water-based paints, adhesives,
textile finishes, paper coatings, manufactured fibers, pharmaceuticals,
herbicides and plastics.
With respect to substantially all of its major products, this segment is
either the largest or second largest United States merchant market supplier.
Celmex is the sole or a major Mexican producer of a variety of products
including vinyl acetate, acetic acid, acetic anhydride and acrylates. Celanese
Canada is the sole or a major Canadian producer of acetic acid, acetic
anhydride, formaldehyde, pentaerythritol and vinyl acetate monomer.
Specialties and Advanced Materials Segment--This segment consists of the
Advanced Materials Group, Specialty Chemicals Group and Advanced Technology
Group. This segment produces, imports and sells a wide variety of specialty
products. Segment sales were $1.5 billion in 1992, and the Company incurred an
operating loss of $1 million.
The Advanced Materials Group produces a variety of high-performance
engineering thermoplastics, including acetal copolymer sold under the
trademarks Celcon (R) and Hostaform (R), Celanese (R) nylon 6/6 resins,
thermoplastic polyester sold under the trademarks Celanex (R) and Impet (R),
liquid crystal polymers sold under the trademark Vectra (R), long fiber-
reinforced thermoplastics sold under the trademark Celstran (R) and
thermoplastic alloys sold under the trademark Vandar (R), as replacements for
metals and other plastics in a wide variety of end uses.
The Specialty Chemicals Group's product lines include: textile dyes, organic
pigments, colorant and additive masterbatches, resins, sodium hydrosulfite,
surfactants, and other specialty chemicals which are mainly used in the
textile, ink, pulp and paper, paint, coatings, plastics, personal care,
detergent and food processing industries; organic intermediates used for
synthesis of dyes, pigments, pharmaceutical, cosmetics, agricultural chemicals,
photochemicals, plastics, adhesives, and other chemical products; inorganic
chemicals sold for broad industrial use, including pharmaceuticals, electrical
and battery equipment and oil drilling; superabsorbant polymers used in
personal care products; waxes and lubricants used for polish and plastics
processing applications; a complete range of color proofing and printing-plate
systems for the graphic arts industry; and liquid photoresists and ancillaries
used in the manufacture of microchips for computers and other electronic
devices. Among internationally registered trademarks are: Remazol (R) dyes;
Genapol (R) and Hostapon (R) surfactants; Sanwet (R) superabsorbant polymers (a
registered trademark of Sanyo Chemical Industries, Ltd. licensed to the
Company), and AZ (R) liquid photoresist.
The Advanced Technology Group is responsible for the commercialization of new
technologies; research and development activities, primarily in advanced
materials and chemical intermediates; and investments in technology-oriented
businesses.
Life Sciences Segment--This segment consists of Hoechst-Roussel
Pharmaceuticals Incorporated ("HRPI"), Pharmaceutical Production Division
("PPD"), Hoechst-Roussel Agri-Vet Company ("HRAVC") and Copley Pharmaceutical,
Inc. ("Copley"). See "Recent Developments" below. Its operations encompass the
research and development, production and marketing of branded and generic
prescription drugs, bulk pharmaceutical chemicals, veterinary pharmaceutical
products, animal-feed additives and crop protection products. Segment sales in
1992 were $723 million, and operating income was $84 million.
S-3
The Company's branded prescription drug business is conducted through HRPI, a
majority owned subsidiary. The major products of HRPI are prescription drugs
which are promoted by a field sales force to health professionals in
physicians' offices, pharmacies and hospitals. Major products include:
Altace (TM) (ramipril), Claforan (R) (cefotaxime sodium), DiaBeta (R)
(glyburide), Lasix (R) (furosemide), Loprox (R) (ciclopirox olamine),
Topicort (R) (desoximetasone) and Trental (R) (pentoxifylline).
PPD produces and supplies HRPI with active ingredients for DiaBeta (R),
Lasix (R), Topicort (R) and Trental (R) products. HRAVC is a partnership
involved in developing and marketing animal health and crop protection
products. HRAVC's animal health products consist primarily of veterinary
pharmaceuticals and animal-feed additives. HRAVC also markets crop protection
products for use with four of the five major United States crops: wheat,
soybeans, cotton and rice.
RECENT DEVELOPMENTS
In November 1993, the Company acquired 51% of the shares (on a fully diluted
basis) of Copley, a generic drug manufacturer, in a tender offer for an
aggregate purchase price of $546 million (the "Copley Acquisition"). The
Company funded the purchase price with a $546 million loan under a revolving
credit agreement (the "Revolving Credit Agreement") with Hoechst Corporation,
the Company's parent. On January 5, 1994, Copley announced a voluntary
nationwide recall of its asthma drug Albuterol Sulfate Inhalation Solution,
0.5%. Copley estimated that its out of pocket expenses for the recall will be
approximately $6 million.
USE OF PROCEEDS
The net proceeds from the sale of Notes will be used to repay a portion of
the amount borrowed under the Revolving Credit Agreement for the Copley
Acquisition. See "Recent Developments". The Revolving Credit Agreement provides
for loans of up to $750 million through October 1998 at an interest rate equal
to 30 day LIBOR plus .0625%.
CAPITALIZATION
The following table sets forth the historical consolidated capitalization of
the Company at September 30, 1993, and on an adjusted basis giving effect to
the indebtedness incurred for the Copley Acquisition and the issuance of the
Notes offered hereby and the use of proceeds to repay outstanding indebtedness.
SEPTEMBER 30, 1993
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ACTUAL AS ADJUSTED(2)
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(IN MILLIONS)
Short-term Debt(1)........................................ $ 402 $ 704
Long-term Debt............................................ 803 1,053
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Total Debt.............................................. 1,205 1,757
Stockholder's Equity...................................... 3,517 3,517
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Total Capitalization.................................... $4,722 $5,274
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(1) This item consists of commercial paper, notes payable (to third parties,
parent and affiliates) and current installments of long-term debt.
(2) Does not include adjustments relating to the assumption of Copley
indebtedness, which was $6 million on the date of the acquisition.
S-4
SELECTED CONSOLIDATED FINANCIAL DATA
The following selected consolidated financial data of the Company for each
of the years ended December 31, 1992, 1991, 1990, 1989 and 1988 have been
derived from the consolidated financial statements of the Company which were
audited by KPMG Peat Marwick, independent certified public accountants. The
1992 and 1991 consolidated balance sheets and the 1992, 1991 and 1990
consolidated statements of earnings of the Company are incorporated herein by
reference in reliance upon the report thereon by KPMG Peat Marwick. The
selected consolidated financial data for the nine month periods ended
September 30, 1993 and 1992 are unaudited and are derived from the
consolidated financial statements of the Company which are also incorporated
by reference herein. Such financial statements include, in the opinion of
management, all adjustments (which are of a normal, recurring nature)
necessary to present fairly the results of operations and financial condition
for such nine month periods. Operating results for the nine months ended
September 30, 1993 are not necessarily indicative of operating results for the
full year 1993. This selected financial data should be read in conjunction
with the consolidated financial statements of the Company and the notes
thereto, and "Management's Discussion and Analysis of Financial Condition and
Results of Operation" for the three years ended December 31, 1992, 1991 and
1990 and the nine months ended September 30, 1993 and 1992 incorporated by
reference herein.
NINE MONTHS ENDED
SEPTEMBER 30, YEARS ENDED DECEMBER 31,
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(UNAUDITED)
1993 1992 1992 1991 1990 1989 1988
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(IN MILLIONS, EXCEPT RATIOS)
INCOME STATEMENT DATA
Net sales.............. $ 4,791 $ 5,013 $7,044 $6,794 $5,881 $6,016 $5,679
Cost of sales.......... 3,721 3,882 5,336 5,170 4,486 4,534 4,195
-------- -------- ------ ------ ------ ------ ------
Gross profit......... 1,070 1,131 1,708 1,624 1,395 1,482 1,484
Selling, general and
administrative
expenses.............. 682 682 946 890 753 759 732
Research and develop-
ment expenses......... 188 186 262 261 237 221 202
Restructuring costs.... -- 42 102 -- -- -- --
-------- -------- ------ ------ ------ ------ ------
Operating income..... 200 221 398 473 405 502 550
Equity in net income of
affiliates............ (8) 6 4 18 48 62 44
Interest expense....... (55) (63) (81) (94) (68) (73) (62)
Interest and other in- 43 54 74 69 47 67 9
come, net............. -------- -------- ------ ------ ------ ------ ------
Earnings before income
taxes, minority
interests and cumula-
tive effect of
accounting change..... 180 218 395 466 432 558 541
Income taxes........... 65 99 186 221 208 261 253
-------- -------- ------ ------ ------ ------ ------
Earnings before minor-
ity interests and
cumulative effect of
accounting change..... 115 119 209 245 224 297 288
Minority interests..... 52 45 75 73 23 30 38
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Earnings before cumula-
tive effect of
accounting change..... 63 74 134 172 201 267 250
Cumulative effect of (31) (141) (141) -- -- -- --
accounting change..... -------- -------- ------ ------ ------ ------ ------
Net earnings (loss).... $ 32 $ (67) $ (7) $ 172 $ 201 $ 267 $ 250
======== ======== ====== ====== ====== ====== ======
Ratio of earnings to
fixed charges(1)...... 3.1x 3.3x 4.0x 4.3x 4.7x 5.0x 5.8x
BALANCE SHEET DATA
Working capital........ $ 755 $ 977 $ 843 $ 935 $ 724 $ 741 $ 584
Property, plant and
equipment, net........ 2,997 2,599 2,696 2,540 2,193 2,080 2,053
Total assets........... 7,238 6,903 7,044 6,630 6,082 6,062 5,708
Short-term debt(2)..... 402 342 258 139 142 125 18
Long-term debt......... 803 849 830 752 741 803 814
Stockholder's equity... 3,517 3,437 3,454 3,503 3,413 3,299 3,161
OTHER DATA
Net cash provided by
operating activities.. $ 162 $ 268 $ 584 $ 492 $ 348 $ 590 $ 284
Capital expenditures... 423 396 592 498 381 382 378
Dividends declared..... -- -- 85 90 100 115 195
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(1) For the purpose of calculating the ratio of earnings to fixed charges,
earnings consist of earnings from operations before fixed charges, minority
interests, income taxes and cumulative effect of accounting changes. Fixed
charges consist of interest and debt expense, capitalized interest, interest
on obligations under capital leases, the estimated interest portion of rents
under operating leases and the majority-owned preferred stock dividend
requirement.
(2) This item consists of commercial paper, notes payable (to third parties,
parent and affiliates) and current installments of long-term debt.
S-5
DESCRIPTION OF THE NOTES
The following description of the particular terms of the Notes offered hereby
supplements the description of the general terms of the Securities set forth
under the heading "Description of Securities" in the accompanying Prospectus,
to which description reference is hereby made.
GENERAL
The Notes offered hereby constitute a series of Securities to be issued under
the Indenture referred to in the accompanying Prospectus. The Notes will mature
on February 1, 2004. The Notes will bear interest at the rate set forth on the
cover page of this Prospectus Supplement from February 2, 1994, payable semi-
annually in arrears on February 1 and August 1 of each year, commencing August
1, 1994 to the persons in whose names the Notes are registered at the close of
business on the preceding January 15 and July 15, as the case may be. The Notes
are not redeemable prior to maturity and do not provide for any sinking fund.
BOOK-ENTRY SYSTEM
The Notes initially will be represented by a single global security (the
"Global Security") deposited with DTC and registered in the name of a nominee
of DTC, except as set forth below. The settlement of transactions with respect
to the Global Security will be facilitated through electronic computerized
book-entry changes in participants' accounts, thereby eliminating the physical
movement of Note certificates. The Notes will be available for purchase in
denominations of $1,000 and integral multiples thereof in book-entry form only.
Unless and until certificated Notes are issued under the limited circumstances
described below, no beneficial owner of a Note shall be entitled to receive a
definitive certificate representing a Note. So long as DTC or any successor
depositary (the "Depositary") or its nominee is the registered owner of the
Global Security, the Depositary or such nominee, as the case may be, will be
considered to be the sole owner or holder of the Notes for all purposes of the
Indenture. Unless and until it is exchanged in whole or in part for the Notes
represented thereby, the Global Security may not be transferred except as a
whole by the Depositary to a nominee of the Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by the
Depositary or any nominee to a successor depositary or any nominee of such
successor.
So long as the Notes are represented by the Global Security, all payments of
principal and interest will be made to the Depositary or its nominee (or a
successor), as the case may be, as the sole registered owner of the Global
Security representing the Notes.
The Company expects that the Depositary or its nominee, upon receipt of any
payment of principal or interest in respect of the Global Security representing
the Notes, will credit participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal amount
of the Global Security as shown on the records of the Depositary or such
nominee.
If DTC is at any time unwilling, unable or ineligible to continue as
depositary and a successor depositary is not appointed by the Company within 90
days, the Company will issue certificated Notes in definitive form in exchange
for the Global Security. In addition, the Company may at any time determine not
to have the Notes represented by the Global Security, and, in such event, will
issue certificated Notes in definitive form in exchange for the Global
Security. In either instance, an owner of a beneficial interest in the Global
Security will be entitled to physical delivery of certificated Notes in
definitive form equal in principal amount to such beneficial interest in the
Global Security and to have such certificated Notes registered in its name.
Certificated Notes so issued in definitive form will be issued in denominations
of $1,000 and integral multiples thereof and will be issued in registered form
only, without coupons.
See "Description of Securities" in the accompanying Prospectus for additional
information concerning the Notes, the Indenture and the book-entry system.
SAME DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available funds. All payments of principal and interest to the Depositary will
be made by the Company in immediately available funds.
Secondary trading in notes and debentures of corporate issuers is generally
settled in clearinghouse or next-day funds. In contrast, the Notes will trade
in the DTC's Same-Day Funds Settlement System until maturity, and secondary
market trading activity in the Notes will therefore settle in immediately
available funds. No assurance can be given as to the effect, if any, of
settlements in immediately available funds on trading activity in the Notes.
S-6
UNDERWRITING
The Underwriters named below, for whom CS First Boston Corporation, Dillon,
Read & Co. Inc., Goldman, Sachs & Co., and J.P. Morgan Securities Inc. are
acting as Representatives (the "Representatives"), have severally agreed to
purchase from the Company the following respective principal amounts of the
Notes:
PRINCIPAL
UNDERWRITER AMOUNT
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CS First Boston Corporation.................................... $ 47,500,000
Dillon, Read & Co. Inc. ....................................... 47,500,000
Goldman, Sachs & Co. .......................................... 47,500,000
J.P. Morgan Securities Inc..................................... 47,500,000
ABD Securities Corporation..................................... 10,000,000
Chase Securities, Inc. ........................................ 10,000,000
Chemical Securities Inc. ...................................... 10,000,000
Citicorp Securities, Inc. ..................................... 10,000,000
C.J. Lawrence/Deutsche Bank Securities Corporation............. 10,000,000
Prudential Securities Incorporated............................. 10,000,000
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Total...................................................... $250,000,000
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The Underwriting Agreement provides that the obligations of the Underwriters
are subject to certain conditions precedent and that the Underwriters will be
obligated to purchase all of the Notes if any are purchased.
The Company has been advised by CS First Boston Corporation, the lead
Representative of the Underwriters, that the Underwriters propose to offer the
Notes to the public initially at the public offering price set forth on the
cover page of this Prospectus Supplement and, through the Representatives, to
certain dealers at such price less a concession of .40% of the principal amount
per Note; that the Underwriters and such dealers may allow a discount of .25%
of such principal amount on sales to certain other dealers; and that after the
initial public offering, the public offering price and concession and discount
to dealers may be changed by the Representatives.
The Notes are a new issue of securities with no established trading market.
The Representatives have advised the Company that one or more of them intends
to act as a market maker for the Notes. However, the Representatives are not
obligated to do so and may discontinue any market making at any time without
notice. No assurance can be given as to the liquidity of the trading market for
the Notes.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including civil liabilities under the Securities Act of 1933, or
contribute to payments which the Underwriters may be required to make in
respect thereof.
Certain of the Underwriters and their affiliates may engage in transactions
with, and perform services for, the Company in the ordinary course of business,
including commercial banking services.
VALIDITY OF NOTES
The validity of the Notes will be passed upon for the Company by David A.
Jenkins, Vice President and General Counsel of the Company, and for the
Underwriters by Cravath, Swaine & Moore, New York, New York.
S-7
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PROSPECTUS
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$650,000,000
Hoechst Celanese Corporation
Debt Securities and Medium-Term Notes
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Hoechst Celanese Corporation (the "Company") may offer from time to time its
unsecured debt securities ("Debt Securities") consisting of notes, debentures
or other evidences of indebtedness, and Medium-Term Notes (the "Medium-Term
Notes", and together with the Debt Securities, the "Securities") at an
aggregate initial public offering price of not more than $650,000,000 or,
if applicable, the equivalent thereof in one or more foreign currencies
or currency units. The Securities may be offered as separate series in
amounts, at prices and on terms to be determined in light of market
conditions at the time of sale and set forth in a Prospectus
Supplement or Prospectus Supplements. The aggregate initial public
offering price of the Medium-Term Notes will constitute not less
than $383,850,000 of such $650,000,000 total (or, in each case, the
respective equivalents thereof in one or more foreign currencies or
currency units). The Medium-Term Notes will be offered in one or
more series, designated Series B or such other series as set
forth in the applicable Prospectus Supplement.
The terms of each series of Securities, including, where applicable, the
specific designation, aggregate principal amount, authorized denominations,
maturity, rate or rates and time or times of payment of any interest, any
terms for optional or mandatory redemption or payment of additional amounts
or any sinking fund provisions, any initial public offering price, the
proceeds to the Company, special provisions relating to Securities in
bearer form and any other specific terms in connection with the offering
and sale of such series will be set forth in a Prospectus Supplement or
Prospectus Supplements. Securities may be issued with amounts payable
in respect of principal of or any premium or interest on the
Securities determined by reference to the value, rate or price of
one or more specified indices.
The Securities may be sold directly by the Company, through agents designated
from time to time, through underwriting syndicates led by one or more
managing underwriters or through one or more underwriters. See "Plan of
Distribution". If any agents or underwriters are involved in any offering
of Securities, the names of such agents or underwriters will be set forth
in the applicable Prospectus Supplement. If an underwriter, agent or
dealer is involved in any offering of Securities, the underwriter's
discount, agent's commission or dealer's purchase price will be set
forth in, or may be calculated from the information set forth in, the
applicable Prospectus Supplement, and the net proceeds to the Company
from such offering will be the public offering price of such
Securities less such discount in the case of any offering through
an underwriter, or the purchase price of such Securities less such
commission in the case of an offering through an agent, and less,
in each case, the other expenses of the Company associated with
the issuance and distribution of such Securities.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
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The date of this Prospectus is January 10, 1994.
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS OR
ANY PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR ANY UNDERWRITER OR AGENT. THIS PROSPECTUS AND ANY PROSPECTUS SUPPLEMENT DO
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF ANY OFFER TO BUY ANY OF
THE SECURITIES OFFERED HEREBY AND THEREBY IN ANY JURISDICTION TO ANY PERSON TO
WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE
DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE
HEREUNDER AND THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THE INFORMATION HEREIN OR THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
THEIR RESPECTIVE DATES.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the United States
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports and other information with the Securities
and Exchange Commission (the "Commission"). Reports and other information filed
by the Company can be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the following Regional Offices of the Commission: 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661-2511; and 13th Floor, 7
World Trade Center, New York, New York 10048. Copies of such material can be
obtained from the Public Reference Section of the Commission, Washington, D.C.
20549, at prescribed rates. This Prospectus does not contain all information
set forth in the Registration Statement and Exhibits thereto which the Company
has filed with the Commission under the United States Securities Act of 1933,
as amended (the "Act"), and to which reference is hereby made.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the Company (File No.
33-13326) are incorporated in this Prospectus by reference: (1) The Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1992; and (2)
the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31,
1993, June 30, 1993, and September 30, 1993.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering of the Securities shall be deemed to be
incorporated by reference in this Prospectus. Any statement contained herein or
in a document all or a portion of which is incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom a copy of this
Prospectus is delivered, upon the written or oral request of any such person, a
copy of any and all of the foregoing documents incorporated by reference
herein, other than the exhibits to such documents (unless such exhibits are
specifically incorporated by reference in such documents). Requests should be
directed to: Hoechst Celanese Corporation, 1041 Route 202-206, Bridgewater, New
Jersey 08807, Attention: Corporate Secretary (telephone: 908-231-2000).
----------------
Unless otherwise indicated, currency amounts in this Prospectus and any
Prospectus Supplement are stated in United States dollars ("$", "dollars",
"U.S. dollars" or "U.S.$").
2
THE COMPANY
The Company was formed in 1918 and was renamed Hoechst Celanese Corporation
in February 1987. The Company manufactures and sells, principally to
industrial customers, a diversified line of products including textile and
technical fibers; acetate cigarette filter tow; specialty and bulk chemicals;
prescription drugs; crop protection products; veterinary pharmaceutical and
animal-feed additives; engineering plastics; presensitized offset printing
plates; dyes and pigments; and polyester film. The Company's operations are
currently segmented as follows: Fibers and Film; Chemicals; Specialties and
Advanced Materials (comprised of the Advanced Materials Group, Specialty
Chemicals Group and Advanced Technology Group); and Life Sciences.
The Company is wholly owned by Hoechst Corporation, which in turn is wholly
owned by Hoechst Aktiengesellschaft ("Hoechst AG"), a large chemical company
headquartered in Frankfurt, Federal Republic of Germany. Hoechst AG and its
consolidated entities (the "Hoechst Group") consist of approximately 280
companies. The Hoechst Group operates in more than 120 countries. The Hoechst
Group's sales in 1992 were approximately $29.4 billion. The Hoechst Group is
one of the largest manufacturers of prescription drugs and one of the four
largest producers and marketers of chemicals and chemical-related products in
the world.
The Company's principal executive offices are located at 1041 Route 202-206,
Bridgewater, New Jersey 08807; its mailing address is Route 202-206, Post
Office Box 2500, Somerville, New Jersey 08876-1258; and its telephone number
is (908) 231-2000.
USE OF PROCEEDS
Unless otherwise indicated in any supplement to this Prospectus, the net
proceeds from the sale of Securities will be used for general corporate
purposes.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's ratio of earnings to fixed
charges for the periods indicated.
YEARS ENDED DECEMBER 31,
NINE MONTHS ENDED ------------------------
SEPTEMBER 30, 1993 1992 1991 1990 1989 1988
------------------ ---- ---- ---- ---- ----
Ratio of earnings to fixed
charges(a)........................ 3.1 4.0 4.3 4.7 5.0 5.8
- --------
(a) For the purpose of calculating the ratio of earnings to fixed charges,
earnings consist of earnings from operations before fixed charges, minority
interests, income taxes, cumulative effects of accounting changes and
extraordinary charges. Fixed charges consist of interest and debt expense,
capitalized interest, interest on obligations under capital leases, the
estimated interest portion of rents under operating leases and the majority-
owned preferred stock dividend requirement. Effective January 1, 1991, the
Company consolidated Celanese Mexicana, S.A. ("Celmex") in its financial
statements. Prior to 1991, the Company accounted for Celmex under the equity
method and included Celmex with "Investment in affiliates".
3
DESCRIPTION OF SECURITIES
The Securities are to be issued under an Indenture, dated as of January 26,
1994 (as amended from time to time, the "Indenture"), between the Company and
Chemical Bank, as Trustee (the "Trustee"), a copy of which is filed as an
exhibit to the Registration Statement of which this Prospectus is a part. The
Securities may be issued from time to time in one or more series. The
particular terms of each series, or of Securities forming a part of a series,
which are offered by a Prospectus Supplement will be described in such
Prospectus Supplement.
The Securities will not be guaranteed by Hoechst AG or any other member of
the Hoechst Group.
The following summaries of certain provisions of the Indenture do not purport
to be complete and are subject, and are qualified in their entirety by
reference, to all the provisions of the Indenture, including the definitions
therein of certain terms, and, with respect to any particular Securities, to
the description of the terms thereof included in the Prospectus Supplement
relating thereto. Wherever particular Sections or defined terms of the
Indenture are referred to herein or in a Prospectus Supplement, such Sections
or defined terms are incorporated by reference herein or therein, as the case
may be.
GENERAL
The Indenture provides that Securities in separate series may be issued
thereunder from time to time without limitation as to aggregate principal
amount. The Company may specify a maximum aggregate principal amount for the
Securities of any series. (Section 301) The Securities are to have such terms
and provisions which are not inconsistent with the Indenture, including as to
maturity, principal and interest, as the Company may determine. The Securities
will be unsecured obligations of the Company and will rank on a parity with all
other unsecured and unsubordinated indebtedness of the Company.
The applicable Prospectus Supplement will set forth the price or prices at
which the Securities to be offered will be issued and will describe the
following terms of such Securities: (1) the title of such Securities; (2) any
limit on the aggregate principal amount of such Securities or the series of
which they are a part; (3) the Person to whom any interest on a Registered
Security shall be payable, if other than the Person in whose name that
Registered Security is registered at the close of business on the Regular
Record Date for such interest; (4) the date or dates on which the principal of
any such Securities will be payable; (5) the rate or rates at which any of such
Securities will bear interest, if any, the date or dates from which any such
interest will accrue, the Interest Payment Dates on which any such interest
will be payable and the Regular Record Date for any such interest payable on
any Interest Payment Date; (6) the place or places where the principal of and
any premium and interest on any of such Securities will be payable; (7) the
period or periods within which, the price or prices at which and the terms and
conditions on which any of such Securities may be redeemed, in whole or in
part, at the option of the Company or the Holder thereof; (8) the obligation,
if any, of the Company to redeem or purchase any of such Securities pursuant to
any sinking fund or analogous provision or at the option of the Holder thereof,
and the period or periods within which, the price or prices at which and the
terms and conditions on which any of such Securities will be redeemed or
purchased, in whole or in part, pursuant to any such obligation; (9) the
denominations in which any of such Securities will be issuable, if other than
denominations of $1,000 and any integral multiple thereof; (10) if other than
the currency of the United States of America, the currency, currencies or
currency units in which principal of or any premium or interest on any of such
Securities will be payable (and the manner in which the equivalent of the
principal amount thereof in the currency of the United States of America is to
be determined for any purpose, including for the purpose of determining the
principal deemed to be Outstanding at any time); (11) if the amount of
principal of or any premium or interest on any of such Securities may be
determined with reference to an index or pursuant to a formula, the manner in
which such amounts will be determined; (12) if other than the entire principal
amount thereof, the portion of the principal amount of any of such Securities
which will be payable upon declaration of acceleration of the Maturity thereof;
(13) whether the Securities shall be issued in whole or in part in the form of
one or more Global Securities and, in such case, the
4
Depositary or Depositaries for such Global Security or Securities; (14) the
currency or currencies of denomination of the Securities, which may be in
Dollars, any foreign currency or any composite currency, including but not
limited to the ECU, and, if any such currency of denomination is a composite
currency other than the ECU, the agency or organization, if any, responsible
for overseeing such composite currency; (15) if the payments of principal of
(and premium, if any) or the interest on the Securities are to be made in a
foreign currency other than the foreign currency in which such Securities are
denominated, the manner in which such amounts shall be determined; (16) whether
or not Section 312 of the Indenture (which provides that if, for the purpose of
satisfying a judgment in any court with respect to any obligation of the
Company under the Indenture or under any Security, it becomes necessary to
convert into any other currency or currency unit any amount in the currency or
currency unit due under the Indenture or under such Security, that such
conversion shall be made at the Conversion Rate) is applicable to the
Securities; (17) if applicable, that the Securities, in whole or any specified
part, shall be defeasible pursuant to the provisions of the Indenture described
under "Defeasance and Covenant Defeasance"; (18) whether any of the Securities
will be issued in bearer form and, if so, any limitations on issuance of such
bearer Securities (including exchange for registered Securities of the same
series); (19) any addition to or change in the Events of Default applicable to
any of such Securities and any change in the right of the Trustee or the
Holders to declare the principal amount of any of such Securities due and
payable; (20) any addition to or change in the covenants in the Indenture
described under "Certain Restrictive Covenants" applicable to any of such
Securities; and (21) any other terms of such Securities not inconsistent with
the provisions of the Indenture. (Section 301)
Securities, including Original Issue Discount Securities, may be sold at a
substantial discount below their principal amount. Certain special United
States federal income tax considerations (if any) applicable to Securities sold
at an original issue discount may be described in the applicable Prospectus
Supplement. In addition, certain special United States federal tax or other
considerations (if any) applicable to any Securities which are denominated in a
currency or currency unit other than United States dollars may be described in
the applicable Prospectus Supplement.
FORM, EXCHANGE AND TRANSFER
Unless otherwise indicated in the applicable Prospectus Supplement, the
Securities of each series will be issuable only in fully registered form,
without coupons, and only in denominations of $1,000 and integral multiples
thereof. The Indenture, however, provides that the Company may also issue
Securities in bearer form only, or in both registered and bearer form.
Securities in bearer form shall not be offered, sold, resold or delivered in
connection with their original issuance in the United States or to any United
States person (as defined below) other than offices located outside the United
States of certain United States financial institutions. As used above, "United
States person" means any citizen or resident of the United States, any
corporation, partnership or other entity created or organized in or under the
laws of the United States, or any estate or trust, the income of which is
subject to United States Federal income taxation regardless of its source, and
"United States" means the United States of America (including the States and
the District of Columbia), its territories, its possessions and other areas
subject to its jurisdiction. Purchasers of Securities in bearer form will be
subject to certification procedures and may be affected by certain limitations
under United States tax laws. Such procedures and limitations will be described
in the Prospectus Supplement relating to the offering of the Securities in
bearer form. Unless otherwise indicated in the applicable Prospectus
Supplement, Securities issued in bearer form will be issued in denominations of
$1,000 and integral multiples thereof. (Section 302)
At the option of the Holder, subject to the terms of the Indenture and the
limitations applicable to Global Securities, Securities of each series will be
exchangeable for other Securities of the same series of any authorized
denomination and of a like tenor and aggregate principal amount. Registered
Securities will not be exchangeable for Securities in bearer form. (Section
305)
Subject to the terms of the Indenture and the limitations applicable to
Global Securities, Securities may be presented for exchange as provided above
or for registration of transfer (duly endorsed or with the form
5
of transfer endorsed thereon duly executed) at the office of the Security
Registrar or at the office of any transfer agent designated by the Company for
such purpose. No service charge will be made for any registration of transfer
or exchange of Securities, but the Company may require payment of a sum
sufficient to cover any tax or other governmental charge payable in connection
therewith. Such transfer or exchange will be effected upon the Security
Registrar or such transfer agent, as the case may be, being satisfied with the
documents of title and identity of the person making the request. The Company
has appointed the Trustee as Security Registrar. Any transfer agent (in
addition to the Security Registrar) initially designated by the Company for any
Securities will be named in the applicable Prospectus Supplement. (Section 305)
The Company may at any time designate additional transfer agents or rescind the
designation of any transfer agent or approve a change in the office through
which any transfer agent acts, except that the Company will be required to
maintain a transfer agent in each Place of Payment for the Securities of each
series. (Section 1002) Securities in bearer form and the coupons, if any,
appertaining thereto will be transferable by delivery.
If the Securities of any series (or of any series and specified terms) are to
be redeemed in part, the Company will not be required to (i) issue, register
the transfer of or exchange any Security of that series (or of that series and
specified terms, as the case may be) during a period beginning at the opening
of business 15 days before the day of mailing of a notice of redemption of any
such Security that may be selected for redemption and ending at the close of
business on the date of such mailing or (ii) register the transfer of or
exchange or any Security so selected for redemption, in whole or in part,
except the unredeemed portion of any such Security being redeemed in part.
(Section 305)
GLOBAL SECURITIES
Some or all of the Securities of any series may be represented, in whole or
in part, by one or more Global Securities which will have an aggregate
principal amount equal to that of the Securities represented thereby. Each
Global Security will be registered in the name of a Depositary or a nominee
thereof identified in the applicable Prospectus Supplement, will be deposited
with such Depositary or nominee or a custodian therefor and will bear a legend
regarding the restrictions on exchanges and registration of transfer thereof
referred to below and any such other matters as may be provided for pursuant to
the Indenture.
If at any time the Depositary for the Securities of a series notifies the
Company that it is unwilling or unable to continue as Depositary for the
Securities of such series or if at any time the Depositary for the Securities
of such series shall no longer be eligible under the Indenture, the Company
shall appoint a successor Depositary with respect to the Securities of such
series. If a successor Depositary for the Securities of such series is not
appointed by the Company within 90 days after the Company receives such notice
or becomes aware of such ineligibility, the Company will execute, and the
Trustee, upon receipt of a Company Order for the authentication and delivery of
definitive Securities of such series, will authenticate and deliver, Securities
of such series in definitive form in an aggregate principal amount equal to the
principal amount of the Global Security or Securities representing such series
in exchange for such Global Security or Securities. (Section 305)
The Company may at any time and in its sole discretion determine that the
Securities of any series issued in the form of one or more Global Securities
shall no longer be represented by such Global Security or Securities. In such
event the Company will execute, and the Trustee, upon receipt of a Company
Order for the authentication and delivery of definitive Securities of such
series, will authenticate and deliver, Securities of such series in definitive
form and in an aggregate principal amount equal to the principal amount of the
Global Security or Securities representing such series in exchange for such
Global Security or Securities.
If specified by the Company with respect to a series of Securities, the
Depositary for such series of Securities may surrender a Global Security for
such series of Securities in exchange in whole or in part for
6
Securities of such series in definitive form on such terms as are acceptable to
the Company and such Depositary. Thereupon, the Company shall execute, and the
Trustee shall authenticate and deliver, without service charge:
(i) to each Person specified by such Depositary a new Security or
Securities of the same series, of any authorized denomination as requested
by such Person in aggregate principal amount equal to and in exchange for
such Person's beneficial interest in the Global Security; and
(ii) to such Depositary a new Global Security in denomination equal to
the difference, if any, between the principal amount of the surrendered
Global Security and the aggregate principal amount of Securities delivered
to Holders thereof.
As long as the Depositary, or its nominee, is the registered Holder of a
Global Security, the Depositary or such nominee, as the case may be, will be
considered the sole owner and Holder of such Global Security and the Securities
represented thereby for all purposes under the Securities and the Indenture.
Except in the limited circumstances referred to above, owners of beneficial
interests in a Global Security will not be entitled to have such Global
Security or any Securities represented thereby registered in their names, will
not receive or be entitled to receive physical delivery of certificated
Securities in exchange therefor and will not be considered to be the owners or
Holders of such Global Security or any Securities represented thereby for any
purpose under the Securities or the Indenture. All payments of principal of and
any premium and interest on a Global Security will be made to the Depositary or
its nominee, as the case may be, as the Holder thereof. The laws of some
jurisdictions require that certain purchasers of securities take physical
delivery of such securities in definitive form. These laws may impair the
ability to transfer beneficial interests in a Global Security.
Ownership of beneficial interests in a Global Security will be limited to
institutions that have accounts with the Depositary or its nominee
("participants") and to persons that may hold beneficial interests through
participants. In connection with the issuance of any Global Security, the
Depositary will credit, on its book-entry registration and transfer system, the
respective principal amounts of Securities represented by the Global Security
to the accounts of its participants. Ownership of beneficial interests in a
Global Security will be shown only on, and the transfer of those ownership
interests will be effected only through, records maintained by the Depositary
(with respect to participants' interests) or any such participant (with respect
to interests of persons held by such participants on their behalf). Payments,
transfers, exchanges and other matters relating to beneficial interests in a
Global Security may be subject to various policies and procedures adopted by
the Depositary from time to time. None of the Company, the Trustee or any agent
of the Company or the Trustee will have any responsibility or liability for any
aspect of the Depositary's or any participant's records relating to, or for
payments made on account of, beneficial interests in a Global Security, or for
maintaining, supervising or reviewing any records relating to such beneficial
interests.
Secondary trading in notes and debentures of corporate issuers is generally
settled in clearing-house or next-day funds. In contrast, beneficial interests
in a Global Security, in some cases, may trade in the Depositary's same-day
funds settlement system, in which secondary market trading activity in those
beneficial interests would be required by the Depositary to settle in
immediately available funds. There is no assurance as to the effect, if any,
that settlement in immediately available funds would have on trading activity
in such beneficial interests. Also, settlement for purchases of beneficial
interests in a Global Security upon the original issuance thereof may be
required to be made in immediately available funds.
PAYMENT AND PAYING AGENTS
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of interest on a Registered Security on any Interest Payment Date will be made
to the Person in whose name such Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest. (Section 307)
7
Unless otherwise indicated in the applicable Prospectus Supplement, principal
of and premium and interest on the Securities of a particular series will be
payable at the office of such Paying Agent or Paying Agents as the Company may
designate for such purpose from time to time, except that at the option of the
Company payment of any interest to Holders of Registered Securities may be made
by check mailed to the address of the Person entitled thereto as such address
appears in the Security Register. Payments in respect of Unregistered
Securities or of any Coupon will be made only against surrender of such
Security or Coupon at the offices of such Paying Agents outside the United
States and its possessions as the Company may from time to time appoint. Unless
otherwise indicated in the applicable Prospectus Supplement, the corporate
trust office of Chemical Bank in the Borough of Manhattan, The City of New York
will be designated as the Company's sole Paying Agent for payments with respect
to Securities of each series. Any other Paying Agents initially designated by
the Company for the Securities of a particular series will be named in the
applicable Prospectus Supplement. The Company may at any time designate
additional Paying Agents or rescind the designation of any Paying Agent or
approve a change in the office through which any Paying Agent acts, except that
the Company will be required to maintain a Paying Agent in each Place of
Payment for the Securities of a particular series. (Section 1002)
Payments of principal of and premium if any, and interest, if any, payable at
the Stated Maturity or at any Redemption Date on a Security will be made in
immediately available funds at the corporate trust office of the Paying Agent,
provided that the Security is presented to the Paying Agent in time for the
Paying Agent to make such payments in such funds in accordance with its normal
procedures. For interest payments of Securities of five million U.S. dollars or
more in principal amount, the purchaser may elect to have payment made in
immediately available funds. Interest payments on Securities of less than five
million U.S. dollars in principal amount will be made in immediately available
funds only if agreed to on a case-by-case basis by the Company and otherwise
will be made by check mailed on the Interest Payment Date to the registered
Holder thereof (which, in the case of Book-Entry Securities, will be a nominee
of the Depository), except that interest payments made at any Redemption Date
or at the Stated Maturity will be made as described above. Interest payments
will not be made in immediately available funds unless written instructions
have been presented to the Trustee at least 15 days prior to the Regular Record
Date from and after which a holder has elected to receive payments in
immediately available funds. The Company will provide the Trustee with funds
available for immediate use for such purpose.
All moneys paid by the Company to a Paying Agent for the payment of the
principal of or any premium or interest on any Security which remain unclaimed
at the end of two years after such principal, premium or interest has become
due and payable will be repaid to the Company, and the Holder of such Security
thereafter may look only to the Company for payment thereof. (Section 1003)
CERTAIN COVENANTS
The Indenture contains the covenants set forth below, which description
should be read in conjunction with the definitions set forth under the heading
"Certain Definitions" which follows:
Limitation on Secured Debt. (a) The Company will not, and will not permit any
Subsidiary of the Company to, create, incur, assume or permit to exist any
Mortgage upon any shares of Capital Stock or Debt of any Domestic Subsidiary,
whether owned on the date of the Indenture or thereafter acquired, to secure
any Debt of the Company or any other Person, unless contemporaneously therewith
effective provision is made to secure the Notes equally and ratably with all
other Debt secured by such Mortgage.
There will be excluded from this restriction (i) Mortgages existing on shares
of Capital Stock or Debt of a corporation at the time such corporation becomes
a Domestic Subsidiary, (ii) Mortgages existing on Capital Stock or Debt of a
Domestic Subsidiary at the time such Capital Stock or Debt is acquired and
(iii) Mortgages securing Debt that constitutes an extension, renewal or
refunding (or any successive extension, renewal or refunding) in whole or in
part of Debt secured by any Mortgages referred to in clause (i) or (ii) above,
if
8
limited to the same shares of Capital Stock and Debt subject to, and securing
no more Debt than the amount secured by, the Mortgage referred to in clause (i)
or (ii). (Section 1004(a))
(b) The Company will not, and will not permit any Restricted Subsidiary to,
create, incur, assume or permit to exist any Mortgage on any Principal Property
of the Company or any Restricted Subsidiary, whether owned or leased on the
date of the Indenture or thereafter acquired, or on any income or profits
therefrom, to secure any Debt of the Company or any other Person, unless
contemporaneously therewith effective provision is made to secure the Notes
equally and ratably with all other Debt secured by such Mortgage.
There will be excluded from this restriction (i) Mortgages existing on
property owned by a corporation at the time such corporation becomes a
Restricted Subsidiary and Mortgages on property of a corporation existing at
the time such corporation is merged or consolidated with the Company or a
Restricted Subsidiary or at the time of sale or other disposition of the
properties of such corporation as an entirety or substantially as an entirety
to the Company or a Restricted Subsidiary; provided, however, that no such
Mortgage shall extend to or cover any property or asset of the Company or a
Restricted Subsidiary other than the property subject thereto at the time such
corporation becomes a Restricted Subsidiary or is merged or consolidated or
such properties are sold or otherwise disposed of; (ii) Mortgages on property
acquired after the date of the Indenture by the Company or a Restricted
Subsidiary existing at the time of acquisition thereof or to secure the payment
of all or any part of the purchase price or construction cost thereof or to
secure any Debt incurred prior to, at the time of or within six months after,
the acquisition of such property or completion of such construction for the
purpose of financing all or part of the purchase price or the construction cost
thereof; provided, however, that no such Mortgage shall extend to or cover any
property or asset of the Company or a Restricted Subsidiary other than the
property so acquired or constructed and fixed improvements thereon; (iii)
Mortgages in favor of the Company or any Restricted Subsidiary; (iv) Mortgages
existing on the date of the Indenture; (v) Mortgages securing Debt that
constitutes an extension, renewal or refunding (or any successive extension,
renewal or refunding) in whole or in part of Debt secured by any Mortgage
referred to in clauses (i), (ii), (iii) or (iv) above (a "Prior Mortgage"), if
limited to the same property (plus additions, extensions, improvements,
repairs, replacements and rebuildings) subject to, and securing no more Debt
than the amount secured by, the Prior Mortgage; and (vi) Mortgages not of a
character referred to in clauses (i) through (v) above if at the time of, and
after giving effect to, the creation or assumption of such Mortgage, the
aggregate of all Debt of the Company and the Restricted Subsidiaries secured by
all such Mortgages of a character not referred to in clauses (i) through (v)
above, plus all Attributable Debt of the Company and the Restricted
Subsidiaries with respect to sale and lease-back transactions to which the next
paragraph hereof is applicable, does not exceed 10% of Consolidated Net
Tangible Assets, as of the date of the most recent audited annual consolidated
balance sheet of the Company and its consolidated Subsidiaries. (Section
1004(b))
Limitation on Sale and Lease-Back Transactions. The Company will not, and
will not permit any Restricted Subsidiary to, enter into any arrangement with
any Person providing for the leasing by the Company or any Restricted
Subsidiary of any real or tangible personal property (except for leases for a
term of not more than three years or between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries), which property has been or is
to be sold or transferred by the Company or such Restricted Subsidiary to such
Person in contemplation of such leasing, unless (i) the Company or such
Restricted Subsidiary would be entitled to create a Mortgage on such property
securing Debt in an amount equal to the Attributable Debt with respect to such
arrangement without equally and ratably securing the Notes as described above
under "Limitation on Secured Debt" or (ii) the net proceeds of such sale are at
least equal to the fair value (as determined by the Board of Directors) of such
property and the Company or such Restricted Subsidiary applies or causes to be
applied in an amount in cash equal to the net proceeds of such sale to the
retirement, within 120 days of the effective date of any such arrangement, of
Senior Debt of the Company or such Restricted Subsidiary (other than Senior
Debt owed to the Company or a Subsidiary or an Affiliate of the Company).
(Section 1005)
9
CERTAIN DEFINITIONS
For purposes of the covenants described above and other provisions of the
Indenture:
"Affiliate" of a Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person. For the purposes of this definition, "control" when used with
respect to any Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise.
"Attributable Debt" in respect of a sale and lease-back arrangement means, as
at the time of determination, the greater of (a) the fair value of the property
subject to such arrangement (as determined by the Board of Directors) or (b)
the present value (discounted at the rate of interest per annum implicit in the
terms of such lease, as determined in good faith by the Company, compounded
annually) of the total obligations of the lessee for rental payments during the
remaining term of the lease included in such arrangement (including any period
for which such lease has been extended).
"Board of Directors" means the board of directors of the Company or any duly
authorized committee thereof.
"Capital Stock" means any and all shares, interests, rights to purchase,
participations or other equivalents of or interests in (however designated)
corporate stock.
"Debt" means, with respect to any Person, without duplication, (i)
indebtedness of such Person for money borrowed (including indebtedness
evidenced by notes, debentures, bonds or other instruments of indebtedness for
the payment of which such Person is responsible or liable, by guarantees or
otherwise), (ii) obligations of such Person under any agreement to lease, or
any lease of, any real or personal property which, in accordance with generally
accepted accounting principles, is classified upon such Person's consolidated
balance sheet as a liability, (iii) indebtedness for money borrowed secured by
any Mortgage existing on property owned by such Person, whether or not the
indebtedness secured thereby shall have been assumed, (iv) all obligations
created or arising under any conditional sale or other similar title retention
agreement with respect to property acquired by such Person, whether or not the
rights and remedies of the seller or lender under such agreement in the event
of default are limited to repossession or sale of such property and (v)
guarantees, endorsements and other contingent obligations in respect of, or
agreements to purchase or otherwise acquire, indebtedness for money borrowed by
other Persons, except guarantees, endorsements or contingent obligations in
connection with the sale or discount of accounts receivable, trade acceptances
and other paper arising in the ordinary course of business.
"Domestic Subsidiary" means any Subsidiary of the Company which is not a
Foreign Subsidiary.
"Finance Subsidiary" means any Subsidiary of the Company which is principally
engaged in (a) leasing property or equipment, (b) financing of accounts
receivable or (c) financing of the operations of the Company and its
Subsidiaries.
"Foreign Subsidiary" means any Subsidiary of the Company (i) not organized
under the laws of the United States of America or any State thereof or the
District of Columbia or (ii) substantially all of whose assets are located,
substantially all of whose business is conducted, outside the United States of
America.
"Mortgage" means any mortgage, pledge, security interest, conditional sale or
other title retention agreement or similar lien.
"Principal Property" means any manufacturing or processing plant or warehouse
owned by the Company or Restricted Subsidiary which is located within the
United States of America and the gross book value of which (without deduction
of any depreciation reserves) on the date as of which the determination is
being
10
made exceeds 2% of Consolidated Net Tangible Assets, other than properties
which in the opinion of the Board of Directors are not of material importance
to the Company's business as an entirety.
"Restricted Subsidiary" means any Subsidiary of the Company (a) substantially
all of whose property is located or substantially all of whose business is
conducted, in the United States of America and (b) which owns a Principal
Property; provided, however, that (i) the term "Restricted Subsidiary" shall
not include a Finance Subsidiary and (ii) the Board of Directors may, by an
irrevocable written notice delivered to the Trustee, designate as a Restricted
Subsidiary any Subsidiary of the Company which does not satisfy the
requirements of clause (a) or (b) above unless at the time of notice, the
Company is in violation of the provisions described above under "Certain
Covenants" with respect to such Subsidiary.
"Senior Debt" of a Person means any indebtedness of such Person for money
borrowed (including indebtedness evidenced by notes, debentures, bonds or other
instruments of indebtedness for the payment of which such Person is responsible
or liable, by guarantees or otherwise) and which is not subordinated in any
manner to the securities issued under the Indenture, including the Notes.
"Subsidiary" of a Person means a corporation of which a majority of the
Capital Stock having voting power under ordinary circumstances to elect a
majority of the board of directors of such corporation is owned by (i) such
Person, (ii) such Person and one or more of its Subsidiaries or (iii) one or
more of the Subsidiaries of such Person.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company may not consolidate with or merge into, or convey or transfer or
lease all or substantially all of its assets to, another Person, unless:
(1) the resulting, surviving or transferee Person is a Person organized
and existing under the laws of the United States of America or any State
thereof or the District of Columbia and such Person assumes all the
obligations of the Company under the Securities and the Indenture;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have happened and be continuing, provided
that such transaction shall be deemed to be in violation of this clause (2)
only as to Securities of any series as to which such Event of Default or
such event shall have happened and be continuing;
(3) if, as a result of such consolidation, merger, conveyance, transfer
or lease, any shares of Capital Stock or Debt of a Domestic Subsidiary or
any Principal Property of the Company or a Restricted Subsidiary would
become subject to a Mortgage which would not be permitted by the Indenture,
the Company or such resulting, surviving or transferee Person, as the case
may be, shall take any steps necessary to secure the Securities equally and
ratably with all Debt secured thereby; and
(4) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and such supplemental indenture comply with
the Indenture. (Section 801)
EVENTS OF DEFAULT
Each of the following will constitute an Event under the Indenture with
respect to Securities of any series: (a) failure to pay principal of or any
premium on any Security of that series when due; (b) failure to pay any
interest on any Securities of that series when due, continued for 30 days; (c)
failure to pay principal of or any premium on any Security of that series when
the same becomes due and payable pursuant to a
11
redemption, as provided in the Indenture; (d) failure to perform any other
agreement of the Company in the Indenture (other than a covenant included in
the Indenture solely for the benefit of a series other than that series),
continued for 90 days after written notice has been given by the Trustee, or
the Holders of at least 25% in principal amount of the Outstanding Securities
of that series, as provided in the Indenture; (e) failure to pay when due
(subject to any applicable grace period) the principal of, or acceleration of,
any indebtedness for money borrowed by the Company having an aggregate
principal amount outstanding of at least $10,000,000, if, in the case of any
such failure, such indebtedness has not been discharged or, in the case of any
such acceleration, such acceleration has not been rescinded or annulled, in
each case within 10 days after written notice has been given by the Trustee, or
the Holders of at least 25% in principal amount of the Outstanding Securities
of that series, as provided in the Indenture; (f) certain events in bankruptcy,
insolvency or reorganization; (g) Hoechst AG and its Wholly Owned Subsidiaries
cease to own, in the aggregate, a majority of the Capital Stock of the Company
having voting power under ordinary circumstances sufficient to elect a majority
of the Board of Directors; and (h) any other Event of Default provided with
respect to Securities of that series. (Section 501)
If an Event of Default (other than an Event of Default described in clause
(f) above) with respect to the Securities of any series at the time Outstanding
shall occur and be continuing, either the Trustee or the Holders of at least
25% in aggregate principal amount of the Outstanding Securities of that series
by notice as provided in the Indenture may declare the principal amount of the
Securities of that series (or, in the case of any Security that is an Original
Issue Discount Security or the principal amount of which is not then
determinable, such portion of the principal amount of such Security, or such
other amount in lieu of such principal amount, as may be specified in the terms
of such Security) to be due and payable immediately. If an Event of Default
described in clause (f) above with respect to the Securities of any series at
the time Outstanding shall occur, the principal amount of all the Securities of
that series (or, in the case of any such Original Issue Discount Security or
other Security, such specified amount) will automatically, and without any
action by the Trustee or any Holder, become immediately due and payable. After
any such acceleration, but before a judgment or decree based on acceleration,
the Holders of a majority in aggregate principal amount of the Outstanding
Securities of that series may, under certain circumstances, rescind and annul
such acceleration if all Events of Default, other than the nonpayment of
accelerated principal (or other specified amount), have been cured or waived as
provided in the Indenture. (Section 502) For information as to waiver of
defaults, see "Modification and Waiver".
Subject to the provisions of the Indenture relating to the duties of the
Trustee in case an Event of Default shall occur and be continuing, the Trustee
will be under no obligation to exercise any of its rights or powers under the
Indenture at the request or direction of any of the Holders, unless such
Holders shall have offered to the Trustee reasonable indemnity. (Section 603)
Subject to such provisions for the indemnification of the Trustee, the Holders
of a majority in aggregate principal amount of the Outstanding Securities of
any series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee with respect to the Securities of
that series. (Section 512)
No Holder of a Security of any series will have any right to institute any
proceeding with respect to the Indenture, or for the appointment of a receiver
or a trustee, or for any other remedy thereunder, unless (i) such Holder has
previously given to the Trustee written notice of a continuing Event of Default
with respect to the Securities of that series, (ii) the Holders of at least 25%
in aggregate principal amount of the Outstanding Securities of that series have
made written request, and such Holder or Holders have offered reasonable
indemnity, to the Trustee to institute such proceeding as trustee and (iii) the
Trustee has failed to institute such proceeding, and has not received from the
Holders of a majority in aggregate principal amount of the Outstanding
Securities of that series a direction inconsistent with such request, within 60
days after such notice, request and offer. (Section 507) However, such
limitations do not apply to a suit instituted by a Holder of a Security for the
enforcement of payment of the principal of or any premium or interest on such
Security on or after the applicable due date specified in such Security.
(Section 508)
12
The Company will be required to furnish to the Trustee annually a statement
by certain of its officers as to whether or not the Company, to their
knowledge, is in default in the performance or observance of any of the terms,
provisions and conditions of the Indenture and, if so, specifying all such
known defaults. (Section 1006)
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the Company and
the Trustee with the consent of the Holders of a majority in aggregate
principal amount of the Outstanding Securities of each series affected by such
modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Security
affected thereby, (a) change the Stated Maturity of the principal of, or any
instalment of principal of or interest on, any Security, (b) reduce the
principal amount of, or any premium or interest on, any Security, (c) reduce
the amount of principal of an Original Issue Discount Security or any other
Security payable upon acceleration of the Maturity thereof, (d) change the
place or currency of payment of principal of, or any premium or interest on,
any Security, (e) impair the right to institute suit for the enforcement of any
payment on or with respect to any Security, (f) reduce the percentage in
principal amount of Outstanding Securities of any series, the consent of whose
Holders is required for modification or amendment of the Indenture, (g) reduce
the percentage in principal amount of Outstanding Securities of any series
necessary for waiver of compliance with certain provisions of the Indenture or
for waiver of certain defaults or (h) modify such provisions with respect to
modification and waiver. (Section 902)
A supplemental indenture which changes or eliminates any covenant or other
provision of the Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.
The Holders of a majority in principal amount of the Outstanding Securities
of any series may waive compliance by the Company with certain restrictive
provisions of the Indenture. (Section 1007) The Holders of a majority in
principal amount of the Outstanding Securities of any series may waive any past
default under the Indenture, except a default in the payment of principal,
premium or interest and certain covenants and provisions of the Indenture which
cannot be amended without the consent of the Holder of each Outstanding
Security of such series affected. (Section 513)
The Indenture provides that in determining whether the Holders of the
requisite principal amount of the Outstanding Securities have given or taken
any direction, notice, consent, waiver or other action under the Indenture as
of any date, (i) the principal amount of an Original Issue Discount Security
that will be deemed to be Outstanding will be the amount of the principal
thereof that would be due and payable as of such date upon acceleration of the
Maturity thereof to such date, (ii) if, as of such date, the principal amount
payable at the Stated Maturity of a Security is not determinable (for example,
because it is based on an index), the principal amount of such Security deemed
to be Outstanding as of such date will be an amount determined in the manner
prescribed for such Security and (iii) the principal amount of a Security
denominated in one or more foreign currencies or currency units that will be
deemed to be Outstanding will be the U.S. dollar equivalent, determined as of
such date in the manner prescribed for such Security, of the principal amount
of such Security (or, in the case of a Security described in clause (i) or (ii)
above, of the amount described in such clause). Certain Securities, including
those for whose payment or redemption money has been deposited or set aside in
trust for the Holders and those that have been fully defeased pursuant to
Section 1302, will not be deemed to be Outstanding. (Section 101)
Except in certain limited circumstances, the Company will be entitled to set
any day as a record date for the purpose of determining the Holders of
Outstanding Securities of any series entitled to give or take any direction,
notice, consent, waiver or other action under the Indenture, in the manner and
subject to the limitations provided in the Indenture. If a record date is set
for any action to be taken by Holders of a particular series, such action may
be taken only by persons who are Holders of Outstanding Securities of that
series on the record date. (Section 104)
13
DEFEASANCE AND COVENANT DEFEASANCE
Unless otherwise specified in the applicable Pricing Supplement, the Company
at any time may defease and be discharged from any and all of its obligations
under the Securities and the Indenture ("Defeasance"), except for certain
obligations, including those respecting the Defeasance Trust and obligations to
register the transfer or exchange of the Securities, to replace mutilated,
destroyed, lost or stolen Securities and to maintain agencies in respect of the
Securities. The Company at any time may terminate its obligations under the
covenants described under "Certain Covenants" and the operation of certain
Events of Defaults described in clauses (e), (f) and (g) under "Events of
Default", above ("Covenant Defeasance").
The Company may exercise its Defeasance option notwithstanding its prior
exercise of its Covenant Defeasance option. If the Company exercises its
Defeasance option, payment of the Securities may not be accelerated because of
an Event of Default with respect thereto. If the Company exercises its Covenant
Defeasance option, payment of the Securities may not be accelerated by
reference to the covenants described under "Certain Covenants" or because of
the above-referenced clauses under "Events of Default".
In order to exercise either option, the Company must deposit in trust (the
"Defeasance Trust") with the Trustee money or U.S. Government Obligations or a
combination thereof for the payment of principal and any premium and interest
on the Securities to redemption or maturity and must comply with certain other
conditions. "U.S. Government Obligations" are securities backed by the full
faith and credit of the United States of America or depository receipts
representing an ownership interest in such obligations. (Article Thirteen)
Under current United States Federal income tax law, the Defeasance of the
Securities will be a taxable exchange of the Securities for interests in the
Defeasance Trust. As a consequence, a Holder will recognize gain or loss equal
to the difference between the Holder's cost or other tax basis for the
Securities and the value of the Holder's interest in the Defeasance Trust, and
therefore will be required to include in income a share of the income, gain and
loss of the Defeasance Trust. Under current United States Federal income tax
law, Covenant Defeasance will not be treated as a taxable exchange of the
Securities. Purchasers of the Securities should consult their own advisors with
respect to the more detailed tax consequences to them of such Defeasance and
Covenant Defeasance, including the applicability and effect of tax laws other
than the United States Federal income tax law.
NOTICES
Notices to Holders of Securities will be given by mail to the addresses of
such Holders as they may appear in the Security Register. (Sections 101 and
106)
TITLE
The Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name a Registered Security is registered as the
absolute owner thereof (whether or not such Registered Security may be overdue)
for the purpose of making payment and for all other purposes, and may treat the
Holder of any Unregistered Security and the Holder of any Coupon as the
absolute owner of such Unregistered Security or Coupon (whether or not such
Unregistered Security or Coupon shall be overdue) for the purpose of making
payment and for all other purposes. (Section 308)
GOVERNING LAW
The Indenture and the Securities will be governed by, and construed in
accordance with, the law of the State of New York. (Section 112)
14
REGARDING THE TRUSTEE
Chemical Bank is the Trustee under the Indenture and is also the Trustee
under an indenture dated August 15, 1988, between the Company and Chemical
Bank, as supplemented by the First Supplemental Indenture dated April 22, 1991,
between the Company and Chemical Bank (together, the "1988 Indenture") under
which securities having a principal amount of approximately $25,000,000 are
outstanding. The Company maintains deposit accounts and banking relations with
the Trustee.
Upon the occurrence of an Event of Default, or any event of default under the
1988 Indenture, the Trustee may be deemed to have a conflicting interest with
respect to the Securities for purposes of the Trust Indenture Act of 1939 and,
accordingly, may be required to resign as Trustee under the Indenture.
FOREIGN CURRENCY RISKS
GENERAL
Securities of a series may be denominated in such foreign currencies or
currency units as may be designated by the Company at the time of offering (the
"Foreign Currency Securities").
THIS PROSPECTUS DOES NOT, AND NO PROSPECTUS SUPPLEMENT WILL, DESCRIBE ALL
RISKS OF AN INVESTMENT IN FOREIGN CURRENCY SECURITIES THAT RESULT FROM SUCH
SECURITIES BEING DENOMINATED IN A FOREIGN CURRENCY OR CURRENCY UNIT EITHER AS
SUCH RISKS EXIST AT THE DATE OF THIS PROSPECTUS OR ANY SUCH PROSPECTUS
SUPPLEMENT OR AS SUCH RISKS MAY CHANGE FROM TIME TO TIME. PROSPECTIVE
PURCHASERS SHOULD CONSULT THEIR OWN FINANCIAL AND LEGAL ADVISORS AS TO THE
RISKS ENTAILED BY AN INVESTMENT IN FOREIGN CURRENCY SECURITIES. FOREIGN
CURRENCY SECURITIES ARE NOT AN APPROPRIATE INVESTMENT FOR INVESTORS WHO ARE
UNSOPHISTICATED WITH RESPECT TO FOREIGN CURRENCY TRANSACTIONS.
Unless otherwise indicated in an applicable Prospectus Supplement, a Foreign
Currency Security will not be sold in, or to a resident of, the country of the
Specified Currency (as defined below) in which such Security is denominated.
The information set forth below is by necessity incomplete and prospective
purchasers of Foreign Currency Securities should consult their own financial
and legal advisors with respect to any matters that may affect the purchase or
holding of a Foreign Currency Security or the receipt of payments of principal
of and any premium and interest on a Foreign Currency Security in a Specified
Currency.
EXCHANGE RATES AND EXCHANGE CONTROLS
An investment in Foreign Currency Securities entails significant risks that
are not associated with a similar investment in a security denominated in U.S.
dollars. Such risks include, without limitation, the possibility of significant
changes in the rate of exchange between the U.S. dollar and the currency or
currency unit designated by the Company at the time of offering (the "Specified
Currency") and the possibility of the imposition or modification of foreign
exchange controls by either the United States or foreign governments. Such
risks generally depend on economic and political events and the supply of and
demand for the relevant currencies over which the Company has no control. In
recent years, rates of exchange between the U.S. dollar and certain foreign
currencies have been highly volatile and such volatility may be expected in the
future. Fluctuations in any particular exchange rate that have occurred in the
past are not necessarily indicative, however, of fluctuations in the rate that
may occur during the term of any Foreign Currency Security. Depreciation of the
Specified Currency applicable to a Foreign Currency Security against the U.S.
dollar would result in a decrease in the U.S. dollar-equivalent yield of such
Security, in the U.S. dollar-equivalent
15
value of the principal repayable at Maturity of such Security and, generally,
in the U.S. dollar-equivalent market value of such Security.
Governments have imposed from time to time exchange controls and may in the
future impose or revise exchange controls at or prior to a Foreign Currency
Security's Maturity. Even if there are not exchange controls, it is possible
that the Specified Currency for any particular Foreign Currency Security would
not be available to the Company at an Interest Payment Date for, or at Maturity
of, such Security due to other circumstances beyond the control of the Company.
GOVERNING LAW AND JUDGMENTS
The Notes will be governed by and construed in accordance with the law of the
State of New York. In the event an action based on Foreign Currency Securities
were commenced in a court of the United States, it is likely that such court
would grant judgment relating to such Securities only in U.S. dollars. It is
not clear, however, whether, in granting such judgment, the rate of conversion
into U.S. dollars would be determined with reference to the date of default,
the date judgment is rendered or some other date. Holders of Foreign Currency
Securities would bear the risk of exchange rate fluctuations between the time
the amount of the judgment is calculated and the time the Trustee converts U.S.
dollars to the Specified Currency for payment of the judgment.
PLAN OF DISTRIBUTION
The Company may sell Securities in any of three ways: (i) through
underwriters or dealers; (ii) directly to one or more purchasers; or (iii)
through agents. The applicable Prospectus Supplement will set forth the terms
of the offering of any Securities, including the names of any underwriters, the
purchase price of such Securities and the proceeds to the Company from such
sale, any underwriting discounts and other items constituting underwriters'
compensation, any initial public offering price, any discounts or concessions
allowed or reallowed or paid to dealers, any securities exchanges on which such
Securities may be listed and any restrictions on the sale and delivery of
Securities in bearer form.
If underwriters are used in the sale, Securities will be acquired by the
underwriters for their own account and may be resold from time to time in one
or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. Such
Securities may be offered to the public either through underwriting syndicates
represented by managing underwriters or by underwriters without a syndicate.
Unless otherwise set forth in the applicable Prospectus Supplement, the
obligations of the underwriters to purchase such Securities will be subject to
certain conditions precedent, and the underwriters will be obligated to
purchase all of such Securities if any of such Securities are purchased. Any
initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
Securities may also be offered and sold, if so indicated in the Prospectus
Supplement, in connection with a remarketing upon their purchase, in accordance
with a redemption or repayment pursuant to their terms, by one or more firms
("remarketing firms") acting as principals for their own accounts or as agents
for the Company. Any remarketing firm will be identified and the terms of its
agreement, if any, with the Company and its compensation will be described in
the Prospectus Supplement. Remarketing firms may be deemed to be underwriters
in connection with the Securities remarketed thereby.
Securities may also be sold directly by the Company or through agents
designated by the Company from time to time. Any agent involved in the offer or
sale of Securities will be named, and any commissions payable by the Company to
such agent will be set forth, in the applicable Prospectus Supplement. Unless
otherwise indicated in the applicable Prospectus Supplement, any such agent
will act on a best efforts basis for the period of its appointment.
16
If so indicated in the applicable Prospectus Supplement, the Company will
authorize agents, underwriters or dealers to solicit offers by certain
specified institutions to purchase Securities at the public offering price set
forth in such Prospectus Supplement pursuant to delayed delivery contracts
providing for payment and delivery on a future date specified in such
Prospectus Supplement. Such contracts will be subject only to those conditions
set forth in the applicable Prospectus Supplement and such Prospectus
Supplement will set forth the commissions payable for solicitation of such
contracts.
Any underwriters, dealers or agents participating in the distribution of
Securities may be deemed to be underwriters and any discounts or commissions
received by them on the sale or resale of Securities may be deemed to be
underwriting discounts and commissions under the Securities Act. Agents and
underwriters may be entitled under agreements entered into with the Company to
indemnification by the Company against certain civil liabilities, including
liabilities under the Securities Act, or to contribution with respect to
payments that the agents or underwriters may be required to make in respect
thereof. Agents and underwriters may be customers of, engage in transactions
with, or perform services for, the Company or its affiliates in the ordinary
course of business.
Unless otherwise indicated in a Prospectus Supplement, all Securities offered
will be a new issue of securities with no established trading market. Any
underwriters to whom Securities are sold by the Company for public offering and
sale may make a market in such Securities, but such underwriters will not be
obligated to do so and may discontinue any market making at any time without
notice. No assurance can be given as to the liquidity of or the trading markets
for any Securities.
VALIDITY OF SECURITIES
The validity of the Securities will be passed upon for the Company by David
A. Jenkins, Vice President and General Counsel of the Company, and for any
underwriters or agents by Cravath, Swaine & Moore, 825 Eighth Avenue, New York,
NY 10019.
EXPERTS
The consolidated financial statements and schedules of Hoechst Celanese
Corporation as of December 31, 1992 and 1991, and for each of the years in the
three-year period ended December 31, 1992 in the Annual Report on Form 10-K of
the Company incorporated by reference herein and elsewhere in the registration
statement have been incorporated by reference herein and in the registration
statement in reliance upon the report of KPMG Peat Marwick, independent
certified public accountants, incorporated by reference herein, and upon the
authority of said firm as experts in accounting and auditing.
The report of KPMG Peat Marwick covering the December 31, 1992 consolidated
financial statements refers to the adoption of Financial Accounting Standard
No. 106 "Employers' Accounting for Postretirement Benefits Other Than Pensions"
in 1992.
17
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NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS
SUPPLEMENT OR THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ANY UNDERWRITER. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF
THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL,
UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE INFORMATION HEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THAT THERE HAS BEEN NO
CHANGE IN THE AFFAIRS OF THE COMPANY SINCE SUCH DATE.
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TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
PAGE
----
The Company................................................................ S-2
Recent Developments........................................................ S-4
Use of Proceeds............................................................ S-4
Capitalization............................................................. S-4
Selected Consolidated Financial Data....................................... S-5
Description of the Notes................................................... S-6
Underwriting............................................................... S-7
Validity of Notes.......................................................... S-7
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
The Company................................................................ 3
Use of Proceeds............................................................ 3
Ratios of Earnings to Fixed Charges........................................ 3
Description of Securities.................................................. 4
Foreign Currency Risks..................................................... 15
Plan of Distribution....................................................... 16
Validity of Securities..................................................... 17
Experts.................................................................... 17
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$250,000,000
Hoechst Celanese
Corporation
6 1/8% Notes Due 2004
-----------------------------------
PROSPECTUS SUPPLEMENT
-----------------------------------
CS First Boston
Dillon, Read & Co. Inc.
Goldman, Sachs & Co.
J.P. Morgan Securities Inc.
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