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AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 27, 1994
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
________________________
THE DIAL CORP
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 36-1169950
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER
INCORPORATION OR ORGANIZATION) IDENTIFICATION NO.)
DIAL TOWER, PHOENIX, ARIZONA 85077
(602) 207-4000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
________________________
JOHN W. TEETS
CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER
THE DIAL CORP
DIAL TOWER, PHOENIX, ARIZONA 85077
(602) 207-4000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
_________________________
COPIES TO:
L. GENE LEMON, ESQ. JOEL S. KLAPERMAN
VICE PRESIDENT AND GENERAL COUNSEL SHEARMAN & STERLING
THE DIAL CORP 599 LEXINGTON AVENUE
DIAL TOWER NEW YORK, NEW YORK 10022
PHOENIX, ARIZONA 85077 (212) 848-4000
(602) 207-4000
________________________
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: From time
to time after the effective date of this Registration Statement.
________________________
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
_________________________
CALCULATION OF REGISTRATION FEE
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PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
OF SECURITIES TO BE REGISTERED REGISTERED(1) UNIT(2) PRICE(3) REGISTRATION FEE
____________________________________________________________________________________________________________________________________
Debt Securities.................... 100%
___________________________________ __________________
Debt Warrants...................... __
___________________________________
Preferred Stock.................... $500,000,000 __ $500,000,000 $174,414
___________________________________
Depositary Shares.................. __
___________________________________
Common Stock(4).................... __
___________________________________
Common Stock Warrants.............. __
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(1) In U.S. dollars or the equivalent thereof in one or more foreign currencies or units of one or more foreign currencies or
composite currencies. If any securities are issued at an original issue discount, then additional securities may be issued
so long as the aggregate initial offering price of all such securities, together with the initial offering price of all other
securities registered hereunder or previously registered under the Securities Act, does not exceed $500,000,000.
(2) Estimated solely for the purpose of computing the registration fee.
(3) No separate consideration will be received for Common Stock or Preferred Stock that are issued upon conversion of Debt
Securities, Preferred Stock, or Depositary Shares. The proposed maximum aggregate offering price has been estimated solely
for the purpose of computing the registration fee.
(4) Includes associated rights (the "Rights") to purchase Common Stock. Until the occurrence of certain prescribed events, none
of which has occurred, the Rights are not exercisable, are evidenced by the certificates representing the Common Stock, and
will be transferred along with and only with the Common Stock.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE
DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL
THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A), MAY DETERMINE.
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INTRODUCTORY NOTE
This Registration Statement contains a form of Basic Prospectus relating to
the Securities registered hereby and a form of Prospectus Supplement relating to
an offering of Medium-Term Notes of The Dial Corp, due nine months or more from
date of issuance. The Prospectus Supplement relates only to such Medium-Term
Notes and is one form of Prospectus Supplement which may be used by The Dial
Corp to offer its Securities under this Registration Statement.
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor
may offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus supplement shall not constitute an offer
to sell or the solicitation of an offer to buy nor shall there be any sale
of these securities in any State in which such offer, solicitation or sale
would be unlawful prior to registration or qualification under the
securities laws of any such State.
PROSPECTUS SUPPLEMENT
(To Prospectus Dated , 1994)
$500,000,000
THE DIAL CORP
MEDIUM-TERM NOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
The Dial Corp (the "Company") may offer from time to time its Medium-Term Notes,
in one or more series (the "Notes") having aggregate proceeds of up to
$500,000,000, subject to reduction at the option of the Company, including as a
result of the sale of other Securities of the Company under the Prospectus to
which this Prospectus Supplement relates. The Notes will be offered at varying
maturities nine months or more from their dates of issue and may be subject to
redemption at the option of the Company or repayment at the option of the holder
prior to maturity as set forth in a pricing supplement (the "Pricing
Supplement") to this Prospectus Supplement. Notes may pay a legal amount in
respect of both principal and interest amortized over the life of the Note (an
"Amortizing Note"). Unless otherwise specified in the applicable Pricing
Supplement, the Notes will be issued in denominations of $1,000 and any larger
amount that is an integral multiple of $1,000. Each Note will bear interest
either at a fixed rate (a "Fixed Rate Note"), which may be zero in the case of
certain Notes issued at a price representing a discount from the principal
amount payable at maturity, or at a floating rate (a "Floating Rate Note") as
set forth in the Pricing Supplement. The Notes will rank pari passu with all
outstanding unsubordinated and unsecured indebtedness of the Company. See
"Description of Notes."
Unless otherwise specified in the applicable Pricing Supplement, interest on
each Fixed Rate Note will accrue from its date of issue and will be payable
semiannually on each January 15, and July 15 and at maturity (or date of earlier
redemption or repayment). Interest on each Floating Rate Note will accrue from
its date of issue and will be payable monthly, quarterly, semiannually, annually
or otherwise as specified in the applicable Pricing Supplement, and at maturity
(or date of earlier redemption or repayment). The issue price, the maturity
date, any applicable interest rate or interest rate formula, any redemption and
repayment provisions and any other terms applicable to each Note will be
established at the time of issuance of such Note and set forth in the applicable
Pricing Supplement.
Unless otherwise specified in the Pricing Supplement, each Note will be issued
only in book-entry form and will be represented by a global security registered
in the name of a nominee of The Depository Trust Company, as Depositary (a
"Book-Entry Note"). Beneficial interests in Book-Entry Notes will be shown on,
and transfers thereof will be effected only through, records maintained by the
Depositary (with respect to beneficial interests of participants) and its
participants. See "Description of Notes -- Book-Entry System."
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 SUPPLEMENT OR THE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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PRICE TO AGENTS' PROCEEDS TO
PUBLIC(1) COMMISSION(2) COMPANY(2)(3)
Per Note............................. 100.000% .125%-.750% 99.250%-99.875%
Total................................ $500,000,000 $625,000-$3,750,000 $496,250,000-$499,375,000
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(1) Unless otherwise specified in the applicable Pricing Supplement, the Notes
will be sold at 100% of their principal amount.
(2) For any Note with a maturity from nine months to thirty years from its date
of issue, the Company will pay a commission to Salomon Brothers Inc,
Citicorp Securities, Inc., Goldman, Sachs & Co. and Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated (each an "Agent" and
collectively the "Agents"), in the form of a discount ranging from .125% to
.750% of the principal amount of any Note, depending upon maturity, sold
through such Agents. The commission applicable to any Note with a maturity
of greater than thirty years from its date of issue will be determined at
the time of sale. The Company may also sell Notes to an Agent, as principal,
at a discount for resale to investors, other dealers or other purchasers at
varying prices related to prevailing market prices at the time of resale or,
if set forth in the applicable pricing supplement, at a fixed offering
price, as determined by such Agent. Unless otherwise specified in the
applicable Pricing Supplement, any Note sold to an Agent as principal will
be purchased by such Agent at a price equal to 100% of the principal amount
thereof less a percentage equal to the commission applicable to an agency
sale of a Note of identical maturity. The Company may also sell Notes
directly to investors on its own behalf, in which case no commission will be
payable. See "Plan of Distribution."
(3) Before deduction of expenses payable by the Company in connection with the
offering of the Notes estimated to be $500,000, including reimbursement of
certain of the Agents' expenses.
The Notes are being offered on a continuous basis by the Company through the
Agents, each of which is authorized to solicit purchases of the Notes. The
Company reserves the right to sell Notes directly on its own behalf in those
jurisdictions where it is authorized to do so. The Notes will not be listed on
any securities exchange. There can be no assurance that the Notes offered by
this Prospectus Supplement will be sold or that there will be a secondary market
for any of the Notes. The Company reserves the right to withdraw, cancel or
modify the offer made hereby without notice. The Company may reject any offer,
in whole or in part. See "Plan of Distribution."
SALOMON BROTHERS INC
CITICORP SECURITIES, INC.
GOLDMAN, SACHS & CO.
MERRILL LYNCH & CO.
The date of this Prospectus Supplement is , 1994.
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DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby supplements, and to the extent inconsistent therewith replaces, the
description of the general terms and provisions of the Securities (as such term
is used in the accompanying Prospectus) set forth in the accompanying
Prospectus, to which description reference is hereby made. The terms and
conditions set forth herein will apply to each Note unless otherwise specified
in the applicable Pricing Supplement and the related Note.
GENERAL
The Notes will be issued under an indenture, dated as of April 1, 1993 (the
"Senior Indenture"), between the Company and The Chase Manhattan Bank, N.A., as
trustee (the "Trustee"). The Notes will rank as to priority of payment pari
passu with all other unsubordinated and unsecured indebtedness of the Company.
The Notes may be issued, from time to time, in one or more series under the
Senior Indenture and are limited to aggregate proceeds of $500,000,000, subject
to reduction at the option of the Company, including as a result of the sale of
other Securities of the Company. See "Plan of Distribution."
The statements herein concerning the Notes and the Senior Indenture do not
purport to be complete. They are qualified in their entirety by reference to the
provisions of the Senior Indenture, including the definitions of certain terms
used herein without definition.
The Notes will be offered on a continuous basis and will mature on any day
nine months or more from the date of issue, as selected by the purchaser and
agreed to by the Company, and may be subject to redemption at the option of the
Company or repayment at the option of the holder prior to maturity. Each Note
will bear interest at either (a) a fixed rate, which may be zero in the case of
certain Notes issued at a price representing a discount from the principal
amount payable at maturity or (b) a rate or rates determined by reference to the
interest rate base or combination of interest rate bases (each a "Base Rate")
specified in the applicable Pricing Supplement, which may be adjusted by a
Spread and/or Spread Multiplier (each as defined below).
The Notes will be issued in fully registered form only, without coupons.
Unless otherwise provided in the applicable Pricing Supplement, the Notes will
be issued in denominations of $1,000 or any amount in excess thereof which is an
integral multiple of $1,000.
Interest rates offered by the Company with respect to the Notes may differ
depending upon the aggregate principal amount of Notes purchased in any
transaction.
The applicable Pricing Supplement will indicate either that a Note cannot
be redeemed prior to maturity or that a Note will be redeemable at the option of
the Company on or after a specified date at prices declining from a specified
premium, if any, to par after a later date, together with accrued interest to
the date of redemption, and if the Notes are subject to a sinking fund. Each
Note may pay a legal amount in respect of both principal and interest amortized
over the life of the Note.
The applicable Pricing Supplement will indicate whether a Note may be
subject to repayment at the option of the holder and, if such Note is subject to
such repayment, the date or dates specified prior to maturity and the applicable
price or prices (together with accrued interest, if any, and premium, if any),
to the date or dates of repayment.
Unless otherwise provided in the applicable Pricing Supplement, each Note
will be issued as a Book-Entry Note registered in the name of the nominee of the
Depositary. So long as the Depositary or its nominee is the registered owner of
such Book-Entry Notes, the Depositary or such nominee, as the case may be, will
be considered the sole owner or holder of the Notes for all purposes under the
Indenture. Except as set forth under "Book-Entry System," Book-Entry Notes will
not be issuable in certificated form.
The Notes may be issued as original issue discount notes (each an "Original
Issue Discount Note") which will be offered at a discount from the principal
amount thereof due at the stated maturity of such Notes. There may not be any
periodic payments of interest on Original Issue Discount Notes. In the event of
an acceleration of the maturity of any Original Issue Discount Note, the amount
payable to the holder of such Original Issue Discount Note upon such
acceleration will be determined in accordance with the Pricing
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Supplement and the terms of such security, but will be an amount less than the
amount payable at the maturity of the principal of such Original Issue Discount
Note. For federal income tax considerations with respect to the Original Issue
Discount Notes, see "Certain United States Federal Income Tax Consequences"
herein.
The Pricing Supplement relating to each Note will describe the following
terms: (1) whether such Note is a Fixed Rate Note or a Floating Rate Note; (2)
the price (expressed as a percentage of the aggregate principal amount thereof)
at which such Note will be issued (the "Issue Price"); (3) the trade date; (4)
the date on which such Note will be issued (the "Original Issue Date"); (5) the
date on which such Note will mature (the "Maturity Date"); (6) if such Note is a
Fixed Rate Note, the rate per annum at which such Note will bear interest (the
"Interest Rate"); (7) if such Note is a Floating Rate Note, the Base Rate, the
Initial Interest Rate, the Interest Reset Dates, the Interest Payment Dates, the
Index Maturity, the Maximum Interest Rate and the Minimum Interest Rate, if any,
and the Spread or Spread Multiplier, if any (each as defined below), and any
other terms relating to the particular method of calculating the interest rate
for such Note; (8) whether such Note may be redeemed at the option of the
Company or repaid at the option of the holder prior to maturity, and, if so, the
provisions relating to such redemption or repayment; (9) whether such Note is an
Original Issue Discount Note, and, if so, the yield to maturity; (10) whether
such Note is an Amortizing Note, and, if so, the dates and amounts that
principal is payable; and (11) any other terms of such Note not inconsistent
with the provisions of the Indenture.
"Business Day" means any day other than a Saturday or Sunday that is (a)
neither a legal holiday nor a day on which banking institutions are authorized
or obligated by law, regulation or executive order to close in The City of New
York and (b) with respect to Notes that will bear interest based on a specified
percentage of London interbank offered rate quotations ("LIBOR"), a London
Banking Day. "London Banking Day" means a day on which dealings in deposits in
U.S. dollars are transacted in the London interbank market.
PAYMENT OF PRINCIPAL AND INTEREST
The principal of and any premium and interest on each Note will be paid by
the Company in U.S. dollars. Until the Notes are paid or payment thereof is duly
provided for, the Company will, at all times, maintain a paying agent in The
City of New York (a "Paying Agent"), capable of performing the duties described
herein to be performed by the Paying Agent. The Company has initially appointed
The Chase Manhattan Bank, N.A. to serve as Paying Agent.
Unless otherwise specified in the applicable Pricing Supplement, interest
on a Note which is not a Book-Entry Note (other than interest paid on the
Maturity Date or upon earlier redemption or repayment) will be paid, except as
provided below, by mailing a check to the holder at the address of such holder
appearing on the security register for the Notes on the applicable Regular
Record Date (as defined below). Notwithstanding the foregoing, a holder of
$10,000,000 or more in aggregate principal amount of Notes of like tenor and
terms which are not Book-Entry Notes will be entitled to receive payments by
wire transfer of immediately available funds, but only if appropriate wire
transfer instructions shall have been received in writing by the Paying Agent
not less than ten Business Days prior to the applicable Interest Payment Date.
Payments of interest on a Book-Entry Note will be made in accordance with the
arrangements from time to time in place between the Paying Agent and the holder
thereof. Beneficial owners of Book-Entry Notes are expected to be paid in
accordance with the Depositary's and its participants' procedures in effect from
time to time as described under "Book-Entry System" below.
The regular record date (the "Regular Record Date") with respect to any
date (an "Interest Payment Date") on which interest on a Note is due and payable
shall be the date 15 calendar days immediately preceding such Interest Payment
Date, whether or not such date shall be a Business Day. Interest payable and
punctually paid or duly provided for on any Interest Payment Date will be paid
to the person in whose name a Note is registered at the close of business on the
Regular Record Date corresponding to such Interest Payment Date; provided,
however, that unless otherwise specified in the applicable Pricing Supplement,
in the case of a Note having an Original Issue Date between a Regular Record
Date and the Interest Payment Date relating to such Regular Record Date,
interest for the period beginning on the Original Issue Date and ending on such
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Interest Payment Date shall be paid on the succeeding Interest Payment Date to
the registered holder on the Regular Record Date for the succeeding Interest
Payment Date; provided, further, that interest payable at maturity or upon
earlier redemption or repayment will be payable to the person to whom principal
shall be payable.
Unless otherwise specified in the applicable Pricing Supplement, payments
of principal, premium, if any, and interest, if any, on the Notes at maturity or
upon earlier redemption or repayment will be made, if at maturity or upon
earlier redemption, then on the Maturity Date or the date fixed for redemption,
as applicable, upon surrender of the Notes accompanied by appropriate wire
instructions at the office of the Paying Agent in The City of New York, and, if
upon repayment prior to maturity, then on the applicable date for repayment,
provided the holder shall have complied with the requirements for repayment set
forth in the Notes. All such payments shall be made in immediately available
funds; provided that the Notes to be paid that are not Book-Entry Notes
presented to the office of the Paying Agent in The City of New York in time for
the Paying Agent to make such payments in such funds in accordance with its
normal procedures. If an Interest Payment Date with respect to any Floating Rate
Note would otherwise fall on a day that is not a Business Day with respect to
such Note, such Interest Payment Date will be postponed to the next succeeding
Business Day (or, in the case of a LIBOR Note, if such day falls in the next
calendar month, the next preceding Business Day). If the maturity date (or date
of redemption or repayment) of any Floating Rate Note would fall on a day that
is not a Business Day, the payment of principal, premium, if any, and interest
may be made on the next succeeding Business Day, and no interest on such payment
will accrue for the period from and after the maturity date (or the date of
redemption or repayment). In the case of Book-Entry Notes, such payments of
principal, premium, if any, and interest, if any, will be made to the Depositary
or its nominee as the registered owner of such Book-Entry Notes. Payments to
beneficial owners of Book-Entry Notes are expected to be made through the
Depositary and its participants. See "Description of Securities -- Global
Securities" in the accompanying Prospectus.
Unless otherwise specified in the applicable Pricing Supplement, all
percentages resulting from any calculation of the rate of interest on a Floating
Rate Note will be rounded, if necessary, to the nearest one hundred-thousandth
of a percentage point, with five one-millionths of a percentage point rounded
upward, and all dollar amounts used in or resulting from such calculation on
Floating Rate Notes will be rounded to the nearest cent (with one half cent
being rounded upward).
FIXED RATE NOTES
Each Fixed Rate Note will bear interest from its Original Issue Date at the
annual interest rate or rates specified on the face thereof and in the
applicable Pricing Supplement until the principal amount thereof is paid or
payment thereof is duly provided for. Unless otherwise set forth in the
applicable Pricing Supplement, interest on Fixed Rate Notes will be payable
semiannually on January 15 and July 15 of each year, and at maturity or upon
earlier redemption or repayment to the persons to whom principal is payable
(which, in the case of Book-Entry Notes, will be the Depositary or its nominee).
Each payment of interest in respect of an Interest Payment Date shall include
interest accrued to, but excluding, such Interest Payment Date and payments of
interest at maturity or upon earlier redemption or repayment shall include
interest accrued to, but excluding, the Maturity Date or the date of redemption
or repayment. Any payment on any Fixed Rate Note due on any day which is not a
Business Day need not be made on such day, but may be made on the next
succeeding Business Day with the same force and effect as if made on the due
date, and no interest shall accrue for the period from and after such date.
Interest on Fixed Rate Notes will be computed on the basis of a 360-day year
consisting of twelve 30-day months.
FLOATING RATE NOTES
Each Floating Rate Note will bear interest from its Original Issue Date at
a rate determined by reference to the Base Rate which may be adjusted by a
Spread and/or Spread Multiplier, if any. The applicable Pricing Supplement will
designate one or more of the following Base Rates as applicable to each Floating
Rate Note: (a) the Commercial Paper Rate (a "Commercial Paper Rate Note"), (b)
LIBOR (a "LIBOR Note"), (c) the Treasury Rate (a "Treasury Rate Note"), (d) the
CD Rate (a "CD Rate Note"), (e) the Federal
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Funds Rate (a "Federal Funds Rate Note"), (f) the Prime Rate (a "Prime Rate
Note"), (g) the CMT Rate (a "CMT Rate Note") or (h) such other Base Rate or
formula as is set forth in such Pricing Supplement and in such Floating Rate
Note. The "Index Maturity" for any Floating Rate Note is the period until
maturity of the instrument or obligation from which the Base Rate is calculated.
As specified in the applicable Pricing Supplement, a Floating Rate Note may
also have either or both of the following: (i) a maximum limitation, or ceiling,
on the rate of interest that may be applicable during any Interest Period (a
"Maximum Interest Rate") and (ii) a minimum limitation, or floor, on the rate of
interest that may accrue during any Interest Period (a "Minimum Interest Rate").
In addition to any Maximum Interest Rate that may be applicable to any Floating
Rate Note pursuant to the above provisions, the interest rate on a Floating Rate
Note will in no event be higher than the maximum rate permitted by applicable
law, as the same may be modified by United States law of general application.
The Notes will be governed by the law of the State of New York and, under such
law, the maximum rate of interest on the date of this Prospectus Supplement,
with certain exceptions, is 25% per annum on a simple interest basis. This limit
may not apply to Notes in which $2,500,000 or more has been invested.
The rate of interest on each Floating Rate Note will be reset daily,
weekly, monthly, quarterly, semiannually or annually (each day on which the rate
of interest is reset being herein referred to as an "Interest Reset Date"), as
specified in the applicable Pricing Supplement. Unless otherwise specified in
the applicable Pricing Supplement, the Interest Reset Date will be, in the case
of Floating Rate Notes that reset daily, each Business Day; in the case of
Floating Rate Notes (other than Treasury Rate Notes) that reset weekly,
Wednesday of each week; in the case of Treasury Rate Notes that reset weekly,
Tuesday of each week (except as hereinafter provided); in the case of Floating
Rate Notes that reset monthly, the third Wednesday of each month; in the case of
Floating Rate Notes that reset quarterly, the third Wednesday of March, June,
September and December of each year; in the case of Floating Rate Notes that
reset semiannually, the third Wednesday of each of the two months of each year
specified in the applicable Pricing Supplement; and in the case of Floating Rate
Notes that reset annually, the third Wednesday of the month of each year
specified in the applicable Pricing Supplement. Unless otherwise specified in
the applicable Pricing Supplement, if any Interest Reset Date for any Floating
Rate Note that resets daily or weekly is not a Business Day, such Interest Reset
Date shall be postponed to the next succeeding Business Day, except that, in the
case of a LIBOR Note, if such Business Day would fall in the next succeeding
calendar month, such Interest Reset Date shall be the next preceding Business
Day.
Interest on each Floating Rate Note will be payable monthly, quarterly,
semiannually, or annually as specified in the applicable Pricing Supplement.
Unless otherwise indicated in the applicable Pricing Supplement and except as
provided below, the Interest Payment Date will be, in the case of Floating Rate
Notes with a daily, weekly or monthly Interest Period, the third Wednesday of
each month or the third Wednesday of March, June, September and December of each
year (as specified in the applicable Pricing Supplement); in the case of
Floating Rate Notes with a quarterly Interest Period, the third Wednesday of
March, June, September and December of each year; in the case of Floating Rate
Notes with a semiannual Interest Period, the third Wednesday of each of the two
months of each year specified in the applicable Pricing Supplement; and in the
case of Floating Rate Notes with an annual Interest Period, the third Wednesday
of the month of each year specified in the applicable Pricing Supplement and, in
each case, the Maturity Date (or date of redemption or repayment). If such an
Interest Payment Date is not a Business Day, such Interest Payment Date will be
postponed to the succeeding Business Day, except that in the case of a LIBOR
Note, if such Business Day is in the succeeding calendar month, such Interest
Payment Date will be the preceding Business Day.
The "Spread" is the number of basis points (one basis point equals
one-hundredth of a percentage point) specified in the applicable Pricing
Supplement as being applicable to the interest rate for such Floating Rate Note,
and the "Spread Multiplier" is the percentage specified in the applicable
Pricing Supplement as being applicable to the interest rate for such Floating
Rate Note.
Unless otherwise specified in the applicable Pricing Supplement, an
interest payment for Floating Rate Notes (except in the case of Floating Rate
Notes which reset daily or weekly) shall be the amount of interest
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accrued from and including the Original Issue Date, or from and including the
last Interest Payment Date to which interest has been paid, as the case may be,
to, but excluding, the next following Interest Payment Date set forth in such
Pricing Supplement (an "Interest Period") or to, but excluding, the Maturity
Date or the date of redemption or repayment. In the case of a Floating Rate Note
on which interest is reset daily or weekly, interest payments shall be the
amount of interest accrued from and including the Original Issue Date or from
and including the last date for which interest has been paid, as the case may
be, to, but excluding, the Regular Record Date immediately preceding such
Interest Payment Date, except that at maturity or redemption the interest
payable will include interest accrued to, but excluding, the Maturity Date or
date of redemption.
With respect to a Floating Rate Note, accrued interest shall be calculated
by multiplying the principal amount of such Floating Rate Note by an accrued
interest factor. Such accrued interest factor will be computed by adding the
interest factors calculated for each day in the Interest Period or from the last
date from which accrued interest is being calculated. The interest factor for
each such day is computed by dividing the interest rate applicable to such day
by 360 in the case of Commercial Paper Rate Notes, LIBOR Notes, CD Rate Notes,
Federal Funds Rate Notes and Prime Rate Notes, by the number of days in the year
in the case of Treasury Rate Notes or CMT Rate Notes, or by such other number of
days as set forth in the Pricing Supplement in the case of Notes carrying
another Base Rate. The interest rate applicable to any other day is the interest
rate for the immediately preceding Interest Reset Date (or, if none, the Initial
Interest Rate, as described below).
Unless otherwise specified in the applicable Pricing Supplement, The Chase
Manhattan Bank, N.A. shall be the calculation agent (in such capacity, the
"Calculation Agent") with respect to the Floating Rate Notes. Upon the request
of the holder of any Floating Rate Note, the Calculation Agent will provide the
interest rate then in effect and, if determined, the interest rate that will
become effective on the next Interest Reset Date with respect to such Floating
Rate Note.
The interest rate in effect with respect to a Floating Rate Note from the
Original Issue Date to the first Interest Reset Date (the "Initial Interest
Rate") will be specified in the applicable Pricing Supplement. The interest rate
for each subsequent Interest Reset Date will be determined by the Calculation
Agent as follows:
Commercial Paper Rate Notes
Commercial Paper Rate Notes will bear interest at the interest rates
(calculated by reference to the Commercial Paper Rate and the Spread, if any,
and/or Spread Multiplier, if any) specified in the Commercial Paper Rate Notes
and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the
"Commercial Paper Rate" for each Interest Reset Date will be determined by the
Calculation Agent as of the second Business Day prior to such Interest Reset
Date (a "Commercial Paper Interest Determination Date") and shall be the Money
Market Yield (as defined below) on such date of the rate for commercial paper
having the Index Maturity specified in the applicable Pricing Supplement, as
such rate shall be published by the Board of Governors of the Federal Reserve
System in "Statistical Release H.15(519), Selected Interest Rates"
("H.15(519)"), or any successor publication, under the heading "Commercial
Paper." In the event that such rate is not published prior to 9:00 A.M., New
York City time, on the Calculation Date (as defined below), then the Commercial
Paper Rate shall be the Money Market Yield on such Commercial Paper Interest
Determination Date of the rate for commercial paper of the specified Index
Maturity as published by the Federal Reserve Bank of New York in its daily
statistical release, "Composite 3:30 P.M. Quotations for U.S. Government
Securities" ("Composite Quotations") under the heading "Commercial Paper." If by
3:00 P.M., New York City time, on such Calculation Date such rate is not yet
published in either H.15(519) or Composite Quotations, then the Commercial Paper
Rate shall be the Money Market Yield of the arithmetic mean of the offered rates
as of 11:00 A.M., New York City time, on that Commercial Paper Interest
Determination Date, of three leading dealers of commercial paper in The City of
New York selected by the Calculation Agent for commercial paper having the
specified Index Maturity placed for an industrial issuer whose bond rating is
"AA," or the equivalent, from a nationally recognized rating agency; provided,
however, that if the dealers selected as
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aforesaid by the Calculation Agent are not quoting offered rates as mentioned in
this sentence, the Commercial Paper Rate will be the Commercial Paper Rate in
effect on such Commercial Paper Interest Determination Date.
"Money Market Yield" shall be a yield calculated in accordance with the
following formula:
Money Market Yield = D X 360
______________ X 100
360 - (DXM)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the period for which interest is being calculated.
The interest rate on Commercial Paper Rate Notes for each Interest Reset
Date shall be the Commercial Paper Rate applicable to such Interest Reset Date
plus or minus the Spread, if any, or multiplied by the Spread Multiplier, if
any, as specified in the applicable Pricing Supplement; provided, however, that
(i) the interest rate in effect for the period from the Original Issue Date to
the first Interest Reset Date will be the Initial Interest Rate and (ii) the
interest rate in effect for the ten days immediately prior to maturity or
repayment will be that in effect on the tenth day preceding such maturity or
repayment. The "Calculation Date" pertaining to a Commercial Paper Interest
Determination Date will be the first to occur of either (a) the tenth Business
Day after such Commercial Paper Interest Determination Date or (b) the second
Business Day preceding the date any payment is required to be made for any
period following the applicable Interest Reset Date.
LIBOR Notes
LIBOR Notes will bear interest at the interest rates (calculated by
reference to LIBOR and the Spread, if any, and/or Spread Multiplier, if any)
specified in the LIBOR Notes and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, LIBOR for
each Interest Reset Date will be determined by the Calculation Agent in
accordance with the following provisions:
(i) With respect to an Interest Reset Date relating to a LIBOR Note,
either, as specified in the applicable Pricing Supplement: (a) the
arithmetic mean of the offered rates for deposits in the applicable
currency specified in the Pricing Supplement (or, if no such currency is
specified, U.S. dollars) for the period of the Index Maturity specified in
the applicable Pricing Supplement, commencing on the second London Banking
Day immediately following such Interest Reset Date, which appear on the
Reuters Screen LIBO Page as of 11:00 A.M., London time, on the Interest
Reset Date, if at least two such offered rates appear on the Reuters Screen
LIBO Page ("LIBOR Reuters") or (b) the rate for deposits in U.S. dollars
having the Index Maturity designated in the applicable Pricing Supplement,
commencing on the second London Banking Day immediately following that
Interest Reset Date, that appears on the Telerate Page 3750 as of 11:00
A.M., London time, on that Interest Reset Date ("LIBOR Telerate"). Unless
otherwise indicated in the applicable Pricing Supplement, "Reuters Screen
LIBO Page" means the display designated as Page "LIBO" on the Reuters
Monitor Money Rate Service (or such other page as may replace the LIBO page
on that service for the purpose of displaying London interbank offered
rates of major banks). "Telerate Page 3750" means the display designated as
page "3750" on the Telerate Service (or such other page as may replace the
3750 page on that service or such other service or services as may be
nominated by the British Bankers' Association for the purpose of displaying
London interbank offered rates for U.S. dollar deposits). If neither LIBOR
Reuters nor LIBOR Telerate is specified in the applicable Pricing
Supplement, LIBOR will be determined as if LIBOR Telerate had been
specified. In the case where (a) above applies, if fewer than two offered
rates appear on the Reuters Screen LIBO Page, or, in the case where (b)
above applies if no rate appears on the Telerate Page 3750, as applicable,
LIBOR in respect of that Interest Reset Date will be determined as if the
parties had specified the rate described in (ii) below.
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(ii) With respect to an Interest Reset Date on which this provision
applies, LIBOR will be determined on the basis of the rates at which
deposits in U.S. dollars having the Index Maturity designated in the
applicable Pricing Supplement are offered at approximately 11:00 A.M.,
London time, on such Interest Reset Date by four major banks ("Reference
Banks") in the London interbank market selected by the Calculation Agent to
prime banks in the London interbank market commencing on the second London
Banking Day immediately following such Interest Reset Date and in a
principal amount of not less than U.S. $1,000,000 that is representative
for a single transaction in such market at such time. The Calculation Agent
will request the principal London office of each of the Reference Banks to
provide a quotation of its rate. If at least two such quotations are
provided, LIBOR for such Interest Reset Date will be the arithmetic mean of
such quotations. If fewer than two quotations are provided, LIBOR for such
Interest Reset Date will be the arithmetic mean of the rates quoted at
approximately 11:00 A.M., New York City time, on such Interest Reset Date
by three major banks (which may include the Agents) in The City of New York
selected by the Calculation Agent for loans in U.S. dollars to leading
European banks having the specified Index Maturity designated in the
applicable Pricing Supplement commencing on the second London Banking Day
immediately following such Interest Reset Date and in a principal amount
equal to an amount of not less than U.S. $1,000,000 that is representative
for a single transaction in such market at such time; provided, however,
that if the banks selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, LIBOR will be LIBOR then in effect
on such Interest Reset Date.
The interest rate on LIBOR Notes for each Interest Reset Date shall be
LIBOR plus or minus the Spread, if any, or multiplied by the Spread Multiplier,
if any, as specified in the applicable Pricing Supplement; provided, however,
that (i) the interest rate in effect for the period from the Original Issue Date
to the first Interest Reset Date will be the Initial Interest Rate and (ii) the
interest rate in effect for the ten days immediately prior to maturity or
repayment will be that in effect on the tenth day preceding such maturity or
repayment.
Treasury Rate Notes
Treasury Rate Notes will bear interest at the interest rates (calculated by
reference to the Treasury Rate and the Spread, if any, and/or Spread Multiplier,
if any) specified in the Treasury Rate Notes and in the applicable Pricing
Supplement.
Unless otherwise specified in the applicable Pricing Supplement, "Treasury
Rate" means, with respect to any Interest Reset Date, the rate for the auction
held on the Treasury Rate Determination Date (as defined below) of direct
obligations of the United States ("Treasury bills") having the Index Maturity
specified in the applicable Pricing Supplement as published in H.15(519) under
the heading "U.S. Government Securities -- Treasury bills -- auction average
(investment)" or, if not so published by 9:00 A.M., New York City time, on the
Calculation Date (as defined below) pertaining to such Treasury Rate
Determination Date, the auction average rate (expressed as a bond equivalent
yield, on the basis of a year of 365 or 366 days, as applicable, and applied on
a daily basis) as otherwise announced by the United States Department of the
Treasury. In the event that the results of the auction of Treasury bills having
the Index Maturity designated in the applicable Pricing Supplement are not
published or reported as provided above by 3:00 P.M., New York City time, on
such Calculation Date or if no such auction is held on such Treasury Rate
Determination Date, then the Treasury Rate shall be calculated by the
Calculation Agent and shall be a yield to maturity (expressed as a bond
equivalent yield, on the basis of a year of 365 or 366 days, as applicable, and
applied on a daily basis) of the arithmetic mean of the secondary market bid
rates, as of approximately 3:30 P.M., New York City time, on such Treasury Rate
Determination Date, of three leading primary United States government securities
dealers selected by the Calculation Agent for the issue of Treasury bills with a
remaining maturity closest to the specified Index Maturity; provided, however,
that if the dealers selected as aforesaid by the Calculation Agent are not
quoting as mentioned in this sentence, the Treasury Rate for such Interest Reset
Date will be the Treasury Rate in effect on such Treasury Rate Determination
Date.
The "Treasury Rate Determination Date" for any Interest Reset Date will be
the day of the week in which such Interest Reset Date falls on which Treasury
bills would normally be auctioned, but if an auction
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shall fall on any Interest Reset Date, then the Interest Reset Date shall
instead be the first Business Day following such auction. Treasury bills are
normally sold at auction on Monday of each week, unless that day is a legal
holiday, in which case the auction is normally held on the following Tuesday,
except such auction may be held on the preceding Friday. If as the result of a
legal holiday, an auction is so held on the preceding Friday, such Friday will
be the Treasury Rate Determination Date pertaining to the Interest Reset Date
occurring in the next succeeding week. If no auction is held in any week (or on
the preceding Friday), the Treasury Rate Determination Date shall be the Monday
of the week in which the Interest Reset Date falls.
The interest rate on Treasury Rate Notes for each Interest Reset Date shall
be the Treasury Rate plus or minus the Spread, if any, or multiplied by the
Spread Multiplier, if any, as specified in the applicable Pricing Supplement;
provided, however, that (i) the interest rate in effect for the period from the
Original Issue Date to the first Interest Reset Date will be the Initial
Interest Rate and (ii) the interest rate in effect for the ten days immediately
prior to maturity or repayment will be that in effect on the tenth day preceding
such maturity or repayment. The "Calculation Date" pertaining to a Treasury Rate
Determination Date will be the first to occur of either (a) the tenth Business
Day after such Treasury Rate Determination Date or (b) the second Business Day
preceding the date any payment is required to be made for any period following
the applicable Interest Reset Date.
CD Rate Notes
CD Rate Notes will bear interest at the interest rates (calculated by
reference to the CD Rate and the Spread, if any, and/or Spread Multiplier, if
any) specified in the CD Rate Notes and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the "CD
Rate" with respect to each Interest Reset Date will be determined by the
Calculation Agent as of the second Business Day prior to such Interest Reset
Date (a "CD Interest Determination Date") and shall be the rate on such date for
negotiable certificates of deposit having the Index Maturity designated in the
applicable Pricing Supplement as published in H.15(519) under the heading "CDs
(Secondary Market)" or, if not so published by 9:00 A.M., New York City time, on
the Calculation Date (as defined below) pertaining to such CD Interest
Determination Date, then the CD Rate shall be the rate on such CD Interest
Determination Date for negotiable certificates of deposit having the specified
Index Maturity as published in Composite Quotations under the heading
"Certificates of Deposit." If such rate is not so published by 3:00 P.M., New
York City time, on such Calculation Date, then the CD Rate on such CD Interest
Determination Date will be calculated by the Calculation Agent and will be the
arithmetic mean of the secondary market offered rates as of 10:00 A.M., New York
City time, on such CD Interest Determination Date, of three leading nonbank
dealers in negotiable U.S. dollar certificates of deposit in The City of New
York selected by the Calculation Agent for negotiable certificates of deposit of
major United States money center banks of the highest credit standing (in the
market for negotiable certificates of deposit) with a remaining maturity closest
to the specified Index Maturity in a denomination of U.S.$5,000,000; provided,
however, that if the dealers selected as aforesaid by the Calculation Agent are
not quoting as mentioned in this sentence, the CD Rate will be the CD Rate in
effect on such CD Interest Determination Date.
The interest rate on CD Rate Notes for each Interest Reset Date shall be
the CD Rate applicable to such Interest Reset Date, plus or minus the Spread, if
any, or multiplied by the Spread Multiplier, if any, as specified in the
applicable Pricing Supplement; provided, however, that (i) the interest rate in
effect for the period from the Original Issue Date to the first Interest Reset
Date will be the Initial Interest Rate and (ii) the interest rate in effect for
the ten days immediately prior to maturity or repayment will be that in effect
on the tenth day preceding such maturity or repayment. The "Calculation Date"
pertaining to a CD Interest Determination Date will be the first to occur of
either (a) the tenth Business Day after such CD Interest Determination Date or
(b) the second Business Day preceding the date any payment is required to be
made for any period following the applicable Interest Reset Date.
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Federal Funds Rate Notes
Federal Funds Rate Notes will bear interest at the interest rates
(calculated by reference to the Federal Funds Rate and the Spread, if any,
and/or Spread Multiplier, if any) specified in the Federal Funds Rate Notes and
in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the
"Federal Funds Rate" with respect to each Interest Reset Date will be determined
by the Calculation Agent as of the second Business Day prior to such Interest
Reset Date (a "Federal Funds Interest Determination Date"), and shall be the
rate on that date for Federal Funds as published in H.15 (519) under the heading
"Federal Funds (Effective)," or, if not so published by 9:00 A.M., New York City
time, on the Calculation Date (as defined below) pertaining to such Federal
Funds Interest Determination Date, the Federal Funds Rate will be the rate on
such Federal Funds Interest Determination Date as published in Composite
Quotations under the heading "Federal Funds/Effective Rate." If such rate is not
so published by 3:00 P.M., New York City time, on the Calculation Date
pertaining to such Federal Funds Interest Determination Date, the Federal Funds
Rate for such Federal Funds Reset Date will be calculated by the Calculation
Agent and will be the arithmetic mean of the rates for the last transaction in
overnight Federal Funds arranged by three leading brokers of Federal Funds
transactions in The City of New York selected by the Calculation Agent as of
9:00 A.M., New York City time, on such Federal Funds Interest Determination
Date; provided, however, that if the brokers selected as aforesaid by the
Calculation Agent are not quoting as mentioned in this sentence, the Federal
Funds Rate will be the Federal Funds Rate in effect on such Federal Funds
Interest Determination Date.
The interest rate on Federal Funds Rate Notes for each Interest Reset Date
shall be the Federal Funds Rate applicable to such Interest Reset Date, plus or
minus the Spread, if any, or multiplied by the Spread Multiplier, if any, as
specified in the applicable Pricing Supplement; provided, however, that (i) the
interest rate in effect for the period from the Original Issue Date to the first
Interest Reset Date shall be the Initial Interest Rate; and (ii) the interest
rate in effect for the ten days immediately prior to maturity or repayment will
be that in effect on the tenth day preceding such maturity or repayment. The
"Calculation Date" pertaining to a Federal Funds Interest Determination Date
will be the first to occur of either (a) the tenth Business Day after such
Federal Funds Interest Determination Date or (b) the second Business Day
preceding the date any payment is required to be made for any period following
the applicable Interest Reset Date.
Prime Rate Notes
Prime Rate Notes will bear interest at the interest rates (calculated by
reference to the Prime Rate and the Spread, if any, and/or Spread Multiplier, if
any) specified in the Prime Rate Notes and in the applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, the "Prime
Rate" with respect to each Interest Reset Date will be determined by the
Calculation Agent as of the second Business Day prior to such Interest Reset
Date (a "Prime Interest Determination Date") and shall be the rate set forth on
such date in H.15(519) under the heading "Bank Prime Loan," or if not so
published prior to 9:00 A.M., New York City time, on the Calculation Date (as
defined below) pertaining to such Prime Interest Determination Date, then the
Prime Rate will be determined by the Calculation Agent and will be the
arithmetic mean of the rates of interest publicly announced by each bank that
appear on the Reuters Screen NYMF Page (as defined below) as such bank's prime
rate or base lending rate as in effect for the Prime Interest Determination
Date. If fewer than four such rates but more than one such rate appear on the
Reuters Screen NYMF Page for the Prime Interest Determination Date, the Prime
Rate will be determined by the Calculation Agent and will be the arithmetic mean
of the prime rate quoted on the basis of the actual number of days in the year
divided by a 360-day year as of the close of business on such Prime Interest
Determination Date by four major money center banks in The City of New York
selected by the Calculation Agent. If fewer than two such rates appear on the
Reuters Screen NYMF Page, the Prime Rate will be determined by the Calculation
Agent on the basis of the rates furnished in The City of New York by the
appropriate number of substitute banks or trust companies organized and doing
business under the laws of the United States, or any state thereof, having total
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equity capital of at least $500,000,000 and being subject to supervision or
examination by Federal or State authority, selected by the Calculation Agent to
provide such rate or rates; provided, however, that if the banks selected as
aforesaid are not quoting as mentioned in this sentence, the Prime Rate will be
the Prime Rate in effect on such Prime Interest Determination Date. "Reuters
Screen NYMF Page" means the display designated as page "NYMF" on the Reuters
Monitor Money Rates Service (or such other page as may replace the NYMF page on
that service for the purpose of displaying prime rates or base lending rates of
major United States banks).
The interest rate on Prime Rate Notes for each Interest Reset Date shall be
the Prime Rate applicable to such Interest Reset Date, plus or minus the Spread,
if any, or multiplied by the Spread Multiplier, if any, as specified in the
applicable Pricing Supplement; provided, however, that (i) the interest rate in
effect for the period from the Original Issue Date to the first Interest Reset
Date shall be the Initial Interest Rate and (ii) the interest rate in effect for
the ten days immediately prior to maturity or repayment will be that in effect
on the tenth day preceding such maturity or repayment. The "Calculation Date"
pertaining to a Prime Interest Determination Date will be the first to occur of
either (a) the tenth Business Day after such Prime Interest Determination Date
or (b) the second Business Day preceding the date any payment is required to be
made for any period following the applicable Interest Reset Date.
CMT Rate Notes
CMT Rate Notes will bear interest at the rates (calculated with reference
to the CMT Rate and the spread and/or Spread Multiplier, if any) specified in
such CMT Rate Notes and any applicable Pricing Supplement.
Unless otherwise specified in the applicable Pricing Supplement, "CMT Rate"
means, with respect to any Interest Determination Date relating to a CMT Rate
Note or any Floating Rate Note for which the interest rate is determined with
reference to the CMT Rate (a "CMT Rate Interest Determination Date"), the rate
displayed on the Designated CMT Telerate Page under the caption ". . .Treasury
Constant Maturities. . .Federal Reserve Board Release H.15. . .Mondays
Approximately 3:45 P.M.," under the column for the Designated CMT Maturity Index
for (i) if the Designated CMT Telerate Page is 7055, the rate on such CMT Rate
Interest Determination Date and (ii) if the Designated CMT Telerate Page is
7052, the week, or the month, as applicable, ended immediately preceding the
week in which the related CMT Rate Interest Determination Date occurs. If such
rate is no longer displayed on the relevant page, or if not displayed by 3:00
P.M., New York City time, on the related Calculation Date, then the CMT Rate for
such CMT Rate Interest Determination Date will be such treasury constant
maturity rate for the Designated CMT Maturity Index as published in the relevant
H.15(519). If such rate is no longer published, or if not published by 3:00
P.M., New York City time, on the related Calculation Date, then the CMT Rate for
such CMT Rate Interest Determination Date will be such treasury constant
maturity rate for the Designated CMT Maturity Index (or other United States
Treasury rate for the Designated CMT Maturity Index) for the CMT Rate Interest
Determination Date with respect to such Interest Reset Date as may then be
published by either the Board of Governors of the Federal Reserve System or the
United States Department of the Treasury that the Calculation Agent determines
to be comparable to the rate formerly displayed on the Designated CMT Telerate
Page and published in the relevant H.15(519). If such information is not
provided by 3:00 P.M., New York City time, on the related Calculation Date, then
the CMT Rate for the CMT Rate Interest Determination Date will be calculated by
the Calculation Agent and will be a yield to maturity, based on the arithmetic
mean of the secondary market closing offer side prices as of approximately 3:30
P.M. (New York City time) on the CMT Rate Interest Determination Date reported,
according to their written records, by three leading primary United States
government securities dealers (each, a "Reference Dealer") in The City of New
York selected by the Calculation Agent (from five such Reference Dealers
selected by the Calculation Agent and eliminating the highest quotation (or, in
the event of equality, one of the highest) and the lowest quotation (or, in the
event of equality, one of the lowest)), for the most recently issued direct
noncallable fixed rate obligations of the United States ("Treasury Notes") with
an original maturity of approximately the Designated CMT Maturity Index and a
remaining term to maturity of not less than such Designated CMT Maturity Index
minus one year. If the Calculation Agent cannot obtain three such Treasury Note
quotations,
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the CMT Rate for such CMT Rate Interest Determination Date will be calculated by
the Calculation Agent and will be a yield to maturity based on the arithmetic
mean of the secondary market offer side prices as of approximately 3:30 P.M.
(New York City time) on the CMT Rate Interest Determination Date of three
Reference Dealers in The City of New York (from five such Reference Dealers
selected by the Calculation Agent and eliminating the highest quotation (or, in
the event of equality, one of the highest) and the lowest quotation (or, in the
event of equality, one of the lowest)), for Treasury Notes with an original
maturity of the number of years that is the next highest to the Designated CMT
Maturity Index and a remaining term to maturity closest to the Designated CMT
Maturity Index and in an amount of at least $100 million. If three or four (and
not five) of such Reference Dealers are quoting as described above, then the CMT
Rate will be based on the arithmetic mean of the offer prices obtained and
neither the highest nor the lowest of such quotes will be eliminated; provided
however, that if fewer than three Reference Dealers selected by the Calculation
Agent are quoting as described herein, the CMT Rate will be the CMT Rate in
effect on such CMT Rate Interest Determination Date. If two Treasury Notes with
an original maturity as described in the third preceding sentence, have
remaining terms to maturity equally close to the Designated CMT Maturity Index,
the quotes for the CMT Rate Note with the shorter remaining term to maturity
will be used.
"Designated CMT Telerate Page" means the display on the Dow Jones Telerate
Service on the page designated in the applicable Pricing Supplement (or any
other page as may replace such page on that service for the purpose of
displaying Treasury Constant Maturities as reported in H.15(519)), for the
purpose of displaying Treasury Constant Maturities as reported in H.15(519). If
no such page is specified in the applicable Pricing Supplement, the Designated
CMT Telerate Page shall be 7052, for the most recent week.
"Designated CMT Maturity Index" means the original period to maturity of
the U.S. Treasury securities (either 1, 2, 3, 5, 7, 10, 20 or 30 years)
specified in the applicable Pricing Supplement with respect to which the CMT
Rate will be calculated. If no such maturity is specified in the applicable
Pricing Supplement, the Designated CMT Maturity Index shall be 2 years.
Payments on Amortizing Notes
Amortizing Notes are securities for which payments of principal and
interest are made in equal installments over the life of the security. Unless
otherwise provided in the applicable Pricing Supplement, interest on each
Amortizing Note will be computed upon the basis of a 360-day year of twelve
30-day months. Payments with respect to Amortizing Notes will be applied first
to interest due and payable thereon and then to the reduction of the unpaid
principal amount thereof. A table setting forth repayment information in respect
of each Amortizing Note will be provided to the original purchaser and will be
available, upon request, to subsequent holders.
Book-Entry System
Upon issuance, all Book-Entry Notes having the same Original Issue Date,
original issue discount provisions, if any, Maturity Date, redemption
provisions, if any, repayment provisions, if any, Interest Payment Dates,
Interest Period, Regular Record Dates and, in the case of Fixed Rate Notes,
interest rate or, in the case of Floating Rate Notes, the Base Rate, Initial
Interest Rate, Index Maturity, Interest Reset Dates, Spread or Spread
Multiplier, if any, Minimum Interest Rate, if any, and Maximum Interest Rate, if
any, will be represented by a single Global Security. Each Global Security
representing Book-Entry Notes will be deposited with, or on behalf of, The
Depository Trust Company, New York, New York (the "Depositary") or such other
depositary as is specified in the Pricing Supplement, and registered in the name
of a nominee of the Depositary.
Book-Entry Notes will not be exchangeable for certified Notes. However, if
the Depositary is at any time unwilling, unable or ineligible to continue as a
depositary and a successor depositary is not appointed by the Company within 90
days, the Company will issue individual Notes in definitive form in exchange for
the Book-Entry Notes. In addition, the Company may at any time and in its sole
discretion determine not to have Book-Entry Notes, and, in such event, will
issue individual Notes in definitive form in exchange for the Book-Entry Notes
previously representing all such Notes. In either instance, an owner of a
beneficial interest in a
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Book-Entry Note will be entitled to physical delivery of Notes in definitive
form equal in principal amount to such beneficial interest and to have such
Notes registered in its name. Individual Notes so issued in definitive form will
be issued in denominations of $1,000 and any larger amount that is an integral
multiple of $1,000 and will be issued in registered form only, without coupons.
The Depositary has advised the Company and the Agents as follows: The
Depositary is a limited purpose trust company organized under the laws of the
State of New York, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the New York Uniform Commercial Code, and a
"clearing agency" registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934. The Depositary was created to hold securities
of its participants and to facilitate the clearance and settlement of securities
transactions among its participants in such securities through electronic
book-entry changes in accounts of the participants, thereby eliminating the need
for physical movement of securities certificates. The Depositary's participants
include securities brokers and dealers (including the Agents), banks, trust
companies, clearing corporations, and certain other organizations, some of whom
(and/or their representatives) own the Depositary. Access to the Depositary's
book-entry system is also available to others, such as banks, brokers, dealers
and trust companies that clear through or maintain a custodial relationship with
a participant, either directly or indirectly.
A further description of the Depositary's procedures with respect to Global
Securities representing Book-Entry Notes is set forth in the accompanying
Prospectus under "Description of Debt Securities -- Global Securities." The
Depositary has confirmed to the Company, the Agents and the Trustee that it
intends to follow such procedures.
REDEMPTION AND REPURCHASE
The Pricing Supplement relating to each Note will indicate either that such
Note cannot be redeemed prior to maturity or that such Note will be redeemable
at the option of the Company on a date or dates specified prior to maturity at a
price or prices set forth in the applicable Pricing Supplement, together with
accrued interest to the date of redemption. The Company may redeem any of the
Notes that are redeemable and remain outstanding either in whole or from time to
time in part, upon not less than 30 nor more than 60 days' written notice to the
holders of the Notes, addressed to them at their respective addresses appearing
on the Security Register of the Notes. If less than all Notes of a series having
the same terms (except as to principal amount and date of issuance) are to be
redeemed, the Notes to be redeemed shall be selected by the Trustee by such
method as the Trustee shall deem fair and appropriate.
The Company may at any time purchase Notes at any price in the open market
or otherwise. Notes so purchased by the Company may, at the Company's
discretion, be held, resold or surrendered to the Trustee for cancellation.
REPAYMENT AT OPTION OF HOLDER
The Pricing Supplement relating to each Note will indicate either that such
Note cannot be repaid prior to maturity or that the Note will be repayable at
the option of the holder on a date or dates specified prior to maturity at a
price or prices, including premium, if any, set forth in the applicable Pricing
Supplement, together with accrued interest, if any, to the date or dates of
repayment.
In order for a Note which by its terms is repayable prior to its maturity
to be so repaid, the Paying Agent must receive at least 30 days but not more
than 45 days prior to the repayment date (a) appropriate wire instructions and
(b) either (i) the Note with the form entitled "Option to Elect Repayment" on
the reverse of the Note duly completed or (ii) a telegram, telex, facsimile
transmission or a letter from a member of a national securities exchange, the
National Association of Securities Dealers Inc., the Depositary (in accordance
with its normal procedures) or a commercial bank or trust company in the United
States setting forth the name of the holder of the Note, the principal amount of
the Note to be repaid, the certificate number or a description of the terms of
the Note, a statement that the option to elect repayment is being exercised
thereby and a guarantee that the Note to be repaid with the form entitled
"Option to Elect Repayment" on the reverse of the Note duly completed will be
received by the Paying Agent not later than five Business Days
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after the date of such telegram, telex, facsimile transmission or letter and
such Note and form duly completed must be received by the Paying Agent by such
fifth Business Day. The repayment option may be exercised by the holder of a
Note for less than the entire principal amount of the Note, provided that the
principal amount of the Note remaining outstanding after repayment is an
authorized denomination.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of the material United States federal income tax
considerations relevant to the purchase, ownership and disposition of a Note and
is based on the Internal Revenue Code of 1986, as amended (the "Code"), Treasury
Regulations (including proposed Regulations and temporary Regulations)
promulgated thereunder, rulings, official pronouncements and judicial decisions,
all as in effect on the date of this Prospectus Supplement and all of which are
subject to change, possibly with retroactive effect. This summary, however,
provides general information only and does not purport to address all of the
United States federal income tax consequences that may be applicable to a holder
of a Note. It does not address all of the tax consequences that may be relevant
to certain types of holders subject to special treatment under the federal
income tax law, such as individual retirement and other tax-deferred accounts,
dealers in securities or currencies, life insurance companies, tax-exempt
organizations, persons holding Notes as a hedge or hedged against currency risk
(or as a position in a straddle for tax purposes) or United States persons (as
defined below) whose functional currency is other than the U.S. dollar. It also
does not discuss the tax consequences to subsequent purchasers of Notes and is
limited to investors who hold the Notes as capital assets (generally property
held for investment). The federal income tax consequences of purchasing, holding
or disposing of a particular Note will depend, in part, on the particular terms
of such Note as set forth in the applicable Pricing Supplement and prospective
purchasers should refer to the applicable Pricing Supplement. Further, persons
considering the purchase of Notes are advised to consult their own tax advisors
concerning the application of the United States federal income tax law to their
particular situations as well as any tax consequences arising under the law of
any state, local or foreign tax jurisdiction.
UNITED STATES PERSONS
For purposes of the following discussion, "United States person" means an
individual who is a citizen or resident of the United States for United States
federal income tax purposes, an estate or trust subject to United States federal
income taxation without regard to the source of its income, or a corporation,
partnership or other entity created or organized in or under the law of the
United States or any state or the District of Columbia. The following discussion
pertains only to a holder of a Note who is a beneficial owner of such Note and
who is a "United States person."
PAYMENTS OF INTEREST ON NOTES THAT ARE NOT ORIGINAL ISSUE DISCOUNT NOTES
Except as discussed below under "Original Issue Discount Notes" and "Short
Term Notes", payments of stated interest on a Note will be taxable to a holder
as ordinary interest income at the time such interest is accrued or received in
accordance with the holder's regular method of tax accounting so long as such
interest represents qualified stated interest (as defined below).
PURCHASE, SALE, EXCHANGE OR RETIREMENT OF NOTES
A holder's tax basis in a Note generally will be the cost of the Note to
such holder increased by any original issue discount, market discount or
acquisition discount (all as defined below) previously included in the holder's
gross income (as described below), and reduced by any amortized premium (as
described below), principal payments received by the holder and payments of
stated interest received by the holder that do not qualify as payments of
qualified stated interest (as defined below).
Upon the sale, exchange or retirement of a Note, a holder generally will
recognize gain or loss equal to the difference between the holder's tax adjusted
basis in the Note and the amount realized on the sale, exchange or retirement
except to the extent such amount is attributable to accrued interest. Any such
gain or loss will be capital gain or loss if the Note was held as a capital
asset, except for gain recognized by a cash
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basis holder representing accrued interest on a short-term note and for gain
attributable to accrued market discount not previously included in income. Any
such capital gain or loss will be long term capital gain or loss, if, at the
time of the sale, exchange or retirement the Note was held for more than one
year. Under current law, long-term capital gains of individuals are, under
certain circumstances, taxed at lower rates than items of ordinary income.
ORIGINAL ISSUE DISCOUNT NOTES
The following summary is a general description of U.S. federal income tax
consequences to holders of Notes issued with original issue discount ("Original
Issue Discount Notes") and is based on the provisions of the Code and on certain
Treasury Regulations promulgated thereunder in February 1994 (the "OID
Regulations"). For purposes of this discussion, Original Issue Discount Notes
includes Notes that are initially sold at a discount from their face amount and
Notes that bear stated interest that does not qualify as qualified stated
interest (described below).
For United States federal income tax purposes, original issue discount is
the excess of the stated redemption price at maturity of each Original Issue
Discount Note over its issue price if such excess is greater than or equal to a
de minimis amount (described below). The issue price of an issue of Original
Issue Discount Notes that are issued for cash will be equal to the first price
at which a substantial amount of such Notes are sold to the public. The stated
redemption price at maturity of an Original Issue Discount Note is the total of
all payments required to be made under the Original Issue Discount Note other
than payments of "qualified stated interest." The term "qualified stated
interest" generally means stated interest that is unconditionally payable in
cash or property (other than debt instruments of the issuer) at least annually
at a single fixed rate or at current values of (i) a single qualified floating
rate, or (ii) a single objective rate. A "qualified floating rate" is any
floating rate where variations in such rate can reasonably be expected to
measure contemporaneous variations in the cost of newly borrowed funds (e.g.,
the Prime Rate or LIBOR). An "objective rate" is a rate that is not itself a
qualified floating rate but which is determined using a single formula that is
fixed throughout the term of the Note and which is based upon one or more
qualified rates or that is based on changes in the price of actively traded
property (or an index of the prices of such property).
Special rules may apply under the OID Regulations in cases where variable
rate debt instruments are subject to interest rate caps, floors or certain other
interest rate adjustment features.
Except as described below with respect to Short-Term Notes (as defined
below), and subject to a de minimis exception, a holder of an Original Issue
Discount Note will be required to include original issue discount in income
before the receipt of cash attributable to such income regardless of such
Holder's regular method of accounting. Under the de minimis exception, such
inclusion is not required if the original issue discount is less than a de
minimis amount (generally 1/4 of 1% of the Note's stated redemption price at
maturity multiplied by the number of complete years to maturity from the issue
date). The OID Regulations provide that the holder will be required to include
any amount excluded under the de minimis rule for original issue discount in
income ratably as stated principal payments on the Notes are made.
The amount of original issue discount includible in income by the initial
holder of an Original Issue Discount Note is the sum of the daily portions of
original issue discount with respect to such Note for each day during the
taxable year on which such holder held such Note ("accrued original issue
discount"). Generally, the daily portion of the original issue discount is
determined by allocating to each day in any "accrual period" a ratable portion
of the original issue discount allocable to such accrual period. "Accrual
periods" may be of any length and may vary in length over the term of the debt
instrument, provided that each accrual period is no longer than one year and
each scheduled payment of principal or interest occurs either on the first day
or on the final day of an accrual period. The "adjusted issue price" of an
Original Issue Discount Note at the beginning of any accrual period generally is
the sum of the issue price of an Original Issue Discount Note plus the accrued
original issue discount for each prior accrual period reduced by any prior
payment on the Original Issue Discount Note other than a payment of qualified
stated interest. For any accrual period, the amount of the original issue
discount allocable to each accrual period is equal to the excess (if any) of (a)
the product of the adjusted issue price of the Original Issue Discount Note at
the beginning of such accrual period and its
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yield to maturity (determined on the basis of compounding at the close of each
accrual period and adjusted for the length of the accrual period) over (b) the
sum of the qualified stated interest, if any, payable on such Original Issue
Discount Note and allocable to such accrual period. Under these rules, a holder
of an Original Issue Discount Note generally will have to include in income
increasingly greater amounts of original issue discount in successive accrual
periods.
If a holder's tax basis in an Original Issue Discount Note immediately
after it is purchased exceeds the adjusted issue price of the Original Issue
Discount Note (the amount of such excess is considered "acquisition premium")
but is not greater than the stated redemption price at maturity of such Original
Issue Discount Note, the amount includible in income in each taxable year as
original issue discount is reduced (but not below zero) by that portion of the
excess properly allocable to such year.
Certain of the Original Issue Discount Notes may be redeemable prior to
maturity at the option of the Company (a "call option") and/or repayable prior
to maturity at the option of the holder (a "put option"). Original Issue
Discount Notes containing either or both of such features may be subject to
rules that differ from the general rules discussed above. Holders intending to
purchase Original Issue Discount Notes with either or both of such features
should carefully examine the applicable Pricing Supplement and should consult
with their own tax advisors with respect to either or both of such features
since the tax consequences with respect to OID will depend, in part, on the
particular terms and the particular features of the purchased Note.
Under the OID Regulations, holders may elect, subject to certain
limitations, to include all interest on a Note using the constant yield method.
For this purpose, interest includes stated interest, acquisition discount,
original issue discount, de minimis original issue discount, market discount, de
minimis market discount, and unstated interest, as adjusted by any amortizable
bond premium or acquisition premium. Special rules apply to elections made with
respect to Notes with amortizable bond premium or market discount and holders
considering such an election should consult their own tax advisor. The election
cannot be revoked without the approval of the Internal Revenue Service.
MARKET DISCOUNT
If a holder purchases a Note other than an Original Issue Discount Note for
an amount that is less than its stated redemption price at maturity or, in the
case of an Original Issue Discount Note, its "revised issue price" (defined
below) as of the purchase date, the amount of the difference will be treated as
"market discount", unless such difference is less than a specified de minimis
amount. The "revised issue price" of an Original Issue Discount Note generally
equals its issue price, plus the aggregate amount of original issue discount,
includible (without regard to any reduction for acquisition premium, as
discussed above) in gross income by all previous holders of the Original Issue
Discount Note, less any cash payments (other than qualified stated interest)
made to all previous holders of such Original Issue Discount Note.
Under the market discount rules of the Code, a holder will be required to
treat any partial principal payment (or, in the case of an Original Issue
Discount Note, any payment that does not constitute qualified stated interest)
or any gain realized on the sale, exchange or retirement of a Note as ordinary
income to the extent of the accrued market discount which has not previously
been included in income at the time of such payment or disposition. Further, a
disposition of a Note by gift (and in certain other circumstances) could result
in the recognition of market discount income, computed as if such Note had been
sold at its then fair market value. In addition, a Holder who purchases a Note
with market discount may be required to defer the deduction of a portion of the
interest paid or accrued on any indebtedness incurred or maintained to purchase
or carry such Note until the maturity of the Note or its earlier disposition in
a taxable transaction.
Market discount is considered to accrue ratably during the period from the
date of acquisition to the maturity date of a Note, unless the holder elects to
accrue market discount under the rules applicable to original issue discount. A
holder may elect to include market discount in income currently as it accrues,
in which case the rules described above regarding the deferral of interest
deductions will not apply.
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AMORTIZABLE BOND PREMIUM
Generally, if a holder's tax basis in a Note exceeds the stated redemption
price at maturity of such Note, such excess may constitute amortizable bond
premium that the holder may elect to amortize as an offset to interest income on
the Note under the constant interest rate method over the period from the Note's
acquisition date to its maturity date, with a corresponding decrease in the tax
basis of the holder in the Note. Under certain circumstances, amortizable bond
premium may be determined by reference to an early call date.
SHORT-TERM NOTES
In general, an individual or other cash method holder of a Note that
matures one year or less from the date of its issuance (a "Short-Term Note") is
not required to accrue stated interest or original issue discount on such Note
unless it has elected to do so. Holders who report income under the accrual
method, however, and certain other holders, including banks, dealers in
securities and electing holders, are required to accrue "acquisition discount"
(which is generally equal to original issue discount in the absence of an
election by the holder) and any stated interest (to the extent not taken into
account in determining the amount of acquisition discount) on such Note. In the
case of a holder who is not required and does not elect to accrue acquisition
discount and interest on a Short-Term Note, any gain realized on the sale,
exchange or retirement of such Short-Term Note will be ordinary income to the
extent of the acquisition discount and stated interest accrued through the date
of sale, exchange or retirement. Such a holder will be required to defer, until
such Short-Term Note is sold or otherwise disposed of, the deduction of a
portion of the interest expense on any indebtedness incurred or continued to
purchase or carry such Short-Term Note. Acquisition discount accrues on a
straight-line basis unless an election is made to use the constant yield method
(based on daily compounding).
The market discount rules will not apply to a Short-Term Note.
NON-UNITED STATES PERSONS
Subject to the discussion of backup withholding below, payments of
principal and interest (including original issue discount) by the Company or its
agent (in its capacity as such) to any holder that is a beneficial owner of a
Note, but that is not a United States person and is not engaged in a trade or
business in the United States, will not be subject to United States federal
withholding tax provided (i) such holder does not actually or constructively own
10% or more of the total combined voting power of all classes of stock of the
Company entitled to vote, (ii) such holder is not a controlled foreign
corporation for United States tax purposes that is related to the Company
through stock ownership, and (iii) either (A) the beneficial owner of the Note
certifies to the Company or its agent, under penalties of perjury, that it is
not a United States person and provides its name and address or (B) a securities
clearing organization, bank or other financial institution that holds customers'
securities in the ordinary course of its trade or business (a "financial
institution") certifies to the Company or its agent, under penalties of perjury,
that the certification described in clause (A) hereof has been received from the
beneficial owner by it or by a financial institution between it and the
beneficial owner and furnishes the payor with a copy thereof.
If a holder of a Note that is not a United States person is engaged in a
trade or business in the United States and if interest (including original issue
discount) gain or income on the Note is effectively connected with the conduct
of such trade or business, such holder, although exempt from United States
withholding tax discussed in the preceding paragraph by reason of delivery of a
properly prepared and completed Form 4224, will be subject to United States
federal income tax on such interest (including original issue discount) gain or
income less any allowable deductions, at the rates generally applicable to U.S.
persons (plus, in the case of corporations, possible "branch profits" tax).
Subject to the discussion of "backup" withholding below, any capital gain
realized upon the sale, exchange or retirement of a Note by a holder who is not
a United States person will not be subject to United States federal income or
withholding taxes unless (i) such gain is effectively connected with a United
States trade or business of the holder (in which case such gain would be taxable
as described in the immediately
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preceding paragraph), or (ii) in the case of an individual, such holder is
present in the United States for 183 days or more in the taxable year of the
retirement or disposition and certain other conditions are met (in which case
such gain generally would be subject to tax on a gross basis at a 30% rate).
BACKUP WITHHOLDING AND INFORMATION REPORTING
The "backup" withholding and information reporting requirements may apply
to payments on a Note and to certain payments of proceeds of the sale or
retirement of a Note. The Company, its agent, a broker, or any paying agent, as
the case may be, will be required to withhold tax from any payment that is
subject to backup withholding equal to 31% of such payment if the holder fails
to furnish his taxpayer identification number (social security number or
employer identification number), to certify that such holder is not subject to
backup withholding, or to otherwise comply with the applicable requirements of
the backup withholding rules. Certain holders (including, among others,
corporations and nonresident aliens who provide certification as to their
foreign status) are not subject to the backup withholding and reporting
requirements.
Any amounts withheld under the backup withholding rules from a payment to a
holder may be claimed as a credit against such holder's United States federal
income tax liability.
THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY AND MAY NOT BE APPLICABLE DEPENDING UPON A HOLDER'S PARTICULAR
SITUATION. HOLDERS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE TAX
CONSEQUENCES TO THEM OF THE PURCHASE, OWNERSHIP AND DISPOSITION OF THE NOTES,
INCLUDING THE TAX CONSEQUENCES UNDER STATE, LOCAL, FOREIGN AND OTHER TAX LAWS
AND THE POSSIBLE EFFECTS OF CHANGES IN FEDERAL OR OTHER TAX LAWS.
PLAN OF DISTRIBUTION
The Notes are being offered on a continuous basis by the Company through
each of the Agents, each of which has agreed to use its reasonable efforts to
solicit offers to purchase Notes. For any Note with a maturity from nine months
to thirty years from its date of issue, the Company will pay each Agent a
commission of .125% to .750% of the principal amount of each Note sold through
such Agent, depending upon the maturity of the Note. The commission applicable
to any Note with a maturity of greater than thirty years from its date of issue
will be determined at the time of sale. The Company may sell Notes to any of the
Agents, as principal, at or above par or at a discount for resale to investors
or other purchasers at varying prices related to prevailing market prices at the
time of resale, to be determined by such Agent. The Company may also sell Notes
to an Agent, as principal, at a discount for resale to investors, other dealers
or other purchasers at varying prices related to prevailing market prices at the
time of resale or, if set forth in the applicable Pricing Supplement, at a fixed
offering price, as determined by such Agent. Unless otherwise indicated in the
applicable Pricing Supplement, any Note sold to an Agent as principal will be
purchased by such Agent at a price equal to 100% of the principal amount thereof
less a percentage equal to the commission applicable to an agency sale of a Note
of identical maturity. The Company may sell Notes directly to investors on its
own behalf. In the case of sales made directly by the Company, no commission
will be payable. The Company has agreed to reimburse the Agents for certain
expenses. Notes also may be offered through other agents on the same terms and
conditions as those described above for offerings through the Agents. In such
cases, the names of the other agents will be set forth in the Pricing
Supplement.
The Company will have the sole right to accept offers to purchase Notes and
may reject any proposed purchase of Notes in whole or in part whether placed
directly with the Company or through an Agent. Each Agent will have the right,
in its discretion reasonably exercised, to reject any offer to purchase Notes
received by it in whole or in part.
In addition to offering Notes through the Agents as described herein, the
Company may sell other Securities. Under certain circumstances, the sale of any
such Securities may reduce correspondingly the maximum aggregate amount of Notes
that may be offered by this Prospectus Supplement.
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No Note will have an established trading market when issued. The Notes will
not be listed on any securities exchange. Each Agent may make a market in the
Notes, but such Agent is not obligated to do so and may discontinue any
market-making at any time without notice. There can be no assurance that the
Notes offered hereby will be sold or that there will be a secondary market for
any of the Notes.
The Company has agreed to indemnify each Agent against certain civil
liabilities, including liabilities under the Securities Act of 1933, or to
contribute to payments such Agent may be required to make in respect thereof.
Each Agent may be deemed to be an "underwriter" within the meaning of the
Securities Act of 1933.
Each Agent may sell Notes it has purchased from the Company as principal to
other dealers for resale to investors and other purchasers, and may allow any
portion of the discount received in connection with such purchase from the
Company to such dealers. After the initial public offering of Notes, the public
offering price (in the case of Notes to be resold at a fixed public offering
price), the concession and the discount may be changed.
The Agents and certain of their affiliates engage in transactions with and
perform services for the Company in the ordinary course of business.
LEGAL OPINIONS
The legality of the Notes offered hereby has been passed upon for the
Company by L. Gene Lemon, Esq., Vice President and General Counsel of the
Company, and for the Agents by Shearman & Sterling, New York, New York. Shearman
& Sterling has advised the Company with respect to certain tax matters relating
to the Notes as set forth under "Certain United States Federal Income Tax
Consequences."
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Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor
may offers to buy be accepted prior to the time the registration statement
becomes effective. This prospectus shall not constitute an offer to sell or
the solicitation of an offer to buy nor shall there be any sale of these
securities in any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws
of any such State.
SUBJECT TO COMPLETION DATED , 1994
PROSPECTUS
THE DIAL CORP
DEBT SECURITIES AND DEBT WARRANTS
PREFERRED STOCK AND DEPOSITARY SHARES
COMMON STOCK AND COMMON STOCK WARRANTS
The Dial Corp ("Company" or "Dial") may offer and sell from time to time
under this Prospectus, together or separately, (i) unsecured debt securities
(the "Debt Securities"), which may be either senior (the "Senior Debt
Securities") or subordinated (the "Subordinated Debt Securities"), (ii) warrants
to purchase Debt Securities (the "Debt Warrants"), (iii) shares of its preferred
stock (the "Preferred Stock"), (iv) depositary shares (the "Depositary Shares")
representing interests in Preferred Stock, (v) shares of its Common Stock (the
"Common Stock") and (vi) warrants to purchase Common Stock (the "Common
Warrants"), all on terms to be determined at the time of offering. The Debt
Securities and Preferred Stock may be convertible into or exchangeable for
Common Stock or other securities as herein described.
The Debt Warrants and Common Warrants are collectively called the
"Warrants." The Debt Securities, Warrants, Preferred Stock, Depositary Shares or
Common Stock, or a combination thereof, proposed to be sold pursuant to this
Prospectus and the accompanying Prospectus Supplement are referred to as the
"Offered Securities," and the Offered Securities, together with any Debt
Securities issuable upon exercise of Debt Warrants, Common Stock issuable upon
exercise of Common Warrants, Preferred Stock underlying Depositary Shares or
Common Stock or other securities issuable upon conversion or exchange of any
Debt Securities or Preferred Stock, are referred to as the "Securities."
Securities (including Securities issuable upon conversion or exchange or upon
exercise of Warrants) with an aggregate public offering price of up to
$500,000,000 (or the equivalent thereof if any of the Securities are denominated
in a currency, currency unit or composite currency ("Currency") other than the
U.S. dollar) may be issued under this Prospectus.
The Prospectus Supplement accompanying this Prospectus sets forth, with
respect to each series or issue of Securities for which this Prospectus and the
Prospectus Supplement are being delivered: (i) the terms of any Debt Securities
offered, including, where applicable, their title, ranking, aggregate principal
amount, maturity, rate of any interest (or manner of calculation and time of
payment thereof), any redemption or repayment terms, the Currency or Currencies
in which such Debt Securities will be denominated or payable, any index, formula
or other method pursuant to which principal, premium or interest may be
determined, any terms for the conversion or exchange thereof and the form of
such Debt Securities (which may be in registered, bearer or global form); (ii)
the terms of any Warrants offered, including, where applicable, the exercise
price, detachability, expiration date and other terms; (iii) the terms of any
Preferred Stock offered, including the specific designations and dividend,
redemption, voting and other rights not described in this Prospectus and any
terms for the conversion or exchange thereof; (iv) the terms of any Depositary
Shares offered; (v) the terms of any Common Stock offered; and (vi) any initial
public offering price, the purchase price and net proceeds to the Company and
the other specific terms of the offering of the Offered Securities.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
The Offered Securities may be offered through underwriters, agents or
dealers. If underwriters are used, it is expected that the managing underwriters
will include Salomon Brothers Inc. If an underwriter, agent or dealer is
involved in the offering of any Offered Securities, the underwriter's discount,
agent's commission or dealer's purchase price will be set forth in, or may be
calculated from, the Prospectus Supplement. See "Plan of Distribution."
The date of this Prospectus is , 1994.
23
IN CONNECTION WITH AN OFFERING, THE UNDERWRITERS FOR SUCH OFFERING MAY
OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE
OF THE OFFERED SECURITIES AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN
THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY
TIME.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, and in accordance therewith files reports, proxy
statements and other information with the Securities and Exchange Commission,
which can be inspected and copied at the public reference facilities maintained
by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Regional Offices of the Commission at Seven World Trade Center, New York, New
York 10048, Northwestern Atrium Center, 500 Madison Street (Suite 1400),
Chicago, Illinois 60661-2511 and 5757 Wilshire Boulevard, Los Angeles,
California 90036-3648. Copies of such material can be obtained at prescribed
rates by writing to the Securities and Exchange Commission, Public Reference
Section, Washington, D.C. 20549. The Common Stock of the Company is listed on
the New York Stock Exchange and the Pacific Stock Exchange and reports, proxy
statements and other information about the Company can also be inspected at the
offices of The New York Stock Exchange, 20 Broad Street, New York, New York
10005 and The Pacific Stock Exchange, 115 Sansome Street, Suite 1104, San
Francisco, California 94104. This Prospectus does not contain all the
information set forth in the related registration statement and exhibits thereto
which the Company has filed with the Securities and Exchange Commission under
the Securities Act of 1933 and to which reference is hereby made.
INCORPORATION BY REFERENCE
The following documents filed by the Company with the Securities and
Exchange Commission are incorporated by reference in this Prospectus:
(a) Annual Report on Form 10-K for the fiscal year ended December 31,
1993;
(b) Quarterly Report on Form 10-Q for the quarter ended March 31,
1994; and
(c) The description of the Company's Common Stock and the Rights to
purchase Common Stock contained in the Company's registration statement on
Form 8-B, dated February 24, 1992, under Section 12 of the Securities
Exchange Act of 1934.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934 after 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 and to be a part hereof from
the respective dates of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein or in
any Prospectus Supplement modifies or supersedes such statement. Any statement
so modified or so 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, including any
beneficial owner of Securities, to whom this Prospectus is delivered, upon
written or oral request of such person, a copy of any or all of the documents
that have been incorporated by reference in this Prospectus (not including
exhibits to such documents unless such exhibits are specifically incorporated by
reference into such documents). Requests should be directed to The Dial Corp,
Dial Tower, Phoenix, Arizona 85077; Attention: Treasury Department; telephone
number (602) 207-4000.
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THE COMPANY
The Company conducts a consumer products and services business focused on
North American markets producing annual revenues in excess of $3 billion.
Dial's Consumer Products segment operates through four divisions, as
follows:
Skin Care, which manufactures and markets Dial, Tone, Spirit, Pure &
Natural and Liquid Dial soaps, and other soap and skin care products;
Laundry, which manufactures and markets Purex and Purex Ultra dry
detergent, Purex heavy duty liquid detergent, Trend, Purex Toss 'n Soft and
other laundry products;
Household, which manufactures and markets Renuzit air fresheners,
Brillo scouring pads, Sno Bol and Sno Drops toilet bowl cleaners, Parsons
ammonia, Bruce floor care products and other household items; and
Food, which processes and markets Armour Star chili, beef stew, corned
beef hash and Vienna sausage, Treet luncheon meat and other shelf-stable
canned foods, Lunch Bucket microwaveable meals and other food products.
Dial's Services business operates in three principal business segments
through subsidiary corporations of Dial, as follows:
Airline Catering and Other Food Services, which engages in airline
catering operations, providing in-flight meals to more than 60 domestic and
international airlines, and operates foodservice facilities ranging from
cafeterias in manufacturing plants to corporate executive dining rooms to
the food and beverage facilities of the America West Arena in Phoenix,
Arizona;
Convention Services, which provides exhibit design and construction
and exhibition preparation, installation, electrical, transportation and
management services to major trade shows, manufacturers, museums and
exhibit halls and other customers; and
Travel and Leisure and Payment Services, which engages in airplane
fueling and ground handling, cruise line and hotel/resort operations,
recreation and travel services, Canadian intercity bus transportation, and
operation of duty-free shops on cruise ships and at international airports,
and offers money orders, official checks and negotiable instrument clearing
services through a national network of approximately 43,000 retail agents,
mid-size bank customers and over 4,500 credit unions in the United States
and Puerto Rico.
Dial subsidiaries operate service or production facilities and maintain
sales and service offices in the United States, Canada and Mexico. The Company
also conducts business in other foreign countries.
RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF
EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The ratio of earnings to fixed charges and the ratio of earnings to fixed
charges and preferred stock dividends represent the historical ratios of the
Company and are calculated on a total enterprise basis. The ratio of earnings to
fixed charges is computed by dividing the sum of Pretax Income from Continuing
Operations and Minority Interest and fixed charges (excluding capitalized
interest) by fixed charges. The ratio of earnings to fixed charges and preferred
stock dividends is computed by dividing the sum of Pretax Income from Continuing
Operations and Minority Interest and fixed charges (excluding capitalized
interest) by the sum of fixed charges and preferred stock dividends. Fixed
charges for both ratios represent interest (including capitalized interest),
amortization of debt discount and expense and that portion of rental expense
which is deemed to be representative of interest. Preferred stock dividends are
increased to an amount representing the pre-tax earnings which would be required
to cover such dividend requirements.
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THREE
MONTHS
ENDED MARCH FISCAL YEAR
31, ENDED DECEMBER 31,
----------- --------------------------------
1994 1993 1993 1992 1991 1990 1989
---- ---- ---- ---- ---- ---- ----
Ratio of Earnings to Fixed Charges............ 2.16 1.75 2.91 2.22 1.74 2.24 1.70
Ratio of Earnings to Fixed Charges and
Preferred Stock Dividends................... 2.12 1.72 2.85 2.18 1.69 2.20 1.67
USE OF PROCEEDS
Except as otherwise specified in the accompanying Prospectus Supplement,
the net proceeds from the sale of the Securities offered hereby will be added to
the working capital of the Company, which combined with internally generated
funds, possible future borrowings, and existing cash and marketable securities
may be used for capital expenditures, possible future acquisitions, repurchase
of the Company's outstanding capital stock, refinancing of outstanding
indebtedness, increased working capital requirements, and other corporate
purposes.
DESCRIPTION OF DEBT SECURITIES
The Company may issue its Debt Securities, either separately or together
with other Offered Securities. The Senior Debt Securities will be issued under
an Indenture, dated as of April 1, 1993, as supplemented and amended from time
to time (hereinafter called the "Senior Indenture"), between the Company and The
Chase Manhattan Bank, N.A., as Trustee (the "Senior Trustee"). The Subordinated
Securities are to be issued under an Indenture, dated as of June 1, 1994, as
supplemented and amended from time to time (the "Subordinated Indenture"),
between the Company and Continental Bank, National Association, as Trustee (the
"Subordinated Trustee"). Copies of the Senior Indenture and the Subordinated
Indenture have been filed with the Commission as exhibits to the Registration
Statement of which this Prospectus is a part. The Senior Indenture and the
Subordinated Indenture are sometimes referred to collectively herein as the
"Indentures." The term "Trustee" as used herein refers to either the Senior
Trustee or the Subordinated Trustee, as appropriate. The following sets forth
certain general terms and provisions of the Debt Securities offered hereby. The
following statements do not purport to be complete and are subject to the
detailed provisions of the Indenture, to which reference is hereby made,
including the definition of certain terms used herein without definition. The
Indentures are subject to and governed by the Trust Indenture Act of 1939, as
amended (the "TIA"). Parenthetical references below are to the Indentures.
GENERAL
The Senior Debt Securities will rank equally with all other unsecured and
unsubordinated indebtedness of the Company which is not accorded a priority
under applicable law. The Subordinated Debt Securities will be subordinated in
right of payment to the prior payment in full of the Senior Indebtedness of the
Company as described under "Subordination." The Debt Securities will be
unsecured general obligations of the Company.
Each Indenture provides that any Debt Securities proposed to be sold
pursuant to this Prospectus and the accompanying Prospectus Supplement ("Offered
Debt Securities") and any Debt Securities issuable upon the exercise of Debt
Warrants or upon conversion or exchange of other Offered Securities ("Underlying
Debt Securities"), as well as other unsecured debt securities of the Company,
may be issued under such Indenture in one or more series, in each case as
authorized from time to time by the Company. The aggregate principal amount of
Debt Securities which may be issued under each Indenture is not limited. The
particular terms of the Offered Debt Securities and any Underlying Debt
Securities, any modifications of or additions to the general terms of the Debt
Securities as described herein that may be applicable in the case of the Offered
Debt Securities or Underlying Debt Securities and any applicable federal income
tax considerations are described in the Prospectus Supplement. Accordingly, for
a description of the terms of any Offered Debt Securities and Underlying Debt
Securities reference must be made to both the Prospectus Supplement relating
thereto and the description of Debt Securities set forth in this Prospectus.
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26
Reference is made to the Prospectus Supplement together with any applicable
pricing supplement thereto relating to the Offered Debt Securities, the
Underlying Debt Securities, or both, as the case may be, for the following terms
thereof:
(1) the title of the Debt Securities and whether such Debt Securities
will be Senior Debt Securities or Subordinated Debt Securities;
(2) the aggregate principal amount of such Debt Securities and any
limit upon the aggregate principal amount of the Debt Securities of such
series;
(3) the date or dates on which the principal of the Debt Securities
shall be payable;
(4) the rate or rates (which may be fixed or variable) at which the
Debt Securities shall bear interest, or the method by which such rate or
rates shall be determined;
(5) the date or dates from which such interest shall accrue, or the
method by which such date or dates shall be determined, the dates on which
such interest shall be payable and any record dates therefor;
(6) the place or places where the principal of, premium, if any, and
interest on the Debt Securities shall be payable;
(7) the period or periods within which, the price or prices at which
and the terms and conditions upon which the Debt Securities may be
redeemed, in whole or in part, at the option of the Company;
(8) the obligation, if any, of the Company to redeem, purchase or
repay the Debt Securities pursuant to any sinking fund or analogous
provision or at the option of a holder thereof, and the period or periods
within which, the price or prices at which and the terms and conditions
upon which the Debt Securities shall be redeemed, purchased or repaid, in
whole or in part, pursuant to such obligation;
(9) if other than the principal amount thereof, the percentage of the
principal amount of the Debt Securities payable upon declaration of
acceleration of the maturity of the Debt Securities;
(10) whether the Debt Securities are to be issued in whole or in part
in global form ("Global Securities") and, if so, the identity of the
Depositary for such Global Securities, and the terms and conditions, if
any, upon which interests in such Global Securities may be exchanged, in
whole or in part, for the individual Securities represented thereby;
(11) any deletions from, modifications of, or additions to the events
of default or covenants of the Company with respect to any of the Debt
Securities;
(12) if such Debt Securities will be issuable upon the conversion of
other Securities or upon the exercise of Debt Warrants, the time, manner,
and place for such Debt Securities to be authenticated and delivered;
(13) whether such Subordinated Debt Securities will be convertible
into or exchangeable for Common Stock or other Securities of the Company
and, if so, the terms and conditions upon which such Subordinated Debt
Securities will be so convertible or exchangeable; and
(14) any other terms of the Debt Securities, none of which shall be
inconsistent with the provisions of the applicable Indenture (Section
2.02).
The Company may authorize the issuance and provide for the terms of a
series of Debt Securities pursuant to a resolution of its Board of Directors or
any duly authorized committee thereof or pursuant to one or more supplemental
indentures.
The Debt Securities may be issued in registered form. Debt Securities of a
series may be issued in whole or in part in the form of one or more Global
Securities, as described below under "Global Securities." Unless the applicable
Prospectus Supplement relating thereto specifies otherwise, Debt Securities will
be issued only in denominations of $1,000 or any integral multiple thereof
(Section 2.01). One or more Global Securities will be issued in a denomination
or denominations equal to the aggregate principal amount of Outstanding
Securities of the series to be represented by such Global Security or Securities
(Section 3.01).
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27
Debt Securities (other than a Global Security) may be presented for
exchange and registration of transfer (with the form of transfer endorsed
thereon duly executed) at the office of the Company designated for such purpose
or at the office of any transfer agent or at the office of any Security
Registrar, without service charge and upon payment of any taxes and other
governmental charges as described in the Indenture. Debt Securities may
initially be presented for registration of transfer or exchange at the Company's
principal business office, Dial Tower, Phoenix, Arizona 85077 and at the
Principal Office of the Trustee under the applicable Indenture. Debt Securities
(other than a Global Security) in the several denominations will be
interchangeable without service charge, but the Company may require payment to
cover taxes or other governmental charges. The Trustee under the applicable
Indenture initially will act as authenticating agent (Sections 1.02, 2.05 and
5.02).
CONVERSION AND EXCHANGE
If any Debt Securities will, by their terms, be convertible into or
exchangeable for Common Stock or other Securities, the Prospectus Supplement
relating thereto will set forth the terms and conditions of such conversion or
exchange, including the conversion price or exchange ratio (or the method of
calculating the same), the conversion or exchange period (or the method of
determining the same), whether conversion or exchange will be mandatory or at
the option of the holder or the Company, provisions for adjustment of the
conversion price or the exchange ratio and provisions affecting conversion or
exchange in the event of the redemption of such Debt Securities. Such terms may
also include provision under which the number of shares of Common Stock or the
number of other Securities to be received by the holders of such Debt Securities
upon such conversion or exchange would be calculated according to the market
price of the Common Stock or such other Securities as of a time stated in the
Prospectus Supplement.
PAYMENT AND PAYING AGENTS
Payment of principal of and premium, if any, on Debt Securities (other than
a Global Security) will be made against surrender of such Debt Securities at the
Principal Office of the Trustee under the applicable Indenture in The City of
New York. Payment of any installment of interest on Debt Securities will be made
to the person in whose name such Debt Security is registered at the close of
business on the record date for such interest. Unless otherwise indicated in the
Prospectus Supplement, payments of such interest will be made at the Principal
Office of the Trustee under the applicable Indenture in The City of New York and
at any other office or agency maintained by the Company for such purposes, or,
at the option of the Company, by check mailed by first class mail to registered
holders of a Debt Security at such holder's registered address (Sections 2.01
and 5.02).
All moneys paid by the Company to a paying agent for the payment of
principal of or premium, if any, or interest on any Debt Security that remain
unclaimed at the end of three years after the date of the maturity of the Debt
Securities of such series or the date fixed for the redemption or repayment of
all the Debt Securities of such series at the time outstanding, as the case may
be, will be repaid to the Company and the holder of such Debt Security entitled
to receive such payment will thereafter look only to the Company for payment
therefor (Section 11.03).
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in the
form of one or more Global Securities that will be deposited with, or on behalf
of, a Depositary identified in the Prospectus Supplement relating to such
series. Global Debt Securities may be issued in either temporary or permanent
form. Unless and until it is exchanged for Debt Securities in definitive form, a
Global Security may not be transferred except as a whole by the Depositary for
such Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any such nominee to a successor of such Depositary or a nominee of
such successor (Section 2.05).
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28
The specific terms of the depositary arrangement with respect to a series
of Debt Securities will be described in the Prospectus Supplement relating to
such series. The Company anticipates that the following provisions will apply to
any depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security or its nominee will credit the accounts of persons held with it with
the respective principal amounts of the Debt Securities represented by such
Global Security. Such accounts shall be designated by the underwriters or agents
with respect to such Debt Securities or by the Company if such Debt Securities
are offered and sold directly by the Company. Ownership of beneficial interests
in a Global Security will be limited to persons that have accounts with the
Depositary for such Global Security or its nominee ("participants") or persons
that may hold interests through participants. Ownership of beneficial interests
in such Global Security will be shown on, and the transfer of that ownership
will be effected only through, records maintained by the Depositary for such
Global Security or by participants or persons that hold through participants.
The laws of some states require that certain purchasers of securities take
physical delivery of such securities in definitive form. Such limits and such
laws may impair the ability to transfer beneficial interests in a Global
Security.
So long as the Depositary for a Global Security, or its nominee, is the
owner of such Global Security, such Depositary or such nominee, as the case may
be, will be considered the sole owner or holder of the Debt Securities
represented by such Global Security for all purposes under the Indenture
governing such Debt Securities. Except as set forth below, owners of beneficial
interests in a Global Security will not be entitled to have Debt Securities of
the series represented by such Global Security registered in their names, will
not receive or be entitled to receive physical delivery of Debt Securities of
such series in definitive form and will not be considered the owners or holders
thereof under the Indenture governing such Debt Securities.
Payments of principal of, premium, if any, and interest, if any, on, Debt
Securities registered in the name of or held by a Depositary or its nominee will
be made to the Depositary or its nominee, as the case may be, as the registered
owner or the holder of the Global Security representing such Debt Securities.
None of the Company, the Trustee for such Debt Securities, any paying agent or
the Security Registrar for such Debt Securities will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests in a Global Security for such Debt Securities
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
The Company expects that the Depositary for Debt Securities of a series,
upon receipt of any payment of principal, premium, if any, or interest, if any,
in respect of a permanent Global Security, will credit immediately participants'
accounts with payments in amounts proportionate to their respective beneficial
interests in the principal amount of such Global Security as shown on the
records of such Depositary. The Company also expects that payments by
participants to owners of beneficial interests in such Global Security held
through such participants will be governed by standing instructions and
customary practices, as is now the case with the securities held for the
accounts of customers in bearer form or registered in "street name," and will be
the responsibility of such participants. Receipt by owners of beneficial
interests in a temporary Global Security of payments in respect of such
temporary Global Security may be subject to restrictions. Any such restrictions
will be described in the Prospectus Supplement relating thereto.
If a Depositary for Debt Securities of a series is at any time unwilling or
unable to continue as Depositary and a successor depositary is not appointed by
the Company within ninety days, the Company will issue Debt Securities of such
series in definitive form in exchange for the Global Security or Debt Securities
representing such Debt Securities of such series. In addition, the Company may
at any time and in its sole discretion determine not to have any Debt Securities
of a series represented by one or more Global Securities and, in such event,
will issue Debt Securities of such series in definitive form in exchange for the
Global Security or Securities representing Debt Securities. Further, if the
Company so specifies with respect to the Debt Securities of a series, each
Person specified by the Depositary of the Global Security representing Debt
Securities of such series may, on terms acceptable to the Company and the
Depositary for such Global Security, receive Debt Securities of such series in
definitive form. In any such instance, each Person so specified by the
Depositary of the Global Security will be entitled to physical delivery in
definitive form of
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Debt Securities of the series represented by such Global Security equal in
principal amount to such Person's beneficial interest in the Global Security
(Sections 2.05, 2.08 and 3.01).
CERTAIN DEFINITIONS
The following terms are defined substantially as follows in Section 1.02 of
the Indentures and are used herein as so defined. For the purposes of the
following terms, all items shall be determined in accordance with generally
accepted accounting principles, unless otherwise indicated.
"Consolidated Net Assets" means the total of all assets reflected on a
consolidated balance sheet of the Company and its consolidated Subsidiaries,
prepared in accordance with generally accepted accounting procedures, at their
net book values (after deducting related depreciation, depletion, amortization
and all other valuation reserves which, in accordance with generally accepted
accounting principles, should be set aside in connection with the business
conducted), less the aggregate of the current liabilities of the Company and its
consolidated Subsidiaries reflected on such balance sheet. For purposes of this
definition, "current liabilities" include all indebtedness for money borrowed,
incurred, issued, assumed or guaranteed by the Company and its consolidated
Subsidiaries, and other payables and accruals, in each case payable on demand or
due within one year of the date of determination of Consolidated Net Assets, but
shall exclude any portion of long-term debt maturing within one year of the date
of such determination, all as reflected on such consolidated balance sheet of
the Company and its consolidated Subsidiaries prepared in accordance with
generally accepted accounting principles; provided, however, that for purposes
hereof commercial paper and short-term notes supported by long-term lines of
credit shall not be considered as current liabilities.
"Funded Debt" means Indebtedness of the Company or a Restricted Subsidiary
maturing by its terms more than one year after its creation and indebtedness
classified as long-term debt under generally accepted accounting principles, in
each case ranking at least pari passu with the Senior Debt Securities.
"Indebtedness" means (a) any liability (i) for borrowed money, or (ii)
evidenced by a bond, note, debenture or similar instrument (including a purchase
money obligation) given in connection with the acquisition of any businesses,
properties or assets of any kind (other than a trade payable or a current
liability arising in the ordinary course of business), or (iii) for the payment
of money relating to a capitalized lease; (b) all obligations to purchase,
redeem, retire, defease or otherwise make any payment in respect of any capital
stock of or other ownership or profit interest or any warrants, rights or
options to acquire such capital stock, valued, in the case of redeemable stock,
at the greater of its voluntary or involuntary liquidation preference plus
accrued and unpaid dividends; (c) a guarantee of any liability described above;
and (d) any amendment, supplement, modification, deferral, renewal, extension or
refunding of such liabilities. For purposes of determining any particular amount
of Indebtedness under this definition, guarantees of (or obligations with
respect to letters of credit supporting) Indebtedness otherwise included in the
determination of such amount shall not also be included.
"Lien" means any mortgage, lien, charge, claim, security interest, pledge,
hypothecation, right of another under any conditional sale or other title
retention agreement or any other encumbrance affecting title to property,
including, but not limited to, any lease under a sale and leaseback arrangement.
"Outstanding" means all Debt Securities authenticated and delivered,
except:
(a) Debt Securities or portions thereof for which (i) funds or a
sufficient amount of direct obligations of the United States of America
have been deposited in trust with the Trustee or with any paying agent
(other than the Company) or, if the Company is acting as the paying agent,
have been set aside and segregated in trust by the Company, (ii) in the
case of redemption, notice of redemption has been duly given and (iii) in
the case of a repayment at the option of the holder of a Debt Security,
wire instructions have been duly given to the paying agent and notice and
applicable documentation of the exercise of the option for such repayment
has been duly given to the Company;
(b) Debt Securities which have been cancelled or surrendered to the
Trustee for cancellation; and
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(c) Debt Securities in lieu of or in substitution for which other Debt
Securities have been authenticated and delivered;
provided, however, that in determining whether the holders of the requisite
principal amount of Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver, Debt Securities owned by
the Company or any other obligor upon the Debt Securities or any affiliate of
the Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Debt Securities which the Trustee knows to be so owned
shall be so disregarded. Debt Securities so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Debt Securities and that the pledgee is not the Company or any other obligor
upon the Debt Securities or any affiliate of the Company or of such other
obligor.
"Sale and Leaseback Transaction" means any arrangement with any person
pursuant to which the Company or any Restricted Subsidiary leases any property
that has been or is to be sold or transferred by the Company or the Restricted
Subsidiary to such person, other than (i) leases with a remaining term,
including renewals at the option of the lessee, of not more than three years,
(ii) leases between the Company and a Restricted Subsidiary or between
Restricted Subsidiaries, (iii) leases of property executed by the time of, or
within 12 months after the latest of, the acquisition, the completion of
construction or improvement, or the commencement of commercial operation of the
property, and (iv) arrangements pursuant to any provision of law with an effect
similar to the former Section 168(f)(8) of the Internal Revenue Code of 1954.
"Subsidiary" means any corporation a majority of the Voting Stock of which
is owned, directly or indirectly, by the Company or by one or more Subsidiaries
or by the Company and one or more Subsidiaries. "Restricted Subsidiary" is any
Subsidiary a majority of the Voting Stock of which is owned, directly, by the
Company or by one or more Restricted Subsidiaries or by the Company and one or
more Restricted Subsidiaries, except (a) a Subsidiary which does not regularly
maintain a majority of its fixed assets within the United States or (b) which is
engaged primarily in the finance business, including, without limitation,
financing the operation of, or the purchase of products which are products of,
or incorporate products of, the Company and/or its Subsidiaries, unless in
either case the Subsidiary is designated a Restricted Subsidiary by resolution
of the Board of Directors of the Company. "Unrestricted Subsidiary" means any
Subsidiary other than a Restricted Subsidiary.
"Value" means, with respect to a Sale and Leaseback Transaction, an amount
equal to the present value of the lease payments with respect to the term of the
lease remaining on the date as of which the amount is being determined, without
regard to any renewal or extension options contained in the lease, discounted
using the interest rate inherent in the relevant lease.
"Voting Stock" means stock of any class or classes (however designated)
having ordinary voting power for the election of a majority of the members of
the board of directors (or any governing body) of such corporation, other than
stock having such power only by reason of the happening of a contingency.
LIMITATION ON LIENS
The Senior Indenture provides that the Company will not, and will not
permit any Restricted Subsidiary to, create, assume, incur or suffer to be
created, assumed or incurred or to exist any Lien upon any of the properties of
any character of the Company or any Restricted Subsidiary without making
effective provision for securing the Securities then outstanding equally and
ratably with (or prior to) any other obligation or indebtedness so secured,
other than: (i) any Lien existing on the date the Senior Debt Securities are
issued; (ii) any Lien on property owned or leased by a corporation at the time
it became a Restricted Subsidiary; (iii) any Lien on property at the time of its
acquisition by the Company or a Restricted Subsidiary; (iv) any Lien securing
any Indebtedness that was incurred prior to, at the time of, or within 12 months
after the acquisition of property for the purpose of financing all or any part
of the purchase price of such property and any Lien to the extent that it
secures Indebtedness which is in excess of such purchase price and for which
recourse for payment is limited to such property; (v) any Lien securing any
Indebtedness that was incurred
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prior to, at the time of, or within 12 months after the completion of the
construction and commencement of commercial operation, alteration, repair or
improvement of property for the purpose of financing all or any part of the cost
of such property and any Lien to the extent that it secures Indebtedness which
is in excess of such cost and for which recourse for payment is limited to such
property; (vi) any Lien securing Indebtedness of a Restricted Subsidiary owing
to the Company or to another Restricted Subsidiary; (vii) any Lien in favor of
the United States of America or any State thereof or any other country, or any
agency, instrumentality or political subdivision of any of the foregoing, to
secure partial progress, advance or other payments or performance pursuant to
the provisions of any contract or statute, or any Liens securing industrial
development, pollution control, or similar revenue bonds; (viii) any extension,
renewal or replacement (or successive extensions, renewals or replacements) in
whole or in part of any Lien referred to in (i) through (vii) above, so long as
the principal amount of the Indebtedness secured by such extension, renewal or
replacement does not exceed the principal amount of Indebtedness secured at the
time of such extension, renewal or replacement (except that, where an additional
principal amount of Indebtedness is incurred to provide funds for the completion
of a specific project, the additional principal amount, and any related
financing costs, may be secured by the Lien as well) and the Lien is limited to
the same property subject to the Lien so extended, renewed or replaced (plus
improvements on the property); and (ix) any Liens not permitted by clauses (i)
through (viii) above which, together with the aggregate Value of existing Sale
and Leaseback Transactions which would be subject to the restrictions set forth
below, do not exceed 10% of Consolidated Net Assets at the time any such Lien is
incurred (Section 5.04).
LIMITATION ON SALE AND LEASEBACK TRANSACTIONS
The Senior Indenture provides that the Company shall not enter into any
Sale and Leaseback Transaction, nor permit any Restricted Subsidiary to enter
into such transaction, unless either: (i) the Company or such Restricted
Subsidiary would be entitled to incur Indebtedness, in a principal amount at
least equal to the Value of such Sale and Leaseback Transaction, which is
secured by Liens on the property to be leased (without equally and ratably
securing the outstanding Securities) because such Liens would be of such
character that no violation of any of the provisions regarding the Limitation on
Liens set forth above would result, or (ii) the Company during the six months
immediately following the effective date of such Sale and Leaseback Transaction
causes to be applied an amount equal to the Value of such Sale and Leaseback
Transaction to (A) the acquisition of property or (B) the voluntary retirement
of Funded Debt (whether by redemption, defeasance, repurchase, or otherwise)
(Section 5.05).
LIMITATION ON DIVIDENDS AND OTHER PAYMENT RESTRICTIONS AFFECTING RESTRICTED
SUBSIDIARIES
The Senior Indenture provides that the Company shall not, and shall not
permit any Restricted Subsidiary to, suffer to exist any encumbrance or
restriction (other than pursuant to law, regulation or order) on the ability of
any Restricted Subsidiary (i) to pay, directly or indirectly, dividends or make
any other distributions in respect of its common stock or preferred stock, if
any, or pay any Indebtedness or other obligation owed to the Company or any
other Restricted Subsidiary; (ii) to make loans or advances to the Company or
any Restricted Subsidiary; or (iii) to transfer any of its property or assets to
the Company or any Restricted Subsidiary, except any encumbrance or restriction
(a) with respect to any series of Securities, pursuant to any agreement in
effect on the date the Securities are issued, (b) pursuant to an agreement
entered into by such Restricted Subsidiary prior to the date on which such
Restricted Subsidiary was acquired by the Company and not entered into in
anticipation of becoming a Restricted Subsidiary or (c) pursuant to an agreement
effecting a renewal, extension, refinancing or refunding of Indebtedness
incurred pursuant to an agreement referred to in clause (a) or (b) above;
provided, however, that the provisions contained in such renewal, extension,
refinancing or refunding agreement relating to such encumbrance or restriction
are no more restrictive in any material respect than the provisions contained in
the agreement the subject thereof (Section 5.06).
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LIMITATION ON RESTRICTED SUBSIDIARY INDEBTEDNESS AND PREFERRED STOCK
The Senior Indenture provides that the Company will not permit any
Restricted Subsidiary to, directly or indirectly, create, incur, issue, assume
or otherwise become liable with respect to, extend the maturity of or become
responsible for the payment of any Indebtedness or preferred stock other than:
(i) with respect to any series of Senior Debt Securities, Indebtedness or
preferred stock of a Restricted Subsidiary outstanding on the date the Senior
Debt Securities are issued; (ii) with respect to any series of Senior Debt
Securities, Indebtedness of a Restricted Subsidiary which represents the
assumption by such Restricted Subsidiary of Indebtedness of another Restricted
Subsidiary or the issuance of preferred stock by such Restricted Subsidiary to
another Restricted Subsidiary in connection with a merger of such Restricted
Subsidiaries, provided that no Restricted Subsidiary may assume or otherwise
become responsible for any Indebtedness of an entity or issue any preferred
stock to an entity which is not a Restricted Subsidiary; (iii) Indebtedness or
preferred stock of any corporation existing at the time such corporation became
a Restricted Subsidiary, provided that such Indebtedness was not incurred or
such preferred stock issued in anticipation of such corporation becoming a
Restricted Subsidiary; (iv) Indebtedness of a Restricted Subsidiary arising from
agreements providing for indemnification, adjustment of purchase price or
similar obligations or from guarantees, letters of credit, surety bonds or
performance bonds securing any obligations of the Company or any of its
Restricted Subsidiaries incurred or assumed in connection with the disposition
of any business, property or Restricted Subsidiary, other than guarantees or
similar credit support by any Restricted Subsidiary of Indebtedness incurred by
any person acquiring all or any portion of such business, property or Restricted
Subsidiary for the purpose of financing such acquisition, provided that the
maximum aggregate liability in respect of all such Indebtedness in the nature of
such guarantees will at no time exceed the gross proceeds (including cash and
the fair market value of property other than cash) actually received from the
disposition of such business, property or Restricted Subsidiary; (v)
Indebtedness of a Restricted Subsidiary in respect of performance bonds,
bankers' acceptances, letters of credit and surety bonds provided by such
Restricted Subsidiary in the ordinary course of business; (vi) Indebtedness or
preferred stock of a Restricted Subsidiary if the total of such Indebtedness and
preferred stock and the aggregate amount of Liens which (including the Value of
certain restricted Sale and Leaseback Transactions) are required to be less than
10% of Consolidated Net Assets does not exceed 10% of Consolidated Net Assets at
the time such Indebtedness or Preferred Stock is issued; (vii) any Indebtedness
incurred prior to, at the time of, or within 12 months after the acquisition of
property for the purpose of financing all or a part of the purchase price
thereof directly incurred by a Restricted Subsidiary, provided that (a) the
amount of any such Indebtedness is paid in full to the seller of the property
not later than 360 days after the subject property is delivered to the purchaser
thereof (provided that, in the event that there is a good faith dispute with
respect to the amount of such payment due, it shall be sufficient if the amount
believed in good faith to be payable to the seller is set aside for payment and
the resolution of such dispute is pursued promptly by the Restricted Subsidiary)
and (b) the aggregate amount of such Indebtedness and the aggregate amount of
Liens permitted because such Liens are related to the financing of property does
not exceed $15,000,000 at any one time; or (viii) Indebtedness (including,
without limitation, Indebtedness arising from a guarantee) or preferred stock
issued to and held by the Company or a wholly owned subsidiary of the Company,
but only for so long as held or owned by the Company or a wholly owned
subsidiary of the Company (Section 5.07).
CONSOLIDATION, MERGER, AND SALE OF ASSETS
Each Indenture provides that the Company will not consolidate with, sell or
lease all or substantially all its assets to, or merge with or into any other
corporation, or purchase all or substantially all the assets of another
corporation, unless (i) the Company shall be the continuing corporation, or the
successor, transferee or lessee corporation is organized under the laws of the
United States of America or any state thereof and assumes the Company's
obligations under the Securities and the Indenture and (ii) immediately after
giving effect to such transaction, no default will have occurred and be
continuing. A purchase by a Subsidiary of all or substantially all of the assets
of another corporation shall not be deemed to be a purchase of such assets by
the Company (Section 5.09). Notwithstanding the foregoing, if, upon any such
consolidation or merger of the Company with or into any other corporation, or
upon any conveyance of the property of the Company as an entirety or
substantially as an entirety to any other corporation, any properties of any
character owned by the
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Company immediately prior thereto would thereupon become subject to any Lien,
simultaneously with such consolidation, merger or conveyance, effective
provision will be made to secure the Securities outstanding equally and ratably
with or prior to the debt secured by such Lien (Section 15.01).
MODIFICATION OF THE INDENTURE
Each Indenture contains provisions permitting the Company and the Trustee,
without the consent of the holders of Debt Securities, to, among other things,
establish the form and terms of any series of the Debt Securities issuable
thereunder by one or more supplemental indentures, and, with the consent of the
holders of not less than 66 2/3% in the aggregate principal amount of the Debt
Securities then outstanding which are affected thereby, to modify and alter the
terms of the Indenture or any supplemental indenture or the rights of the
holders of the Debt Securities of such series to be affected, except that no
such modification or alteration may be made which will (i) extend the fixed
maturity of any Debt Securities, or reduce the rate or extend the time of
payment of interest thereon, or reduce the amount of the principal thereof, or
reduce any premium payable upon the redemption or repayment thereof, or make the
principal thereof or interest or premium thereon payable in any coin or currency
other than that provided in the Debt Securities, or impair the right to
institute suit for the enforcement of any such payment on or after the maturity
thereof, without the consent of the holder of each Debt Security so affected, or
(ii) reduce the percentage of Debt Securities of any series, the holders of
which are required to consent to any such supplemental indenture, without the
consent of the holders of all the Debt Securities then outstanding, or (iii)
modify, without the written consent of the Trustee, the rights, duties or
immunities of the Trustee (Sections 13.01 and 13.02).
In addition, under the Subordinated Indenture, no modification or amendment
thereof may, without the consent of the holder of each Outstanding Subordinated
Debt Security affected thereby, modify any of the provisions of such Indenture
relating to the subordination of the Subordinated Debt Securities in a manner
adverse to the holders thereof; and no such modification or amendment may
adversely affect the rights of any holder of Senior Indebtedness without the
consent of such holder of Senior Indebtedness (Section 13.07 of the Subordinated
Indenture).
DEFAULTS
Each Indenture provides that events of default with respect to any series
of Debt Securities will be (i) default for 30 days in payment of interest upon
any Debt Security of such series; (ii) default in payment of principal (other
than pursuant to a sinking fund) or premium, if any, on any Debt Security of
such series; (iii) default for 30 days in payment of any sinking fund instalment
when due by the terms of the Debt Securities of such series; (iv) default under
another instrument or in respect of another series of Debt Securities resulting
in acceleration of maturity of indebtedness of the Company in an amount
exceeding $10,000,000 if such acceleration is not rescinded or annulled, or such
indebtedness shall not have been discharged, within 10 days after written notice
to the Company by the Trustee or to the Company and the Trustee by the holders
of at least 10% in principal amount of the Outstanding Securities of such
series; (v) certain events in bankruptcy or insolvency; (vi) default, for 90
days after written notice to the Company by the Trustee or to the Company and
Trustee by the holders of at least 25% in aggregate principal amount of the Debt
Securities of such series then outstanding, in performance of any covenant or
agreement in the Indenture other than (A) a default in a covenant or agreement
included in the Indenture solely for the benefit of a series of Securities other
than such series or (B) a default (other than a default referred to in clauses
(i) through (v) above) in a covenant or condition if the Company has received
the prior written consent of the holders of at least 66 2/3% in aggregate
principal amount of the Debt Securities of such series then outstanding waiving
compliance with such covenant or condition; and (vii) the incurrence of any
other event of default with respect to Debt Securities of such series (Section
6.01). If an event of default with respect to Debt Securities of any series
should occur and be continuing, either the Trustee or the holders of 25% of the
principal amount of outstanding Debt Securities of such series may declare each
Indenture Security of that series due and payable (Section 6.02). The Company
will be required to file annually with the Trustee a statement of an officer as
to the fulfillment by the Company of its obligations under the Indenture during
the preceding year (Section 5.10).
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Holders of a majority in principal amount of the outstanding Debt
Securities of any series will be entitled to control certain actions of the
Trustee under the Indenture and to waive past defaults with respect to such
series (Sections 6.02 and 6.06). Subject to the provisions of the Indenture
relating to the duties of the Trustee, the Trustee will not be under any
obligation to exercise any of the rights or powers vested in it by the Indenture
at the request, order or direction of any of the holders of Debt Securities,
unless one or more of such holders of Debt Securities shall have offered to the
Trustee reasonable indemnity (Section 10.01).
If an event of default occurs and is continuing with respect to a series of
Debt Securities, any sums held or received by the Trustee under the Indenture
may be applied to reimburse the Trustee for its reasonable compensation and
expenses incurred prior to any payments to holders of Debt Securities of such
series (Section 6.05).
The right of any holder of Debt Securities of any series to institute
action for any remedy is subject to certain conditions precedent, including a
request to the Trustee by the holders of not less than 25% in principal amount
of the Debt Securities of that series outstanding to take action, and an offer
to the Trustee of reasonable indemnity satisfactory to the Trustee against
liabilities incurred by it in so doing and the Trustee does not take such action
within 60 days from receiving such request (Section 6.07).
DEFEASANCE
The Company may at any time terminate all of its obligations with respect
to the Debt Securities of a series ("defeasance"), except for certain
obligations, including those regarding any trust established for a defeasance
and obligations to register the transfer and exchange of the Securities, to
replace mutilated, destroyed, lost or stolen Debt Securities, and to maintain
agencies in respect of Securities. The Company may at any time terminate its
obligations under certain covenants set forth in the Indenture, some of which
are described above, and any omission to comply with such obligations shall not
constitute a default or event of default with respect to the Securities issued
under the Indenture ("covenant defeasance"). In order to exercise either
defeasance or covenant defeasance, the Company shall deposit with the Trustee,
in trust for the benefit of the holders thereof, (i) funds sufficient to pay, or
(ii) such amount of direct obligations of the United States of America as will
or will together with the income thereon without consideration of any
reinvestment thereof be sufficient to pay, all sums due for principal of,
premium, if any, and interest on the Debt Securities of a particular series, as
they shall become due from time to time, and comply with certain other
conditions. Such defeasance or covenant defeasance is conditioned upon the
Company's delivery of an opinion of counsel that the holders of the Debt
Securities of such series will have no federal income tax consequences as a
result of such deposit (Section 11.02).
SUBORDINATION
Upon any distribution of assets of the Company upon any dissolution,
winding up, liquidation or reorganization, the payment of the principal of (and
premium, if any) and interest on the Subordinated Debt Securities is to be
subordinated to the extent provided in the Subordinated Indenture in right of
payment to the prior payment in full of all Senior Indebtedness, but the
obligation of the Company to make payment of principal (and premium, if any) or
interest on the Subordinated Debt Securities will not otherwise be affected. No
payment on account of principal (or premium, if any), sinking fund or interest
may be made on the Subordinated Debt Securities at any time when there is a
default in the payment of principal, premium, if any, sinking fund or interest
on Senior Indebtedness. In the event that, notwithstanding the foregoing, any
payment by the Company described in the foregoing sentence is received by the
Subordinated Trustee or the holders of any of the Subordinated Debt Securities
before all Senior Indebtedness is paid in full, such payment or distribution
will be paid over to the holders of such Senior Indebtedness or on their behalf
for application to the payment of all such Senior Indebtedness remaining unpaid
until all such Senior Indebtedness has been paid in full, after giving effect to
any concurrent payment or distribution to the holders of such Senior
Indebtedness. Subject to payment in full of Senior Indebtedness, the holders of
the Subordinated Debt Securities will be subrogated to the rights of the holders
of the Senior Indebtedness to the extent of payments made to the holders of such
Senior Indebtedness out of the distributive share of the Subordinated Debt
Securities. By reason of such subordination, in the event of a distribution of
assets upon insolvency, certain
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general creditors of the Company may recover more, ratably, than holders of the
Subordinated Debt Securities. The Subordinated Indenture provides that the
subordination provisions thereof will not apply to money and securities held in
trust pursuant to the defeasance provisions of the Subordinated Indenture
(Article Fifteen of the Subordinated Indenture).
Senior Indebtedness is defined in the Subordinated Indenture as the
principal of (and premium, if any) and unpaid interest on (i) indebtedness of
the Company (including indebtedness of others guaranteed by the Company),
whether outstanding on the date of the Subordinated Indenture or thereafter
created, incurred, assumed or guaranteed, for money borrowed (other than the
Indenture Securities issued under the Subordinated Indenture), unless in the
instrument creating or evidencing the same or pursuant to which the same is
outstanding it is provided that such indebtedness is not senior or prior in
right of payment to the Subordinated Debt Securities or is made subordinate to
any other indebtedness of the Company on the same or substantially the same
basis as the Subordinated Debt Securities are made subordinate, and (ii)
renewals, extensions, modifications and refundings of any such indebtedness.
If this Prospectus is being delivered in connection with the offering of a
series of Subordinated Debt Securities, the accompanying Prospectus Supplement
or the information incorporated by reference will set forth the approximate
amount of Senior Indebtedness outstanding as of a recent date.
CONCERNING THE TRUSTEES
Each of the Senior Trustee and the Subordinated Trustee is one of the banks
participating in a revolving credit agreement and is a counterparty in
interest-rate swap agreements with the Company. In addition, the Senior Trustee
is trustee for noteholders under the Note Facility Agreement for the Company's
Employees' Stock Ownership Plan ("ESOP") and is indexing agent under the ESOP
Indexing Agreement.
DESCRIPTION OF DEBT WARRANTS
The Company may issue (either separately or together with other Offered
Securities) Debt Warrants to purchase Underlying Debt Securities (the "Offered
Debt Warrants"). The Debt Warrants will be issued under warrant agreements (each
a "Debt Warrant Agreement") to be entered into between the Company and a bank or
trust company, as warrant agent (the "Debt Warrant Agent"), all as shall be set
forth in the Prospectus Supplement relating to the Debt Warrants being offered
thereby. A copy of the form of Debt Warrant Agreement, including the form of
certificate representing the Debt Warrants (the "Debt Warrant Certificates"), is
filed as an exhibit to the registration statement of which this Prospectus is a
part. The following summaries of certain provisions of the Debt Warrant
Agreement and the Debt Warrant Certificates do not purport to be complete and
are subject to, and are qualified in their entirety by reference to, all the
provisions of the Debt Warrant Agreement and the Debt Warrant Certificates,
respectively, including the definitions therein of certain terms.
GENERAL
The Prospectus Supplement will describe the terms of the Offered Debt
Warrants and the Debt Warrant Agreement relating to Debt Warrants, including the
following:
(1) the title and aggregate number of such Debt Warrants;
(2) the offering price of such Debt Warrants;
(3) the title, aggregate principal amount and terms of the Underlying
Debt Securities purchasable upon exercise of such Debt Warrants;
(4) the principal amount of Underlying Debt Securities that may be
purchased upon exercise of each such Debt Warrant, and the price, or the
manner of determining the price, at which such principal amount may be
purchased upon such exercise;
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(5) the time or times at which, or period or periods in which, such
Debt Warrants may be exercised and the expiration date of such Debt
Warrants;
(6) the terms of any right of the Company to redeem such Debt
Warrants;
(7) whether such Debt Warrants are to be issued with (a) any Debt
Securities and, if so, the title, aggregate principal amount and terms of
such Debt Securities (as specified under "Description of Debt Securities")
and the number of such Debt Warrants to be issued with each $1,000
principal amount of such Debt Securities (or such other principal amount as
may be established) or (b) any other Securities and, if so, the number and
terms thereof;
(8) the date, if any, on and after which such Debt Warrants and such
Debt Securities or other Securities will be separately transferable;
(9) a discussion of the federal income tax considerations applicable
to such Debt Warrants and Underlying Debt Securities; and
(10) any other terms of such Debt Warrants.
Debt Warrant Certificates may be issued in registered or bearer form, or
both, as set forth in the Prospectus Supplement, and will be exchangeable for
new Debt Warrant Certificates of different denominations. No service charge will
be made for any permitted transfer or exchange of Debt Warrant Certificates, but
the Company may require payment of any tax or other governmental charge payable
in connection therewith. Debt Warrants may be exercised at the corporate trust
office of the Debt Warrant Agent or any other office indicated in the Prospectus
Supplement.
EXERCISE OF DEBT WARRANTS
Each Offered Debt Warrant will entitle the holder thereof to purchase such
amount of Underlying Debt Securities at the exercise price set forth in, or
calculable from, the Prospectus Supplement relating to such Offered Debt
Warrants. After the close of business on the applicable expiration date,
unexercised Debt Warrants will become void.
Offered Debt Warrants may be exercised by payment to the Debt Warrant Agent
of the applicable exercise price and by delivery to the Debt Warrant Agent of
the related Debt Warrant Certificate, with the reverse side thereof properly
completed. Offered Debt Warrants will be deemed to have been exercised upon
receipt of the exercise price, subject to the receipt by the Debt Warrant Agent,
within five business days thereafter, of the Debt Warrant Certificate or
Certificates evidencing such Offered Debt Warrants. Upon receipt of such payment
and the properly completed Debt Warrant Certificates at the corporate trust
office of the Debt Warrant Agent or any other office indicated in the Prospectus
Supplement, the Company will, as soon as practicable, deliver the amount of
Underlying Debt Securities purchased upon such exercise. If fewer than all of
the Offered Debt Warrants represented by any Debt Warrant Certificate are
exercised, a new Debt Warrant Certificate will be issued for the unexercised
Offered Debt Warrants. The holder of an Offered Debt Warrant will be required to
pay any tax or other governmental charge that may be imposed in connection with
any transfer involved in the issuance of Underlying Debt Securities purchased
upon such exercise.
MODIFICATIONS
The Debt Warrant Agreement and the terms of the Debt Warrants may be
modified or amended by the Company and the Debt Warrant Agent, without the
consent of any holder, for the purpose of curing any ambiguity, or of curing,
correcting or supplementing any defective or inconsistent provision contained
therein, or in any other manner that the Company deems necessary or desirable
and that will not materially and adversely affect the interests of the holders
of the Offered Debt Warrants.
The Company and the Debt Warrant Agent may also modify or amend the Debt
Warrant Agreement and the terms of the Offered Debt Warrants with the consent of
the holders of not less than a majority in number of the then outstanding
unexercised Debt Warrants affected thereby; provided that no such modification
or amendment that accelerates the expiration date, increases the exercise price,
reduces the number of
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outstanding Debt Warrants the consent of the holders of which is required for
any such modification or amendment, or otherwise materially and adversely
affects the rights of the holders of the Debt Warrants, may be made without the
consent of each holder affected thereby.
NO RIGHTS AS HOLDERS OF UNDERLYING DEBT SECURITIES
Holders of Debt Warrants are not entitled, by virtue of being such holders,
to payments of principal of (premium, if any, on) or interest, if any, on the
related Underlying Debt Securities or to exercise any other rights whatsoever as
holders of the Underlying Debt Securities.
DESCRIPTION OF PREFERRED STOCK
The Company may issue (either separately or together with other Offered
Securities) shares of its Preferred Stock. Under its Restated Certificate of
Incorporation (the "Certificate of Incorporation"), the Company is authorized to
adopt resolutions providing for the issuance, in one or more series, of up to
5,000,000 shares of its Preferred Stock, with such powers, preferences and
relative, participating, optional or other special rights and qualifications,
limitations or restrictions thereof as shall be adopted by the Board of
Directors or a duly authorized committee thereof.
The description below sets forth certain general terms and provisions of
the Preferred Stock covered by this Prospectus. The specific terms of any (i)
Preferred Stock proposed to be sold pursuant to this Prospectus and the
accompanying Prospectus Supplement (the "Offered Preferred Stock") and (ii) any
Preferred Stock to be represented by Depositary Shares or issuable upon the
conversion or exchange of other Offered Securities (the "Underlying Preferred
Stock") will be described in such Prospectus Supplement. The following summaries
of certain provisions of the Preferred Stock do not purport to be complete and
are subject to, and are qualified in their entirety by reference to, the
Certificate of Incorporation and the Certificate of Designations relating to the
offered or Underlying Preferred Stock.
If so indicated in the Prospectus Supplement, the terms of the Offered or
Underlying Preferred Stock may differ from the terms set forth below, except
those terms required by the Certificate of Incorporation.
GENERAL
Under the Certificate of Incorporation, each series of Preferred Stock of
the Company may have such preferences and rights as to dividends and
distributions of assets upon liquidation with respect to any other series of
Preferred Stock of the Company as the Board of Directors determines. The Offered
and Underlying Preferred Stock will, when issued, be fully paid and
non-assessable and holders thereof will have no preemptive rights.
Reference is made to the Prospectus Supplement relating to the Offered
Preferred Stock, the Underlying Preferred Stock, or both, as the case may be,
for specific terms, including:
(1) the title and stated value of such Preferred Stock;
(2) the number of shares of such Preferred Stock offered, the
liquidation preference per share and the offering price of such Preferred
Stock;
(3) the dividend rate(s), period(s) and/or payment date(s) or
method(s) of calculation thereof applicable to such Preferred Stock;
(4) the date from which dividends on such Preferred Stock shall
accumulate, if applicable;
(5) the liquidation preference of such Preferred Stock;
(6) the procedures for any auction and remarketing, if any, of such
Preferred Stock;
(7) the provision for a sinking fund, if any, for such Preferred
Stock;
(8) the provision for redemption, if applicable, of such Preferred
Stock;
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(9) whether interests in such Preferred Stock will be represented by
Depositary Shares;
(10) whether such Preferred Stock will be convertible into or
exchangeable for shares of Common Stock or other Securities and, if so, the
terms and conditions upon which such Preferred Stock will be so convertible
or exchangeable, including the conversion price or exchange ratio and the
conversion or exchange period (or the method of determining the same);
(11) whether such Preferred Stock will be listed on any securities
exchange;
(12) whether such Preferred Stock will be sold with any other Offered
Securities and, if so, the amount and terms thereof;
(13) any other specific terms, preferences or rights of, or
limitations or restrictions on, such Preferred Stock; and
(14) a discussion of federal income tax considerations applicable to
such Preferred Stock.
Subject to the Certificate of Incorporation and to any limitations
contained in outstanding Preferred Stock, the Company may issue additional
series of Preferred Stock, at any time or from time to time, with such powers,
preferences and relative, participating, optional or other special rights and
qualifications, limitations or restrictions thereof, as the Board of Directors
or any duly authorized committee thereof determine, all without further action
of the stockholders, including holders of then outstanding Preferred Stock, of
the Company.
DIVIDENDS
Holders of the Preferred Stock will be entitled to receive cash dividends,
when, as and if declared by the Board of Directors, out of assets of the Company
legally available for payment, at such rate and on such dates as will be set
forth in the Prospectus Supplement. Each dividend will be payable to holders of
record as they appear on the stock book of the Company on the record date fixed
by the Board of Directors. Dividends, if cumulative, will be cumulative from and
after the date set forth in the Prospectus Supplement.
The Company may not (i) declare or pay dividends (except in stock of the
Company junior to the Preferred Stock (the "Junior Stock")) or make any other
distributions on any Junior Stock or (ii) purchase, redeem or otherwise acquire
Junior Stock or set aside funds for such purpose (except (A) in a
reclassification or exchange of Junior Stock through the issuance of other
Junior Stock or (B) with the proceeds of a reasonably contemporaneous sale of
Junior Stock), if there are arrearages in dividends or failure in the payment of
the Company's sinking fund or redemption obligations on any of its Preferred
Stock and, in the case of (i) above, if dividends in full for the current
quarterly dividend period have not been paid or declared on any of its Preferred
Stock.
Dividends in full may not be declared or paid or set apart for payment on
any series of Preferred Stock unless (i) there are no arrearages in dividends
for any past quarterly dividend periods on any series of Preferred Stock and
(ii) to the extent that such dividends are cumulative, dividends in full for the
current quarterly dividend period have been declared or paid on all Preferred
Stock. Any dividends declared or paid when dividends are not so declared, paid
or set apart in full will be shared ratably by the holders of all series of
Preferred Stock in proportion to such respective arrearages and undeclared and
unpaid current quarterly cumulative dividends. No interest, or sum of money in
lieu of interest, will be payable in respect of any dividend payment or payments
that may be in arrears.
CONVERSION AND EXCHANGE
If the Offered or Underlying Preferred Stock will be convertible into or
exchangeable for Common Stock or other Securities, the Prospectus Supplement
will set forth the terms and conditions of such conversion or exchange,
including the conversion price or exchange ratio (or the method of calculating
the same), the conversion or exchange period (or the method of determining the
same), whether conversion or exchange will be mandatory or at the option of the
holder or the Company, the events requiring an adjustment of the conversion
price or the exchange ratio and provisions affecting conversion or exchange in
the event of the
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redemption of such Preferred Stock. Such terms may also include provisions under
which the number of shares of Common Stock or the number of other Securities to
be received by the holders of such Preferred Stock upon such conversion or
exchange would be calculated according to the market price of the Common Stock
or such other Securities as of a time stated in such Prospectus Supplement.
LIQUIDATION RIGHTS
In the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company, the holders of each series of the Preferred Stock
will be entitled to receive out of assets of the Company available for
distribution to stockholders, before any distribution of assets is made to
holders of any Junior Stock, liquidating distributions in the amount set forth
in the Prospectus Supplement plus all accrued and unpaid dividends. If, upon any
voluntary or involuntary liquidation, dissolution or winding up of the Company,
the amounts payable with respect to the Preferred Stock are not paid in full,
the holders of Preferred Stock will share ratably in any such distribution of
assets of the Company in proportion to the full respective preferential amounts
to which they are entitled. After payment of the full amount of the liquidating
distribution to which they are entitled, the holders of the Preferred Stock will
not be entitled to any further participation in any distribution of assets by
the Company. A consolidation or merger of the Company with or into any other
corporation or corporations or a sale of all or substantially all of the assets
of the Company will not be deemed to be a liquidation, dissolution or winding up
of the Company.
REDEMPTION
If so provided in the Prospectus Supplement, the Offered or Underlying
Preferred Stock will be redeemable in whole or in part at the option of the
Company, at the times and at the redemption prices set forth therein.
If dividends on any series of Preferred Stock are in arrears or the Company
has failed to fulfill its sinking fund or redemption obligations with respect to
any series of Preferred Stock, the Company may not purchase or redeem any shares
of Preferred Stock or any other capital stock ranking on a parity with the
Preferred Stock as to dividends or upon liquidation, nor permit any subsidiary
to do so, without in either case the consent of the holders of at least
two-thirds of all shares of Preferred Stock then outstanding; provided, however,
that (1) to meet its purchase, retirement or sinking fund obligations with
respect to any series of Preferred Stock, the Company may use shares of such
Preferred Stock acquired prior to such arrearages or failure of payment and then
held as treasury stock and (2) the Company may complete the purchase or
redemption of shares of Preferred Stock for which a contract was entered into
for any purchase, retirement or sinking fund purposes prior to such arrearages
or failure of payment.
VOTING RIGHTS
Except as indicated below or in the Prospectus Supplement, or except as
expressly required by applicable law, the holders of the Preferred Stock will
not be entitled to vote. As used herein, the term "Applicable Preferred Stock"
means those series of Preferred Stock to which the provisions described herein
are expressly made applicable by resolutions of the Board of Directors of the
Company.
If the equivalent of six quarterly dividends payable on any share of any
series of Applicable Preferred Stock are in default (whether or not such
dividends have been declared or such defaulted dividends are consecutive), the
number of directors of the Company will be increased by two and the holders of
all outstanding series of Applicable Preferred Stock (whether or not dividends
thereon are in default), voting as a single class without regard to series, will
be entitled to elect the two additional directors until four consecutive
quarterly dividends are paid or declared and set apart for payment, if such
share is noncumulative, or until all arrearages in dividends and dividends in
full for the current quarterly period are paid or declared and set apart for
payment, if such share is cumulative, whereupon all voting rights described
herein shall be divested from the Applicable Preferred Stock. The holders of
Applicable Preferred Stock may exercise their special class voting rights at
meetings of the stockholders for the election of directors or at special
meetings for the purpose
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of electing such directors, in either case at which the holders of not less than
one-third of the aggregate number of shares of Applicable Preferred Stock are
present in person or by proxy.
The affirmative vote of the holders of at least two-thirds of the
outstanding shares of Preferred Stock will be required (i) for any amendment of
the Certificate of Incorporation that will adversely affect the powers,
preferences or rights of the holders of the Preferred Stock or (ii) to create
any class of stock (or increase the authorized number of shares of any class of
stock) that will have preference as to dividends or upon liquidation over the
Preferred Stock or create any stock or other security convertible into or
exchangeable for or evidencing the right to purchase any such stock. The
affirmative vote of the holders of at least two-thirds of the outstanding shares
of Preferred Stock of a series will be required for any amendment of the
Certificate of Incorporation (or the related Certificate of Designations) that
will adversely affect the powers, preferences or rights of Preferred Stock of
such series.
The affirmative vote of the holders of a majority of then outstanding
shares of Preferred Stock will be required to (i) increase the authorized amount
of the Preferred Stock or (ii) create any class of stock (or increase the
authorized number of shares of any class of stock) that will rate on a parity
with the Preferred Stock either as to dividends or upon liquidation, or create
any stock or other security convertible into or exchangeable for or evidencing
the right to purchase any such stock unless such stock is being issued for the
purpose of redeeming all of such outstanding Preferred Stock.
DESCRIPTION OF DEPOSITARY SHARES
The Company may offer (either separately or together with other Offered
Securities) Depositary Shares representing interests in shares of its Preferred
Stock of one or more series. The Depositary Shares will be issued under deposit
agreements (each a "Deposit Agreement") to be entered into between the Company
and a bank or trust company, as depositary (the "Preferred Stock Depositary"),
all as set forth in the Prospectus Supplement relating to the Depositary Shares
being offered thereby. A copy of the form of Deposit Agreement, including the
form of depositary receipts evidencing Depositary Shares (the "Depositary
Receipts"), is filed as an exhibit to the registration statement of which this
Prospectus is a part. The following summaries of certain provisions of the
Depositary Shares do not purport to be complete and are subject to, and are
qualified in their entirety by reference to, all provisions of the Deposit
Agreement and the Deposit Receipts, including the definitions therein of certain
terms.
The description below sets forth certain general terms and provisions of
the Depositary Shares covered by this Prospectus. The specific terms of any
Depositary Shares proposed to be sold pursuant to this prospectus and the
accompanying Prospectus Supplement (the "Offered Depositary Shares") will be
described in such Prospectus Supplement.
If so indicated in the Prospectus Supplement, the terms of the Depositary
Shares may differ from the terms set forth below.
GENERAL
The Company will provide for the issuance by the Preferred Stock Depositary
to the public of the Depositary Receipts evidencing the Depositary Shares, each
of which will represent a fractional interest (to be specified in the Prospectus
Supplement) in one share of the related Preferred Stock, as described below.
Reference is made to the Prospectus Supplement relating to the Offered
Depositary Shares for specific terms, including:
(1) the terms of the series of Preferred Stock deposited by the
Company under the Deposit Agreement;
(2) the number of such Depositary Shares, the fraction of one share of
such Preferred Stock represented by one such Depositary Share;
(3) a discussion of the federal income tax considerations applicable
to such Depositary Shares;
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(4) whether such Depositary Shares will be listed on any securities
exchange;
(5) whether such Depositary Shares will be sold with any other Offered
Securities and, if so, the amount and terms thereof; and
(6) any other terms of such Depositary Shares.
The shares of Preferred Stock of a series represented by the Depositary
Shares will be deposited by the Company provided in the Deposit Agreement. The
Prospectus Supplement will set forth the name and address of the Preferred Stock
Depositary. Subject to the terms of the Deposit Agreement, each owner of a
Depositary Share will be entitled, in proportion to the applicable fractional
interest in a share of Preferred Stock of such series represented by such
Depositary Share, to all rights and preferences of the Preferred Stock
represented by such Depositary Share (including dividend, voting and liquidation
rights and any redemption, conversion or exchange rights).
DIVIDENDS AND OTHER DISTRIBUTIONS
The Preferred Stock Depositary will distribute all cash dividends and other
cash distributions received in respect of the related series of Preferred Stock
to the record holders of Depositary Shares in proportion to the number of such
Depositary Shares owned by such holders on the relevant record date. The
Preferred Stock Depositary will distribute only such amount, however, as can be
distributed without attributing to any holder of Depositary Shares a fraction of
one cent, and any balance not so distributed will be added to and treated as
part of the next sum, if any, received by the Preferred Stock Depositary for
distribution to record holders of Depositary Shares.
In the event of a distribution other than in cash, the Preferred Stock
Depositary will distribute property received by it to the record holders of
Depositary Shares entitled thereto, unless the Preferred Stock Depositary
determines that it is not feasible to make such distribution, in which case the
Preferred Stock Depositary may, with the approval of the Company, sell such
property and distribute the net proceeds from such sale to such holders.
The Deposit Agreement will also contain provisions relating to the manner
in which any subscription or similar rights offered by the Company to holders of
the related series of Preferred Stock will be made available to holders of
Depositary Shares.
WITHDRAWAL OF PREFERRED STOCK
Upon surrender of Depositary Receipts at the corporate trust office of the
Preferred Stock Depositary (unless the related shares of Preferred Stock have
previously been called for redemption), the holder of the Depositary Shares
evidenced thereby will be entitled to receive at such office, to or upon such
holder's order, the number of whole shares of the related series of Preferred
Stock and any money or other property represented by such Depositary Shares.
However, shares of Preferred Stock so withdrawn may not be redeposited. If the
holder requests withdrawal of less than all the shares of Preferred Stock to
which such holder is entitled, or if such holder would otherwise be entitled to
a fractional share of Preferred Stock, the Preferred Stock Depositary will
deliver to such holder a new Depositary Receipt evidencing such balance or
fractional share.
REDEMPTION OF DEPOSITARY SHARES
Whenever the Company redeems Preferred Stock held by the Preferred Stock
Depositary, the Preferred Stock Depositary will redeem as of the same redemption
date the number of Depositary Shares representing the Preferred Stock so
redeemed; provided that the Company paid in full to the Preferred Stock
Depositary the redemption price of such Preferred Stock plus an amount equal to
any accrued and unpaid dividends thereon to the date fixed for redemption. The
redemption price per Depositary Share will be equal to the applicable fraction
of the redemption price per share and accrued and unpaid dividends payable with
respect to such Preferred Stock. If less than all the Depositary Shares are to
be redeemed, the Depositary Shares to be
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redeemed will be selected by lot or pro rata or by another equitable method, in
each case as may be determined by the Company.
After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be deemed to be outstanding, and all rights of the
holders of the Depositary Shares so called for redemption will cease, except the
right to receive the moneys payable upon such redemption and any money or other
property to which the holders of such Depositary Shares were entitled upon such
redemption and surrender to the Preferred Stock Depositary of the Depositary
Receipts evidencing such Depositary Shares.
CONVERSION AND EXCHANGE
The Depositary Shares, as such, are not convertible into or exchangeable
for Common Stock or other Securities. Nevertheless, if Preferred Stock
represented by the Depositary Shares is convertible into or exchangeable for
Common Stock or other Securities, the Depositary Receipts may be surrendered by
the holder thereof to the Preferred Stock Depositary with written instructions
to convert or exchange such Preferred Stock into whole shares of Common Stock or
other Securities, as specified in the related Prospectus Supplement. The
Company, upon receipt of such instructions and any amounts payable in respect
thereof, will cause the conversion or exchange thereof and will deliver to the
holder such whole shares of Common Stock or such whole number of other
Securities (and cash in lieu of any fractional share or Security). In the case
of a partial conversion or exchange, the holder will receive a new Depositary
Receipt evidencing the unconverted or unexchanged balance.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting at which holders of one or more
series of Preferred Stock are entitled to vote, the Preferred Stock Depositary
will mail the information contained in such notice of meeting to the holders of
the Depositary Shares relating to such Preferred Stock. Each record holder of
such Depositary Shares on the record date for such meeting will be entitled to
instruct the Preferred Stock Depositary as to the manner in which to vote the
number of shares of Preferred Stock represented by such Depositary Shares. The
Company will agree to take all reasonable action that may be deemed necessary by
the Preferred Stock Depositary in order to enable the Preferred Stock Depositary
to vote in accordance with each holder's instructions. The Preferred Stock
Depositary will abstain from voting Preferred Stock to the extent it does not
receive instructions from the holders of Depositary Shares representing such
Preferred Stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between the Company and the Preferred Stock Depositary. However, any amendment
that materially and adversely alters the rights of the holders of Depositary
Shares will not be effective unless such amendment has been approved by the
holders of at least a majority of the Depositary Shares then outstanding;
provided that any amendment that prejudices any substantial right of the holders
of Depositary Shares will not become effective until the expiration of 90 days
after notice of such amendment has been given to such holders. A holder that
continues to hold one or more Depositary Receipts at the expiration of such
90-day period will be deemed to consent to, and will be bound by, such
amendment. No amendment may impair the right of any holder to surrender such
holder's Depositary Receipt and receive the related Preferred Stock, as
discussed above under "Withdrawal of Preferred Stock."
The Deposit Agreement may be terminated by the Company at any time upon not
less than 60 days' prior written notice to the Preferred Stock Depositary. In
any such case, the Preferred Stock Depositary will deliver to each holder of
Depositary Shares, upon surrender of the related Depositary Receipts, the number
of whole shares of the related series of Preferred Stock to which such holder is
entitled, together with cash in lieu of any fractional share. The Deposit
Agreement will terminate automatically after all the related Preferred Stock has
been redeemed, withdrawn, converted or exchanged or there has been a final
distribution in respect of the
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Preferred Stock represented by such Depositary Shares in connection with any
liquidation, dissolution or winding up of the Company.
CHARGES OF PREFERRED STOCK DEPOSITARY
Except as provided in the Prospectus Supplement, the Company will pay the
fees and expenses of the Preferred Stock Depositary, and the holders of
Depositary Receipts will be required to pay any tax or other governmental charge
that may be imposed in connection with the transfer, exercise, surrender or
split-up of Depositary Receipts.
MISCELLANEOUS
The Preferred Stock Depositary will forward to the holders of Depositary
Shares all reports and communications from the Company that are delivered to the
Preferred Stock Depositary and that the Company is required to furnish to the
holders of the Preferred Stock.
Neither the Preferred Stock Depositary nor the Company will be liable if it
is prevented or delayed by law or any circumstance beyond its control in
performing its obligations under the Deposit Agreement. The obligations of the
Company and the Preferred Stock Depositary under the Deposit Agreement will be
limited to performance in good faith of their respective duties thereunder, and
neither entity will be obligated to prosecute or defend any legal proceeding in
respect of any Depositary Shares or related shares of Preferred Stock unless
satisfactory indemnity is furnished.
RESIGNATION AND REMOVAL OF PREFERRED STOCK DEPOSITARY
The Preferred Stock Depositary may resign at any time by delivering to the
Company notice of its election to do so, and the Company may at any time remove
the Preferred Stock Depositary, any such resignation or removal to take effect
upon the appointment of a successor Preferred Stock Depositary. Such successor
Preferred Stock Depositary must be appointed within 60 days after delivery of
notice of resignation or removal and must be a bank or trust company having its
principal office in the United States and having a combined capital and surplus
of at least $50,000,000.
DESCRIPTION OF COMMON STOCK
The Company may issue (either separately or together with other Offered
Securities) shares of its Common Stock. Under the Certificate of Incorporation,
the Company is authorized to issue up to 200,000,000 shares of its Common Stock.
The Prospectus Supplement relating to an offering of Common Stock, or to the
issuance of Common Stock upon the exercise of Common Warrants or to Common Stock
issuable upon the conversion or exchange of other Offered Securities, will
describe terms relevant thereto, including the number of shares offered, any
initial offering price, and market price and dividend information, as well as,
if applicable, information on such other Offered Securities.
DESCRIPTION OF COMMON WARRANTS
The Company may issue (either separately or together with other Offered
Securities) Common Warrants to purchase Common Stock (the "Offered Common
Warrants"). The Common Warrants will be issued under warrant agreements (each a
"Common Warrant Agreement") to be entered into between the Company and a bank or
trust company, as warrant agent (the "Common Warrant Agent"), all as set forth
in the Prospectus Supplement relating to the Common Warrants being offered
thereby. A copy of the form of Common Warrant Agreement, including the form of
certificate representing the Common Warrants (the "Common Warrant
Certificates"), is filed as an exhibit to the registration statement of which
this Prospectus is a part. The following summaries of certain provisions of the
Common Warrant Agreement and the Common Warrant Certificates do not purport to
be complete and are subject to, and are qualified in their entirety by reference
to, all the provisions of the Common Warrant Agreement and the Common Warrant
Certificates, respectively, including the definitions therein of certain terms.
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GENERAL
The Prospectus Supplement will describe the terms of the Offered Common
Warrants, the Common Warrant Agreement relating to such Common Warrants and the
Common Warrant Certificates representing such Common Warrants, including the
following:
(1) the title and aggregate number of such Common Warrants;
(2) the offering price of such Common Warrants;
(3) the number of shares of Common Stock that may be purchased upon
exercise of each such Common Warrant; the price, or the manner of
determining the price, at which such shares may be purchased upon such
exercise; if other than cash, the property and manner in which the exercise
price may be paid; and any minimum number of such Common Warrants that are
exercisable at any one time;
(4) the time or times at which, or period or periods which, such
Common Warrants may be exercised and the expiration date of such Common
Warrants;
(5) the terms of any right of the Company to redeem such Common
Warrants;
(6) the terms of any right of the Company to accelerate the exercise
of such Common Warrants upon the occurrence of certain events;
(7) whether such Common Warrants will be sold with any other Offered
Securities and, if so, the amount and terms thereof;
(8) the date, if any, on and after which such Common Warrants and such
Offered Securities will be separately transferable;
(9) a discussion of the federal income tax considerations applicable
to such Common Warrants and Common Stock; and
(10) any other terms of such Common Warrants.
Common Warrant Certificates may be issued in registered or bearer form, or
both, as set forth in the Prospectus Supplement, and will be exchangeable for
new Common Warrant Certificates of different denominations. No service charge
will be made for any permitted transfer or exchange of Common Warrant
Certificates, but the Company may require payment of any tax or other
governmental charge payable in connection therewith. Common Warrants may be
exercised at the corporate trust office of the Common Warrant Agent or any other
office indicated in the Prospectus Supplement.
EXERCISE OF COMMON WARRANTS
Each Offered Common Warrant will entitle the holder thereof to purchase
such number of shares of Common Stock at the exercise price set forth in, or
calculable from, the Prospectus Supplement relating to such Offered Common
Warrants. After the close of business on the applicable expiration date,
unexercised Common Warrants will become void.
Offered Common Warrants may be exercised by payment to the Common Warrant
Agent of the exercise price and by delivery to the Common Warrant Agent of the
related Common Warrant Certificate, with the reverse side thereof properly
completed. Offered Common Warrants will be deemed to have been exercised upon
receipt of the exercise price, subject to the receipt by the Common Warrant
Agent, within five business days thereafter, of the Common Warrant Certificate
or Certificates evidencing such Offered Common Warrants. Upon receipt of such
payment and the properly completed Common Warrant Certificates at the corporate
trust office of the Common Warrant Agent or such other office acceptable to the
Common Warrant Agent, the Company will, as soon as practicable, deliver the
shares of Common Stock purchased upon such exercise. If fewer than all of the
Offered Common Warrants represented by any Common Warrant Certificate are
exercised, a new Common Warrant Certificate will be issued for the unexercised
Offered Common Warrants. The holder of an Offered Common Warrant will be
required to pay any tax or other governmental
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charge that may be imposed in connection with any transfer involved in the
issuance of Common Stock purchased upon such exercise.
MODIFICATIONS
The Common Warrant Agreement and the terms of the Offered Common Warrants
may be modified or amended by the Company and the Common Warrant Agent, without
the consent of any holder, for the purpose of curing any ambiguity, or of
curing, correcting or supplementing any defective or inconsistent provision
contained therein, or in any other manner that the Company deems necessary or
desirable and that will not materially and adversely affect the interests of the
holders of the Offered Common Warrants.
The Company and the Common Warrant Agent may also modify or amend the
Common Warrant Agreement and the terms of the Offered Common Warrants with the
consent of the holders of not less than a majority in number of the then
outstanding unexercised Common Warrants affected thereby; provided that no such
modification or amendment that accelerates the expiration date, increases the
exercise price, reduces the number of outstanding Common Warrants, the consent
of the holders of which is required for any such modification or amendment, or
otherwise materially and adversely affects the rights of the holders of the
Common Warrants may be made without the consent of each holder affected thereby.
COMMON WARRANT ADJUSTMENTS
The terms and conditions on which the exercise price of and/or the number
of shares of Common Stock covered by an Offered Common Warrant are subject to
adjustment will be set forth in the Common Warrant Agreement and the Prospectus
Supplement. Such terms will include provisions for adjusting the exercise price
and/or the number of shares of Common Stock covered by such Offered Common
Warrant; the events requiring such adjustment; the events upon which the Company
may, in lieu of making such adjustment, make proper provisions so that the
holder of such Offered Common Warrant, upon exercise thereof, would be treated
as if such holder had exercised such Common Warrant prior to the occurrence of
such events; and provisions affecting exercise in the event of certain events
affecting the Common Stock.
NO RIGHTS AS STOCKHOLDERS
Holders of Common Warrants are not entitled, by virtue of being such
holders, to vote, consent or receive notice as stockholders of the Company in
respect of any meeting of stockholders for the election of directors of the
Company or any other matter, or exercise any other rights whatsoever as
stockholders of the Company.
DESCRIPTION OF OUTSTANDING CAPITAL STOCK
The authorized capital stock of the Company consists of (i) 200,000,000
shares of Common Stock, $1.50 par value per share, (ii) 5,000,000 shares of
Preferred Stock, $0.01 par value per share, (iii) 442,352 shares of Series $4.75
Preferred Stock, without par value but with a stated value of $100 per share
(the "$4.75 Preferred Stock") and (iv) 2,000,000 shares of junior participating
preferred stock, par value $0.01 per share (the "Junior Preferred Stock").
On December 31, 1993, there were outstanding (i) 46,018,008 shares of
Commom Stock, (ii) employee stock options to purchase an aggregate of 3,883,370
shares of Common Stock and (iii) 235,101 shares of $4.75 Preferred Stock. In
addition, rights to purchase Junior Preferred Stock have been distributed to
holders of the Common Stock pursuant to the Rights Agreement, as further
described below. A maximum of 2,000,000 shares of Junior Preferred Stock is
currently authorized for issuance upon exercise of such rights. See "Rights
Plan" below.
The number of outstanding shares of Common Stock described above has not
been adjusted to account for the 2 for 1 stock split declared by the Company on
May 10, 1994 to the holders of record of the Common Stock on June 1, 1994. The
stock split will take effect on July 1, 1994.
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The following descriptions are summaries, and reference is made to the
detailed provisions of the following documents: (i) the Company's Certificate of
Incorporation; (ii) the Company's Bylaws; and (iii) the Rights Agreement, as
amended, between the Company and Bank One of Arizona, as Rights Agent (the
"Rights Agreement").
COMMON STOCK
Subject to the rights of the holders of any outstanding shares of Preferred
Stock, $4.75 Preferred Stock and Junior Preferred Stock, holders of Common Stock
are entitled to receive dividends when, as and if declared by the Board of
Directors out of funds legally available therefor.
Each holder of Common Stock is entitled to one vote for each share held on
all matters voted upon by the stockholders of the Company, including the
election of directors. The Common Stock does not have cumulative voting rights.
Election of directors is decided by the holders of a plurality of the shares
entitled to vote and present in person or by proxy at a meeting for the election
of directors.
In the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company, after the payment or provision for payment of the
debts and other liabilities of the Company and the preferential amounts to which
holders of the Company's Preferred Stock, $4.75 Preferred Stock and Junior
Preferred Stock are entitled (if any shares of Preferred Stock, $4.75 Preferred
Stock and Junior Preferred Stock are then outstanding), the holders of Common
Stock are entitled to share ratably in the remaining assets of the Company.
The outstanding shares of Common Stock are, and any shares of Common Stock
offered hereby upon issuance and payment therefor will be, fully paid and
non-assessable. The Common Stock has no preemptive or conversion rights and
there are no redemption or sinking fund provisions applicable thereto.
The Common Stock of the Company is listed on The New York Stock Exchange
and The Pacific Stock Exchange (symbol "DL"). The transfer agent and registrar
is the First National Bank of Boston.
$4.75 PREFERRED STOCK
Dividends are paid quarterly on the $4.75 Preferred Stock at an annual rate
of $4.75 per share on the fifteenth day of January, April, July and October in
each year when and if declared. Such dividends are cumulative, to the extent not
paid. In the event of any liquidation, dissolution or winding up of the Company,
the holders of the $4.75 Preferred Stock are entitled to receive an amount equal
to the accrued and unpaid dividends thereon plus, on involuntary liquidation,
$100 per share or, on voluntary liquidation, $101 per share before any
distribution may be made to holders of common or any other stock junior to the
$4.75 Preferred Stock.
Shares of the $4.75 Preferred Stock are redeemable at the option of the
Company at $101 per share plus accrued and unpaid dividends thereon computed to
the date of redemption. In the case of redemption of less than all the
outstanding $4.75 Preferred Stock, the shares to be redeemed will be selected by
lot in the manner prescribed by the Board. All shares redeemed will be cancelled
and will not be reissued as $4.75 Preferred Stock. In addition, the $4.75
Preferred Stock is entitled to the benefits of mandatory annual cumulative
sinking fund payments due September 1 of each year in an amount per share
sufficient to redeem 6,000 shares at par plus accrued and unpaid dividends.
Previously purchased shares of $4.75 Preferred Stock may be used to satisfy the
sinking fund requirement.
When, if ever, dividends on the $4.75 Preferred Stock shall be in arrears,
in whole or in part, as to each of six quarterly dividends, whether or not
consecutive, holders of the $4.75 Preferred Stock will have the exclusive right,
voting separately as a class at the next annual meeting of shareholders, and
annually thereafter, to elect two Directors of the Company in addition to those
elected by other classes of shareholders. Such right of election and the
existence of such additional directorships shall continue until such time as all
cumulative dividends in arrears have been paid in full. The holders of at least
10% of the $4.75 Preferred Stock may require that a special meeting of such
holders be called to elect such additional Directors if the foregoing arrearages
shall occur more than 90 days prior to the date fixed by the Bylaws for the next
annual meeting of
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shareholders. Except as described herein and as otherwise required by law, the
$4.75 Preferred Stock will have no voting rights.
The Company, without the approval of at least a majority of the then
outstanding $4.75 Preferred Stock, voting as a class, or the unanimous written
consent of such stock, may not create or issue any class or series of stock
ranking on a parity with the $4.75 Preferred Stock either as to dividends or
liquidation rights, or increase the authorized number of shares of any such
class or series. Also, the Company, without the approval of at least two-thirds
of the then outstanding $4.75 Preferred Stock, voting as a class, or the
unanimous written consent of such stock, may not
(a) amend, alter or repeal any of the provisions of its Certificate of
Incorporation so as to alter materially any existing provisions of the
$4.75 Preferred Stock,
(b) create or issue any class or series of stock ranking prior to the
$4.75 Preferred Stock either as to dividends or liquidation rights, or
increase the authorized number of shares of any such class or series of the
$4.75 Preferred Stock, or
(c) sell, lease or convey all or substantially all of the Company's
property or business, or voluntarily liquidate, merge or consolidate,
provided that no such vote or consent will be required for a consolidation
or merger of the Company if, after any such transaction, each holder
possesses an equivalent number of shares of the surviving corporation
having substantially the same terms and provisions as the $4.75 Preferred
Stock and the surviving corporation has no stock either authorized or
outstanding ranking prior to or on a parity with such shares.
No such approval or consent will be required for issuance either of senior
or parity stock for the purpose of redeeming or otherwise retiring the $4.75
Preferred Stock.
If and so long as the Company may be in default with respect to any
dividend or sinking fund payment on the $4.75 Preferred Stock, it may not pay
any dividends (other than dividends payable in junior stock) or make other
distributions on junior stock or acquire shares of such junior stock for a
consideration.
Holders of the $4.75 Preferred Stock will have no preemptive rights. The
$4.75 Preferred Stock is not liable for further calls or subject to assessment.
The $4.75 Preferred Stock is not entitled to conversion rights.
CERTAIN ANTITAKEOVER EFFECTS OF CERTAIN PROVISIONS OF THE CERTIFICATE OF
INCORPORATION AND BYLAWS
The Certificate of Incorporation and Bylaws contain certain provisions that
could make more difficult the acquisition of the Company by means of a tender
offer, a proxy contest or otherwise. The description set forth below is intended
as a summary only and is qualified in its entirety by reference to the forms of
the Certificate of Incorporation and Bylaws, which have been filed as an exhibit
to the registration statement of which this Prospectus is a part.
Classification of Board of Directors. The Certificate of Incorporation and
Bylaws of the Company provide that the Company's Board of Directors will be
divided into three classes of directors, with the classes to be as nearly equal
in number as possible. The term of office of one class of directors expires each
year in rotation so that one class is elected at each annual meeting of
shareholders for a full three-year term. The Bylaws provide for not less than
three nor more than seventeen directors which the Company would have if there
were no vacancies (the "Whole Board"). The Bylaws provide that a vacancy on the
Company's Board may be filled only by the affirmative vote of a majority of the
remaining directors, even though less than a quorum. The Certificate of
Incorporation further provides that a director may be removed only for cause and
only by affirmative vote of the holders of at least 80% of the voting power of
the then outstanding voting stock of the Company.
These provisions would preclude a third party from removing incumbent
directors and simultaneously gaining control of the Company's Board by filling
the vacancies created by removal with its own nominees, unless such third party
controls at least 80% of the combined voting power of the voting stock of the
Company. Under the classified board provisions described above, it would take at
least two elections of directors for any
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individual or group to gain control of the Company's Board. Accordingly, these
provisions would tend to deter unfriendly takeovers.
Stockholder Action. The Certificate of Incorporation and the Bylaws also
provide that stockholder action can be taken only at an annual or special
meeting of stockholders and prohibit stockholder action by written consent in
lieu of a meeting. The Bylaws provide that special meetings of stockholders can
be called only by the Chairman of the Board of Directors or by the Company's
Board of Directors pursuant to a resolution adopted by a majority of the Whole
Board. Stockholders are not permitted to call a special meeting or to require
that the Company's Board of Directors call a special meeting of stockholders.
Advance Notice Provisions for Stockholder Nominations and Stockholder
Proposals. The Bylaws establish an advance notice procedure for stockholders to
make nominations of candidates for election as directors, or to bring other
business before an annual meeting of stockholders of the Company (the
"Stockholder Notice Procedure").
The Stockholder Notice Procedure provides that only persons who are
nominated by, or at the direction of, the Company Board, or by a stockholder who
has given timely written notice to the Secretary of the Company prior to the
meeting at which directors are to be elected, will be eligible for election as
directors of the Company. The Stockholder Notice Procedure provides that at an
annual meeting only such business may be conducted as has been brought before
the meeting by, or at the direction of, the Chairman or the Company's Board or
by a stockholder who has given timely written notice to the Secretary of the
Company of such stockholder's intention to bring such business before such
meeting.
Under the Stockholder Notice Procedure, for notice of stockholder
nominations to be made at an annual meeting to be timely, such notice must be
received by the Company not less than 70 days nor more than 90 days prior to the
first anniversary of the previous year's annual meeting (or if the date of the
annual meeting is advanced by more than 20 days, or delayed by more than 70
days, from such anniversary date, not earlier than the 90th day prior to such
meeting and not later than the later of (x) the 70th day prior to such meeting
and (y) the 10th day after public announcement of the date of such meeting is
first made). Notwithstanding the foregoing, in the event that the number of
directors to be elected is increased and there is no public announcement made by
the Company naming all of the nominees for director or specifying the size of
the increased Board of Directors at least 80 days prior to the first anniversary
of the preceding year's annual meeting, a stockholder's notice will be timely,
but only with respect to nominees for any new positions created by such
increase, if it is received by the Company not later than the 10th day after
such public announcement is first made by the Company. Under the Stockholder
Notice Procedure, for notice of a stockholder nomination to be made at a special
meeting at which directors are to be elected to be timely, such notice must be
received by the Company not earlier than the 90th day before such meeting and
not later than the later of (x) the 70th day prior to such meeting and (y) the
10th day after public announcement of the date of such meeting is first made.
In addition, under the Stockholder Notice Procedure, a stockholder's notice
to the Company proposing to nominate a person for election as a director must
contain certain specified information. If the Chairman of the Board or other
officer presiding at a meeting determines that a person was not nominated, or
other business was not brought before the meeting, in accordance with the
Stockholder Notice Procedure, such person will not be eligible for election as a
director, or such business will not be conducted at such meeting, as the case
may be.
Merger/Sale of Assets. The Certificate of Incorporation of the Company
provides that certain "business combinations" (as defined) must be approved by
the holders of at least 66 2/3% of the voting power of the shares not owned by
an "interested shareholder" (as defined), unless the business combinations are
approved by the "Continuing Directors" or meet certain requirements regarding
price and procedure.
Delaware General Corporation Law Section 203. The Company is subject to
the provisions of Section 203 of the General Corporation law of the State of
Delaware ("Delaware sec. 203"), the "business combination" statute. In general,
the law prohibits a public Delaware corporation from engaging in a "business
combination" with an "interested stockholder" for a period of three years after
the date of the transaction in which the
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49
person became an interested stockholder, unless (i) prior to such date, the
board of directors of the corporation approved either the business combination
or the transaction that resulted in the stockholder becoming an interested
stockholder, (ii) upon consummation of the transaction that resulted in the
stockholder becoming an interested stockholder, the interested stockholder owned
at least 85% of the voting stock of the corporation outstanding at the time the
transaction commenced (excluding certain shares described in Delaware sec. 203),
or (iii) on or subsequent to such date, the business combination is approved by
the board of directors of the corporation and authorized at an annual or special
meeting of stockholders and by the affirmative vote of at least two-thirds of
the outstanding voting stock that is not owned by the "interested stockholder".
"Business combination" is defined to include mergers, asset sales and certain
other transactions resulting in a financial benefit to a stockholder. An
"interested stockholder" is defined generally as a person who, together with
affiliates and associates, owns (or, within the prior three years, did own) 15%
or more of a corporation's voting stock. The Certificate of Incorporation does
not exclude the Company from the restrictions imposed under sec. 203 of the
Delaware law. The statute could prohibit or delay the accomplishment of mergers
or other takeover or change in control attempts with respect to the Company and,
accordingly, may discourage attempts to acquire the Company.
RIGHTS PLAN
Pursuant to the Company's Rights Agreement (as adjusted to account for the
2 for 1 stock split announced by the Company on May 10, 1994), attached to each
share of Common Stock is one right (a "Right") that, when exercisable, entitles
the holder of the Right to purchase one two-hundredth of a share of Junior
Preferred Stock at a purchase price (the "Purchase Price") of $55, subject to
adjustment. The number of Rights attached to each share of Common Stock is
subject to adjustment. In certain events (such as a person or group becoming the
owner of 20% or more of the Common Stock or a merger or other transaction with
an entity controlled by such an acquiring person or group), exercise of the
Rights would entitle the holders thereof (other than the acquiring person or
group) to receive Common Stock or common stock of a surviving corporation, or
cash, property or other securities, with a market value equal to twice the
Purchase Price. Accordingly, exercise of the Rights may cause substantial
dilution to a person who attempts to acquire the Company. The Rights
automatically attach to each outstanding share of Common Stock, including any
shares offered pursuant to the applicable Prospectus Supplement. There is no
monetary value presently assigned to the Rights, and they will not trade
separately from the Common Stock unless and until they become exercisable. The
Rights, which expire on February 28, 2002, may be redeemed at a price of $.025
per Right at any time until any individual, corporation or other entity
(excluding the Company or its affiliates) has acquired 20% or more of the
outstanding Common Stock, except as otherwise provided in the Rights Agreement.
The Rights Agreement may have certain antitakeover effects, although it is not
intended to preclude any acquisition or business combination that is at a fair
price and otherwise in the best interests of the Company and its stockholders as
determined by the Board of Directors. However, a stockholder could potentially
disagree with the Board's determination of what constitutes a fair price or the
best interests of the Company and its stockholders.
Shares of Junior Preferred Stock purchasable upon exercise of the Rights
will not be redeemable. Each share of Junior Preferred Stock will be entitled to
a minimum preferential quarterly dividend payment of one dollar per share but
will be entitled to an aggregate dividend equal to 200 times the dividend
declared per share of Common Stock. In the event of liquidation, the holders of
the Junior Preferred Stock will be entitled to a minimum preferential
liquidation payment of $200 per share but will be entitled to an aggregate
payment equal to 200 times the payment made per share of Common Stock. Each
share of Junior Preferred Stock will have 200 votes, voting together with the
Common Stock. Finally, in the event of any merger, consolidation or other
transaction in which Common Stock is exchanged, each share of Junior Preferred
Stock will be entitled to receive an amount equal to 200 times the amount
received per share of Common Stock. These rights are protected by customary
antidilution provisions. Because of the nature of the dividend, liquidation and
voting rights of Junior Preferred Stock, the value of one two-hundredth interest
in a share of Junior Preferred Stock purchasable upon exercise of each Right
should approximate the value of one share of Common Stock.
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50
PLAN OF DISTRIBUTION
The Company may sell the Securities (a) directly to purchasers, (b) through
agents, (c) to dealers as principals, and (d) through underwriters.
Offers to purchase Securities may be solicited directly by the Company or
by agents designated by the Company from time to time. Any such agent, who may
be deemed to be an underwriter as that term is defined in the Securities Act of
1933, involved in the offer or sale of the Securities is named, and any
commissions payable by the Company to such agent will be set forth, in the
Prospectus Supplement relating to the Securities. Unless otherwise indicated in
such Prospectus Supplement, any such agent will use its reasonable efforts to
solicit offers to purchase Securities for the period of its appointment.
If a dealer is utilized in the sale of the Securities, the Company will
sell such Securities to the dealer as principal. The dealer may then resell
Securities to the public at varying prices to be determined by such dealer at
the time of resale.
If an underwriter or underwriters are utilized in the sale of the
Securities, the Company will enter into an underwriting agreement with such
underwriters at the time of sale to them. The names of the underwriters and the
terms of the transaction will be set forth in the Prospectus Supplement, which
will be used by the underwriters to make resales of the Securities. Unless
otherwise indicated in the Prospectus Supplement relating to the Securities, the
obligations of the underwriters to purchase the Securities will be subject to
certain conditions precedent and the underwriters will be obligated to purchase
all such Securities if any are purchased.
Agents, dealers, or underwriters and their controlling persons may be
entitled under agreements which may be entered into with the Company to
indemnification by the Company against certain civil liabilities, including
liabilities under the Securities Act of 1933, or to contribution with respect to
payments which the agents, dealers or underwriters may be required to make in
respect thereof, and may be customers of, engage in transactions with or perform
services for the Company in the ordinary course of business.
If so indicated in the Prospectus Supplement, the Company will authorize
underwriters or agents to solicit offers by certain institutions to purchase
Securities from the Company at the public offering price set forth in the
Prospectus Supplement pursuant to Delayed Delivery Contracts providing for
amounts, payment and delivery as described in the Prospectus Supplement.
Institutions with whom the contracts may be made include commercial and savings
banks, insurance companies, pension funds, investment companies, educational and
charitable institutions and other institutions, but shall in all cases be
subject to the approval of the Company. A commission described in the Prospectus
Supplement will be paid to underwriters and agents soliciting purchases of
Securities pursuant to contracts accepted by the Company. Contracts will not be
subject to any conditions except that (a) the purchase by an institution of the
Securities covered by its contract shall not at the time of delivery be
prohibited under the laws of any jurisdiction in the United States to which such
institution is subject and (b) the Company shall have sold and delivered to any
underwriters named in the Prospectus Supplement that portion of the issue of
Securities as is set forth therein. The underwriters and agents will not have
any responsibility in respect of the validity or the performance of the
contracts.
Unless otherwise indicated in the Prospectus Supplement relating to the
Securities, the Securities will not be listed on any securities exchange.
The place and time of delivery for the Securities will be set forth in the
Prospectus Supplement.
EXPERTS
The consolidated financial statements and the related financial statement
schedules incorporated in this Prospectus by reference from the Company's Annual
Report on Form 10-K for the year ended December 31, 1993 have been audited by
Deloitte & Touche, independent auditors, as stated in their reports, which are
incorporated herein by reference, and have been so incorporated in reliance upon
the reports of such firm given upon their authority as experts in accounting and
auditing.
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LEGAL OPINIONS
The legality of the Securities will be passed upon for the Company by L.
Gene Lemon, Esq., Vice President and General Counsel of the Company, and for the
underwriters, if any, by Shearman & Sterling, New York, New York. As of May 31,
1994, Mr. Lemon held approximately 49,000 shares of Common Stock of the Company
and options to acquire approximately 126,000 of such shares.
30
52
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION
OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS
SUPPLEMENT OR THE PROSPECTUS IN CONNECTION WITH THE OFFER CONTAINED IN THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ANY AGENT. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS NOR ANY SALE MADE HEREUNDER OR THEREUNDER SHALL UNDER ANY
CIRCUMSTANCES CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS
OF THE COMPANY SINCE THE DATE HEREOF. THIS PROSPECTUS SUPPLEMENT AND THE
PROSPECTUS ARE NOT AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY
SECURITY IN ANY JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
________________________
TABLE OF CONTENTS
PAGE
----
PROSPECTUS SUPPLEMENT
Description Of Notes................. S-2
Certain United States Federal Income
Tax Consequences................... S-14
Plan Of Distribution................. S-18
Legal Opinion........................ S-19
PROSPECTUS
Available Information................ 2
Incorporation By Reference........... 2
The Company.......................... 3
Ratio Of Earnings To Fixed Charges
and Ratio of Earnings to Fixed
Charges and Preferred Stock
Dividends.......................... 3
Use Of Proceeds...................... 4
Description Of Debt Securities....... 4
Description Of Debt Warrants......... 14
Description of Preferred Stock....... 16
Description of Depositary Shares..... 19
Description of Common Stock.......... 22
Description of Common Warrants....... 22
Description of Outstanding Capital
Stock.............................. 24
Plan of Distribution................. 29
Experts.............................. 29
Legal Opinions....................... 30
$500,000,000
THE DIAL CORP
MEDIUM-TERM NOTES
DUE NINE MONTHS OR MORE
FROM DATE OF ISSUE
SALOMON BROTHERS INC
CITICORP SECURITIES, INC.
GOLDMAN, SACHS & CO.
MERRILL LYNCH & CO.
PROSPECTUS SUPPLEMENT
DATED , 1994
53
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
All expenses other than the Securities and Exchange Commission registration
fee are estimated.
SEC registration fee...................................................... $ 172,414
Accountants' fees and expenses............................................ 75,000
Legal fees and expenses................................................... 50,000
Blue Sky fees and expenses................................................ 17,500
Printing and engraving expenses........................................... 16,000
Rating agencies' fees..................................................... 150,000
Trustee's and registrar's fees and expenses............................... 15,000
Miscellaneous............................................................. 4,086
---------
Total........................................................... $ 500,000
========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Bylaws of the Company (the "Bylaws") provide that each person who was
or is made a party or is threatened to be made a party to or is involved in any
action, suit, or proceeding, whether civil, criminal, administrative or
investigative (a "Proceeding"), by reason of the fact that he or she or a person
of whom he or she is the legal representative is or was a director, officer or
employee of the Company or is or was serving at the request of the Company as a
director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust or other enterprise, including service with respect to
employee benefit plans, whether the basis of such Proceeding is alleged action
in an official capacity as a director, officer, employee or agent or in any
other capacity while serving as a director, officer, employee or agent, will be
indemnified and held harmless by the Company to the fullest extent authorized by
Delaware law as the same exists or may in the future be amended (but, in the
case of any such amendment, only to the extent that such amendment permits the
Company to provide broader indemnification rights than said law permitted the
Company to provide prior to such amendment), against all expense, liability and
loss (including, without limitation, attorneys' fees, judgments, fines, ERISA
excise taxes or penalties and amounts paid in settlement) reasonably incurred by
such person in connection therewith and such indemnification will continue as to
a person who has ceased to be a director, officer, employee or agent and will
inure to the benefit of his or her heirs, executors and administrators; however,
except as described in the following paragraph with respect to Proceedings to
enforce rights to indemnification, the Company will indemnify any such person
seeking indemnification in connection with a Proceeding (or part thereof)
initiated by such person only if such Proceeding (or part thereof) was
authorized by the Board of Directors of the Company.
Pursuant to the Bylaws, if a claim described in the preceding paragraph is
not paid in full by the Company within thirty days after a written claim has
been received by the Company, the claimant may at any time thereafter bring suit
against the Company to recover the unpaid amount of the claim, and, if
successful in whole or in part, the claimant will also be entitled to be paid
the expense of prosecuting such claim. The Bylaws provide that it will be a
defense to any such action (other than an action brought to enforce a claim for
expenses incurred in defending any Proceeding in advance of its final
disposition where the required undertaking, if any is required, has been
tendered to the Company) that the claimant has not met the standards of conduct
which make it permissible under the General Corporation Law of the State of
Delaware (the "Delaware Law") for the Company to indemnify the claimant for the
amount claimed, but the burden of proving such defense will be on the Company.
The Bylaws provide that, following any "change of control" of the Company of the
type required to be reported under Item I of Form 8-K promulgated under the
Securities Exchange Act of 1934, any such determination will be made by
independent legal counsel selected by the claimant, approved by the Board of
Directors of the Company (the "Board") (which approval may not be unreasonably
withheld) and retained by the Board on behalf of the Company. Neither the
failure of the
II-1
54
Company (including the Board, independent legal counsel or stockholders) to have
made a determination prior to the commencement of such action that
indemnification of the claimant is proper in the circumstances because he or she
has met the applicable standard of conduct set forth in the Delaware Law, nor an
actual determination by the Company (including the Board, independent legal
counsel or stockholders) that the claimant has not met such applicable standard
of conduct, will be a defense to the action or create a presumption that the
claimant has not met the applicable standard of conduct.
The Bylaws provide that the right to indemnification and the payment of
expenses incurred in defending a Proceeding in advance of its final disposition
conferred in the Bylaws will not be exclusive of any other right which any
person may have or may in the future acquire under any statute, provision of the
Certificate of Incorporation, the Bylaws, agreement, vote of stockholders or
disinterested directors or otherwise. The Bylaws permit the Company to maintain
insurance, at its expense, to protect itself and any director, officer, employee
or agent of the Company or another corporation, partnership, joint venture,
trust or other enterprise against any expense, liability or loss, whether or not
the Company would have the power to indemnify such person against such expense,
liability or loss under the Delaware Law. The Company has obtained directors and
officers liability insurance providing coverage to its directors and officers.
In addition, the Bylaws authorize the Company, to the extent authorized from
time to time by the Board, to grant rights to indemnification, and rights to be
paid by the Company the expenses incurred in defending any Proceeding in advance
of its final disposition, to any agent of the Company to the fullest extent of
the provisions of the Bylaws with respect to the indemnification and advancement
of expenses of directors, officers and employees of the Company.
The Bylaws provide that the right to indemnification conferred therein is a
contract right and includes the right to be paid by the Company the expenses
incurred in defending any such Proceeding in advance of its final disposition,
except that if Delaware law requires, the payment of such expenses incurred by a
director or officer in his or her capacity as a director or officer (and not in
any other capacity in which service was or is rendered by such person while a
director or officer, including, without limitation, service to an employee
benefit plan) in advance of the final disposition of a Proceeding will be made
only upon delivery to the Company of an undertaking by or on behalf of such
director or officer to repay all amounts so advanced if it is ultimately
determined that such director or officer is not entitled to be indemnified under
the Bylaws or otherwise.
The Company has entered into indemnification agreements with each of the
Company's directors. The indemnification agreements, among other things, require
the Company to indemnify the officers and directors to the fullest extent
permitted by law, and to advance to the directors all related expenses, subject
to reimbursement if it is subsequently determined that indemnification is not
permitted. The Company must also indemnify and advance all expenses incurred by
directors seeking to enforce their rights under the indemnification agreements,
and cover directors under the Company's directors' liability insurance. Although
the form of indemnification agreement offers substantially the same scope of
coverage afforded by provisions in the Certificate of Incorporation and the
Bylaws, it provides greater assurance to directors that indemnification will be
available, because, as a contract, it cannot be modified unilaterally in the
future by the Board or by the stockholders to eliminate the rights it provides,
an action that is possible with respect to the relevant provisions of the
Bylaws, at least as to prospective elimination of such rights. The Bylaws
provide that any amendment or repeal of the Bylaw provisions regarding this
indemnification will not adversely affect any right or protection of this
indemnification under the Bylaws in respect of any act or omission occurring
prior to such amendment or repeal.
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55
ITEM 16. EXHIBITS
EXHIBIT NO. DESCRIPTION
- ----------- ----------------------------------------------------------------------------------
1.1(a) Form of Underwriting Agreement for Debt Securities and Warrants to Purchase Debt
Securities.
1.1(b) Form of Underwriting Agreement for Equity Securities and Warrants to Purchase
Common Stock.
1.2 Form of Selling Agency Agreement (with Medium-Term Note Administrative Procedures
annexed thereto).
4.1 Form of Senior Indenture, incorporated herein by reference to Exhibit 4.1 of the
Registration Statement on Form S-3 (Registration No. 33-61092) filed on April 15,
1993.
4.2 Form of Senior Note, incorporated herein by reference to Exhibit 4.2 of the
Registration Statement on Form S-3 (Registration No. 33-61092) filed on April 15,
1993.
4.3 Form of Fixed Rate Medium-Term Note, incorporated herein by reference to Exhibit
4.3 of the Registration Statement on Form S-3 (Registration No. 33-61092) filed on
April 15, 1993.
4.4 Form of Floating Rate Medium-Term Note, incorporated herein by reference to
Exhibit 4.4 of the Registration Statement on Form S-3 (Registration No. 33-61092)
filed on April 15, 1993.
4.5 Restated Certificate of Incorporation of the Company, incorporated herein by
reference to Exhibit 3(A) to Form 8-B filed on February 24, 1992.
4.6 Bylaws of the Company, incorporated herein by reference to Exhibit 3(B) to Form
8-B filed on February 24, 1992.
4.7 Form of Subordinated Indenture among The Dial Corp and Continental Bank, N.A.,
Trustee.
4.8 Form of Subordinated Debt Securities.
4.9(a) Form of Warrant Agreement for Debt Securities.
4.9(b) Form of Warrant Agreement for Equity Securities.
4.10 Form of Deposit Agreement (including Form of Depositary Receipt).
4.11 Rights Agreement, dated as of February 15, 1992, between the Company and Bank One
of Arizona, N.A. (formerly The Valley National Bank of Arizona), as Rights Agent,
including as Exhibit B thereto the form of Rights Certificate, incorporated herein
by reference to Exhibit 4(C) to Form 8-B filed on February 24, 1992.
5 Opinion of L. Gene Lemon, Esq. regarding the legality of the Securities.
8 Tax opinion of Shearman & Sterling.
12.1 Computation of ratio of earnings to fixed charges.
12.2 Computation of ratio of earnings to fixed charges and preferred stock dividends.
23.1 Consent of Deloitte & Touche (included at page II-7).
23.2 Consent of L. Gene Lemon, Esq. (included in Exhibit 5).
23.3 Consent of Shearman & Sterling (included in Exhibit 8).
24 Powers of Attorney of directors and certain officers of the registrant (included
at page II-6).
25.1 Statement of Eligibility on Form T-I of The Chase Manhattan Bank, N.A., as trustee
under the Senior Indenture, incorporated herein by reference to Exhibit 25 of the
Registration Statement on Form S-3 (Registration No. 33-61092) filed on April 15,
1993.
25.2 Statement of Eligibility on Form T-1 of Continental Bank, National Association, as
trustee under the Subordinated Indenture.
II-3
56
ITEM 17. UNDERTAKINGS
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3 or Form S-8, and the information required
to be included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a new registration
statement relating to the securities offered herein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(5) That, for purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained in a
form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(6) That, for the purpose of determining any liability under the Securities
Act of 1933, each post effective amendment that contains a form of prospectus
shall be deemed to be a new registration statement relating to the securities
offered herein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions described under Item 15 above,
or otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public policy
as expressed in the Securities Act of 1933 and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act of 1933 and will be governed by the final adjudication of such
issue.
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57
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Phoenix, and State of Arizona, on the 27th day of
June, 1994.
The Dial Corp
By: /s/ JOHN W. TEETS
______________________________
John W. Teets
Chairman, President and
Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby authorizes and appoints
Richard C. Stephan, as his or her attorney-in-fact, with full power of
substitution and resubstitution, to sign and file on his or her behalf
individually and in each such capacity stated below any and all amendments and
post-effective amendments to this Registration Statement, as fully as such
person could do in person, hereby verifying and confirming all that said
attorney-in-fact, or his substitutes, may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURES TITLE DATE
____________ _______ ______
Principal Executive Officer
/s/ JOHN W. TEETS Director; Chairman, President and June 27, 1994
_____________________________ Chief Executive Officer
John W. Teets
Principal Financial Officer
/s/ F. EDWARD LAKE Vice President -- Finance June 27, 1994
_____________________________
F. Edward Lake
Principal Accounting Officer
/s/ RICHARD C. STEPHAN Vice President -- Controller June 27, 1994
______________________________
Richard C. Stephan
Directors
/s/ JOE T. FORD June 27, 1994
_______________________________
Joe T. Ford
/s/ THOMAS L. GOSSAGE June 22, 1994
_______________________________
Thomas L. Gossage
II-5
58
SIGNATURES TITLE DATE
____________ _______ _____
/s/ DONALD E. GUINN June 27, 1994
_______________________________
Donald E. Guinn
/s/ JESS HAY June 27, 1994
_______________________________
Jess Hay
/s/ JUDITH K. HOFER June 21, 1994
_______________________________
Judith K. Hofer
/s/ JACK F. REICHERT June 27, 1994
_______________________________
Jack F. Reichert
/s/ LINDA JOHNSON RICE June 27, 1994
_______________________________
Linda Johnson Rice
/s/ DENNIS C. STANFILL June 27, 1994
________________________________
Dennis C. Stanfill
/s/ A. THOMAS YOUNG June 21, 1994
________________________________
A. Thomas Young
II-6
59
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement
of The Dial Corp on Form S-3 of our reports dated February 25, 1994, appearing
in and incorporated by reference in the Annual Report on Form 10-K of The Dial
Corp for the year ended December 31, 1993, and to reference to us under the
heading "Experts" in the Prospectus, which is part of this Registration
Statement.
DELOITTE & TOUCHE
Phoenix, Arizona
June 22, 1994
II-7
60
REGISTRATION NO.
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
------------------------
EXHIBITS
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
THE DIAL CORP
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
================================================================================
61
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION OF EXHIBIT
- ----------- ----------------------------------------------------------------------------------
1.1(a) Form of Underwriting Agreement for Debt Securities and Warrants to Purchase Debt
Securities.
1.1(b) Form of Underwriting Agreement for Equity Securities and Warrants to Purchase
Common Stock.
1.2 Form of Selling Agency Agreement (with Medium-Term Note Administrative Procedures
annexed thereto).
4.1 Form of Senior Indenture, incorporated herein by reference to Exhibit 4.1 of the
Registration Statement on Form S-3 (Registration No. 33-61092) filed on April 15,
1993.
4.2 Form of Senior Note, incorporated herein by reference to Exhibit 4.2 of the
Registration Statement on Form S-3 (Registration No. 33-61092) filed on April 15,
1993.
4.3 Form of Fixed Rate Medium-Term Note, incorporated herein by reference to Exhibit
4.3 of the Registration Statement on Form S-3 (Registration No. 33-61092) filed on
April 15, 1993.
4.4 Form of Floating Rate Medium-Term Note, incorporated herein by reference to
Exhibit 4.4 of the Registration Statement on Form S-3 (Registration No. 33-61092)
filed on April 15, 1993.
4.5 Restated Certificate of Incorporation of the Company, incorporated herein by
reference to Exhibit 3(A) to Form 8-B filed on February 24, 1992.
4.6 Bylaws of the Company, incorporated herein by reference to Exhibit 3(B) to Form
8-B filed on February 24, 1992.
4.7 Form of Subordinated Indenture among The Dial Corp and Continental Bank, N.A.,
Trustee.
4.8 Form of Subordinated Debt Securities.
4.9(a) Form of Warrant Agreement for Debt Securities.
4.9(b) Form of Warrant Agreement for Equity Securities.
4.10 Form of Deposit Agreement (including Form of Depositary Receipt).
4.11 Rights Agreement, dated as of February 15, 1992, between the Company and Bank One
of Arizona, N.A. (formerly The Valley National Bank of Arizona), as Rights Agent,
including as Exhibit B thereto the form of Rights Certificate, incorporated herein
by reference to Exhibit 4(C) to Form 8-B filed on February 24, 1992.
5 Opinion of L. Gene Lemon, Esq. regarding the legality of the Securities.
8 Tax opinion of Shearman & Sterling.
12.1 Computation of ratio of earnings to fixed charges.
12.2 Computation of ratio of earnings to fixed charges and preferred stock dividends.
23.1 Consent of Deloitte & Touche (included at page II-7).
23.2 Consent of L. Gene Lemon, Esq. (included in Exhibit 5).
23.3 Consent of Shearman & Sterling (included in Exhibit 8).
24 Powers of Attorney of directors and certain officers of the registrant (included
at page II-6).
25.1 Statement of Eligibility on Form T-I of The Chase Manhattan Bank, N.A., as trustee
under the Senior Indenture, incorporated herein by reference to Exhibit 25 of the
Registration Statement on Form S-3 (Registration No. 33-61092) filed on April 15,
1993.
25.2 Statement of Eligibility on Form T-1 of Continental Bank, National Association, as
trustee under the Subordinated Indenture.