<PAGE> 1
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED NOVEMBER 16, 1995
$250,000,000
ITT CORPORATION
6 3/4% NOTES DUE NOVEMBER 15, 2003
Interest on the 6 3/4% Notes Due November 15, 2003 (the "Notes"), is
payable on May 15 and November 15 of each year, commencing May 15, 1997. The
Notes are not redeemable prior to maturity, except for the redemption of a
particular holder's Securities pursuant to the application of certain gaming
laws. See "Description of Debt Securities -- Redemption Pursuant to Gaming Laws"
in the accompanying Prospectus.
------------------------
THE NOTES HAVE NOT BEEN APPROVED BY THE --
SEC,
state securities commissions,
Nevada State Gaming Control Board,
New Jersey Casino Control Commission,
Mississippi Gaming Commission, or the
Indiana Gaming Commission
None of these organizations has determined that this prospectus supplement
or the prospectus is accurate or complete. Any representation to the
contrary is a criminal offense.
------------------------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
------------------ ------------------ ------------------
<S> <C> <C> <C>
Per Note........................... 99.785% 0.625% 99.160%
Total.............................. $249,462,500 $1,562,500 $247,900,000
</TABLE>
- ---------------
(1) Plus accrued interest from November 15, 1996 to date of delivery.
(2) We have agreed to indemnify the Underwriters against certain liabilities,
including liabilities under the Securities Act of 1933.
(3) Before deducting expenses payable by us estimated at $120,000.
The Notes are offered severally by the Underwriters subject to receipt and
acceptance by them and subject to their right to reject any order in whole or in
part. It is expected that the Notes will be ready for delivery in book-entry
form only through the facilities of DTC in New York, New York, on or about
November 15, 1996, against payment in immediately available funds.
------------------------
GOLDMAN, SACHS & CO.
CHASE SECURITIES INC.
J.P. MORGAN & CO.
LAZARD FRERES & CO.
UBS SECURITIES
------------------------
THE DATE OF THIS PROSPECTUS SUPPLEMENT IS NOVEMBER 12, 1996.
<PAGE> 2
In connection with this offering, the Underwriters may over-allot or effect
transactions which stabilize or maintain the market price of the securities at
levels above those which might otherwise prevail in the open market. Such
stabilizing, if commenced, may be discontinued at any time.
------------------------
S-2
<PAGE> 3
SUMMARY
This summary highlights selected information from this document and may not
contain all of the information that is important to you. To understand the terms
of our securities, you should carefully read this document and the prospectus
that gives general terms of the securities we are offering. You should also read
the documents we have referred you to in Incorporation of Certain Documents by
Reference on page 2 of the accompanying Prospectus for information on our
company and our financial statements.
ITT CORPORATION
(Formerly ITT Destinations, Inc.)
Our company combines one of the world's largest hotel and gaming companies
with a premier sports and entertainment franchise and information service
business. Our hospitality, gaming, and entertainment businesses are conducted
through ITT Sheraton Corporation, Ciga, S.p.a., Caesars World, Inc. and Madison
Square Garden, L.P. The information service business in conducted through ITT
World Directories, Inc. and ITT Educational Services, Inc.
Through the ITT Sheraton brand name, we are represented in most major
markets of the world. In 1995, over 45 million customers stayed at ITT Sheraton
properties in approximately 60 countries. ITT Sheraton is a worldwide
hospitality network of owned, leased, managed and franchised properties,
including hotels, casinos and inns. Gaming operations are marketed under the
Caesars World and ITT Sheraton brand names and are currently represented in Las
Vegas, Atlantic City, Halifax (Nova Scotia), Sydney (Nova Scotia), Lake Tahoe,
Tunica County (Mississippi), Lima (Peru), Cairo (Egypt), Windsor (Ontario) and
Townsville (Australia). In addition, the acquisition in 1994 of 70.3% of Ciga
and other key hotel properties enhanced our geographic balance along with our
image and profile.
Caesars World is one of the leading companies in gaming. Caesars' flagship
property is the renowned Caesars Palace in Las Vegas and Caesars also owns and
operates Caesars Atlantic City in Atlantic City, New Jersey, and Caesars Tahoe
in Stateline, Nevada. Caesars also owns one-third of a management company that
operates Casino Windsor, which was opened in May 1994 in Windsor, Ontario, and
operates four non-gaming resorts in Pennsylvania's Pocono Mountains. We have
recently announced an extensive capital expenditure program designed to increase
and enhance the Caesars product. As part of that program, Caesars Palace in Las
Vegas and Caesars Atlantic City will undergo extensive renovations.
In March 1995, we, in partnership with subsidiaries of Cablevision Systems
Corporation, acquired MSG, the owner of the New York Knickerbockers basketball
and New York Rangers hockey franchises as well as the Madison Square Garden
Arena, which seats approximately 20,000 people, and the MSG cable television
entertainment network. Through the MSG cable television network, MSG supplies
and distributes television programming, which currently includes broadcasts of
the Knicks, Rangers and Yankees games, for cable systems, principally in New
York, New Jersey and Connecticut.
On July 1, 1996, we, in partnership with Dow Jones & Co., purchased
television station WNYC-TV from New York City. The station has been renamed
WBIS+ and in January 1997 it plans to fully introduce a new format of business
and sports programming.
ITT World Directories, an 80% owned subsidiary, engages in the publication
of telephone directories, including classified directory services for telephone
subscribers in numerous countries outside the United States, as well as in
Puerto Rico and the United States Virgin Islands. ITT Educational Services,
which is owned 83% by us and 17% by the public, operates technical colleges
offering post-secondary career education.
We also own approximately 7.5 million shares (4.8%) of Alcatel Alsthom, a
French company, which owns Alcatel N.V., one of the largest telecommunications
equipment manufacturers in the world.
As a result of a spin-off on December 19, 1995 we became an independent
company and are no longer affiliated with ITT Industries, Inc. or ITT Hartford
Group, Inc.
S-3
<PAGE> 4
SUMMARY FINANCIAL INFORMATION
The following information is unaudited and was derived from our financial
statements. The information is only a summary and does not provide all of the
information contained in our financial statements, including the related notes,
and Management's Discussion and Analysis, which are part of our Annual Report on
Form 10-K for the year ended December 31, 1995 and our Quarterly Reports on Form
10-Q for the quarters ended March 31, 1996, June 30, 1996 and September 30,
1996. You should read our financial statements and other information that we
have filed with the SEC.
<TABLE>
<CAPTION>
NINE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
1996 1995
----------------- -----------------
<S> <C> <C>
Revenues.......................................... $ 4.8 billion $ 4.6 billion
Net Income........................................ $183 million $103 million
Net Income Per Share.............................. $1.54 $0.87
</TABLE>
<TABLE>
<CAPTION>
AT SEPTEMBER 30, AT DECEMBER 31,
1996 1995 (UNAUDITED)
----------------- -----------------
<S> <C> <C>
Total Assets...................................... $9.2 billion $8.7 billion
Stockholders Equity............................... $3.0 billion $2.9 billion
</TABLE>
Our ability to generate earnings to pay the fixed expenses of our debt is
shown below. Before the spin-off in December 1995, our expenses were allocated
to us by our parent. While we believe the method used to allocate those expenses
was reasonable, these allocations may not necessarily reflect the costs we would
have incurred if we had operated as a separate company.
<TABLE>
<CAPTION>
RATIO OF EARNINGS TO TOTAL FIXED CHARGES
- -----------------------------------------
NINE MONTHS ENDED
SEPTEMBER 30, YEAR ENDED
1996 DECEMBER 31, 1995
- ----------------- -----------------
<S> <C>
2.46 1.76
</TABLE>
These computations include us and our subsidiaries, and 50% or less equity
companies. For these ratios, "earnings" is determined by adding "total fixed
charges" (excluding interest capitalized), income taxes, minority common
stockholders equity in net income and amortization of interest capitalized to
income from continuing operations after eliminating equity in undistributed
earnings and adding back losses of companies in which at least 20% but less than
50% equity is owned. For this purpose, "total fixed charges" consists of (1)
interest on all indebtedness and amortization of debt discount and expense, (2)
interest capitalized and (3) an interest factor attributable to rentals.
S-4
<PAGE> 5
6 3/4% NOTES DUE NOVEMBER 15, 2003
The 6 3/4% Notes Due November 15, 2003 have the following terms:
- $250,000,000 aggregate principal amount
- 6 3/4% interest coupon
- Maturity date of November 15, 2003
- Interest will be paid on May 15 and November 15 of each year, commencing
May 15, 1997
- Not redeemable prior to the maturity date
GENERAL INDENTURE PROVISIONS THAT APPLY TO THE NOTES
- The indenture does not limit the amount of debt that we may issue or
provide holders any protection should there be a highly leveraged
transaction involving our company.
- The indenture allows us to merge or to consolidate with another company,
or sell all or substantially all of our assets to another company. If
these events occur, the other company will be required to assume our
responsibilities on the Notes, and we will be released from all
liabilities and obligations.
- The indenture provides that holders of a majority of the total principal
amount of the Notes may vote to change our obligations or your rights
concerning the Notes. But to change the payment of principal or interest,
every holder must consent.
- The gaming laws of certain jurisdictions may limit who may own the Notes.
If these laws do not permit you to hold the Notes, we may redeem your
Notes or require you to sell them. In the event you are not permitted to
hold our Notes under such gaming laws, we may redeem the Notes at the
lesser of either: (1) the price you paid, or (2) the lowest closing sale
price on any of the 120 trading days prior to the date the gaming
authorities gave a notice of disqualification.
- We may discharge the indentures at any time by depositing sufficient
funds with the Trustee to pay the obligations when due. All amounts due
to you on the Notes would be paid by the Trustee from the deposited
funds.
- If we fail to meet our obligations on the Notes, the indentures give you
the following remedy:
Event of Default
- Principal not paid when due
- Sinking fund payment not made when due
- Failure to pay interest for 30 days
- Covenants not performed for 60 days
- Acceleration of at least $10,000,000 in principal amount of other debt
not rescinded in 30 days after notice
- Any other event of default in the indenture
Remedy
Trustee or holders of 25% of the principal amount outstanding may declare
principal immediately payable. However, a majority in principal amount may
rescind this action.
To understand all of the terms of the 6 3/4% Notes Due November 15, 2003,
you should read the complete Prospectus and Prospectus Supplement, along with
certain of the incorporated documents, including the Indenture.
S-5
<PAGE> 6
THE COMPANY
THIS DESCRIPTION OF THE COMPANY REPLACES THE DESCRIPTION WHICH APPEARS IN
THE PROSPECTUS.
ITT Corporation, which was formerly ITT Destinations, Inc., (the "Company"
which may be referred to as "we" or "us") combines one of the world's largest
hotel and gaming companies with a premier sports and entertainment franchise and
information service business. The Company conducts these businesses through some
of the most recognized brand names in the world. Our hospitality, gaming and
entertainment businesses are conducted through ITT Sheraton Corporation ("ITT
Sheraton"), Ciga, S.p.A. ("Ciga"), Caesars World, Inc. ("Caesars") and Madison
Square Garden, L.P. ("MSG"). Our information service business is conducted
through ITT World Directories, Inc. ("ITT World Directories") and ITT
Educational Services, Inc. ("ITT Educational Services").
Through the ITT Sheraton brand name, we are represented in most major
markets of the world. In 1995, over 45 million customers stayed at ITT Sheraton
properties in approximately 60 countries. ITT Sheraton is a worldwide
hospitality network of owned, leased, managed and franchised properties,
including hotels, casinos and inns. Gaming operations are marketed under the
Caesars World and ITT Sheraton brand names and are currently represented in Las
Vegas, Atlantic City, Halifax (Nova Scotia), Sydney (Nova Scotia), Lake Tahoe,
Tunica County (Mississippi), Lima (Peru), Cairo (Egypt), Windsor (Ontario) and
Townsville (Australia). In addition, the acquisition in 1994 of 70.3% of Ciga
and other key hotel properties enhanced our geographic balance along with our
image and profile.
Caesars World is one of the leading companies in gaming. Caesars' flagship
property is the renowned Caesars Palace in Las Vegas and Caesars also owns and
operates Caesars Atlantic City in Atlantic City, New Jersey, and Caesars Tahoe
in Stateline, Nevada. Caesars also owns one-third of a management company that
operates Casino Windsor, which was opened in May 1994 in Windsor, Ontario, and
operates four non-gaming resorts in Pennsylvania's Pocono Mountains. We have
recently announced an extensive capital expenditure program designed to increase
and enhance the Caesars product. As part of that program, Caesars Palace in Las
Vegas and Caesars Atlantic City will undergo extensive renovations.
In March 1995, we, in partnership with subsidiaries of Cablevision Systems
Corporation, acquired MSG, the owner of the New York Knickerbockers basketball
and New York Rangers hockey franchises as well as the Madison Square Garden
Arena, which seats approximately 20,000 people, and the MSG cable television
entertainment network. Through the MSG cable television network, MSG supplies
and distributes television programming, which currently includes broadcasts of
the Knicks, Rangers and Yankees games, for cable systems, principally in New
York, New Jersey and Connecticut.
On July 1, 1996, we, in partnership with Dow Jones & Co., purchased
television station WNYC-TV from New York City. The station has been renamed
WBIS+ and in January 1997 it plans to fully introduce a new format of business
and sports programming.
ITT World Directories, an 80% owned subsidiary, engages in the publication
of telephone directories, including classified directory services for telephone
subscribers in numerous countries outside the United States, as well as in
Puerto Rico and the United States Virgin Islands. ITT Educational Services,
which is owned 83% by us and 17% by the public, operates technical colleges
offering post-secondary career education.
We currently own approximately 7.5 million shares, or approximately 4.8% of
the outstanding capital shares, of Alcatel Alsthom, a French company that owns
Alcatel N.V., one of the largest telecommunications equipment manufacturers in
the world.
S-6
<PAGE> 7
We were formerly a wholly owned subsidiary of a Delaware corporation known
as ITT Corporation ("Old ITT"). We are a Nevada corporation, with world
headquarters at 1330 Avenue of the Americas, New York, New York 10019-5490, and
were incorporated in 1995. On December 19, 1995, Old ITT (which has been renamed
"ITT Industries, Inc.") distributed to its shareholders all of the outstanding
shares of the Common Stock (the "Distribution"). The Notes do not represent an
ownership interest in or obligation of ITT Industries, Inc. We are no longer
affiliated with ITT Industries, Inc. or ITT Hartford Group, Inc.
On June 28, 1996, we filed a registration statement with the SEC to
register up to $565,541,250 of our Common Stock. We expect to file an amendment
to that registration statement that will permit us to offer and sell debt,
preferred stock, common stock or warrants prior to the time we sell any
securities under that registration statement.
USE OF PROCEEDS
The net proceeds from the sale of the Notes will be used for general
corporate purposes. General corporate purposes may include repayment of debt,
acquisitions, additions to working capital and capital expenditures.
------------------------
RATIO OF EARNINGS TO TOTAL FIXED CHARGES
The following table contains our consolidated ratios of earnings to fixed
charges for each of 1995, 1994, 1993, 1992 and 1991 and for the nine months
ended September 30, 1996. For the periods before the Distribution, our financial
statements were prepared as if we were a separate entity. Certain costs of Old
ITT, including certain items included in fixed charges, were allocated to us. In
the opinion of management, the methods for allocating these costs are believed
to have been reasonable. However, the costs allocated to us are not necessarily
indicative of the costs that would have been incurred if we had been operated as
an unaffiliated entity. It is not practical to estimate such costs on a stand
alone basis.
<TABLE>
<CAPTION>
NINE MONTHS
ENDED YEAR ENDED DECEMBER 31,
SEPTEMBER 30, ----------------------------------------
1996 1995 1994 1993 1992 1991
------------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to total fixed
charges................................. 2.46 1.76 1.98 3.23 1.49 1.41
</TABLE>
These computations include us and our subsidiaries, and 50% or less equity
companies. For these ratios, "earnings" is determined by adding "total fixed
charges" (excluding interest capitalized), income taxes, minority common
stockholders equity in net income and amortization of interest capitalized to
income from continuing operations after eliminating equity in undistributed
earnings and adding back losses of companies in which at least 20% but less than
50% equity is owned. For this purpose, "total fixed charges" consists of (1)
interest on all indebtedness and amortization of debt discount and expense, (2)
interest capitalized and (3) an interest factor attributable to rentals.
S-7
<PAGE> 8
DESCRIPTION OF NOTES
GENERAL
The following description of the particular terms of the Notes supplements
the description of the general terms and provisions of Debt Securities set forth
in the Prospectus to which description reference is hereby made.
The Notes will be our general unsecured obligations and will be issued
under an Amended and Restated Indenture dated as of November 15, 1995 between us
and The First National Bank of Chicago, as trustee (the "Trustee"), as Amended
and Restated as of December 19, 1995.
The Notes will be limited to $250,000,000 aggregate principal amount and
will mature on November 15, 2003. The Notes will bear interest at 6 3/4% per
annum from November 15, 1996 or from the most recent Interest Payment Date to
which interest has been paid or provided for. Interest is payable semiannually
on May 15 and November 15 of each year, commencing on May 15, 1997, to the
persons in whose names the Notes are registered at the close of business on the
last day of April and October, as the case may be, next preceding such Interest
Payment Date.
The Notes may not be redeemed prior to maturity, except for the redemption
of a particular holder's Securities pursuant to the application of certain
gaming laws. See "Description of Debt Securities -- Redemption Pursuant to
Gaming Laws" in the accompanying Prospectus.
BOOK ENTRY SYSTEM
The Notes will be issued in the form of one or more Global Securities that
will be deposited with The Depository Trust Company, New York, New York ("DTC")
who will act as Depositary. Beneficial interests in the Notes will be shown on,
and transfers of the Notes will be effected only through, records maintained by
DTC and its participants.
DTC has provided the following information to us: DTC is a limited-purpose
trust company organized under the New York Banking Law, a "banking organization"
within the meaning of the New York Banking Law, a member of the United States
Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code and a "clearing agency" registered under the
provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds
securities that its participants ("Direct Participants") deposit with DTC. DTC
also facilitates the settlement among Direct Participants of securities
transactions, such as transfers and pledges, in deposited securities through
electronic computerized book-entry changes in such Direct Participant's
accounts, eliminating the need for physical movement of securities certificates.
Direct Participants include securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations. DTC is owned
by a number of its Direct Participants and by the New York Stock Exchange, Inc.,
The American Stock Exchange, Inc. and The National Association of Securities
Dealers, Inc. Access to DTC's book-entry system is also available to others such
as securities brokers and dealers, banks and trust companies that clear through
or maintain a custodial relationship with a Direct Participant, either directly
or indirectly ("Indirect Participants"). The rules applicable to DTC and its
Direct and Indirect Participants are on file with the SEC.
Principal and interest payments on the Notes will be made in immediately
available funds to DTC's nominee as the registered owner of the Notes. We and
the Trustee will treat DTC's nominee as the owner of the Notes for all other
purposes as well. Accordingly, we, the Trustee and any paying agent will have no
direct responsibility or liability to pay amounts due on the Notes to owners of
beneficial interests in the Notes. It is DTC's current practice, upon receipt of
any payment of principal or interest, to credit Direct Participants' accounts on
the payment date according to their respective holdings of beneficial interests
in the Global Securities as shown on DTC's records. Payments by Direct and
Indirect Participants to owners of beneficial interests in the Notes will be
governed by standing instructions and customary practices, as is the case with
securities held for the account of customers in bearer form or registered in
"street name". Such payments will be the responsibility of such Direct and
Indirect Participants and not of DTC, the Trustee or us.
Notes represented by a Global Security will be exchangeable for Notes in
definitive form of like
S-8
<PAGE> 9
tenor in authorized denominations only if DTC notifies us that it is unwilling
or unable to continue as Depositary or if DTC ceases to be a clearing agency
registered under applicable law and a successor depositary is not appointed by
us within 90 days or we, in our discretion, determine not to require all of the
Notes to be represented by a Global Security and notify the Trustee of our
decision.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available funds. So long as DTC continues to make its Same-Day Funds Settlement
System available to us, all payment of principal and interest on the Notes will
be made in immediately available funds.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearing-house or next-day funds. In contrast, the Notes
will trade in DTC's Same-Day Funds Settlement System until maturity, and
secondary market trading activity in the Notes will therefore be required by DTC
to settle in immediately available funds. No assurance can be given as to the
effect, if any, of settlement in immediately available funds on trading activity
in the Notes.
CONCERNING THE TRUSTEE
We and certain of our subsidiaries may maintain bank accounts, borrow money
and have other customary banking relationships with the Trustee in the ordinary
course of business.
S-9
<PAGE> 10
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting
Agreement, we have agreed to sell to each of the Underwriters named below, and
each of the Underwriters has severally agreed to purchase, the principal amount
of the Notes set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
UNDERWRITER AMOUNT
------------------------------------------------------------ ------------
<S> <C>
Goldman, Sachs & Co......................................... $ 50,000,000
Chase Securities Inc........................................ 50,000,000
J.P. Morgan Securities Inc.................................. 50,000,000
Lazard Freres & Co. LLC..................................... 50,000,000
UBS Securities LLC.......................................... 50,000,000
------------
Total............................................. $250,000,000
============
</TABLE>
The Underwriting Agreement provides that the obligations of the several
Underwriters are subject to certain conditions precedent. The Underwriters will
be obligated to purchase all of the Notes if any of the Notes are purchased.
We have been advised by the Underwriters that they propose initially to
offer the Notes directly to the public at the public offering price set forth on
the cover page of this Prospectus Supplement and to certain dealers at a price
which represents a concession not in excess of 0.375% of the principal amount of
the Notes. The Underwriters may allow, and such dealers may reallow, a
concession, not in excess of 0.250% of the principal amount of the Notes to
certain other dealers. After the initial public offering, the public offering
prices and such concessions may be changed.
We have been advised by the Underwriters that they currently intend to make
a market in the Notes, but are not obligated to do so and may discontinue such
market making at any time without notice. We cannot predict the liquidity of any
trading market for the Notes.
The Underwriting Agreement provides that we will indemnify the several
Underwriters against certain liabilities, including liabilities under the
Securities Act of 1933, as amended, or contribute to payments the Underwriters
may be required to make in respect thereof.
Certain of the Underwriters or their affiliates have provided from time to
time, and expect to provide in the future, investment or commercial banking
services to us and our affiliates, for which such Underwriters or their
affiliates have received and will receive customary fees and commissions.
LEGAL OPINIONS
The legality of the Notes will be passed upon for us by Richard S. Ward,
Esq., Executive Vice President, General Counsel and Corporate Secretary, or
another of our lawyers, and for the Underwriters by Cravath, Swaine & Moore,
Worldwide Plaza, 825 Eighth Avenue, New York, NY 10019-7475. Mr. Ward has an
interest in certain of our securities. Cravath, Swaine & Moore acts from time to
time as our legal counsel on various matters.
S-10
<PAGE> 11
PROSPECTUS
ITT DESTINATIONS, INC.
Debt Securities and
Warrants to Purchase Debt Securities
Unconditionally Guaranteed (Which Guarantees Shall Terminate
Upon the Distribution) as to Payment of Principal,
Premium, if any, and Interest by
ITT CORPORATION
------------------------------
ITT Destinations, Inc. ("ITT Destinations") may offer or issue from time to
time to or through underwriters, or directly to other purchasers or through
agents, in one or more series, its unsecured debt securities ("Debt Securities")
and warrants ("Warrants") to purchase Debt Securities (the Debt Securities and
the Warrants being herein collectively called the "Securities") for proceeds up
to $2,000,000,000, or the equivalent thereof if any of the Securities are
denominated in foreign currency or a foreign currency unit.
All Debt Securities will be unconditionally guaranteed prior to the
Distribution (as defined below) as to payment of principal, premium, if any, and
interest (the "Guarantees") by ITT Corporation ("ITT"). Upon the consummation of
the Distribution, the Guarantees will irrevocably terminate and be of no further
force or effect. ITT currently expects the Distribution to occur prior to
December 31, 1995.
The Debt Securities of each series will be offered on terms determined at
the time of sale. The Debt Securities and Warrants may be sold for U. S.
dollars, foreign currencies or foreign currency units, and the principal of,
premium, if any, and any interest on the Debt Securities may be payable in U. S.
dollars, foreign currencies or foreign currency units. The specific designation,
aggregate principal amount, the currency or currency unit in which the
principal, premium, if any, and any interest is payable, the rate (or method of
calculation) and the time of payment of any interest, authorized denominations,
maturity, offering price, any redemption terms or other specific terms of the
Securities in respect of which this Prospectus is being delivered are set forth
in the accompanying Prospectus Supplement (the "Prospectus Supplement"). With
regard to the Warrants, if any, in respect of which this Prospectus is being
delivered, the Prospectus Supplement sets forth a description of the Debt
Securities for which each Warrant is exercisable and the offering price, if any,
exercise price, duration, detachability and other terms of such Warrant.
------------------------------
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.
NEITHER THE NEVADA STATE GAMING CONTROL BOARD, THE NEVADA GAMING COMMISSION,
THE MISSISSIPPI GAMING COMMISSION, NOR THE NEW JERSEY CASINO CONTROL
COMMISSION HAS PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS TO WHICH IT RELATES OR
THE INVESTMENT MERITS OF THE SECURITIES OFFERED HEREBY.
ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
------------------------------
The Securities may be sold by ITT Destinations directly to purchasers,
through agents or dealers designated from time to time, through underwriting
syndicates led by one or more managing underwriters or through one or more
underwriters. If underwriters or agents are involved in the offering of the
Securities, the name of the managing underwriter or underwriters or agents will
be set forth in the Prospectus Supplement. If an underwriter, agent or dealer is
involved in the offering of any 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, and the net proceeds to ITT Destinations from
such offering will be the public offering price of the Securities less such
discount in the case of an underwriter, the purchase price of the Securities
less such commission in the case of an agent or the purchase price of the
Securities in the case of a dealer, and less, in each case, the other expenses
of ITT Destinations associated with the issuance and distribution of the
Securities.
------------------------------
The date of this Prospectus is November 16, 1995.
<PAGE> 12
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS AND THE PROSPECTUS SUPPLEMENT, AND IF GIVEN OR MADE SUCH INFORMATION
OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY ITT
DESTINATIONS, ITT OR ANY AGENT, UNDERWRITER OR DEALER. THIS PROSPECTUS AND THE
PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER OF ANY SECURITIES OTHER THAN
THOSE TO WHICH IT RELATES, OR AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO
BUY THOSE SECURITIES TO WHICH IT RELATES IN ANY JURISDICTION TO ANY PERSON TO
WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. THE
DELIVERY OF THIS PROSPECTUS AND/OR THE PROSPECTUS SUPPLEMENT AT ANY TIME DOES
NOT IMPLY THAT THE INFORMATION THEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO
ITS DATE.
------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by ITT with the Securities and Exchange
Commission (the "Commission") (File No. 1-5627) are hereby incorporated by
reference in this Prospectus:
(a) Annual Report on Form 10-K for the year ended December 31, 1994;
(b) Quarterly Reports on Form 10-Q for the quarters ended March 31,
June 30 and September 30, 1995;
(c) Proxy Statement for the Special Meeting of Stockholders on
September 21, 1995 (filed with the Commission on August 28, 1995)(the
"Proxy"); and
(d) Current Reports on Form 8-K dated February 6, April 3, June 8 and
November 7, 1995.
The following document filed by ITT Destinations with the Commission (File
No. 1-13960) is hereby incorporated by reference in this Prospectus: Form 10
dated September 18, 1995, with respect to the shares of ITT Destinations common
stock (and related ITT Destinations Rights (as defined therein)) to be received
by the shareholders of ITT in the Distribution.
All documents filed by ITT Destinations and ITT (prior to the Distribution)
with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934, as amended (the "1934 Act"), subsequent to the
date of this Prospectus and prior to the termination of the offering of the
Securities covered by this Prospectus shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing
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 modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
ITT DESTINATIONS AND ITT WILL PROVIDE, WITHOUT CHARGE, TO EACH PERSON,
INCLUDING ANY BENEFICIAL HOLDER, TO WHOM THIS PROSPECTUS IS DELIVERED, UPON THE
WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON, A COPY OF ANY OR ALL OF THE
DOCUMENTS INCORPORATED HEREIN BY REFERENCE (OTHER THAN CERTAIN EXHIBITS TO SUCH
DOCUMENTS). SUCH REQUESTS SHOULD BE DIRECTED TO ITT DESTINATIONS AND ITT AT
THEIR PRINCIPAL EXECUTIVE OFFICES, 1330 AVENUE OF THE AMERICAS, NEW YORK, NEW
YORK 10019-5490, ATTENTION: CORPORATE SECRETARY (TELEPHONE NUMBER:
212-258-1000).
AVAILABLE INFORMATION
ITT is subject to the informational requirements of the 1934 Act, and in
accordance therewith files reports, proxy statements and other information with
the Commission. Such reports, proxy statements and other information can be
inspected and copied at the Public Reference Section of the Commission located
at Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, DC 20549 and
at the following regional offices: Midwest regional office, Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, IL 60661-2511; and New York regional
office, 7 World Trade Center, 13th Floor, New York, NY 10048. Copies of such
material can be obtained from the Public Reference Section of the Commission at
prescribed rates. Certain securities of ITT are listed on the New York and
Pacific Stock Exchanges, and such reports, proxy statements and other
information can also be inspected at the offices of such exchanges. This
Prospectus does not contain
2
<PAGE> 13
all the information set forth in the Registration Statement and Exhibits thereto
which ITT has filed with the Commission under the Securities Act of 1933 and to
which reference is hereby made.
ITT Destinations has filed with the Commission a Registration Statement on
Form 10 with respect to the shares of ITT Destinations common stock (and related
ITT Destinations Rights) to be received by the shareholders of ITT in the
Distribution. It is expected that ITT Destinations will request effectiveness of
such Registration Statement prior to the Distribution. On and after the
effectiveness of such Registration Statement, ITT Destinations will be subject
to the informational requirements of the 1934 Act, and in accordance therewith
will file reports, proxy statements and other information with the Commission.
Such reports, proxy statements and other information will be available for
inspection and copying at the public reference facilities of the Commission
listed above and may be obtained by mail from the Commission as described above.
Application has been made to list the shares of ITT Destinations common stock
(and related ITT Destinations Rights) on the New York Stock Exchange ("NYSE")
and, if and when such shares of ITT Destinations common stock (and related ITT
Destinations Rights) commence trading on the NYSE, such reports, proxy
statements and other information will be available for inspection at the offices
of the NYSE. Additionally, ITT Destinations intends to provide annual reports,
containing audited financial statements, to its shareholders.
ITT DESTINATIONS
ITT Destinations, Inc. is a Nevada corporation, with World Headquarters at
1330 Avenue of the Americas, New York, New York 10019-5490. ITT Destinations,
Inc. was incorporated in 1995. Unless the context otherwise requires, references
herein to ITT Destinations include its subsidiaries.
Following the Distribution, ITT Destinations will combine the world's
largest hotel and gaming company with a premier sports and entertainment company
and information services businesses. ITT Destinations will conduct its
hospitality and entertainment business through ITT Sheraton Corporation ("ITT
Sheraton"), Ciga S.p.A., Caesars World, Inc. ("Caesars") and Madison Square
Garden, L.P. and conduct its information services business through ITT World
Directories, Inc. and ITT Educational Services, Inc. In addition, ITT
Destinations will own approximately 6% of the outstanding capital shares of
Alcatel Alsthom, a French company which owns, among other things, Alcatel N.V.,
one of the largest telecommunications equipment manufacturers in the world.
ITT CORPORATION
ITT Corporation is a Delaware corporation, with World Headquarters at 1330
Avenue of the Americas, New York, New York 10019-5490. Until December 31, 1983,
the corporation was known as International Telephone and Telegraph Corporation.
It is the successor (since 1968) to a Maryland corporation incorporated in 1920.
Unless the context otherwise requires, references herein to ITT include its
subsidiaries.
ITT is a diversified global enterprise engaged, directly and through its
subsidiaries, in three major business areas: Insurance, Industries and
Hospitality, Entertainment and Information Services. For financial statement
purposes, ITT's Insurance, Hospitality, Entertainment and Information Services
businesses are treated by ITT as discontinued operations. See "The
Distribution."
THE DISTRIBUTION
At a special meeting of shareholders of ITT held on September 21, 1995, in
New York, New York, the shareholders approved a group of separate but related
proposals to divide ITT into its three separate areas: (i) Insurance, (ii)
Industries and (iii) Hospitality, Entertainment and Information Services.
These proposals provide for the proposed distribution (the "Distribution")
to ITT's shareholders of all the shares of common stock of ITT Destinations,
which is a wholly owned subsidiary of ITT, and all the shares of common stock of
ITT Hartford Group, Inc. ("ITT Hartford"), which is also a wholly owned
subsidiary of ITT. The Distribution will separate ITT into three publicly owned
companies. In addition, as part of the
3
<PAGE> 14
Distribution, ITT will change its name to ITT Industries, Inc. and ITT
Destinations will change its name to ITT Corporation. In connection with the
Distribution, ITT (which is now a Delaware corporation) will reincorporate in
Indiana. After the Distribution, ITT Industries will continue to conduct the
automotive, defense and electronics, and fluid technology businesses of ITT. ITT
Destinations, renamed ITT Corporation, will continue to conduct the Hospitality,
Entertainment and Information Services businesses of ITT. ITT Hartford will
continue to conduct the insurance businesses of ITT. In the Distribution,
holders of ITT common stock will receive one share of ITT Destinations common
stock and one share of ITT Hartford common stock for every one share of ITT
common stock held.
The Distribution is subject to various conditions, including (i) receipt of
a favorable ruling from the Internal Revenue Service as to certain federal
income tax consequences of the Distribution and (ii) all necessary consents of
any governmental or regulatory bodies having been obtained. A complete
description of the conditions precedent to the Distribution is contained in the
Proxy, which is incorporated herein by reference. ITT currently expects the
Distribution to occur prior to December 31, 1995; however, there can be no
assurance that the Distribution will occur prior to that date or at all.
If the Distribution were not to occur, ITT would remain liable for its
obligations with respect to the Debt Securities pursuant to the Guarantees.
USE OF PROCEEDS
Unless otherwise specified in the Prospectus Supplement, the net proceeds
from the sale of the Securities will be applied to the repayment of short-term
debt or will be added to the general funds of ITT Destinations to be used for
general corporate purposes.
ITT DESTINATIONS RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
NINE MONTHS YEAR ENDED DECEMBER 31,
ENDED SEPTEMBER 30, -----------------------------------------
1995 1994 1993 1992 1991 1990
- ------------------- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
1.71 1.98 3.23 1.49 1.41 *
</TABLE>
- ---------------
* Earnings were inadequate to cover total fixed charges by approximately $8
million.
These computations include ITT Destinations and its subsidiaries, and 50%
or less equity companies. For the purpose of these pro forma ratios, "earnings"
is determined by adding "fixed charges" (excluding interest capitalized), income
taxes, minority common stockholders equity in net income and amortization of
interest capitalized to income from continuing operations after eliminating
equity in undistributed earnings of companies in which at least 20% but less
than 50% equity is owned. For this purpose, "fixed charges" consists of (1)
interest on all indebtedness and amortization of debt discount and expense, (2)
interest capitalized and (3) an interest factor attributable to rentals.
ITT RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
NINE MONTHS YEAR ENDED DECEMBER 31,
ENDED SEPTEMBER 30, -----------------------------------------
1995 1994 1993 1992 1991 1990
- ------------------- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C>
1.57* 3.40 2.05 5.27 1.99 5.31
</TABLE>
- ---------------
* Includes after-tax provisions of $111 million for the expected losses on the
disposals of ITT Semiconductors and ITT Community Development Corporation.
Excluding these provisions, the ratio was 2.66.
The ratios of earnings to fixed charges for ITT set forth above reflect the
businesses of ITT Destinations and ITT Hartford as discontinued operations for
all periods presented. These computations include ITT and its subsidiaries, and
50% or less equity companies. For the purpose of these ratios, "earnings" is
determined by
4
<PAGE> 15
adding "fixed charges" (excluding interest capitalized), income taxes, minority
common stockholders equity in net income and amortization of interest
capitalized to income from continuing operations after eliminating equity in
undistributed earnings of companies in which at least 20% but less than 50%
equity is owned. For this purpose, "fixed charges" consists of (1) interest on
all indebtedness and amortization of debt discount and expense, (2) interest
capitalized and (3) an interest factor attributable to rentals.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will constitute non-convertible unsecured general
obligations of ITT Destinations and will be issued under one of the indentures
described below (each an "Indenture"), in each case among ITT Destinations, ITT
and a banking institution organized under the laws of the United States of
America or of any State thereof (each a "Trustee"). The following summary of
certain provisions of the Indentures does not purport to be complete and is
qualified in its entirety by reference to the applicable Indenture, a copy of
which is filed as an exhibit to the Registration Statement. All article and
section references appearing herein are to articles and sections of the
applicable Indenture, and all capitalized terms have the meanings specified in
the applicable Indenture.
GENERAL
None of the Indentures limits the amount of Debt Securities which may be
issued thereunder. Each Indenture provides that Debt Securities may be issued
thereunder up to the aggregate principal amount which may be authorized from
time to time by ITT Destinations and may be denominated in any currency or
currency unit designated by ITT Destinations. Except for the limitations on
liens, sale and leaseback transactions and consolidation, merger and sale of
assets of ITT Destinations and ITT referred to herein, the Indentures and the
terms of the Debt Securities do not contain any covenants or other provisions
designed to afford holders of any Debt Securities protection in the event of a
highly leveraged transaction involving either ITT Destinations or ITT. Reference
is made to the Prospectus Supplement which accompanies this Prospectus for the
following terms and other information with respect to the Debt Securities being
offered thereby: (1) the title of the Debt Securities; (2) the designation,
aggregate principal amount and authorized denominations of such Debt Securities;
(3) the percentage of their principal amount at which such Debt Securities will
be issued; (4) the currency, currencies or currency units for which the Debt
Securities may be purchased and the currency, currencies or currency units in
which the principal of, premium, if any, and any interest on such Debt
Securities may be payable; (5) the date on which such Debt Securities will
mature; (6) the rate per annum at which such Debt Securities will bear interest,
if any, or the method of determination of such rate; (7) the dates on which such
interest, if any, will be payable and the record dates for such payment dates;
(8) the Trustee under the Indenture pursuant to which the Debt Securities are to
be issued; (9) whether the Debt Securities are to be issued in the form of one
or more global securities representing all Debt Securities of that series (each
a "Global Security") and, if so, the identity of a depositary (the "Depositary")
for such Global Security or Securities; and (10) any redemption terms or other
specific terms.
If any of the Securities are sold for foreign currencies or foreign
currency units or if the principal of, premium, if any, or any interest on any
series of Debt Securities is payable in foreign currencies or foreign currency
units, the restrictions, elections, tax consequences, specific terms and other
information with respect to such issue of Securities and such currencies or
currency units will be set forth in the Prospectus Supplement relating thereto.
The Debt Securities may be issued in fully registered form without coupons
("Fully Registered Securities"), or in a form registered as to principal only
with coupons or in bearer form with coupons. Unless otherwise specified in the
Prospectus Supplement, the Debt Securities will be only Fully Registered
Securities. In addition, Debt Securities of a series may be issuable in the form
of one or more Global Securities, which will be denominated in an amount equal
to all or a portion of the aggregate principal amount of such Debt Securities.
See "Global Securities." (Sections 3.1., 3.2.)
One or more series of Debt Securities may be sold at a substantial discount
below their stated principal amount, bearing no interest or interest at a rate
which at the time of issuance is below market rates. Federal income tax
consequences and other special considerations applicable to any such series will
be described in the Prospectus Supplement relating thereto.
5
<PAGE> 16
GUARANTEES
ITT will unconditionally guarantee (prior to the Distribution) the due and
punctual payment of the principal, premium, if any, and interest on the Debt
Securities when and as the same shall become due and payable, whether at
maturity, upon redemption, or otherwise. The Guarantees will rank equally with
all other unsecured and unsubordinated obligations of ITT. The Guarantees will
irrevocably terminate and be of no further force or effect upon the completion
of the Distribution, subject to certain conditions.(Sections 14.1., 14.2.,
14.3.)
CERTAIN COVENANTS OF ITT DESTINATIONS
On and after the Distribution, each Indenture will require ITT Destinations
to comply with certain restrictive covenants. None of the Indentures will
require ITT Destinations to maintain any Restricted Subsidiaries. Accordingly,
if ITT Destinations elects not to maintain any Restricted Subsidiaries, none of
the Indentures will provide any limitations on the activity of any ITT
Destinations subsidiary. However, each Indenture will contain certain provisions
applicable to any companies maintained as Restricted Subsidiaries, and such
provisions are described below.
Definitions of Restricted Subsidiary and Unrestricted Subsidiary. The term
"Restricted Subsidiary" will be defined in each Indenture to mean any subsidiary
other than an Unrestricted Subsidiary; and the term "Unrestricted Subsidiary"
will be defined to mean (i) any subsidiary 50% or less of the voting stock of
which is owned directly by ITT Destinations and/or one or more Restricted
Subsidiaries or (ii) any subsidiary designated as an Unrestricted Subsidiary by
the ITT Destinations Board of Directors. A Restricted Subsidiary may at any time
be designated as an Unrestricted Subsidiary, and an Unrestricted Subsidiary's
designation as such may at any time be rescinded by the ITT Destinations Board
of Directors; and any subsidiary may be the subject of a series of such
designations and rescissions thereof, without limitation, except that: (i) a
subsidiary may not become an Unrestricted Subsidiary if, upon the effectiveness
thereof, it would own any capital stock of, or hold any indebtedness of, any
Restricted Subsidiary; and (ii) an Unrestricted Subsidiary may not become a
Restricted Subsidiary unless such subsidiary has outstanding no lien upon its
property which such subsidiary would be prohibited, under the restriction on
liens described below, from creating immediately after it becomes a Restricted
Subsidiary and, with certain exceptions, such subsidiary is not a party to any
lease which it would have been prohibited, under the restriction on sale and
lease-back transactions described below, from entering into had it been a
Restricted Subsidiary at the time it entered into such lease. (Section 1.1.)
Definition of Consolidated Net Tangible Assets. The term "Consolidated Net
Tangible Assets" will be defined in each Indenture to mean the total of all
assets appearing on a consolidated balance sheet of ITT Destinations and its
Restricted Subsidiaries prepared in accordance with generally accepted
accounting principles as of a date not more than 90 days prior to the date as of
which Consolidated Net Tangible Assets are to be determined, but excluding (i)
the book amount of all segregated intangible assets, (ii) all depreciation,
valuation and other reserves, (iii) current liabilities, (iv) any minority
interest in the stock and surplus of Restricted Subsidiaries, (v) investments in
subsidiaries which are not Restricted Subsidiaries, (vi) deferred income and
deferred liabilities, and (vii) other items deductible under generally accepted
accounting principles. (Section 1.1.)
The term "Capitalized Lease-Back Obligation" will be defined in each
Indenture to mean the total net rental obligations of ITT Destinations or a
Restricted Subsidiary under any lease entered into as part of a sale and
lease-back transaction involving a Principal Property discounted to present
value at the rate of 9% per annum. The term "Principal Property" will be defined
in each Indenture to mean any single property owned by ITT Destinations or any
Restricted Subsidiary having a gross book value in excess of 2% of Consolidated
Net Tangible Assets, except any such property or portion thereof which the ITT
Destinations Board of Directors by resolution declares is not of material
importance to the total business conducted by ITT Destinations and its
Restricted Subsidiaries as an entirety. (Section 1.1.)
Sale and Lease-Back. Each Indenture will provide that neither ITT
Destinations nor any Restricted Subsidiary may enter into any sale and
lease-back transaction (except for temporary leases of a term of not
6
<PAGE> 17
more than three years and except for leases between ITT Destinations and a
Restricted Subsidiary or between Restricted Subsidiaries) involving the leasing
by ITT Destinations or any Restricted Subsidiary of any Principal Property, more
than 120 days after the acquisition thereof or the completion of construction
and commencement of full operation thereof, unless either (i) ITT Destinations
applies an amount equal to the greater of the fair value (as determined by the
ITT Destinations Board of Directors) of such property or the net proceeds of
such sale, within 120 days, to the retirement of Debt Securities or other
indebtedness ranking on a parity with the Debt Securities, or to the
acquisition, construction, development or improvement of properties, facilities
or equipment used for operating purposes which are, or upon such acquisition,
construction, development or improvement will be, a Principal Property or a part
thereof, or (ii) at the time of entering into such transaction, such Principal
Property could have been subjected to a mortgage securing indebtedness in a
principal amount equal to the Capitalized Lease-Back Obligation (as defined)
with respect to such Principal Property under clause (m) of the provision for
limitations on liens referred to below without securing the Debt Securities as
contemplated by that provision. (Section 4.5.)
Liens. Each Indenture will prohibit ITT Destinations and its Restricted
Subsidiaries from creating any mortgages or other liens upon any Principal
Property (without securing the Debt Securities equally and ratably with all
other indebtedness secured thereby), with the following exceptions: (a)
mortgages or other liens on any such property acquired, constructed or improved
by ITT Destinations or a Restricted Subsidiary to secure or provide for the
payment of any part of the purchase price of such property or the cost of such
construction or improvement, or any mortgage or other lien on any such property
existing at the time of acquisition thereof; (b) any mortgage or other lien on
any property of another company existing at the time it is acquired by merger,
consolidation or acquisition of substantially all of its stock or its assets;
(c) pledges or deposits to secure payment of workers' compensation or insurance
premiums, or relating to tenders, bids, contracts (except contracts for the
payment of money) or leases; (d) pledges or liens in connection with tax
assessments or other governmental charges, or as security required by law or
governmental regulation as a condition to the transaction of any business or the
exercise of any privilege or right; (e) pledges or liens to secure a stay of
process in proceedings to enforce a contested liability, or required in
connection with the institution of legal proceedings or in connection with any
other order or decree in any such proceeding or in connection with any contest
of any tax or other governmental charge, or deposits with a governmental agency
entitling ITT Destinations or a Restricted Subsidiary to maintain self-insurance
or to participate in other specified insurance arrangements; (f) mechanics',
carriers', workmen's and other like liens; (g) encumbrances in favor of the U.
S. Government to secure progress or advance payments; (h) mortgages, pledges or
other liens securing any indebtedness incurred to finance the cost of property
leased to the U. S. Government at a rental sufficient to pay the principal of
and interest on such indebtedness; (i) mortgages or other liens securing
indebtedness of a Restricted Subsidiary to ITT Destinations or to a Restricted
Subsidiary; (j) mortgages, pledges or other liens affecting property securing
indebtedness of a governmental authority issued to finance the cost of a
pollution control program with respect to operations of ITT Destinations or a
Restricted Subsidiary; (k) renewals, extensions and replacements of any
permitted mortgage, lien, deposit or encumbrance, provided the amount secured is
not increased; (l) mortgages or other liens on any such property existing on the
date of such Indenture; and (m) the creation of any other mortgage, pledge or
other lien, if, after giving effect to the creation thereof, the total of (i)
the aggregate principal amount of indebtedness of ITT Destinations and its
Restricted Subsidiaries secured by all mortgages, pledges or other liens created
under the provisions referred to in this clause (m), plus (ii) the aggregate
amount of Capitalized Lease-Back Obligations of ITT Destinations and its
Restricted Subsidiaries under the entire unexpired terms of all leases entered
into in connection with sale and lease-back transactions which would have been
precluded by the provision for limitations on such transactions described above,
but for the satisfaction of the condition referred to in clause (ii) of the
description of such provision, will not exceed an amount equal to 15% of
Consolidated Net Tangible Assets (as defined).
The lease of any property and rental obligations thereunder (whether or not
involving a sale and lease-back and whether or not capitalized) shall not be
deemed to create a lien. The sale or other transfer of (a) timber or other
natural resources in place for a period of time until, or in an amount such
that, the purchaser will realize therefrom a specified amount of money (however
determined) or a specified amount of
7
<PAGE> 18
such resources, or (b) any other interest in property of the character commonly
referred to as a "production payment", shall not be deemed to create a lien.
(Section 4.6.)
Consolidation, Merger or Sale. Each Indenture will permit the
consolidation or merger of ITT Destinations with or into any other corporation,
or the merger into ITT Destinations of any other corporation, or the sale by ITT
Destinations of its property and assets as, or substantially as, an entirety, or
otherwise; provided, however, (a) that, in case of any such consolidation or
merger the corporation resulting from such consolidation or any corporation
other than ITT Destinations into which such merger shall be made shall succeed
to and be substituted for ITT Destinations with the same effect as if it has
been named therein as a party thereto and shall become liable and be bound for,
and shall expressly assume, by a supplemental indenture, executed and delivered
to the Trustee, the due and punctual payment of the principal of, premium, if
any, and interest, if any, on all the Debt Securities of each series and the
coupons, if any, appertaining thereto and the performance and observance of each
and every covenant and condition of the applicable Indenture on the part of ITT
Destinations to be performed or observed, and (b) that, as a condition of any
such sale of the property and assets of ITT Destinations as, or substantially
as, an entirety, the corporation to which such property and assets shall be sold
shall (i) expressly assume, as a part of the purchase price thereof, the due and
punctual payment of the principal of, premium, if any, and interest, if any, on
all the Debt Securities of each series and the coupons, if any, appertaining
thereto and the performance and observance of all the covenants and conditions
of the applicable Indenture on the part of ITT Destinations to be performed or
observed, and (ii) simultaneously with the delivery to it of the conveyances or
instruments of transfer of such property and assets, execute and deliver to the
Trustee a supplemental indenture, in form satisfactory to the Trustee, whereby
such purchasing corporation shall so assume the due and punctual payment of the
principal of, premium, if any, and interest, if any, on all the Debt Securities
of each series and the coupons, if any, appertaining thereto and the performance
and observance of each and every covenant and condition of the applicable
Indenture on the part of ITT Destinations to be performed or observed, to the
same extent that ITT Destinations is bound and liable.
ITT Destinations will not consolidate with any other corporation or accept
a merger of any other corporation into ITT Destinations or permit ITT
Destinations to be merged into any other corporation, or sell its properties and
assets as, or substantially as, an entirety, except upon the terms and
conditions set forth in the applicable Indenture. Upon any consolidation or
merger, or any sale of the properties and assets of ITT Destinations as, or
substantially as, an entirety in accordance with the provisions of the
applicable Indenture, the corporation formed by such consolidation or into which
ITT Destinations shall have been merged or to which such sale shall have been
made shall succeed to and be substituted for ITT Destinations with the same
effect as if it had been named therein as a party thereto and thereafter from
time to time such successor corporation may exercise each and every right and
power of ITT Destinations under each Indenture, in the name of ITT Destinations
or in its own name; and any act or proceeding by any provision of the applicable
Indenture required or permitted to be done by the Board of Directors or any
officer of ITT Destinations may be done with like force and effect by the like
board or officer of any corporation that shall at the time be the successor of
ITT Destinations thereunder. In the event of the sale by ITT Destinations of its
properties and assets as, or substantially as, an entirety upon the terms and
conditions of the applicable Indenture, ITT Destinations shall be released from
all its liabilities and obligations thereunder and under the Debt Securities.
(Section 12.1.)
Each Indenture will provide that ITT may, prior to the completion of the
Distribution, assume the obligations of ITT Destinations under such Indenture
and the Securities without the consent of the Holders, provided certain
conditions are met. Upon such assumption, ITT Destinations will be released from
all obligations and covenants under the applicable Indenture and the Securities.
(Section 12.4.)
The Trustee, subject to the provisions of the applicable Indenture, may
receive an Opinion of Counsel as conclusive evidence that any such
consolidation, merger or sale, and any such assumption, complies with the
provisions of the Indenture. (Section 12.3.)
8
<PAGE> 19
CERTAIN COVENANTS OF ITT
Prior to the Distribution, each Indenture will require ITT and its Domestic
Subsidiaries to comply with certain restrictive covenants. None of the
Indentures will require ITT to maintain any Domestic Subsidiaries. Accordingly,
if ITT elects not to maintain any Domestic Subsidiaries, none of the Indentures
will provide any limitations on the activity of any ITT subsidiary. However,
each Indenture will contain certain provisions applicable to any companies
maintained as Domestic Subsidiaries, and such provisions are described below.
Definition of Domestic Subsidiary. The term "Domestic Subsidiary" will be
defined in each Indenture to mean any subsidiary which is neither a Foreign
Subsidiary nor an Unrestricted Subsidiary. "Foreign Subsidiary" will be defined
to mean any subsidiary substantially all of the operating assets of which are
located, or substantially all of the business of which is carried on, outside
the United States of America and its territories and possessions, but such term
shall not include any subsidiary incorporated under the laws of any state of the
United States, substantially all of the assets of which consist of securities of
other subsidiaries. (Section 1.1.)
Definitions of Restricted Subsidiary and Unrestricted Subsidiary. In the
case of ITT, the term "Restricted Subsidiary" will be defined in each Indenture
to mean any subsidiary other than an Unrestricted Subsidiary; and the term
"Unrestricted Subsidiary" will be defined to mean (i) any subsidiary 50% or less
of the voting stock of which is owned directly by ITT and/or one or more
Restricted Subsidiaries, or (ii) any subsidiary designated as an Unrestricted
Subsidiary by the ITT Board of Directors. A Restricted Subsidiary may at any
time be designated as an Unrestricted Subsidiary, and an Unrestricted
Subsidiary's designation as such may at any time be rescinded by the ITT Board
of Directors; and any subsidiary may be the subject of a series of such
designations and rescissions thereof, without limitation, except that: (i) a
subsidiary may not become an Unrestricted Subsidiary if, upon the effectiveness
thereof, it would own any capital stock of, or hold any indebtedness of, any
Restricted Subsidiary; and (ii) an Unrestricted Subsidiary may not become a
Restricted Subsidiary unless such subsidiary has outstanding no lien upon its
property which such subsidiary would be prohibited, under the restriction on
liens described below, from creating immediately after it becomes a Restricted
Subsidiary and, with certain exceptions, such subsidiary is not a party to any
lease which it would have been prohibited, under the restriction on sale and
lease-back transactions described below, from entering into had it been a
Restricted Subsidiary at the time it entered into such lease. (Section 1.1.)
Definition of Consolidated Net Tangible Assets. In the case of ITT, the
term "Consolidated Net Tangible Assets" will be defined in each Indenture to
mean the total of all assets appearing on a consolidated balance sheet of ITT
and its Domestic Subsidiaries prepared in accordance with generally accepted
accounting principles as of a date not more than 90 days prior to the date as of
which Consolidated Net Tangible Assets are to be determined, but excluding (i)
the book amount of all segregated intangible assets, (ii) all depreciation,
valuation and other reserves, (iii) current liabilities, (iv) any minority
interest in the stock and surplus of Domestic Subsidiaries, (v) investments in
subsidiaries which are not Domestic Subsidiaries, (vi) deferred income and
deferred liabilities, and (vii) other items deductible under generally accepted
accounting principles. (Section 1.1.)
In the case of ITT, the term "Capitalized Lease-Back Obligation" will be
defined in each Indenture to mean the total net rental obligations of ITT or a
Domestic Subsidiary under any lease entered into as part of a sale and
lease-back transaction involving a Principal Property discounted to present
value at the rate of 9% per annum. In the case of ITT, the term "Principal
Property" will be defined in each Indenture to mean any single manufacturing or
processing facility owned by ITT or any Domestic Subsidiary having a gross book
value in excess of 2% of Consolidated Net Tangible Assets, except any such
facility or portion thereof which the ITT Board of Directors by resolution
declares is not of material importance to the total business conducted by ITT
and its Domestic Subsidiaries as an entirety. (Section 1.1.)
Sale and Lease-Back. Each Indenture will provide that neither ITT nor any
Domestic Subsidiary may enter into any sale and lease-back transaction (except
for temporary leases of a term of not more than three years and except for
leases between ITT and a Domestic Subsidiary or between Domestic Subsidiaries)
involving the leasing by ITT or any Domestic Subsidiary of any Principal
Property, more than 120 days after the acquisition thereof or the completion of
construction and commencement of full operation thereof, unless
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either (i) ITT applies an amount equal to the greater of the fair value (as
determined by the ITT Board of Directors) of such property or the net proceeds
of such sale, within 120 days, to the retirement of Debt Securities or other
indebtedness ranking on a parity with the Debt Securities, or to the
acquisition, construction, development or improvement of properties, facilities
or equipment used for operating purposes which are, or upon such acquisition,
construction, development or improvement will be, a Principal Property or a part
thereof, or (ii) at the time of entering into such transaction, such Principal
Property could have been subjected to a mortgage securing indebtedness in a
principal amount equal to the Capitalized Lease-Back Obligation (as defined)
with respect to such Principal Property under clause (1) of the provision for
limitations on liens referred to below without securing the Debt Securities as
contemplated by that provision. (Section 5.1.)
Liens. Each Indenture will prohibit ITT and its Domestic Subsidiaries from
creating any mortgages or other liens upon any Principal Property (without
securing the Debt Securities equally and ratably with all other indebtedness
secured thereby), with the following exceptions: (a) mortgages or other liens on
any such property acquired, constructed or improved by ITT or a Domestic
Subsidiary to secure or provide for the payment of any part of the purchase
price of such property or the cost of such construction or improvement, or any
mortgage or other lien on any such property existing at the time of acquisition
thereof; (b) any mortgage or other lien on any property of another company
existing at the time it is acquired by merger, consolidation or acquisition of
substantially all of its stock or its assets; (c) pledges or deposits to secure
payment of workers' compensation or insurance premiums, or relating to tenders,
bids, contracts (except contracts for the payment of money) or leases; (d)
pledges or liens in connection with tax assessments or other governmental
charges, or as security required by law or governmental regulation as a
condition to the transaction of any business or the exercise of any privilege or
right; (e) pledges or liens to secure a stay of process in proceedings to
enforce a contested liability, or required in connection with the institution of
legal proceedings or in connection with any other order or decree in any such
proceeding or in connection with any contest of any tax or other governmental
charge, or deposits with a governmental agency entitling ITT or a Domestic
Subsidiary to maintain self-insurance or to participate in other specified
insurance arrangements; (f) mechanics', carriers', workmen's and other like
liens; (g) encumbrances in favor of the U. S. Government to secure progress or
advance payments; (h) mortgages, pledges or other liens securing any
indebtedness incurred to finance the cost of property leased to the U. S.
Government at a rental sufficient to pay the principal of and interest on such
indebtedness; (i) mortgages or other liens securing indebtedness of a Domestic
Subsidiary to ITT or to a Domestic Subsidiary; (j) mortgages, pledges or other
liens affecting property securing indebtedness of a governmental authority
issued to finance the cost of a pollution control program with respect to
operations of ITT or a Domestic Subsidiary; (k) renewals and extensions of any
permitted mortgage, lien, deposit or encumbrance, provided the amount secured is
not increased; and (l) the creation of any other mortgage, pledge or other lien,
if, after giving effect to the creation thereof, the total of (i) the aggregate
principal amount of indebtedness of ITT and its Domestic Subsidiaries secured by
all mortgages, pledges or other liens created under the provisions referred to
in this clause (l), plus (ii) the aggregate amount of Capitalized Lease-Back
Obligations of ITT and its Domestic Subsidiaries under the entire unexpired
terms of all leases entered into in connection with sale and lease-back
transactions which would have been precluded by the provision for limitations on
such transactions described above but for the satisfaction of the condition
referred to in clause (ii) of the description of such provision, will not exceed
an amount equal to 5% of Consolidated Net Tangible Assets (as defined).
The lease of any property and rental obligations thereunder (whether or not
involving a sale and lease-back and whether or not capitalized) shall not be
deemed to create a lien. The sale or other transfer of (a) timber or other
natural resources in place for a period of time until, or in an amount such
that, the purchaser will realize therefrom a specified amount of money (however
determined) or a specified amount of such resources, or (b) any other interest
in property of the character commonly referred to as a "production payment",
shall not be deemed to create a lien. (Section 5.2.)
Consolidation, Merger or Sale. Each Indenture will permit the
consolidation or merger of ITT with or into any other corporation, or the merger
into ITT of any other corporation, or the sale by ITT of its property and assets
as, or substantially as, an entirety, or otherwise; provided, however, (a) that,
in case of any such
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consolidation or merger the corporation resulting from such consolidation or any
corporation other than ITT into which such merger shall be made shall succeed to
and be substituted for ITT with the same effect as if it has been named therein
as a party thereto and shall become liable and be bound for, and shall expressly
assume, by a supplemental indenture, executed and delivered to the Trustee, the
due and punctual payment of the principal of, premium, if any, and interest, if
any, on all the Debt Securities of each series and the coupons, if any,
appertaining thereto and the performance and observance of each and every
covenant and condition of the applicable Indenture on the part of ITT to be
performed or observed, and (b) that, as a condition of any such sale of the
property and assets of ITT as, or substantially as, an entirety, the corporation
to which such property and assets shall be sold shall (i) expressly assume, as a
part of the purchase price thereof, the due and punctual payment of the
principal of, premium, if any, and interest, if any, on all the Debt Securities
of each series and the coupons, if any, appertaining thereto and the performance
and observance of all the covenants and conditions of the applicable Indenture
on the part of ITT to be performed or observed, and (ii) simultaneously with the
delivery to it of the conveyances or instruments or transfer of such property
and assets, execute and deliver to the Trustee a supplemental indenture, in form
satisfactory to the Trustee, whereby such purchasing corporation shall so assume
the due and punctual payment of the principal of, premium, if any, and interest,
if any, on all the Debt Securities of each series and the coupons, if any,
appertaining thereto and the performance and observance of each and every
covenant and condition of the applicable Indenture on the part of ITT to be
performed or observed, to the same extent that ITT is bound and liable.
ITT will not consolidate with any other corporation or accept a merger of
any other corporation into ITT or permit ITT to be merged into any other
corporation, or sell its properties and assets as, or substantially as, an
entirety, except upon the terms and conditions set forth in the applicable
Indenture. Upon any consolidation or merger, or any sale of the properties and
assets of ITT as, or substantially as, an entirety in accordance with the
provisions of the applicable Indenture, the corporation formed by such
consolidation or into which ITT shall have been merged or to which such sale
shall have been made shall succeed to and be substituted for ITT with the same
effect as if it had been named therein as a party thereto and thereafter from
time to time such successor corporation may exercise each and every right and
power of ITT under each Indenture, in the name of ITT or in its own name; and
any act or proceeding by any provision of the applicable Indenture required or
permitted to be done by the Board of Directors or any officer of ITT may be done
with like force and effect by the like board or officer of any corporation that
shall at the time be the successor of ITT thereunder. In the event of the sale
by ITT of its properties and assets as, or substantially as, an entirety upon
the terms and conditions of the applicable Indenture, ITT shall be released from
all its liabilities and obligations thereunder and with respect to the Debt
Securities. (Section 12.2.)
The Trustee, subject to the provisions of the applicable Indenture, may
receive an Opinion of Counsel as conclusive evidence that any such
consolidation, merger or sale, and any such assumption, complies with the
provisions of the Indenture. (Section 12.3.)
Except for the limitations on liens, sale and leaseback transactions and
consolidation, merger and sale of assets of ITT Destinations and ITT referred to
above, the Indentures and the terms of the Debt Securities do not contain any
covenants or other provisions designed to afford holders of any Debt Securities
protection in the event of a highly leveraged transaction involving either ITT
Destinations or ITT.
REDEMPTION PURSUANT TO GAMING LAWS
If a holder or beneficial owner of a Debt Security is required by any
gaming authority to be licensed or found qualified or suitable to hold or own
the Debt Securities and such holder is not licensed or found qualified or
suitable within any time specified by such gaming authority or such gaming
authority denies a license to or finds unqualified or unsuitable such holder,
ITT Destinations will have the right at its option to require such holder to
dispose of such holder's Debt Securities within the time period prescribed by
ITT Destinations or such other time period as may be prescribed by any gaming
authority, which time period shall be specified in a written notice from ITT
Destinations. If the holder having been given the opportunity by ITT
Destinations to dispose of such Debt Securities fails to do so within the
prescribed time period, ITT Destinations will have the right to call for
redemption such holder's Debt Securities by notice of redemption to such person.
On any such redemption, the redemption price shall be the lesser of (a) the
lowest closing sale price of the Debt Securities
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on any trading day during the 120 day period commencing on the date upon which
ITT Destinations shall have received notice from a gaming authority of such
holder's disqualification or (b) the price at which such holder acquired the
Debt Securities, unless a different redemption price is required by such gaming
authority, in which event such required price shall be the redemption price.
(Section 16.5.)
MODIFICATION OF INDENTURE
Each applicable Indenture, the rights and obligations of ITT Destinations
and ITT thereunder and the rights of the Holders thereunder may be modified with
respect to one or more series of Debt Securities issued under such Indenture
with the consent of the Holders of not less than a majority in aggregate
principal amount of the Outstanding Debt Securities of each such series
(including Debt Securities of each such series issuable upon exercise of
unexpired Warrants) affected by the modification or amendment. No modification
of the terms of payment of principal or interest or the Guarantees, and no
modification reducing the percentage required for modifications, is effective
against any Holder without its consent. For the purpose of these provisions
solely, a holder of an unexpired Warrant shall be deemed to be the Holder of the
principal amount of Debt Securities issuable upon exercise of such Warrant.
(Section 11.2.)
EVENTS OF DEFAULT
Except as may otherwise be set forth in each Prospectus Supplement, each
Indenture provides that the following are Events of Default thereunder with
respect to any series of Debt Securities issued thereunder: (i) default in the
payment of the principal of (or premium, if any, on) any Debt Security of such
series when and as the same shall be due and payable; (ii) default in the
deposit of a sinking fund payment, if any, when and as the same shall be due and
payable by the terms of the Debt Securities of such series; (iii) default for 30
days in the payment of any installment of interest on any Debt Security of such
series; (iv) default for 60 days after notice in the performance of any other
covenant in respect of the Debt Securities or Guarantees of such series
contained in such Indenture; (v) acceleration (after the Distribution) of
certain debt instruments of at least $10,000,000 aggregate principal amount of
ITT Destinations, which acceleration shall not have been rescinded or annulled
within 30 days after notice; (vi) certain events in bankruptcy, insolvency or
reorganization of ITT (prior to the Distribution) or ITT Destinations; (vii) the
Guarantee of the Debt Securities ceases to be in full force and effect (other
than as a result of the release of such Guarantee upon the Distribution or
otherwise in accordance with the terms of the Indenture); or (viii) any other
Event of Default provided in the applicable Board Resolution or supplemental
indenture under which such series of Debt Securities is issued. (Section 7.1.)
An Event of Default with respect to a particular series of Debt Securities
issued under an Indenture does not necessarily constitute an Event of Default
with respect to any other series of Debt Securities issued under such Indenture.
The applicable Trustee may withhold notice to the Holders of any series of Debt
Securities of any default with respect to such series (except in the payment of
principal or interest) if it considers such withholding in the interests of such
Holders. (Section 7.11.)
If an Event of Default with respect to any series of Debt Securities shall
have occurred and be continuing, the applicable Trustee or the Holders of not
less than 25% in aggregate principal amount of the Debt Securities of such
series may declare the principal, or in the case of discounted Debt Securities,
such portion thereof as may be described in the Prospectus Supplement
accompanying this Prospectus, of all the Debt Securities of such series to be
due and payable immediately, provided, however, that, subject to certain
conditions, any such declaration and its consequences may be rescinded and
annulled by the Holders of not less than a majority in aggregate principal
amount of the Debt Securities of such series. (Section 7.1.)
Each Indenture will require the annual filing by ITT Destinations and ITT
(prior to the Distribution) with the applicable Trustee of a certificate, signed
by a specified officer, stating whether or not such officer has obtained
knowledge of any default by ITT or ITT Destinations, as the case may be, in the
performance, observance or fulfillment of any condition or covenant of such
Indenture, and, if so, specifying each such default and the nature thereof.
(Sections 4.7., 5.3.)
Subject to provisions relating to its duties in case of default, a Trustee
shall be under no obligation to exercise any of its rights or powers under the
applicable Indenture at the request, order or direction of any Holders, unless
such Holders shall have offered to such Trustee reasonable indemnity. (Section
8.2.) Subject to such provisions for indemnification, the Holders of a majority
in principal amount of the Debt Securities of
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any series may direct the time, method and place of conducting any proceeding or
any remedy available to the appropriate Trustee, or exercising any trust or
power conferred upon such Trustee, with respect to the Debt Securities of such
series. (Section 7.9.)
PAYMENT AND TRANSFER
Principal of, premium, if any, and interest, if any, on Fully Registered
Securities are to be payable at the place or places designated by ITT
Destinations for such purposes, provided that payment of interest, if any, may
be made at the option of ITT Destinations by check mailed to the persons in
whose names such Securities are registered at the close of business on the day
or days specified in the Prospectus Supplement accompanying this Prospectus. The
principal of, premium, if any, and interest, if any, on Debt Securities in other
forms will be payable in such manner and at such place or places as may be
designated by ITT Destinations and specified in the applicable Prospectus
Supplement. (Sections 3.1., 4.1., 4.2.)
Fully Registered Securities may be transferred or exchanged at the
Corporate Trust Office of the Trustee under the applicable Indenture or at any
other office or agency maintained by ITT Destinations for such purposes, subject
to the limitations contained in the Indenture, without the payment of any
service charge except for any tax or governmental charge incidental thereto.
Provisions with respect to the transfer and exchange of Debt Securities in other
forms will be set forth in the applicable Prospectus Supplement. (Sections 3.1.,
3.6.)
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, the Depositary identified in the Prospectus Supplement relating to such
series. Unless and until it is exchanged in whole or in part for Debt Securities
in definitive form, a Global Security may not be transferred except as a whole
to a nominee of the Depositary for such Global Security, or by a nominee of such
Depositary to such Depositary, or to a successor of such Depositary or a nominee
of such successor. (Section 2.4.)
The specific terms of the depositary arrangement with respect to any series
of Debt Securities and the rights of and limitations on owners of beneficial
interests in a Global Security representing all or a portion of a series of Debt
Securities will be described in the Prospectus Supplement relating to such
series.
DEFEASANCE
Except as may otherwise be provided in the applicable Prospectus Supplement
with respect to the Securities of any series (Section 3.1.), each Indenture
provides that ITT Destinations and ITT shall be discharged from their
obligations with respect to the Securities of a series at any time prior to the
Stated Maturity or redemption thereof when (a) ITT Destinations has irrevocably
deposited with the Trustee, in trust, (i) sufficient funds in the currency or
currency unit in which the Securities are denominated to pay the principal of
(and premium, if any), and interest to Stated Maturity (or redemption) on, the
Securities of such series, or (ii) such amount of direct obligations of, or
obligations the principal of and interest on which are fully guaranteed by, the
government which issued the currency in which the Securities are denominated,
and which are not subject to prepayment, redemption or call, as will, together
with the predetermined and certain income to accrue thereon without
consideration of any reinvestment thereof, be sufficient to pay when due the
principal of (and premium, if any), and interest to Stated Maturity (or
redemption) on, the Securities of such series, and (b) ITT Destinations has paid
all other sums payable with respect to the Securities of such series. Upon such
discharge, the Holders of the Securities of such series shall no longer be
entitled to the benefits of the Indenture, except for the purposes of
registration of transfer and exchange of the Securities of such series, and
replacement of lost, stolen or mutilated Securities, and shall look only to such
deposited funds or obligations for payment. (Sections 13.1., 13.3.)
Under Federal income tax law as of the date of this Prospectus, such
deposit and discharge may be treated as an exchange of the related Securities.
As a consequence, each Holder of such Securities might be required to recognize
gain or loss equal to the difference between the Holder's cost or other tax
basis for the Securities and the value of the Holder's interest in the trust.
Such Holders thereafter might be required to
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include in income a different amount than would be includable in the absence of
the discharge. Prospective investors are urged to consult their own tax advisers
as to the specific consequences of such a deposit and discharge, including the
applicability and effect of tax laws other than the Federal income tax law.
CONCERNING THE TRUSTEES
Business and other relationships (including other trusteeships) between ITT
Destinations, ITT and their subsidiaries and each Trustee under any Indenture
pursuant to which any of the Debt Securities to which the Prospectus Supplement
accompanying this Prospectus relates are described in such Prospectus
Supplement.
DESCRIPTION OF WARRANTS
The following statements with respect to the Warrants are summaries of, and
subject to, the detailed provisions of one or more separate Warrant Agreements
(each a "Warrant Agreement"), in each case between ITT Destinations and a
banking institution organized under the laws of the United States of America or
any State thereof, as Warrant Agent (each a "Warrant Agent"), a form of which
will be filed as an exhibit to a Current Report on Form 8-K.
GENERAL
The Warrants, whether evidenced by Warrant Certificates (the "Warrant
Certificates") or not so evidenced, may be issued under a Warrant Agreement
independently or together with any Debt Securities offered by any Prospectus
Supplement and may be attached to or separate from such Debt Securities. If
Warrants are offered, the Prospectus Supplement will describe the terms of the
Warrants, including the following: (i) the offering price, if any; (ii) the
designation, aggregate principal amount, and terms of the Debt Securities
purchasable upon exercise of the Warrants; (iii) if applicable, the designation
and terms of the Debt Securities with which the Warrants are issued and the
number of Warrants issued with each such Debt Security; (iv) if applicable, the
date on and after which the Warrants and the related Debt Securities will be
separately transferable; (v) the principal amount of Debt Securities purchasable
upon exercise of one Warrant and the price at which such principal amount of
Debt Securities may be purchased upon such exercise; (vi) the date on which the
right to exercise the Warrants shall commence and the date on which such right
shall expire; (vii) federal income tax consequences; (viii) whether the Warrants
represented by the Warrant Certificates will be issued in registered or bearer
form; (ix) whether the Warrants will be issued in certificated or uncertificated
form; and (x) any other terms of the Warrants.
Warrant Certificates, if any, may be exchanged for new Warrant Certificates
of different denominations and may (if in registered form) be presented for
registration of transfer at the corporate trust office of the Warrant Agent or
any Co-Warrant Agent, which will be listed in the Prospectus Supplement, or at
such other office as may be set forth therein. Warrantholders do not have any of
the rights of holders of Debt Securities (except to the extent that the consent
of Warrantholders may be required for certain modifications of the terms of the
Indenture and the series of Debt Securities issuable upon exercise of the
Warrants) and are not entitled to payments of principal, premium, if any, or
interest, if any, on such Debt Securities.
EXERCISE OF WARRANTS
Warrants may be exercised by surrendering the Warrant Certificate, if any,
at the corporate trust office of the Warrant Agent or at the corporate trust
office of the Co-Warrant Agent, if any, with the form of election to purchase on
the reverse side of the Warrant Certificate, if any, properly completed and
executed, and by payment in full of the exercise price, as set forth in the
Prospectus Supplement. Upon exercise of Warrants, the Warrant Agent or
Co-Warrant Agent, if any, will, as soon as practicable, deliver the Debt
Securities in authorized denominations in accordance with the instructions of
the exercising Warrantholder and at the sole cost and risk of such holder. If
less than all of the Warrants evidenced by the Warrant Certificate, if any, are
exercised, a new Warrant Certificate will be issued, if sufficient time exists
prior to the expiration of the exercise period, for the remaining amount of
Warrants.
REDEMPTION PURSUANT TO GAMING LAWS
If a holder or beneficial owner of a Warrant is required by any gaming
authority to be licensed or found qualified or suitable to hold or own the
Warrants and such holder is not licensed or found qualified or suitable
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within any time specified by such gaming authority or such gaming authority
denies a license to or finds unqualified or unsuitable such holder, ITT
Destinations will have the right at its option to require such holder to dispose
of such holder's Warrants within the time period prescribed by ITT Destinations
or such other time period as may be prescribed by any gaming authority, which
time period shall be specified in a written notice from ITT Destinations. If the
holder having been given the opportunity by ITT Destinations to dispose of such
Warrants fails to do so within the prescribed time period, ITT Destinations will
have the right to call for redemption such holder's Warrants by notice of
redemption to such person. On any such redemption, the redemption price shall be
the lesser of (a) the lowest closing sale price of the Warrants on any trading
day during the 120 day period commencing on the date upon which ITT Destinations
shall have received notice from a gaming authority of such holder's
disqualification or (b) the price at which such holder acquired the Warrants,
unless a different redemption price is required by such gaming authority, in
which event such required price shall be the redemption price.
CASINO GAMING REGULATION
ITT Destination's gaming operations consist of Caesars Palace in Las Vegas,
Caesars Atlantic City in Atlantic City and Caesars Tahoe in Stateline, Nevada
(each of which was acquired by ITT in January 1995), ITT Sheraton's Desert Inn
Resort's Casino in Las Vegas, the Sheraton Casino in Tunica County, Mississippi,
and various hotel/casino operations of ITT Sheraton and Caesars outside the
United States. These gaming operations are subject to extensive regulation,
including the following:
NEVADA GAMING REGULATION
The ownership and/or operation of casino gaming facilities in Nevada are
subject to state and local regulation. Nevada's casino gaming laws, regulations
and supervisory procedures are extensive and reflect certain broad declarations
of public policy. In general, Nevada's gaming laws, regulations and supervisory
procedures seek to (i) prevent unsavory or unsuitable persons from having any
direct or indirect involvement with gaming at any time or in any capacity, (ii)
establish and maintain responsible accounting practices and procedures, (iii)
maintain effective control over the financial practices of licensees, including
establishing minimum procedures for internal fiscal affairs and the safeguarding
of assets and revenues, providing reliable recordkeeping, and making periodic
reports to the applicable casino gaming authority, (iv) prevent cheating and
fraudulent practices and (v) provide a source of state and local revenues
through taxation and licensing fees.
The Nevada Gaming Commission (the "Nevada Commission") may, in its
discretion, require the holder of any debt security of ITT Destinations or any
affiliated company of ITT Destinations to file an application, be investigated
and found suitable to own such debt security. If the Nevada Commission
determines that a person is unsuitable to own such debt security, then pursuant
to the Nevada Gaming Control Act (the "Nevada Act"), ITT Destinations and its
affiliated Nevada gaming companies, the Sheraton Desert Inn Companies and the
Caesars Nevada Companies, can be sanctioned, including the loss of their
approvals, if without the prior approval of the Nevada Commission, they: (i) pay
to the unsuitable person any dividend, interest or any distribution whatsoever;
(ii) recognize any voting right by such unsuitable person in connection with
such securities; (iii) pay the unsuitable person remuneration in any form; or
(iv) make any payment to the unsuitable person by way of principal, redemption,
conversion, exchange, liquidation or similar transaction. See "Description of
Debt Securities -- Redemption Pursuant to Gaming Laws".
Any person who fails or refuses to apply for a finding of suitability or a
license within 30 days after being ordered to do so by the Nevada Commission or
by the Chairman of the Nevada State Gaming Control Board may be found
unsuitable. Any holder of any equity or debt security found unsuitable and who
holds, directly or indirectly, any beneficial ownership of ITT Destinations'
debt or equity voting securities beyond such period or periods of time as may be
prescribed by the Nevada Commission may be guilty of a gross misdemeanor. ITT
Destinations could be subject to disciplinary action if, without the prior
approval of the Nevada Commission and after ITT Destinations receives notice
that a person is unsuitable to be an equity or debt security holder or to have
any other relationship with ITT Destinations, ITT Sheraton, Sheraton Gaming
Corporation, Sheraton
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Desert Inn Corporation, Caesars, Caesars Palace Corporation or Desert Palace,
Inc. or any one of them either (i) pays to the unsuitable person any dividend,
interest or any distribution whatsoever, (ii) recognizes any voting right by
such unsuitable person in connection with such securities, (iii) pays the
unsuitable person remuneration in any form, (iv) makes any payment to the
unsuitable person by way of principal, redemption, conversion, exchange,
liquidation or similar transaction or (v) fails to pursue all lawful efforts to
require such unsuitable person to relinquish his securities including, if
necessary, the immediate purchase of such securities for cash at fair market
value.
NEW JERSEY GAMING REGULATION
Casino gaming in New Jersey is subject to strict compliance with the New
Jersey Casino Control Act (the "New Jersey Act"), the strict supervision of the
New Jersey Casino Control Commission (the "New Jersey Commission") and
compliance with the regulations adopted by the New Jersey Commission. The New
Jersey gaming laws and regulations primarily concern (a) the financial stability
and character of casino operators, their employees, their security holders and
others financially interested in casino operations, and (b) the operating
methods -- including the rules of the games and credit issuance
procedures -- and the financial and accounting procedures used in connection
with casino operations. The New Jersey gaming laws and regulations include
detailed provisions concerning, among other things, (i) the type, manner and
number of applications and licenses required to conduct casino gaming and
ancillary activities, (ii) the licensing, regulation and curricula of gaming
schools, (iii) the establishment of minimum standards of accounting and internal
control, including the issuance and enforceability of casino credit, (iv) the
manufacture, sale, distribution and possession of gaming equipment, (v) the
rules of the games, (vi) the exclusion of undesirable persons, (vii) the use,
regulation and reporting of junket activities, (viii) the possession, sale and
distribution of alcoholic beverages, (ix) the regulation and licensing of
suppliers to licensed casino operators, (x) the conduct of entertainment within
licensed casino facilities, (xi) equal employment opportunity for employees of
licensed casino operators, contractors for casino facilities and the like, (xii)
the payment of gross revenue taxes and similar fees and expenses, (xiii) the
conduct of casino simulcasting and (xiv) the imposition and discharge of casino
reinvestment development obligations. A number of these regulations require
practices which are different from those in many casinos elsewhere. As a
prerequisite to being licensed, a New Jersey casino/hotel facility must meet
certain facilities requirements concerning, among other things, the size and
number of guest rooms.
Caesars's casino gaming operations in Atlantic City, New Jersey are
conducted by Boardwalk Regency Corporation ("BRC"), which is a wholly owned
subsidiary of Caesars New Jersey, Inc. ("CNJ"), which, in turn, is a wholly
owned subsidiary of Caesars, which in turn, will be a wholly owned subsidiary of
ITT Sheraton (ITT Sheraton, Caesars, CNJ and BRC collectively referred to as the
"Caesars New Jersey Companies"). After the Distribution, ITT Sheraton will be a
wholly owned subsidiary of ITT Destinations. As a prerequisite to BRC holding a
license, ITT Destinations, ITT Sheraton, Caesars and CNJ have to be approved by
the New Jersey Commission due to their corporate relationship to BRC. Thus, any
debt or equity security holder of ITT Destinations, ITT Sheraton, Caesars or CNJ
will have to be found qualified. The qualification requirement of any debt or
equity security holder of ITT Destinations may be waived based on an express
finding by the New Jersey Commission, with the consent of the Director of the
New Jersey Division of Gaming Enforcement ("DGE"), that the security holder
either (a)(i) is not significantly involved in the activities of BRC, (ii) does
not have the ability to control ITT Destinations, ITT Sheraton, Caesars, CNJ or
BRC and (iii) does not have the ability to elect one or more members of the
respective boards of directors of ITT Destinations, ITT Sheraton, Caesars, CNJ
or BRC, or (b) is an "institutional investor", as such term is defined in the
New Jersey Act and regulations; for purposes of the former, the New Jersey Act
presumes that any non-"institutional investor" security holder who owns or
beneficially holds 5% or more of the equity securities of ITT Destinations has
the ability to control ITT Destinations, ITT Sheraton, Caesars, CNJ or BRC,
unless such presumption is rebutted by clear and convincing evidence.
The New Jersey Act and regulations define an "institutional investor" as
(i) any retirement fund administered by a public agency for the exclusive
benefit of Federal, state or local public employees, (ii) an investment company
registered under the Investment Company Act of 1940, (iii) a collective
investment trust
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organized by banks under Part Nine of the Rules of the Comptroller of the
Currency, (iv) a closed end investment trust, (v) a chartered or licensed life
insurance company or property and casualty insurance company, (vi) banking or
other licensed or chartered lending institutions, (vii) an investment adviser
registered under the Investment Advisers Act of 1940 or (viii) such other
persons as the New Jersey Commission may determine for reasons consistent with
the policies of the New Jersey Act. In the absence of a prima facie showing by
the Director of the New Jersey DGE that there is any cause to believe that such
institutional investor may be found unqualified, upon application and for good
cause shown, an institutional investor holding either (a) less than 10% of the
equity securities of ITT Destinations or (b) ITT Destinations debt securities
constituting less than 20% of the outstanding debt of ITT Destinations and less
than 50% of the issue involved shall be granted a waiver of qualification as to
such holdings if (i) such securities are those of a publicly traded corporation,
(ii) the institutional investor's holdings of such securities were purchased for
investment purposes only and (iii) upon request by the New Jersey Commission,
the institutional investor files with the New Jersey Commission a certified
statement to the effect that the institutional investor had no intention of
influencing or affecting the affairs of ITT Destinations, ITT Sheraton, Caesars,
CNJ or BRC; notwithstanding the foregoing, the institutional investor is
permitted to vote on matters put to the vote of the outstanding security holders
of ITT Destinations.
If an institutional investor who has been granted a waiver subsequently
determines to influence or affect the affairs of ITT Destinations, the
institutional investor must provide to the New Jersey Commission not less than
30 days prior notice of such intent and the institutional investor must file
with the New Jersey Commission an application for qualification before taking
any action that may influence or affect the affairs of ITT Destinations.
Notwithstanding the foregoing, the institutional investor is permitted to vote
on matters put to the vote of the outstanding security holders of ITT
Destinations. If an institutional investor changes its investment intent, or if
the New Jersey Commission finds reasonable cause to believe that the
institutional investor may be found unqualified, no action other than
divestiture shall be taken by such institutional investor with respect to its
security holdings until there has been compliance with the interim casino
authorization provisions of the New Jersey Act, including the execution of a
trust agreement. ITT Destinations, ITT Sheraton, Caesars, CNJ and BRC are
required to immediately notify the New Jersey Commission and the New Jersey DGE
of any information about, or action of, an institutional investor holding its
equity or debt securities where such information or action may impact on the
eligibility of such institutional investor for a waiver. If the New Jersey
Commission finds an institutional investor unqualified or if the New Jersey
Commission finds that, by reason of the extent or nature of its holdings, an
institutional investor is in the position to exercise a substantial impact on
the controlling interests of BRC so that qualification of the institutional
investor is necessary to protect the public interest, the New Jersey Act vests
in the New Jersey Commission the power to take all necessary action to protect
the public interest, including the power to require that the institutional
investor submit to qualification and become qualified under the New Jersey Act.
An equity or debt security holder -- including institutional
investors -- of ITT Destinations, ITT Sheraton, Caesars, CNJ or BRC who is
required to be found qualified by the New Jersey Commission must submit an
application for qualification within 30 days after being ordered to do so or
divest all security holdings within 120 days after the New Jersey Commission
determines such qualification is required. The application for qualification
must include a trust agreement by which the security holder places its interest
in ITT Destinations in trust with a trustee qualified by the New Jersey
Commission. If the security holder is ultimately found qualified, the trust
agreement is terminated. If the security holder is not found qualified or
withdraws its application for qualification prior to a determination on
qualification being made, the trustee will be empowered with all rights of
ownership pertaining to such security holder's ITT Destinations securities,
including all voting rights and the power to sell the securities; in any event,
the unqualified security holder will not be entitled to receive in exchange for
its ITT Destinations securities an amount in excess of the lower of (i) the
actual cost the security holder incurred in acquiring the securities or (ii) the
value of such securities calculated as if the investment had been made on the
date the trust became operative. By the same token, if the security holder is
not found qualified, it is unlawful for the security holder to (i) receive any
dividends or interest on such securities, (ii) exercise, directly or through any
trustee or nominee, any right conferred by such securities, or (iii) receive any
remuneration in any form from ITT Destinations, ITT Sheraton, Caesars, CNJ or
BRC for services rendered or otherwise.
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For a more detailed description of casino gaming regulations see "Business
of New ITT After the Distribution -- Governmental Regulation and Related
Matters -- Casino Gaming Regulation" in the Proxy.
RELATED PROVISIONS OF THE ITT DESTINATIONS AMENDED AND RESTATED ARTICLES OF
INCORPORATION
ITT Destinations' Amended and Restated Articles of Incorporation provide
that (i) all securities of ITT Destinations are subject to redemption by ITT
Destinations to the extent necessary to prevent the loss, or to secure the
reinstatement, of any casino gaming license held by ITT Destinations or any of
its subsidiaries in any jurisdiction within or without the United States of
America, (ii) all securities of ITT Destinations are held subject to the
condition that if a holder thereof is found by a gaming authority in any such
jurisdiction to be disqualified or unsuitable pursuant to any gaming law, such
holder will be required to dispose of all ITT Destinations securities held by
such holder, and (iii) it will be unlawful for any such disqualified person to
(A) receive payments of interest or dividends on any ITT Destinations
securities, (B) exercise, directly or indirectly, any rights conferred by any
ITT Destinations securities or (C) receive any remuneration in any form, for
services rendered or otherwise, from the subsidiary that holds the gaming
license in such jurisdiction.
PLAN OF DISTRIBUTION
ITT Destinations may sell the Securities (i) through underwriters or
dealers; (ii) directly to one or more purchasers; or (iii) through agents. The
Prospectus Supplement with respect to the Securities being offered thereby sets
forth the terms of the offering of such Securities, including the name or names
of any underwriters, the purchase price of such Securities and the proceeds to
ITT Destinations from such sale, any underwriting discounts and other items
constituting underwriters' compensation, any initial public offering price, any
discounts or concessions allowed or reallowed or paid to dealers, and any
securities exchange on which such Securities may be listed. Only underwriters so
named in the Prospectus Supplement are deemed to be underwriters in connection
with the Securities offered thereby.
If underwriters are used in the sale, the Securities will be acquired by
the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. The
obligations of the underwriters to purchase such Securities will be subject to
certain conditions precedent, and the underwriters will be obligated to purchase
all the Securities of the series offered by the Prospectus Supplement if any of
such Securities are purchased. Any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be changed
from time to time.
Securities may also be sold directly by ITT Destinations or through agents
designated by ITT Destinations from time to time. Any agent involved in the
offering and sale of the Securities in respect of which this Prospectus is
delivered is named, and any commissions payable by ITT Destinations to such
agent are set forth, in the Prospectus Supplement. Unless otherwise indicated in
the Prospectus Supplement, any such agent is acting on a best efforts basis for
the period of its appointment.
If so indicated in the Prospectus Supplement, ITT Destinations will
authorize agents, underwriters or dealers to solicit offers by certain
institutional investors to purchase Securities providing for payment and
delivery on a future date specified in the Prospectus Supplement. Institutional
investors to which such offers may be made, when authorized, include commercial
and savings banks, insurance companies, pension funds, investment companies,
education and charitable institutions and such other institutions as may be
approved by ITT Destinations. The obligations of any such purchasers pursuant to
such delayed delivery and payment arrangements will not be subject to any
conditions except that the purchase by an institution of the particular
Securities shall not at any time of delivery be prohibited under the laws of any
jurisdiction in the United States to which such institution is subject.
Underwriters will not have any responsibility in respect of the validity of such
arrangements or the performance of ITT Destinations or such institutional
investors thereunder.
Underwriters, dealers and agents that participate in the distribution of
the Securities may be deemed to be underwriters, and any discounts or
commissions received by them from ITT Destinations and any profit on the resale
of the Securities by them may be deemed to be underwriting discounts and
commissions, under the
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Securities Act of 1933 (the "Act"). Under agreements which may be entered into
by ITT Destinations, underwriters, dealers and agents who participate in the
distribution of the Securities may be entitled to indemnification by ITT
Destinations and, under certain circumstances, by ITT, against certain civil
liabilities, including liabilities under the Act, or to contribution with
respect to payments which the underwriters, dealers or agents may be required to
make with respect thereof. Underwriters, dealers and agents may engage in
transactions with, or perform services for, ITT Destinations, ITT or their
respective subsidiaries in the ordinary course of their respective businesses.
LEGAL OPINIONS
The legality of the Securities and the Guarantees offered hereby will be
passed upon for ITT Destinations and ITT by Richard S. Ward, Esq., ITT's
Executive Vice President and General Counsel, or such other attorney of ITT
Destinations or ITT as ITT Destinations and ITT may designate, and for the
Underwriters by Cravath, Swaine & Moore, New York, NY, or such other counsel as
may be designated. Mr. Ward has an interest in certain securities of ITT.
Cravath, Swaine & Moore acts from time to time as legal counsel to ITT and ITT
Destinations on various matters, including the Distribution.
EXPERTS
The audited financial statements and schedules relating to ITT, ITT
Destinations and Caesars included or incorporated by reference in this
Prospectus and elsewhere in the Registration Statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect thereto, and are incorporated herein by reference in
reliance upon the authority of said firm as experts in accounting and auditing
in giving said reports.
The financial statements relating to Ciga incorporated by reference in this
Prospectus and elsewhere in this Registration Statement have been audited by
Price Waterhouse (Milan, Italy), independent public accountants, as indicated in
their report with respect thereto, and are incorporated herein by reference in
reliance upon the authority of said firm as experts in accounting and auditing
in giving said report.
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YOU SHOULD RELY ONLY ON THE INFORMATION INCORPORATED BY REFERENCE OR PROVIDED
IN THE PROSPECTUS OR THE PROSPECTUS SUPPLEMENT. WE HAVE AUTHORIZED NO ONE TO
PROVIDE YOU WITH DIFFERENT INFORMATION. WE ARE NOT MAKING AN OFFER OF THESE
SECURITIES IN ANY STATE WHERE THE OFFER IS NOT PERMITTED. YOU SHOULD NOT ASSUME
THAT THE INFORMATION IN THE PROSPECTUS OR THE PROSPECTUS SUPPLEMENT IS ACCURATE
AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT OF THE DOCUMENT.
------------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
PROSPECTUS SUPPLEMENT
Summary............................... S-3
The Company........................... S-6
Use of Proceeds....................... S-7
Ratio of Earnings to Total Fixed
Charges............................. S-7
Description of Notes.................. S-8
Underwriting.......................... S-10
Legal Opinions........................ S-10
PROSPECTUS
Incorporation of Certain Documents by
Reference........................... 2
Available Information................. 2
ITT Destinations...................... 3
ITT Corporation....................... 3
The Distribution...................... 3
Use of Proceeds....................... 4
ITT Destinations Ratio of Earnings to
Fixed Charges....................... 4
ITT Ratio of Earnings to Fixed
Charges............................. 4
Description of Debt Securities........ 5
Description of Warrants............... 14
Casino Gaming Regulation.............. 15
Plan of Distribution.................. 18
Legal Opinions........................ 19
Experts............................... 19
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</TABLE>
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$250,000,000
ITT CORPORATION
6 3/4% NOTES DUE NOVEMBER 15, 2003
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PROSPECTUS SUPPLEMENT
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GOLDMAN, SACHS & CO.
CHASE SECURITIES INC.
J.P. MORGAN & CO.
LAZARD FRERES & CO. LLC
UBS SECURITIES
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