<PAGE>
PROSPECTUS SUPPLEMENT Filed pursuant to Rule 424(B)(5)
(To Prospectus dated January 14, 1998) SEC File No. 333-42525
[LOGO OF TYSON FOODS, INC. APPEARS HERE]
TYSON FOODS, INC.
$240,000,000
7% Notes due 2018
Interest payable May 1 and November 1
ISSUE PRICE: 98.354%
Interest on the 7% Notes due May 1, 2018 (the "Notes") is payable semiannually
on May 1 and November 1 of each year, beginning November 1, 1998. The Notes
will not be redeemable prior to maturity and will not be subject to any sinking
fund. The Notes will be represented by Global Securities registered in the name
of The Depository Trust Company (the "Depositary") or its nominee. Interests in
the Global Securities will be shown on, and transfer thereof will be effected
only through, records maintained by the Depositary and its participants. Except
as provided herein, Notes in definitive form will not be issued. See
"Description of Notes."
The Notes will trade in the Depositary's Same-Day Funds Settlement System until
maturity, and secondary market trading activity in the Notes will therefore
settle in immediately available funds. All payments of principal and interest
will be made by the Company in immediately available funds. See "Description of
Notes--Same-Day Settlement and Payment."
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC(1) COMMISSIONS(2) COMPANY(1)(3)
- -------------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Note 98.354% .875% 97.479%
- -------------------------------------------------------------------------------------
Total $236,049,600 $2,100,000 $233,949,600
- -------------------------------------------------------------------------------------
</TABLE>
(1) Plus accrued interest, if any, from May 1, 1998.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."
(3) Before deducting expenses payable by the Company, estimated at $187,800.
The Notes are offered, subject to prior sale, when, as and if accepted by the
Underwriters and subject to approval of certain legal matters by Davis Polk &
Wardwell, counsel for the Underwriters. It is expected that delivery of the
Notes will be made on or about May 1, 1998 through the facilities of the
Depositary, against payment therefor in same-day funds.
J.P. MORGAN & CO. MERRILL LYNCH & CO.
April 28, 1998
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE NOTES.
SPECIFICALLY, THE UNDERWRITERS MAY OVERALLOT IN CONNECTION WITH THE OFFERING
AND MAY BID FOR, AND PURCHASE, THE NOTES IN THE OPEN MARKET. FOR A DESCRIPTION
OF THESE ACTIVITIES, SEE "UNDERWRITING".
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED OR INCORPORATED BY REFERENCE IN
THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN
OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN
THE SECURITIES DESCRIBED IN THIS PROSPECTUS SUPPLEMENT OR AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN
WHICH SUCH OFFER OR SOLICITATION IS UNLAWFUL. NEITHER THE DELIVERY OF THIS
PROSPECTUS SUPPLEMENT OR THE PROSPECTUS, NOR ANY SALE MADE HEREUNDER AND
THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE
HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT
THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE HEREIN OR THEREIN IS
CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE OF SUCH INFORMATION.
----------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Recent Events.............................................................. S-3
Use of Proceeds............................................................ S-3
Description of Notes....................................................... S-4
Underwriting............................................................... S-5
Legal Matters.............................................................. S-5
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
The Company................................................................ 3
Ratio of Earnings to Fixed Charges......................................... 3
Use of Proceeds............................................................ 4
Description of Debt Securities............................................. 4
Plan of Distribution....................................................... 15
Legal Matters.............................................................. 16
Experts.................................................................... 16
</TABLE>
S-2
<PAGE>
RECENT EVENTS
RECENT ACQUISITION
On January 9, 1998, the Company completed the acquisition of Hudson Foods,
Inc. ("Hudson") pursuant to which Hudson merged with and into a wholly-owned
subsidiary of the Company (the "Hudson Acquisition"). At the effective time of
the merger the Class A and Class B shareholders of Hudson received an
aggregate of approximately 18.4 million shares of the Company's Class A Common
Stock and approximately $257.4 million in cash. Reference is made to the
Company's Current Report on Form 8-K, dated January 15, 1998, incorporated by
reference into the Prospectus, for a more detailed description of the Hudson
Acquisition, including certain pro forma financial information giving effect
to such acquisition.
RESULTS OF OPERATIONS
On April 27, 1998 the Company reported operating results for the three month
period (the "second quarter") and six month period (the "six month period")
ended March 28, 1998, respectively. Earnings per share for the second quarter
were $.10, which represented a decrease of 55% from $.22 for the same period
in fiscal 1997. Gross profits for the second quarter increased 2.5% to $268.8
million from $262.2 million for the same period in fiscal 1997. Sales for the
second quarter were $1.87 billion, compared to $1.57 billion for the same
period in fiscal 1997, an increase of 18.8%. The increase in sales was mainly
due to the Hudson Acquisition, resulting in an overall increase of 27.3% in
total volume partially offset by a 6.7% decrease in average sales prices. The
decrease in earnings was primarily attributable to the excess supply of all
meat proteins, weaknesses in the export markets and the quality of Hudson's
sales mix.
Earnings per share for the six month period were $.31, compared to $.42 for
the same period in fiscal 1997, a decrease of 26.2%. Gross profits for the six
month period increased 3.7% to $529.5 million from $510.6 million for the same
period in fiscal 1997. Sales for the six month period were $3.39 billion,
compared to $3.10 billion for the same period in fiscal 1997, an increase of
9.3%.
Reference is made to the Company's Current Report on Form 8-K, dated April
27, 1998, incorporated by reference into the Prospectus, for a more complete
description of the Company's operating results for the second quarter and the
six month period.
USE OF PROCEEDS
The net proceeds from the offering of the Notes will be used by the Company
to repay all outstanding borrowings under its $250 million revolving credit
agreement expiring in May 1998 (the "Expiring Credit Agreement"), with the
remainder of the net proceeds being used to repay a portion of the borrowings
under its commercial paper program. As of April 24, 1998, the outstanding
borrowings under the Expiring Credit Agreement were approximately $75.0
million and the weighted average interest rate was 5.629%. As of April 24,
1998, the outstanding borrowings under the Company's commercial paper program
were approximately $934.5 million and the weighted average rate on such
commercial paper was 5.673%, with maturities ranging from 4 to 38 days.
The reduction of the Company's commercial paper borrowings will increase
availability under the Company's remaining $1.0 billion revolving credit
agreement which currently supports such commercial paper borrowings and bears
interest at floating rates (weighted average rate, excluding commercial paper,
of 5.629% at April 24, 1998). The Company has previously used, and may from
time to time in the future use, funds borrowed under its revolving credit
agreement, commercial paper program or through the issuance of additional debt
securities to: (i) repay indebtedness of Hudson assumed by the Company as a
result of the Hudson Acquisition, (ii) refinance other indebtedness (or
capital leases) of the Company, (iii) finance acquisitions as opportunities
may arise, and (iv) for other general corporate purposes.
Pending application of the net proceeds from the offering of the Notes, such
proceeds may be invested in short-term interest bearing securities.
S-3
<PAGE>
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes supplements
and, to the extent inconsistent therewith, replaces the description of the
general terms and provisions of the Debt Securities set forth in the
accompanying Prospectus, to which description reference is hereby made.
Whenever a defined term is referred to and not herein defined, the definition
thereof is contained in the accompanying Prospectus or in the Indenture
referred to therein.
GENERAL
The Notes constitute a single series of Debt Securities to be issued
pursuant to an Indenture, dated as of June 1, 1995, between the Company and
The Chase Manhattan Bank. The Notes will be limited to $240,000,000 in
aggregate principal amount and will mature on May 1, 2018. The Notes will not
be redeemable prior to maturity and will not be subject to any sinking fund.
The Notes will bear interest at the rate per annum set forth on the cover
page of this Prospectus Supplement from the date of issuance or from the most
recent interest payment date to which interest has been paid or provided for,
payable semiannually on May 1 and November 1 of each year, beginning November
1, 1998, to the persons in whose names the Notes are registered at the close
of business on the immediately preceding April 15 and October 15,
respectively, whether or not such day is a Business Day.
The Notes will (i) rank equally with other unsecured and unsubordinated
obligations of the Company (excluding subsidiary debt) for borrowed money, of
which approximately $2,293,000,000 was outstanding at April 24, 1998, (ii) be
effectively subordinated (with respect to underlying collateral) to secured
indebtedness of the Company (excluding subsidiary debt), of which
approximately $39,000,000 was outstanding at April 24, 1998, and (iii) be
structurally subordinated to all indebtedness of the Company's subsidiaries,
of which approximately $25,000,000 was outstanding at April 24, 1998.
BOOK-ENTRY SYSTEM
Upon issuance, the Notes will be represented by one or more Global
Securities deposited with, or on behalf of the Depositary. The Global
Securities representing the Notes will be registered in the name of the
Depositary or its nominee. Except under the circumstances described in the
accompanying Prospectus under "Description of Debt Securities--Book-Entry
System," the Notes will not be issuable in definitive form. So long as the
Notes are represented by one or more Global Securities, the Depositary or its
nominee will be considered the sole owner or holder of such Notes for all
purposes under the Indenture, and the beneficial owners of such Notes will be
entitled only to those rights and benefits afforded to them in accordance with
the Depositary's regular operating procedures. See "Description of Debt
Securities--Book-Entry System" in the Prospectus.
A further description of the Depositary's procedures with respect to Global
Securities is set forth in the accompanying Prospectus under "Description of
Debt Securities--Book-Entry System." The Depositary has confirmed to the
Company, the Underwriters and the Trustee that it intends to follow such
procedures with respect to the Notes.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available funds. So long as the Notes are represented by Global Securities,
all payments of principal and interest will be made by the Company in
immediately available funds.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearinghouse or next-day funds. In contrast, so long as
the Notes are represented by Global Securities registered
S-4
<PAGE>
in the name of the Depositary or its nominee, the Notes will trade in the
Depositary's Same-Day Funds Settlement System, and secondary market trading
activity in the Notes will therefore be required by the Depositary 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.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
dated the date hereof, the Company has 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 AMOUNT
NAME OF NOTES
---- ----------------
<S> <C>
J.P. Morgan Securities Inc. ................................ $120,000,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated....................................... 120,000,000
------------
Total..................................................... $240,000,000
============
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are obligated to take and pay for all of the Notes if any are
taken.
The Underwriters initially propose 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 such price less a concession not in
excess of .50% of the principal amount of the Notes. The Underwriters may
allow, and such dealers may reallow, a concession not in excess of .25% of the
principal amount of the Notes to certain other dealers. After the initial
public offering, the public offering price and such concessions may be
changed.
The Company does not intend to apply for listing of the Notes on a national
securities exchange, but has been advised by the Underwriters that they intend
to make a market in the Notes. The Underwriters are not obligated, however, to
make a market in the Notes and may discontinue market making at any time
without notice. No assurance can be given as to the liquidity of, or trading
markets for, the Notes.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
In the ordinary course of their respective businesses, the Underwriters and
certain of their affiliates have engaged, and may in the future engage, in
investment banking and/or commercial banking transactions with the Company and
its affiliates.
In connection with the offering of the Notes, the Underwriters may engage in
transactions that stabilize, maintain or otherwise affect the price of the
Notes. Specifically, the Underwriters may overallot such offerings, creating a
syndicate short position. In addition, the Underwriters may bid for, and
purchase Notes in the open market to cover syndicate shorts or to stabilize
the price of the Notes. Finally, the underwriting syndicate may reclaim
selling concessions allowed for distributing the Notes in the offering, if the
syndicate repurchases previously distributed Notes in syndicate covering
transactions, in stabilization transactions or otherwise. Any of these
activities may stabilize or maintain the market price of the Notes above
independent market levels. The Underwriters are not required to engage in
these activities, and may end any of these activities at any time.
LEGAL MATTERS
The validity of the issuance of the Notes offered hereby will be passed upon
for the Company by Kutak Rock, Little Rock, Arkansas, and for the Underwriters
or agents by Davis Polk & Wardwell, New York, New York.
S-5
<PAGE>
PROSPECTUS
$500,000,000
TYSON FOODS, INC.
DEBT SECURITIES
----------------
Tyson Foods, Inc. (the "Company") intends to issue from time to time debt
securities (the "Debt Securities"), which will be direct, unsecured
obligations of the Company and offered to the public on terms determined by
market conditions at the time of sale. The Company may sell Debt Securities
for proceeds of up to $500,000,000, or the equivalent thereof in one or more
foreign currencies or composite currencies, (i) directly to purchasers, (ii)
through agents designated from time to time, (iii) to dealers, or (iv) through
underwriters or a group of underwriters.
The Debt Securities may be issued in one or more series with the same or
various maturities at or above par or with an original issue discount. The
specific designation, aggregate principal amount, authorized denominations,
purchase price, maturity, rate (or method of calculation) and time of payment
of any interest, any terms for redemption or repurchase or conversion, the
currency or composite currency in which the Debt Securities shall be
denominated or payable, any listing on a securities exchange, whether the Debt
Securities will be issued in the form of a Global Security (as hereafter
defined) or securities, or other specific terms of the Debt Securities in
respect of which this Prospectus is being delivered ("Offered Securities") are
set forth in the accompanying supplement to the Prospectus (the "Prospectus
Supplement"), together with the terms of offering of the Offered Securities.
Unless otherwise indicated in the Prospectus Supplement, the Company does not
intend to list any of the Debt Securities on a national securities exchange.
See "Plan of "Distribution."
----------------
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 OR ANY
SUPPLEMENT HERETO. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
----------------
THE DATE OF THIS PROSPECTUS IS JANUARY 14, 1998.
<PAGE>
No person has been authorized to give any information or to make any
representations not contained or incorporated by reference in this Prospectus
or the accompanying Prospectus Supplement and, if given or made, such
information or representation must not be relied upon as having been
authorized by the Company or any agent, dealer or underwriter. Neither the
delivery of this Prospectus or the accompanying Prospectus Supplement nor any
sale made hereunder or thereunder shall, under any circumstances, create any
implication that the information contained herein or in the accompanying
Prospectus Supplement is correct as of any date subsequent to the date hereof
or thereof or that there has been no change in the affairs of the Company
since the date hereof or thereof. Neither this Prospectus nor the accompanying
Prospectus Supplement constitutes an offer to sell or solicitation of an offer
to buy Debt Securities in any jurisdiction in which such offer or solicitation
is not authorized or in which the person making such offer or solicitation is
not qualified to do so or to any person to whom it is unlawful to make such
offer or solicitation.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information can be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549 and at the following regional offices of the Commission: Seven
World Trade Center, Suite 1300, New York, New York 10048, and Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such
material can be obtained by mail at prescribed rates from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549.
The Commission also maintains a Web Site at http://www.sec.gov that contains
reports, proxy statements and other information. Reports and other information
concerning the Company can also be inspected at the offices of the New York
Stock Exchange, 20 Broad Street, New York, New York 10005, on which certain of
the Company's securities are listed.
This Prospectus constitutes a part of a Registration Statement on Form S-3,
as amended (the "Registration Statement") filed by the Company with the
Commission under the Securities Act of 1933, as amended (the "Securities
Act"). This Prospectus and the accompanying Prospectus Supplement omit certain
of the information contained in the Registration Statement in accordance with
the rules and regulations of the Commission. Reference is hereby made to the
Registration Statement and related exhibits for further information with
respect to the Company and the Debt Securities. Statements contained herein
concerning the provisions of any document are not necessarily complete and, in
each instance, reference is made to the copy of such document filed as an
exhibit to the Registration Statement or otherwise filed with the Commission.
Each such statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents previously filed by the Company with the Commission
are incorporated by reference in this Prospectus:
1. The Company's Annual Report on Form 10-K for the fiscal year ended
September 27, 1997;
2. The Company's Current Report on Form 8-K dated December 16, 1997; and
3. The Company's Current Report on Form 8-K dated January 2, 1998.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14, or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering hereunder shall be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of the filing of such documents.
2
<PAGE>
Any statement contained herein or in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of the Registration Statement and this Prospectus to the extent
that a statement contained herein or in any 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
the Registration Statement or this Prospectus.
The Company will provide, without charge, to each person to whom this
Prospectus is delivered, on the written or oral request of any such person, a
copy of any or all of the documents which have been incorporated herein by
reference, other than exhibits to such documents (unless such exhibits are
specifically incorporated by reference into such documents). Requests should
be directed to Corporate Secretary, Tyson Foods, Inc., 2210 West Oaklawn
Drive, Springdale, Arkansas 72762-6999, telephone: (501) 290-4000.
THE COMPANY
Tyson Foods, Inc. and its various subsidiaries produce, market and
distribute a variety of food products consisting of value-enhanced poultry,
fresh and frozen poultry, value-enhanced seafood products, fresh and frozen
seafood products, prepared foods, and other products such as flour and corn
tortillas and chips. Additionally, the Company has live swine, animal feed and
pet food ingredient operations. The Company's integrated operations consist of
breeding and rearing chickens, and harvesting seafood, as well as the
processing, further processing and marketing of these food products. The
Company's products are marketed and sold to national and regional grocery
chains, regional grocery wholesalers, clubs and warehouse stores, military
commissaries, industrial food processing companies, national and regional
chain restaurants and their distributors, international export companies and
domestic distributors who service restaurants, food service operations such as
plant and school cafeterias, convenience stores, hospitals and other vendors.
As of September 27, 1997, Don Tyson, Senior Chairman of the Board of
Directors of the Company, directly and through the Tyson Limited Partnership,
of which he is the managing general partner, beneficially owned 0.5% and 99.9%
of the Company's Class A Common Stock, $.10 par value per share, and Class B
Common Stock, $.10 par value per share, respectively which represented
approximately 90.2% of the combined voting power of the shares of such Class A
Common Stock and Class B Common Stock on such date.
The Company commenced business in 1935, was incorporated in Arkansas in
1947, and was reincorporated in Delaware in 1986. The Company's executive
offices are located at 2210 West Oaklawn Drive, Springdale, Arkansas 72762-
6999 and its telephone number is (501) 290-4000.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges for
the Company for each year in the five year period ended September 27, 1997.
For the purposes of calculating the ratio of earnings to fixed charges,
"earnings" consist of income from continuing operations before income taxes
and fixed charges (excluding capitalized interest). "Fixed charges" consist of
(i) interest on indebtedness, whether expensed or capitalized, but excluding
interest to fifty-percent-owned subsidiaries (ii) the Company's proportionate
share of interest of fifty-percent-owned subsidiaries, (iii) that portion of
rental expense the Company believes to be representative of interest (one-
third of rental expense) and (iv) amortization of debt discount and expense.
FISCAL YEAR ENDED 1997
<TABLE>
<CAPTION>
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C>
3.37 1.84 3.59 2.14 4.48
</TABLE>
3
<PAGE>
USE OF PROCEEDS
The Company intends to use the net proceeds from the sale of the Debt
Securities to refinance existing indebtedness (including but not limited to
indebtedness of Hudson Foods, Inc. which was assumed pursuant to the
acquisition thereof), to finance acquisitions as opportunities may arise, and
for other general corporate purposes. Further details relating to the uses of
the net proceeds of any such offering will be set forth in the applicable
Prospectus Supplement. The Company expects to engage in additional financing
as needs arise.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued under an Indenture dated as of June 1,
1995, as supplemented, (hereinafter referred to as the "Indenture"), between
the Company and The Chase Manhattan Bank, as Trustee (hereinafter referred to
as the "Trustee"). The following statements are subject to the detailed
provisions of the Indenture, a copy of which is filed as an exhibit to the
Registration Statement and which is also available for inspection at the
office of the Trustee. Section references are to the Indenture. The following
summarizes the material terms of the Indenture; however, the following
summaries of certain provisions of the Indenture do not purport to be
complete, and wherever particular provisions of the Indenture are referred to,
such provisions, including definitions of certain terms, are incorporated by
reference as part of such summaries or terms, which are qualified in their
entirety by such reference to the provisions of the Indenture.
GENERAL
The Indenture does not limit the aggregate principal amount of Debt
Securities which may be issued thereunder and provides that the Debt
Securities may be issued from time to time in one or more series. The Debt
Securities will be direct, unsecured and unsubordinated obligations of the
Company. Except as described under "Certain Covenants," the Indenture does not
limit other indebtedness or securities which may be incurred or issued by the
Company or any of its subsidiaries or contain financial or similar
restrictions on the Company or any of its subsidiaries. The Company's rights
and the rights of its creditors, including holders of Debt Securities, to
participate in any distribution of assets of any subsidiary upon the latter's
liquidation or reorganization or otherwise are effectively subordinated to the
claims of the subsidiary's creditors, except to the extent that the Company or
any of its creditors may itself be a creditor of that subsidiary.
The Prospectus Supplement which accompanies this Prospectus sets forth where
applicable the following terms of and information relating to the Offered
Securities offered thereby: (i) the designation of the Offered Securities;
(ii) the aggregate principal amount of the Offered Securities; (iii) the date
or dates on which principal of, and premium, if any, on the Offered Securities
is payable; (iv) the rate or rates at which the Offered Securities shall bear
interest, if any, or the method by which such rate shall be determined, and
the basis on which interest shall be calculated if other than a 360-day year
consisting of twelve 30-day months, the date or dates from which such interest
will accrue and on which such interest will be payable and the related record
dates; (v) if other than the offices of the Trustee, the place where the
principal of and any premium or interest on the Offered Securities will be
payable; (vi) any redemption, repayment or sinking fund provisions; (vii) if
other than denominations of $1,000 or multiples thereof, the denominations in
which the Offered Securities will be issuable; (viii) if other than the
principal amount thereof, the portion of the principal amount due upon
acceleration; (ix) if other than U.S. dollars, the currency or currencies
(including composite currencies) in which the Offered Securities are
denominated or payable; (x) whether the Offered Securities shall be issued in
the form of a Global Security or securities; (xi) any other specific terms of
the Offered Securities; and (xii) the identity of any trustees, depositories,
authenticating or paying agents, transfer agents or registrars with respect to
the Offered Securities. (Section 2.3)
The Debt Securities will be issued either in certificated, fully registered
form, without coupons, or as global securities under a book-entry system, as
specified in the accompanying Prospectus Supplement. See "--Book-Entry
System."
4
<PAGE>
Unless otherwise specified in the accompanying Prospectus Supplement,
principal and premium, if any, will be payable, and the Debt Securities will
be transferable and exchangeable without any service charge, at the office of
the Trustee. However, the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection with any such
transfer or exchange. (Sections 2.7, 4.1 and 4.2)
Unless otherwise specified in the accompanying Prospectus Supplement,
interest on any series of Debt Securities will be payable on the interest
payment dates set forth in the accompanying Prospectus Supplement to the
persons in whose names the Debt Securities are registered at the close of
business on the related record date and will be paid, at the option of the
Company, by wire transfer or by checks mailed to such persons. (Sections 2.7,
4.1 and 4.2)
If the Debt Securities are issued as Original Issue Discount Securities
(bearing no interest or interest at a rate which at the time of issuance is
below market rates) to be sold at a substantial discount below their stated
principal amount, the federal income tax consequences and other special
considerations applicable to such Original Issue Discount Securities will be
generally described in the Prospectus Supplement.
Unless otherwise described in the accompanying Prospectus Supplement, there
are no covenants or provisions contained in the Indenture which afford the
holders of the Debt Securities Protection in the event of a highly leveraged
transaction involving the Company.
BOOK-ENTRY SYSTEM
If so specified in the accompanying Prospectus Supplement, Debt Securities
of any series may be issued under a book-entry system in the form of one or
more global securities (each a "Global Security"). Each Global Security will
be deposited with, or on behalf of, a depositary, which, unless otherwise
specified in the accompanying Prospectus Supplement, will be The Depository
Trust Company, New York, New York (the "Depositary"). The Global Securities
will be registered in the name of the Depositary or its nominee.
The Depositary has advised the Company that the Depositary is a limited
purpose trust company organized under the laws of the State of New York, a
"banking organization" within the meaning of the New York banking law, a
member of the Federal Reserve system, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of section 17A of the Exchange Act. The
Depositary was created to hold securities of its participants and to
facilitate the clearance and settlement of securities transactions among its
participants through electronic book-entry changes in accounts of the
participants, thereby eliminating the need for physical movement of securities
certificates. The Depositary's participants include securities brokers and
dealers, banks, trust companies, clearing corporations, and certain other
organizations, some of whom (and/or their representatives) own the Depositary.
Access to the Depositary's book-entry system is also available to others, such
as banks, brokers, dealers and trust companies that clear through or maintain
a custodial relationship with a participant, either directly or indirectly.
Upon the issuance of a Global Security in registered form, the Depositary
will credit, on its book-entry registration and transfer system, the
respective principal amounts of the Debt Securities represented by such Global
Security to the accounts of participants. The accounts to be credited will be
designated by the underwriters, dealers or agents, if any, or by the Company,
if such Debt Securities are offered and sold directly by the Company.
Ownership of beneficial interests in the Global Security will be limited to
participants or persons that may hold interests through participants.
Ownership of beneficial interests by participants in the Global Security will
be shown on, and the transfer of that ownership interest will be effected only
through, records maintained by such participants. The laws of some
jurisdictions may require that certain purchasers of securities take physical
delivery of such securities in definitive form. Such laws may impair the
ability to transfer beneficial interest in a Global Security.
So long as the Depositary or its nominee is the registered Owner of a Global
Security, it will be considered the sole owner or holder of the Debt
Securities represented by such Global Security for all purposes under the
5
<PAGE>
Indenture. Except as set forth below, owners of beneficial interests in such
Global Security will not be entitled to have the Debt Securities represented
thereby registered in their names, will not receive or be entitled to receive
physical delivery of certificates representing the Debt Securities and will
not be considered the owners or holders thereof under the Indenture.
Accordingly, each person owning a beneficial interest in such Global Security
must rely on the procedures of the Depositary and, if such person is not a
participant, on the procedures of the participant through which such person
owns its interest, to exercise any rights of a holder under the Indenture. The
Company understands that under existing practice, in the event that the
Company requests any action of the holders or a beneficial owner desires to
take any action a holder is entitled to take, the Depositary would act upon
the instructions of, or authorize, the participant to take such action.
Payment of principal of, premium, if any, and interest on Debt Securities
represented by a Global Security will be made to the Depositary or its
nominee, as the case may be, as the registered owner and holder of the Global
Security representing such Debt securities. None of the Company, the Trustee,
any paying agent or registrar for such Debt Securities will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in the Global
Security or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
The Company has been advised by the Depositary that the Depositary will
credit participants' accounts with payments of principal, premium, if any, or
interest on the payment date thereof in amounts proportionate to their
respective beneficial interests in the principal amount of the Global Security
as shown on the records of the Depositary. The Company expects that payments
by participants to owners of beneficial interests in the Global Security held
through such participants will be governed by standing instructions and
customary practices, as is now the case with securities held for the accounts
of customers registered in "street name," and will be the responsibility of
such participants.
A Global Security may not be transferred except as a whole by the Depositary
to a nominee or successor of the Depositary or by a nominee of the Depositary
to another nominee of the Depositary. A Global Security representing all but
not part of the Debt Securities being offered hereby is exchangeable for Debt
Securities in definitive form of like tenor and terms if (i) the Depositary
notifies the Company that it is unwilling or unable to continue as depositary
for such Global Security or if at any time the Depositary is no longer
eligible to be or in good standing as a clearing agency registered under the
Exchange Act, and in either case, a successor depositary is not appointed by
the Company within 90 days of receipt by the Company of such notice or of the
Company becoming aware of such ineligibility, or (ii) the Company in its sole
discretion at any time determines not to have all of the Debt Securities
represented by a Global Security and notifies the Trustee thereof. A Global
Security exchangeable pursuant to the preceding sentence shall be exchangeable
for Debt Securities registered in such names and in such authorized
denominations as the Depositary for such Global Security shall direct.
(Section 2.7)
CERTAIN COVENANTS
Restrictions on Liens. The Indenture provides that the Company will not, and
will not permit any Restricted Subsidiary (as hereinafter defined) to, create,
incur or suffer to exist any mortgage or pledge, as security for any
indebtedness, on or of any shares of stock, indebtedness or other obligations
of a Subsidiary (as hereinafter defined) or any Principal Property (as
hereinafter defined) of the Company or a Restricted Subsidiary, whether such
shares of stock, indebtedness or other obligations of a Subsidiary or
Principal Property is owned at the date of the Indenture or thereafter
acquired, unless the Company secures or causes such Restricted Subsidiary to
secure the outstanding Debt equally and ratably with all indebtedness secured
by such mortgage or pledge, so long as such indebtedness shall be so secured.
This covenant will not apply in the case of: (i) the creation of any mortgage,
pledge or other lien on any shares of stock, indebtedness or other obligations
of a Subsidiary or any Principal Property acquired after the date of the
Indenture (including acquisitions by way of merger or consolidation) by the
Company or a Restricted Subsidiary contemporaneously with such acquisition, or
within 180 days thereafter, to secure or provide for the payment or financing
of any part of the purchase price thereof,
6
<PAGE>
or the assumption of any mortgage, pledge or other lien upon any shares of
stock, indebtedness or other obligations of a Subsidiary or any Principal
Property acquired after the date of the Indenture existing at the time of such
acquisition, or the acquisition of any shares of stock, indebtedness or other
obligations of a Subsidiary or any Principal Property subject to any mortgage,
pledge or other lien without the assumption thereof, provided that every such
mortgage, pledge or lien referred to in this clause (i) will attach only to
the shares of stock, indebtedness or other obligations of a Subsidiary or any
Principal Property so acquired and fixed improvements thereon; (ii) any
mortgage, pledge or other lien on any shares of stock, indebtedness or other
obligations of a Subsidiary or any Principal Property existing at the date of
this Indenture; (iii) any mortgage, pledge or other lien on any shares of
stock, indebtedness or other obligations of a Subsidiary or any Principal
Property in favor of the Company or any Restricted Subsidiary; (iv) any
mortgage, pledge or other lien on Principal Property being constructed or
improved securing loans to finance such construction or improvements; (v) any
mortgage, pledge or other lien on shares of stock, indebtedness or other
obligations of a Subsidiary or any Principal Property incurred in connection
with the issuance of tax-exempt governmental obligations; and (vi) any renewal
of or substitution for any mortgage, pledge or other lien permitted by any of
the preceding clauses (i) through (v), provided, in the case of a mortgage,
pledge or other lien permitted under clause (i), (ii) or (iv), the
indebtedness secured is not increased nor the lien extended to any additional
shares of stock, indebtedness or other obligations of a Subsidiary or any
additional Principal Property. Notwithstanding the foregoing, the Company or
any Restricted Subsidiary may create or assume liens in addition to those
permitted by this paragraph, and renew, extend or replace such liens, provided
that at the time of such creation, assumption, renewal, extension or
replacement, and after giving effect thereto, Exempted Debt (as hereinafter
defined) does not exceed 10% of Consolidated Net Tangible Assets (as
hereinafter defined) (Section 4.3)
Restrictions on Sale and Lease-Back Transactions. The Indenture provides
that the Company will not, and will not permit any Restricted Subsidiary to,
sell or transfer, directly or indirectly, except to the Company or a
Restricted Subsidiary, any Principal Property as an entirety, or any
substantial portion thereof, with the intention of taking back a lease of such
property, except a lease for a period of three years or less at the end of
which it is intended that the use of such property by the lessee will be
discontinued; provided that, notwithstanding the foregoing, the Company or any
Restricted Subsidiary may sell any such Principal Property and lease it back
for a longer period (i) if the Company or such Restricted Subsidiary would be
entitled, pursuant to the provisions described above under "Restrictions on
Liens," to create a mortgage on the property to be leased securing Funded Debt
(as hereinafter defined) in an amount equal to the Attributable Debt (as
hereinafter defined) with respect to such sale and lease-back transaction
without equally and ratably securing the outstanding Debt Securities or (ii)
if (A) the Company promptly informs the Trustee of such transaction, (B) the
net proceeds of such transaction are at least equal to the fair value (as
determined by board resolution of the Company) of such property and (C) the
Company causes an amount equal to the net proceeds of the sale to be applied
to the retirement, within 180 days after receipt of such proceeds, of Funded
Debt incurred or assumed by the Company or a Restricted Subsidiary (including
the Debt Securities); provided further that, in lieu of applying all of or any
part of such net proceeds to such retirement, the Company may, within 75 days
after such sale, deliver or cause to be delivered to the applicable trustee
for cancellation either debentures or notes evidencing Funded Debt of the
Company (which may include the outstanding Debt Securities) or of a Restricted
Subsidiary previously authenticated and delivered by the applicable trustee,
and not theretofore tendered for sinking fund purposes or called for a sinking
fund or otherwise applied as a credit against an obligation to redeem or
retire such notes or debentures, and an officers' certificate (which will be
delivered to the Trustee and each paying agent and which need not contain the
statements prescribed by the second paragraph of Section 10.4 of the
Indenture) stating that the Company elects to deliver or cause to be delivered
such debentures or notes in lieu of retiring Funded Debt as hereinabove
provided. If the Company shall so deliver Debentures or notes to the
applicable trustee and the Company shall duly deliver such officers'
certificate, the amount of cash which the Company will be required to apply to
the retirement of Funded Debt under this provision of the Indenture shall be
reduced by an amount equal to the aggregate of the then applicable optional
redemption prices (not including any optional sinking fund redemption prices)
if such debentures or notes or, if there are no such redemption prices, the
principal amount of such debentures or notes; provided, that in the case of
debentures or notes which provide for an amount less than the principal amount
thereof to be due and payable upon a declaration of the maturity thereof, such
amount of
7
<PAGE>
cash shall be reduced by the amount of principal of such debentures or notes
that would be due and payable as of the date of such application upon a
declaration of acceleration of the maturity thereof pursuant to the terms of
the Indenture pursuant to which such debentures or notes were issued.
Notwithstanding the foregoing, the Company or any Restricted Subsidiary may
enter into sale and lease-back transactions in addition to those permitted by
this paragraph and without any obligation to retire any outstanding Debt
Securities or other Funded Debt, provided that at the time of entering into
such sale and lease-back transactions and after giving effect thereto,
Exempted Debt does not exceed 10% of Consolidated Net Tangible Assets.
(Section 4.4)
CERTAIN DEFINITIONS
The term "Attributable Debt" as defined in the Indenture means, as to any
particular lease under which any Person is at the time liable, other than a
capital lease, and at any date as of which the amount thereof is to be
determined, the total net amount of rent required to be paid by such Person
under such lease during the initial term thereof as determined in accordance
with generally accepted accounting principles, discounted from the last date
of such initial term to the date of determination at a rate per annum equal to
the discount rate which would be applicable to a capital lease with like term
in accordance with generally accepted accounting principles. The net amount of
rent required to be paid under any such lease for any such period shall be the
aggregate amount of rent payable by the lessee with respect to such period
after excluding amounts required to be paid on account of insurance, taxes,
assessments, utility, operating and labor costs and similar charges. In the
case of any lease which is terminable by the lessee upon the payment of a
penalty, such net amount shall also include the amount of such penalty, but no
rent shall be considered as required to be paid under such lease subsequent to
the first date upon which it may be so terminated. "Attributable Debt" means,
as to a capital lease under which any Person is at the time liable and at any
date as of which the amount thereof is to be determined, the capitalized
amount thereof that would appear on the face of a balance sheet of such Person
in accordance with generally accepted accounting principles.
The term "Consolidated Net Tangible Assets" as defined in the Indenture
means the excess over the current liabilities of the Company of all of its
assets as determined by the Company and as would be set forth in a
consolidated balance sheet of the Company and its Subsidiaries, on a
consolidated basis, in accordance with generally accepted accounting
principles as of a date within 90 days of the date of such determination,
after deducting goodwill, trademarks, patents, other like intangibles and
minority interests of others.
The term "Exempted Debt" as defined in the Indenture means the sum, without
duplication, of the following items outstanding of the date Exempted Debt is
being determined: indebtedness of the Company and its Restricted Subsidiaries
incurred after the date of the Indenture and secured by liens created, assumed
or otherwise incurred or permitted to exist pursuant to the provision
described in the last sentence under "Certain Covenants--Restrictions on
Liens" and (ii) Attributable Debt of the Company and its Restricted
Subsidiaries in respect of all sale and lease-back transactions with regard to
any Principal Property entered into pursuant to the provision described in the
last sentence under "--Certain Covenants--Restrictions on Sale and Lease-Back
Transactions."
The term "Funded Debt" as defined in the Indenture means all indebtedness
for money borrowed, including purchase money indebtedness, having a maturity
of more than one year from the date of its creation or having a maturity of
less than one year but by its terms being renewable or extendible, at the
option of the obligor in respect thereof, beyond one year from its creation.
The term "Principal Property" as defined in the Indenture means (i) land,
land improvements, buildings and associated factory and laboratory equipment
owned or leased pursuant to a capital lease and used by the Company or a
Restricted Subsidiary primarily for processing, producing, packaging or
storing its products, raw materials, inventories or other materials and
supplies and located within the United States of America and having an
acquisition cost plus capitalized improvements in excess of 1% of Consolidated
Net Tangible Assets as of the date of such determination, (ii) certain
property referred to in the Indenture and (iii) any asset held by Tyson
8
<PAGE>
Holding Company, but shall not include any such property or assets described
in clauses (i), (ii) or (iii) that is financed through the issuance of tax
exempt governmental obligations, or any such property or assets that has been
determined by board resolution of the Company not to be of material importance
to the respective businesses conducted by the Company or such Restricted
Subsidiary, effective as of the date such resolution is adopted.
The term "Restricted Subsidiary" as defined in the Indenture means any
Subsidiary organized and existing under the laws of the United States of
America and the principal business of which is carried on within the United
States of America which owns or is a lessee pursuant to a capital lease of any
Principal Property or owns shares of capital stock or indebtedness of another
Restricted Subsidiary other than: (i) each Subsidiary the major part of whose
business consists of finance, banking, credit, leasing, insurance, financial
services or other similar operations, or any combination thereof; and (ii)
each Subsidiary formed or acquired after the date of the Indenture for the
purpose of acquiring the business or assets of another person and which does
not acquire all or any substantial part of the business or assets of the
Company or any Restricted Subsidiary; provided, however, the Board of
Directors of the Company may declare any such Subsidiary to be a Restricted
Subsidiary effective as of the date such resolution is adopted.
The term "Subsidiary" as defined in the Indenture means, with respect to any
Person, any corporation, association or other business entity of which more
than 50% of the outstanding Voting Stock (as defined in the Indenture) is
owned, directly or indirectly, by such Person and one or more other
Subsidiaries of such Person.
RESTRICTIONS ON CONSOLIDATIONS, MERGERS AND SALES OF ASSETS
The Indenture provides that the Company will not consolidate with, merge
with or into, or sell, convey, transfer, lease or otherwise dispose of all or
substantially all of its property and assets (as an entirety or substantially
an entirety in one transaction or a series of related transactions) to, any
Person (other than a consolidation with or merger with or into a Subsidiary)
or permit any Person to merge with or into the Company unless: (a) either (i)
the Company will be the continuing Person or (ii) the Person (if other than
the Company) formed by such consolidation or into which the Company is merged
or that acquired or leased such property and assets of the Company shall be a
corporation organized and validly existing under the laws of the United States
of America or any jurisdiction thereof and shall expressly assume, by a
supplemental indenture, executed and delivered to the Trustee, all of the
obligations of the Company on all of the Debt Securities and the Company shall
have delivered to the Trustee an opinion of counsel stating that such
consolidation, merger or transfer and such supplemental indenture complies
with this provision and that all conditions precedent provided for herein
relating to such transaction have been complied with; and (b) immediately
after giving effect to such transaction, no Default (as defined in the
Indenture) shall have occurred and be continuing. (Section 5.1)
EVENTS OF DEFAULT
An Event of Default, as defined in the Indenture and applicable to Debt
Securities, will occur with respect to the Debt Securities of any series if:
(a) the Company defaults in the payment of the principal of any Debt Security
of such series when the same becomes due and payable at maturity, upon
acceleration, redemption, mandatory repurchase or otherwise; (b) the Company
defaults in the payment of interest on any Debt Security of such series when
the same becomes due and payable, and such default continues for a period of
30 days; (c) the Company defaults in the performance of or breaches any other
covenant or agreement of the Company in the Indenture with respect to the Debt
Securities of such series and such default or breach continues for a period of
30 consecutive days after written notice to the Company by the Trustee or to
the Company and the Trustee by the Holders (as defined in the Indenture) of
25% or more in aggregate principal amount of the Debt Securities of such
series; (d) an involuntary case or other proceeding shall be commenced against
the Company with respect to it or its debts under any bankruptcy, insolvency
or other similar law now or hereafter in effect seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official of it or
any substantial part of its property, and such involuntary case or other
proceeding shall remain undismissed and unstayed for a period of 60 days; or
an order for relief shall be entered against the Company under the federal
bankruptcy laws as now or
9
<PAGE>
hereafter in effect; (e) the Company (i) commences a voluntary case under any
applicable bankruptcy, insolvency or other similar law or hereafter in effect,
or consents to the entry of an order for relief in an involuntary case under
any such law, (ii) consents to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official of the Company or for all or substantially all of the property and
assets of the Company or (iii) effects any general assignment for the benefit
of creditors; or (f) any other Events of Default set forth in the applicable
Prospectus Supplement occurs. (Section 6.1)
The Indenture provides that if an Event of Default described in clauses (a),
(b), (c) or (f) above (if such Event of Default under clause (c) or (f) is
with respect to one or more but not all series of Debt Securities then
outstanding) occurs and is continuing, then, and in each and every such case,
except for any series of Debt Securities the principal of which shall have
already become due and payable, either the Trustee or the Holders of not less
than 25% in aggregate principal amount of the Debt Securities of each such
series then outstanding under the Indenture (each such series voting as a
separate class) by notice in writing to the Company (and to the Trustee if
given by Holders), may declare the entire principal (or, if the Debt
Securities of any such series are Original Issue Discount Securities (as
defined in the Indenture), such portion of the principal amount as may be
specified in the terms of such series and set forth in the applicable
Prospectus Supplement) of all Debt Securities of all such series, and the
interest accrued thereon, if any, to be due and payable immediately, and upon
any such declaration the same shall become immediately due and payable. If an
Event of Default described in clause (c) or (f) occurs and is continuing with
respect to all series of Debt Securities then outstanding, then and in each
and every such case, unless the principal of all the Debt Securities shall
have already become due and payable, either the Trustee or the Holders of not
less than 25% in aggregate principal amount of all the Debt Securities then
outstanding under the Indenture (treated as one class), by notice in writing
to the Company (and to the Trustee if given by Holders), may declare the
entire principal (or, if any Debt Securities are Original Issue Discount
Securities, such portion of the principal as may be specified in the terms
thereof and set forth in the applicable Prospectus Supplement) of all the Debt
Securities then outstanding and interest accrued thereon, if any, to be due
and payable immediately, and upon any such declaration the same shall become
immediately due and payable. If an Event of Default described in clause (d) or
(e) occurs and is continuing, then the principal amount (or, if any Debt
Securities are Original Issue Discount Securities, such portion of the
principal as may be specified in the terms thereof and set forth in the
applicable Prospectus Supplement) of all the Debt Securities then outstanding
and interest accrued thereon, if any shall be and become immediately due and
payable, without any notice or other action by any Holder or the Trustee, to
the full extent permitted by applicable law.
The provisions described in the paragraph above, however, are subject to the
condition that if, at any time after the principal (or, if the Debt Securities
are Original Issue Discount Securities, such portion of the principal as may
be specified in the terms thereof and set forth in the applicable Prospectus
Supplement) of the Debt Securities of any series (or of all the Debt
Securities, as the case may be) shall have been so declared due and payable,
and before any judgment or decree for the payment of the moneys due shall have
been obtained or entered as hereinafter provided, the Company will pay or will
deposit with the Trustee a sum sufficient to pay all matured installments of
interest upon all the Debt Securities of each such series (or of all the Debt
Securities, as the case may be) and the principal of any and all Debt
Securities of each such series (or of all the Debt Securities, as the case may
be) which shall have become due otherwise than by acceleration (with interest
upon such principal and, to the extent that payment of such interest is
enforceable under applicable law, on overdue installments of interest, at the
same rate as the rate of interest or yield to maturity (in the case of
Original Issue Discount Securities) specified in the Debt Securities of each
such series and set forth in the applicable Prospectus Supplement to the date
of such payment or deposit) and such amount as shall be sufficient to cover
reasonable compensation to the Trustee and each predecessor Trustee, their
respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the Trustee and each
predecessor Trustee except as a result of negligence or bad faith, and if any
and all Events of Default under the Indenture, other than the non-payment of
the principal of Debt Securities which shall have become due by acceleration,
shall have been cured, waived or otherwise remedied as provided in the
Indenture, then and in every such case the Holders of a majority in aggregate
principal amount of all the Debt Securities of each such series, or of all the
Debt Securities, in each case voting as a single class, then outstanding, by
written notice to the Company and to the
10
<PAGE>
Trustee, may waive all defaults with respect to each such series (or with
respect to all the Debt Securities, as the case may be) and rescind and annul
such declaration and its consequences, but no such waiver or rescission and
annulment will extend to or shall affect an subsequent default or shall impair
any right consequent thereon. For all purposes under the Indenture, if a
portion of the principal of any Original Issue Discount Securities shall have
been accelerated and declared due and payable pursuant to the provisions
described above, then, from and after such declaration, unless such
declaration has been rescinded and annulled, the principal amount of such
Original Issue Discount Securities will be deemed, for all purposes under the
Indenture, to be such portion of the principal thereof as shall be due and
payable as a result of such acceleration, and payment of such portion of the
principal thereof as shall be due and payable as a result of such
acceleration, together with interest, if any, thereon and all other amounts
owing thereunder, shall constitute payment in full of such Original Issue
Discount Securities. (Section 6.2)
The Indenture contains a provision under which, subject to the duty of the
Trustee during a default to act with the standard of care required by law, (i)
the Trustee may rely and will be protected in acting or refraining from acting
upon any resolution, certificate, statement, instrument, opinion, report,
notice, request, direction, consent, order, bond, debenture, note, other
evidence of indebtedness or other paper or document believed by it to be
genuine and to have been signed or presented by the proper person, and the
Trustee need not investigate any fact or matter stated in the document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit; (ii) before the Trustee acts or
refrains from acting, it may require an officers' certificate or an opinion of
counsel, and the Trustee shall not be liable for any action it takes or omits
to take in good faith in reliance on such certificate or opinion; (iii) the
Trustee may act through its attorneys and agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care; (iv)
the Trustee shall be under no obligation to exercise any of the rights or
powers vested in it by the Indenture at the request or direction of any of the
Holders, unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might
be incurred by it in compliance with such request or direction; (v) the
Trustee shall not be liable for any action it takes or omits to take in good
faith that it believes to be authorized or within its rights or powers or for
any action it takes or omits to take in accordance with the direction of the
Holders of a majority in principal amount of the outstanding Debt Securities
relating to the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred
upon the Trustee, under the Indenture; and (vi) the Trustee may consult with
counsel and the written advice of such counsel or any opinion of counsel shall
be full and complete authorization and protection in respect of any action
taken, suffered or omitted by it hereunder in good faith and in reliance
thereon. (Section 7.2)
Subject to such provisions in the Indenture for the indemnification of the
Trustee and certain other limitations, the Holders of at least a majority in
aggregate principal amount of the outstanding Debt Securities of each series
affected (each such series voting as a separate class) may direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee; provided,
that the Trustee may refuse to follow any direction that conflicts with law or
the Indenture, that may involve the Trustee in personal liability, or that the
Trustee determines in good faith may be unduly prejudicial to the rights of
Holders not joining in the giving of such direction; and provided further,
that the Trustee may take any other action it deems proper that is not
inconsistent with any directions received from Holders of Debt Securities
pursuant to this Paragraph. (Section 6.5)
The Indenture provides that no Holder of any Debt Security of any series may
institute any proceeding, judicial or otherwise, with respect to the Indenture
or the Debt Securities of such series, or for the appointment of a receiver or
trustee, or for any other remedy under the Indenture, unless: (i) such Holder
has previously given to the Trustee written notice of a continuing Event of
Default with respect to the Debt Securities of such series; (ii) the Holders
of at least 25% in aggregate principal amount of outstanding Securities of
such series shall have made written request to the Trustee to institute
proceedings in respect of such Event of Default in its own name as Trustee
under the Indenture; (iii) such Holder or Holders have offered to the Trustee
indemnity reasonably satisfactory to the Trustee against any costs,
liabilities or expenses to be incurred in compliance with such
11
<PAGE>
request; (iv) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such proceeding;
and (v) during such 60-day period, the Holders of a majority in aggregate
principal amount of the outstanding Debt Securities of such series have not
given the Trustee a direction that is inconsistent with such written request.
A Holder may not use the Indenture to prejudice the rights of another Holder
or to obtain a preference or priority over such other Holder. (Section 6.6)
The Indenture contains a covenant that the Company will file annually, not
more than 90 days after the end of its fiscal year, with the Trustee a
certification from the principal executive officer, principal financial
officer or principal accounting officer that a review has been conducted of
the activities of the Company and its Subsidiaries and the Company's and its
Subsidiaries' performance under the Indenture and that the Company has
complied with all conditions and covenants under the Indenture. (Section 4.6)
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
The Indenture provides that, except as provided below, the Company may
terminate its obligations under the Debt Securities of any series and the
Indenture with respect to Debt Securities of such series if: (i) all Debt
Securities of such series previously authenticated and delivered (other than
destroyed, lost or stolen Debt Securities of such series that have been
replaced or Debt Securities of such series that are fully repaid or Debt
Securities of such series for whose payment money or Securities have
theretofore been held in trust and thereafter repaid to the Company, as
provided in the Indenture) have been delivered to the Trustee for cancellation
and the Company has paid all sums payable by it hereunder; or (ii) (A) the
Debt Securities of such series mature within one year or all of them are to be
called for redemption within one year under arrangements satisfactory to the
Trustee for giving the notice of redemption, (B) the Company irrevocably
deposits in trust with the Trustee, as trust funds solely for the benefit of
the Holders of such Securities for that purpose, money or U.S. Government
Obligations or a combination thereof sufficient (in the opinion of a
nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee), without consideration
of any reinvestment, to pay principal of and interest on the Debt Securities
of such series to maturity or redemption, as the case may be, and to pay all
other sums payable by it under the Indenture, (C) no default with respect to
the Debt Securities of such series has occurred and is continuing on the date
of such deposit, (D) such deposit does not result in a breach or violation of,
or constitute a default under, the Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound and (E) the
Company delivers to the Trustee an officers' certificate and an opinion of
counsel, in each case stating that all conditions precedent provided for in
the Indenture relating to the satisfaction and discharge of the Indenture have
been complied with. With respect to the foregoing clause (i), only the
Company's obligations under Section 7.7 of the Indenture in respect of the
Debt Securities of such series shall survive. With respect to the foregoing
clause (ii), only the Company's obligations in Sections 2.2, 2.3, 2.4, 2.5,
2.6, 2.7, 2.11, 4.2, 7.7, 7.8, 8.5 and 8.6 of the Indenture in respect of the
Debt Securities of such series shall survive until the Debt Securities are no
longer outstanding. Thereafter, only the Company's obligations in Sections
7.7, 8.5 and 8.6 of the Indenture in respect of the Debt Securities of such
series shall survive. After any such irrevocable deposit, the Trustee upon
request shall acknowledge in writing the discharge of the Company's
obligations under the Debt Securities of such series and this Indenture with
respect to the Debt Securities of such series except for those surviving
obligations specified above. (Section 8.1)
The Indenture provides that, except as provided below, the Company will be
deemed to have paid and will be discharged from any and all obligations in
respect of the Debt Securities of any series after the period specified in
clause (D)(2)(z) of this paragraph, and the provisions of the Indenture will
no longer be in effect with respect to the Debt Securities of such series, and
the Trustee, at the expense of the Company, shall execute proper instruments
acknowledging the same; provided that the following conditions shall have been
satisfied: (A) the Company has irrevocably deposited in trust with the Trustee
as trust funds solely for the benefit of the Holders for payment of the
principal of and interest on the Debt Securities of such series, money or U.S.
Government Obligations or a combination thereof sufficient (in the opinion of
a nationally recognized firm of independent public accountants expressed in a
written certification thereof delivered to the Trustee) without consideration
of
12
<PAGE>
any reinvestment and after payment of all federal, state and local taxes or
other charges and assessments in respect thereof payable by the Trustee, to
pay and discharge the principal of and accrued interest on the outstanding
Debt Securities of such series to maturity or earlier redemption (irrevocably
provided for under arrangements satisfactory to the Trustee), as the case may
be; (B) such deposit will not result in a breach or violation of, or
constitute a default under, the Indenture or any other agreement or instrument
to which the Company is a party or by which it is bound; (C) no Default with
respect to the Debt Securities of such series shall have occurred and be
continuing on the date of such deposit or at any time during the period
specified in clause (D)(2)(z) below; (D) the Company shall have delivered to
the Trustee (1) either (x) a ruling directed to the Trustee received from the
Internal Revenue Service to the effect that the Holders of the Securities of
such series will not recognize income, gain or loss for federal income tax
purposes as a result of the Company's exercise of its option under this
provision of the Indenture and will be subject to federal income tax on the
same amount and in the same manner and at the same times as would have been
the case if such option had not been exercised or (y) an opinion of counsel to
the same affect as the ruling described in clause (x) above and based on a
change in law and (2) an opinion of counsel to the effect that (x) the
creation of the defeasance trust does not violate the Investment Company Act
of 1940, as amended, (y) the Holders of the Securities of such series have a
valid first priority security interest in the trust funds, and (z) after the
passage of 123 days following the deposit (except after one year following the
deposit, with respect to any trust funds for the account of any Holder of the
Securities of such series who may be deemed to be an "insider" as to an
obligor on the Securities of such series for purposes of the United States
Bankruptcy Code), the trust funds will not be subject to the effect of Section
547 of the United States Bankruptcy Code or Section 15 of the New York Debtor
and Creditor Law in a case commenced by or against the Company under either
such statute, and either (I) the trust funds will no longer remain the
property of the Company (and therefore will not be subject to the effect of
any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors, rights generally) or (II) if a court were to rule under
any such law in any case or proceeding that the trust funds remained in the
possession of the Company, to the extent not paid to such Holders, the Trustee
will hold, for the benefit of such Holders, a valid and perfected first
priority security interest in such trust funds that is not avoidable in
bankruptcy or otherwise (except for the effect of Section 552(b) of the United
States Bankruptcy Code on interest on the trust funds accruing after the
commencement of a case under such statute and the Holders of the Securities of
such series will be entitled to receive adequate protection of their interests
in such trust funds if such trust funds are used in such case or proceeding;
(E) if the Debt Securities of such series are then listed on a national
securities exchange, the Company shall have delivered to the Trustee an
opinion of counsel to the effect that the defeasance contemplated by this
provision of the Indenture of the Debt Securities of such series will not
cause the Debt Securities of such series to be delisted; and (F) the Company
has delivered to the Trustee an officers, certificate and an opinion of
counsel, in each case stating that all conditions precedent provided for in
the Indenture relating to the defeasance contemplated by this provision of the
Indenture of the Debt Securities of such series have been complied with.
Notwithstanding the foregoing, prior to the end of the 123-day (or one year)
period referred to in clause (D)(2)(z) of this paragraph, none of the
Company's obligations under the Indenture with respect to such series shall be
discharged. Subsequent to the end of such 123-day (or one year) period, the
Company's obligations in Sections 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 2.11, 4.1,
4.2, 7.7, 7.8, 8.5 and 8.6 of the Indenture with respect to the Debt
Securities of such series shall survive until such Debt Securities are no
longer outstanding. Thereafter, only the Company's obligations in Sections
7.7, 8.5 and 8.6 of the Indenture with respect to the Debt Securities of such
series shall survive. If and when a ruling from the Internal Revenue Service
or an opinion of counsel referred to in clause (D)(1) of this paragraph is
able to be provided specifically without regard to, and not in reliance upon,
the continuance of the Company's obligations under Section 4.1 of the
Indenture, then the Company's obligations under such Section 4.1 of the
Indenture shall cease upon delivery to the Trustee of such ruling or opinion
of counsel and compliance with the other conditions precedent provided for in
this provision of the Indenture relating to the defeasance contemplated by
this provision of the Indenture. (Section 8.2)
The Indenture provides that the Company may omit to comply with any term,
provision or condition described under "--Certain Covenants," and such
omission shall be deemed not to be an Event of Default, with respect to the
outstanding Debt Securities of any series if: (i) the Company has irrevocably
deposited in trust with the Trustee as trust funds solely for the benefit of
the Holders of the Securities of such series for payment
13
<PAGE>
of the principal of and interest, if any, on the Debt Securities of such
series money or U.S. Government Obligations or a combination thereof in an
amount sufficient (in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee) without consideration of any reinvestment and after
payment of all federal, state and local taxes or other charges and assessments
in respect thereof payable by the Trustee, to pay and discharge the principal
of and interest on the outstanding Debt Securities of such series to maturity
or earlier redemption (irrevocably provided for under arrangements
satisfactory to the Trustee), as the case may be; (ii) such deposit will not
result in a breach or violation of, or constitute a default under, the
Indenture or any other agreement or instrument to which the Company is a party
or by which it is bound; (iii) no Default with respect to the Debt Securities
of such series shall have occurred and be continuing on the date of such
deposit; (iv) the Company has delivered to the Trustee an opinion of counsel
to the effect that (A) the creation of the defeasance trust does not violate
the Investment Company Act of 1940, as amended (B) the Holders of the Debt
Securities of such series have a valid first-priority security interest in the
trust funds, (C) such Holders will not recognize income, gain or loss for
federal income tax purposes as a result of such deposit and covenant
defeasance and will be subject to federal income tax on the same amount and in
the same manner and at the same times as would have been the case if such
deposit and defeasance had not occurred and (D) after the passage of 123 days
following the deposit (except, with respect to any trust funds for the account
of any Holder of the Debt Securities of such series who may be deemed to be an
"insider" as to an obligor on the Debt Securities of such series for purposes
of the United States Bankruptcy Code, the trust funds will not be subject to
the effect of Section 547 of the United States Bankruptcy Code or Section 15
of the New York Debtor and Creditor Law in a case commenced by or against the
Company under either such statute, and either (1) the trust funds will no
longer remain the property of the Company (and therefore will not be subject
to the effect of any applicable bankruptcy, insolvency, reorganization or
similar laws affecting creditors, rights generally) or (2) if a court were to
rule under any such law in any case or proceeding that the trust funds
remained property of the Company, to the extent not paid to such Holders, the
Trustee will hold, for the benefit of such Holders, a valid and perfected
first priority security interest in such trust funds that is not avoidable in
bankruptcy or otherwise (except for the effect of Section 552(b) of the United
States Bankruptcy Code on interest on the trust funds accruing after the
commencement of a case under such statute), and the Holders of the Debt
Securities of such series entitled to receive adequate protection of their
interests in such trust funds if such trust funds are used in such case or
proceeding; (v) if the Debt Securities of such series are then listed on a
national securities exchange, the Company shall have delivered to the Trustee
an opinion of counsel to the effect that the covenant defeasance contemplated
by this provision of the Indenture of the Debt Securities of such series will
not cause the Debt Securities of such series to be delisted; and (vi) the
Company has delivered to the Trustee an officers, certificate and an opinion
of counsel, in each case stating that all conditions precedent provided for in
the Indenture relating to the covenant defeasance contemplated by this
provision of the Indenture of the Debt Securities of such series have been
complied with. (Section 8.3)
MODIFICATION OF THE INDENTURE
The Indenture provides that the Company and the Trustee may amend or
supplement the Indenture or the Debt Securities of any series without notice
to or the consent of any Holder: (1) to cure any ambiguity, defect or
inconsistency in the Indenture; provided that such amendments or supplements
shall not adversely affect the interests of the Holders in any material
respect; (2) to comply with Article 5 of the Indenture; (3) to comply with any
requirements of the Commission in connection with the qualification of the
Indenture under the Trust Indenture Act of 1939, as amended; (4) to evidence
and provide for the acceptance of appointment hereunder by a successor
Trustee; (5) to establish the form or forms or terms of Debt Securities of any
series or of the coupons appertaining to such Debt Securities as permitted by
the Indenture; (6) to provide for uncertificated Debt Securities and to make
all appropriate changes for such purpose; and (7) to make any change that does
not materially and adversely affect the rights of any Holder. (Section 9.1)
The Indenture also provides that, without prior notice to any Holders, the
Company and the Trustee may amend the Indenture and the Debt Securities of any
series outstanding thereunder with the written consent of the Holders of a
majority in principal amount of the outstanding Debt Securities of all series
affected by such
14
<PAGE>
supplemental indenture (all such series voting as one class), and the Holders
of a majority in principal amount of the outstanding Debt Securities of all
series affected thereby (all such series voting as one class) by written
notice to the Trustee may waive future compliance by the Company with any
provision of the Indenture or the Debt Securities of such series.
Notwithstanding the foregoing provision, without the consent of each Holder of
the Debt Securities of each series affected each thereby, an amendment or
waiver, including a waiver pursuant to Section 6.4 of the Indenture, may not:
(i) extend the stated maturity of the principal of, or any installment of
interest on, such Holder's Debt Security, or reduce the principal amount
thereof or the rate of interest thereon (including any amount in respect of
original issue discount), or any premium payable with respect thereto, or
adversely affect the rights of such Holder under any mandatory repurchase
provision or any right of repurchase at the option of such Holder, or reduce
the amount of the principal of an Original Issue Discount Security that would
be due and payable upon an acceleration of the maturity thereof pursuant to
the Indenture or the amount thereof provable in bankruptcy, or change any
place of payment where, or the currency in which, any Debt Security of such
series or any premium or the interest thereon is payable, or impair the right
to institute suit for the enforcement of any such payment on or after the
stated maturity thereof (or, in the case of redemption, on or after the
redemption date or, in the case of mandatory repurchase, the date therefor);
(ii) reduce the percentage in principal amount of outstanding Debt Security of
such series the consent of whose Holders is required for any such supplemental
indenture, for any waiver of compliance with certain provisions of the
Indenture or certain Defaults and their consequences provided for in the
Indenture; (iii) waive a Default in the payment of principal of or interest
on, any Debt Security of such series; (iv) cause any Debt Security of such
series to be subordinated in right of payment to any obligation of the
Company; (v) modify any of the provisions of this section of the Indenture,
except to increase any such percentage or to provide that certain other
provisions of the Indenture cannot be modified or waived without the consent
of the Holder of each outstanding Debt Security of any series affected
thereby. A supplemental indenture which changes or eliminates any covenant or
other provision of the Indenture which has expressly been included solely for
the benefit of one or more particular series of Debt Securities, or which
modifies the rights of Holders of Debt Security of such series with respect to
such covenant or provision, shall be deemed not to affect the rights under the
Indenture of the Holders of Debt Securities of any other series or of the
coupons appertaining to such Debt Securities. It shall not be necessary for
the consent of the Holders under this section of the Indenture to approve the
particular form of any proposed amendment, supplement or waiver, but it shall
be sufficient if such consent approves the substance thereof. After an
amendment, supplement or waiver under this section of the Indenture becomes
effective, the Company shall give to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. The Company will mail
supplemental indentures to Holders upon request. Any failure of the Company to
mail such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such supplemental indenture or waiver. (Section
9.2)
GOVERNING LAW
The Indenture and the Debt Securities will be governed by the laws of the
State of New York.
CONCERNING THE TRUSTEE
The Company and its subsidiaries maintain ordinary banking relationships
with The Chase Manhattan Bank and its affiliates and a number of other banks.
The Chase Manhattan Bank, and its affiliates along with a number of other
banks have extended credit facilities to the Company and its subsidiaries.
PLAN OF DISTRIBUTION
The Company may sell Debt Securities to or through one or more underwriters
and also may sell Debt Securities directly to other purchasers or through
agents or dealers, or the Company may sell Debt Securities through a
combination of any such methods.
15
<PAGE>
The distribution of the Debt Securities may be effected from time to time in
one or more transactions at a fixed price or prices, which may be changed, at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. Underwriters may sell Debt
Securities to or through dealers.
In connection with the sales of Debt Securities, underwriters may receive
compensation from the Company in the form of discounts, concessions or
commissions. Underwriters, dealers and agents that participate in the
distribution of Debt Securities may be deemed to be underwriters, and any
discounts or commissions received by them and any profit on the resale of Debt
Securities by them may be deemed to be underwriting discounts and commissions
under the Securities Act. Any such underwriter or agent will be identified,
and any such compensation will be described in the Prospectus Supplement.
Pursuant to agreements into which the Company may enter, underwriters,
dealers and agents who participate in the distribution of Debt Securities may
be entitled to indemnification by the Company against certain liabilities,
including liabilities under the Securities Act.
Unless otherwise indicated in the Prospectus Supplement, the Company does
not intend to list any of the Debt Securities on a national securities
exchange. In the event the Debt Securities are not listed on a national
securities exchange, certain broker-dealers may make a market in the Debt
Securities, but will not be obligated to do so and may discontinue any market
making at any time without notice. No assurance can be given that any broker-
dealer will make a market in the Debt Securities or as to the liquidity of the
trading market for the Debt Securities, whether or not the Debt Securities are
listed on a national securities exchange. The Prospectus Supplement with
respect to the Debt Securities will state, if known, whether or not any
broker-dealer intends to make a market in the Debt Securities. If no such
determination has been made, the Prospectus Supplement will so state.
The place and time of delivery for the Offered Securities in respect of
which this Prospectus is delivered will be set forth in the Prospectus
Supplement.
LEGAL MATTERS
The validity of the issuance of the Debt Securities offered hereby will be
passed upon for the Company by Rose Law Firm, Little Rock, Arkansas, and for
any underwriters or agents by Davis Polk & Wardwell, New York, New York.
Certain members of the Rose Law Firm beneficially own shares of the Company's
Class A Common Stock, par value $.10 per share, having a market value on
December 11, 1997 of approximately $62,034.
EXPERTS
The consolidated financial statements of Tyson Foods, Inc. incorporated by
reference in the Company's Annual Report (Form 10K) for the year ended
September 27, 1997, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their reports thereon included therein and
incorporated herein by reference. Such consolidated financial statements are
incorporated herein by reference in reliance upon such reports given upon the
authority of such firm as experts in accounting and auditing.
The consolidated balance sheet of Hudson Foods, Inc. as of September 27,
1997 and September 28, 1996 and the consolidated statements of income,
stockholders' equity, and cash flows for each of the three years in the period
ended September 27, 1997, incorporated by reference in this prospectus, have
been incorporated herein in reliance on the report of Coopers & Lybrand,
L.L.P., independent accountants, given on the authority of that firm as
experts in accounting and auditing.
16
