<PAGE>
RULE NO. 424(b)(5)
REGISTRATION NO. 333-79267
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this preliminary prospectus supplement is not complete and +
+ may be changed. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion. Dated May 25, 2000.
Prospectus Supplement To Prospectus dated November 30, 1999.
$400,000,000
Westvaco Corporation
$200,000,000 Floating Rate Notes due June , 2003
$200,000,000 % Notes due June , 2007
---------
Westvaco Corporation is offering two series of notes. Westvaco will pay
interest on the floating rate notes quarterly on the day of March, June,
September and December of each year, commencing September , 2000. The per
annum rate of interest for each quarterly interest period will be reset
quarterly as described in this prospectus supplement based on the three-month
LIBOR plus %. Westvaco will pay interest on the fixed rate notes on June and
December , commencing December , 2000. The notes will be issued only in
denominations of $1,000 and integral multiples of $1,000. There is no sinking
fund for either series of the notes.
Westvaco may redeem the floating rate notes, in whole or in part, on any
interest payment date on or after June , 2001 at the price set forth in this
prospectus supplement. Westvaco may redeem the fixed rate notes, in whole or in
part, at any time before their maturity at the redemption price described in
this prospectus supplement.
---------
Neither the Securities and Exchange Commission nor any other regulatory body
has approved or disapproved of these securities or passed upon the accuracy or
adequacy of this prospectus supplement or the accompanying prospectus. Any
representation to the contrary is a criminal offense.
---------
<TABLE>
<CAPTION>
Per Floating Per Fixed
------------ ---------
Rate Note Total Rate Note Total
------------ ------- --------- --------
<S> <C> <C> <C> <C>
Initial public offering price......... % $ % $
Underwriting discount................. % $ % $
Proceeds, before expenses, to
Westvaco............................. % $ % $
</TABLE>
The initial public offering prices set forth above do not include accrued
interest, if any. Interest on the notes will accrue from , 2000.
---------
The underwriters expect to deliver the notes in book-entry form only through
the facilities of The Depository Trust Company against payment in New York, New
York, on , 2000.
Goldman, Sachs & Co.
J.P. Morgan & Co.
Merrill Lynch & Co.
Bear, Stearns & Co. Inc.
Banc of America Securities LLC
BNY Capital Markets, Inc.
Chase Securities Inc.
Salomon Smith Barney
Wachovia Securities, Inc.
---------
Prospectus Supplement dated , 2000.
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is an important part of this prospectus
supplement and the accompanying prospectus, and information that we file later
with the Securities and Exchange Commission will automatically update and
supersede this information. We incorporate by reference the documents of
Westvaco Corporation listed below and any future filings made with the
Securities and Exchange Commission pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Securities Exchange Act of 1934, until we sell all of the
securities. A document will be incorporated by reference on the date it is
filed.
. Annual Report on Form 10-K for the fiscal year ended October 31,
1999.
. Quarterly Report on Form 10-Q for the quarter ended January 31, 2000.
. Current Reports on Form 8-K dated November 12, 1999, November 18,
1999, November 29, 1999, December 29, 1999, January 7, 2000, January
18, 2000, April 24, 2000 and May 25, 2000.
. Definitive Proxy Statement, dated December 27, 1999, and additional
proxy materials, dated February 4, 2000.
You may request a copy of these filings at no cost by writing or
telephoning us at the following address: Mr. John W. Hetherington, Vice
President and Secretary, Westvaco Corporation, 299 Park Avenue, New York, New
York 10171, telephone (212) 318-5280.
You should rely only on the information contained in or incorporated by
reference in this prospectus supplement and the accompanying prospectus. We
have not authorized any other person to provide you with different information.
We are not making an offer to sell these securities in any jurisdiction where
the offer is not permitted. You should assume that the information appearing in
this prospectus supplement and the accompanying prospectus, as well as
information we previously filed with the Securities and Exchange Commission and
incorporated by reference, is accurate as of the date on the front of these
documents only.
---------------
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<PAGE>
THE COMPANY
Westvaco Corporation is one of the major producers of paperboard and
paper in the United States. It converts paperboard and paper into a variety of
end-products, manufactures a variety of specialty chemicals, produces lumber,
sells timber from its timberlands and is engaged in land development. In
Brazil, it is a major producer of paperboard and corrugated packaging for the
markets of that country and also operates a folding carton plant. Westvaco also
has a folding carton plant in the Czech Republic. Westvaco exports products
from the United States, Brazil and the Czech Republic to other countries
throughout the world.
The company's principal business segments are the manufacture of (1)
packaging products, (2) paper products, and (3) specialty chemicals. The
principal markets for Westvaco's products are in the United States. Sales to
customers outside the United States made up approximately 24% of Westvaco's
total sales in 1999 (1998-25%, 1997-25%). Substantially all products are sold
through the company's own sales force. Westvaco maintains 30 sales offices
located throughout the United States and 29 in foreign countries.
Forest Resources
The principal raw material used in the manufacture of paperboard, paper
and pulp is wood. Westvaco owns 1,446,000 acres of forest land in the United
States and southern Brazil (more than 1,000 miles from the Amazon rainforests).
Westvaco's Cooperative Forest Management Program, established in the 1950s,
provides an additional source of wood fiber from the 1,370,000 acres owned by
participating landowners and managed with assistance from Westvaco foresters.
Westvaco's strategy, based on the location of its mills and the
composition of surrounding forest land ownership, is to provide a portion of
its wood fiber from company-owned land and to rely on private woodland owners
and residues from independent solid wood products plants for substantial
quantities of wood. During 1999, Westvaco furnished 39% (1998-36%, 1997-39%) of
its wood requirements from company-owned land, and an additional 8% (1998-7%,
1997-8%) was purchased from landowners in the Cooperative Forest Management
Program. The remainder was purchased from other private landowners and sawmills
by mill wood procurement organizations. The wood procurement system includes 27
pulpwood concentration and processing yards that are strategically located to
store and ship wood to the mills as needed. The Cooperative Forest Management
Program, private landowners and sawmills continue to provide adequate volumes
of timber to meet our external fiber needs. Westvaco supplied 100% of the wood
for its Brazilian mill from company plantations.
Westvaco forests include plantations, natural stands and fiber farms. The
inventory of growing trees, the basis for volume production, has increased
steadily over the last decade in spite of a steady rise in the volume of wood
harvested. Most of the pine stands harvested are plantations that are
regenerated by establishing new pine plantations. Most hardwood stands that are
harvested are re-established by planned natural regeneration from seeds and
sprouts. Westvaco's hardwood plantation and fiber farm programs are expanding
and involve several domestic species. The quantity of wood harvested by
Westvaco from its lands in any year is primarily controlled by long-range
forest management programs based on integrated wood supply plans.
Research
Westvaco operates major research facilities at Laurel, MD, North
Charleston, SC, and Covington, VA, which provide process and product support
for our manufacturing operations as well as a forest science laboratory at
Summerville, SC. Forest research conducted there, and at satellite
S-3
<PAGE>
centers at Wickliffe, KY, Rupert, WV, and Tres Barras, State of Santa Catarina,
Brazil, is focused on biotechnology, genetics, tree nutrition, regeneration,
stand management, environmental protection and forest measurements. The goal is
increased timber and fiber production on a sustainable basis. The company's
larger divisions and subsidiaries also have product development staffs which
work on product-related projects directed toward specific opportunities of the
individual units.
In 1999, the company incurred $47.3 million (1998-$45.1 million, 1997-
$42.9 million) of research and development costs. Substantially all of the
research projects are company sponsored. Approximately 245 scientists were
employed in research and development activities.
International Operations
In Brazil, Rigesa, a wholly owned subsidiary of Westvaco, operates a
paperboard mill, a corrugated box plant and a consumer packaging plant in
Valinhos, State of Sao Paulo; a paperboard mill in Tres Barras, State of Santa
Catarina; and corrugated box plants in Blumenau, State of Santa Catarina;
Manaus, State of Amazonia; and Pacajus, State of Ceara. Rigesa is one of the
few paper companies in Brazil which is integrated from the forests to the
markets. This fact, combined with technology drawn from Westvaco's U.S.
experience, has provided Rigesa with a history of high-quality products and
strong growth. Rigesa accounted for approximately 13% of packaging segment
operating profit in 1999.
Westvaco's Czech Republic subsidiary, Westvaco Svitavy, spol. s r.o.
("Svitavy"), operates a consumer packaging plant in that country. Svitavy
supplies consumer packaging to the markets of Eastern, Central and Western
Europe. The packaging is made primarily from distinctive paper and paperboard
produced by Westvaco in the United States.
Export sales from Westvaco's U.S. operations made up approximately 18% of
Westvaco's 1999 sales (1998-17%, 1997-16%). Sales of our foreign operating
subsidiaries, including exports, were 6% of Westvaco's total sales (1998-8%,
1997-9%).
During the second fiscal quarter of 1999, Westvaco acquired a 45%
interest in a new consumer packaging business with a plant in Guangzhou, China.
The plant is owned by a subsidiary of International Paper Company.
Environmental Protection
Westvaco is subject to federal and state environmental laws and
regulations in all jurisdictions in which it has operating facilities.
Compliance with these requirements involves the diversion of capital from
production facilities and increases operating costs. In the opinion of
Westvaco's management, environmental protection requirements are not likely to
adversely affect the company's competitive industry position since other
domestic companies are subject to similar requirements. In 1995, the company
authorized removal of elemental chlorine from all of its pulp bleaching
processes. This important initiative, completed during 1997 at a cost of
approximately $110 million, represents a major step by Westvaco in addressing
subsequent EPA regulations for the U.S. pulp and paper industry regarding air
and water quality. These regulations, known as the Cluster Rule, were published
in April 1998. The company anticipates additional capital costs to comply with
other parts of these new regulations over the next several years to be in the
range of $100 million to $150 million, which will also increase operating costs
in the range of $3 million to $7 million annually.
S-4
<PAGE>
Employees
At October 31, 1999, Westvaco employed approximately 12,750 persons, of
whom 5,980 domestic employees are represented by various labor unions under
collective bargaining agreements.
Westvaco was incorporated in 1899 under the laws of Delaware as the West
Virginia Pulp and Paper Company; its name was changed to Westvaco Corporation
on March 3, 1969. The principal executive offices of Westvaco are located at
299 Park Avenue, New York, New York 10171, and its telephone number at that
address is 212-688-5000. Unless otherwise indicated or the context otherwise
requires, the term "Westvaco" refers to Westvaco Corporation and its
consolidated subsidiaries.
RECENT DEVELOPMENTS
Second Quarter 2000 Earnings Release
On May 25, 2000 Westvaco announced second quarter earnings of $61.4
million, or 61 cents per share, for the period ended April 30, a 125 percent
increase compared to earnings of $27.3 million, or 27 cents per share, in the
second quarter of fiscal 1999. Earnings for the quarter include a gain of 7
cents per share due to an asset sale and a charge of 9 cents per share due to
early redemption of debt. Second quarter operating earnings by Westvaco's
packaging business totaled $87 million, up from $51 million in the second
quarter of 1999, due to higher shipment volume, product mix improvement and the
addition to operations of Westvaco's recently acquired bleached paperboard mill
in Evadale, TX. In addition, consumer packaging operations, including the
recently acquired Mebane Packaging Group, contributed to the packaging
segment's results. Revenues for the second quarter of fiscal 2000 totaled
$904.7 million, 33 percent more than during the same period a year earlier.
Revenues for the first six months of 2000 totaled $1.7 billion, a 28 percent
increase compared to the first half of 1999. Earnings for the first six months
of fiscal 2000 totaled $111.6 million, or $1.11 per share, up 112 percent from
$52.5 million, or 52 cents per share, earned during the first half of fiscal
1999. Operating earnings for the paper segment totaled $35 million compared to
$6 million in the second quarter of 1999. This improvement occurred as market
demand strengthened and new coated paper product introductions led to higher
market share. Lower costs also contributed to the enhanced performance by
Westvaco's printing papers business. Second quarter operating earnings in
Westvaco's specialty chemicals business increased to $18 million from $14
million as stronger markets overseas and the continued strength of U.S. markets
lifted product demand. Demand was particularly strong for Westvaco's activated
carbon products used in automotive emission controls and tall oil based
ingredients for ink resins, coatings and other products.
IMPAC Group Acquisition
On April 24, 2000, Westvaco entered into a definitive agreement to
acquire IMPAC Group, Inc. for approximately $500 million, including the
assumption of $294 million in net debt and preferred stock. IMPAC Group is a
leading supplier of high-end specialty packaging for various consumer products
including entertainment, cosmetics, health and personal care. The acquisition
furthers Westvaco's strategy of expanding in high-value consumer packaging
markets. IMPAC Group is a privately held company with over 2,100 employees and
8 facilities in North America and 12 facilities in Austria, Ireland, The
Netherlands and the United Kingdom. Westvaco expects to close the transaction
in Westvaco's third fiscal quarter of 2000, subject to obtaining necessary
government approvals and the satisfaction of other customary conditions.
S-5
<PAGE>
USE OF PROCEEDS
Westvaco expects to use the net proceeds from the sale of both series of
notes to fund part of the acquisition of IMPAC Group and the related
refinancing of indebtedness and redemption of preferred stock as described
under "Recent Developments--IMPAC Group Acquisition" in this prospectus
supplement. To the extent the net proceeds from the sale of notes are not so
applied, the net proceeds will be added to Westvaco's general corporate funds
and will be available for future capital outlays, for working capital purposes
and for the repayment of existing debt.
S-6
<PAGE>
CAPITALIZATION OF WESTVACO CORPORATION
The following table shows the unaudited consolidated capitalization of
Westvaco at January 31, 2000, as adjusted to reflect the retirement of $150
million of commercial paper incurred in connection with the redemption of $270
million of debentures in January 2000 and as further adjusted to reflect the
sale of the notes offered hereby.
<TABLE>
<CAPTION>
January 31, 2000
----------------------------------
As As Further
Actual Adjusted Adjusted
---------- ---------- ----------
(unaudited, in thousands)
<S> <C> <C> <C>
Long-term obligations
Notes:
Floating rate, due June , 2003......... $ -- $ -- $ 200,000
6.85%, due November 15, 2004............ 200,000 200,000 200,000
%, due June , 2007................... -- -- 200,000
7.10%, due November 15, 2009............ 200,000 200,000 200,000
Debentures:
9.65%, due 2002......................... 100,000 100,000 100,000
9 3/4%, due 2020........................ 100,000 100,000 100,000
8.20%, due 2030......................... 400,000 400,000 400,000
Sinking fund debentures:..................
7%, due 2004-2023....................... 150,000 150,000 150,000
7 1/2%, due 2008-2027................... 150,000 150,000 150,000
7.65%, due 2008-2027.................... 150,000 150,000 150,000
7.75%, due 2004-2023.................... 150,000 150,000 150,000
8 1/8%, due 2001-2007................... 17,100 17,100 17,100
8.30%, due 2003-2022.................... 125,000 125,000 125,000
Pollution control revenue bonds:
5.2--10 1/2%, due 2001-2027............. 74,075 74,075 74,075
Industrial revenue bonds:
7%--7.67%, due 2001-2027................ 94,145 94,145 94,145
Floating rate, due 2014................. 34,500 34,500 34,500
Floating rate, due 2023................. 47,500 47,500 47,500
Economic development bonds:
8 3/4%, due 2001-2010................... 4,190 4,190 4,190
Notes payable and other..................... 394,624 244,624 244,624
---------- ---------- ----------
Total long-term obligations............... 2,391,134 2,241,134 2,641,134
Shareholders' equity:
Common stock, $5 par, 300,000,000
authorized, 103,170,667 shares issued at
January 31, 2000......................... 766,432 766,432 766,432
Retained income........................... 1,633,051 1,633,051 1,633,051
Common stock in treasury, at cost:
2,877,824 shares at January 31, 2000..... (63,526) (63,526) (63,526)
Accumulated other comprehensive income
(loss)................................... (118,178) (118,178) (118,178)
---------- ---------- ----------
Total shareholders' equity................ 2,217,779 2,217,779 2,217,779
---------- ---------- ----------
Total Capitalization.................. $4,608,913 $4,458,913 $4,858,913
========== ========== ==========
</TABLE>
S-7
<PAGE>
SUMMARY OF FINANCIAL INFORMATION
The following is a summary of certain financial information of Westvaco
and its consolidated subsidiaries. With the exception of the inclusion of the
ratios of earnings to fixed charges, the following amounts were derived from
Westvaco's consolidated financial statements and other financial data contained
in its Annual Report on Form 10-K for the fiscal year ended October 31, 1999
and its Quarterly Report on Form 10-Q for the fiscal quarter ended January 31,
2000 (see "Documents Incorporated by Reference"). The information for the three
months ended January 31, 1999 and 2000 is unaudited and, in the opinion of
Westvaco's management, all adjustments (consisting of normal recurring
accruals) necessary for a fair statement of the results of operations have been
reflected therein.
<TABLE>
<CAPTION>
Three Months Ended
Year Ended October 31, January 31,
---------------------------------------------------------- ----------------------
1995 1996 1997 1998 1999 1999 2000
---------- ---------- ---------- ---------- ---------- ---------- ----------
(dollars in thousands, except ratios)
<S> <C> <C> <C> <C> <C> <C> <C>
Income Statement Data
Net Sales............... $3,272,447 $3,045,450 $2,982,288 $2,885,917 $2,801,849 $ 650,715 $ 799,593
Other income............ 30,297 29,065 28,743 18,747 29,384 8,705 12,359
---------- ---------- ---------- ---------- ---------- ---------- ----------
3,302,744 3,074,515 3,011,031 2,904,664 2,831,233 659,420 811,952
Cost of goods sold (ex-
cludes depreciation)... 2,266,807 2,173,719 2,161,194 2,071,011 1,969,515 464,360 554,243
Selling, research and
administration
expense................ 235,100 234,366 240,814 238,097 230,963 55,006 60,782
Depreciation and amorti-
zation................. 230,306 240,411 269,151 280,981 280,470 69,331 71,902
Restructuring charge.... -- -- -- -- 78,771 -- --
Interest expense........ 100,205 90,063 93,272 110,162 123,538 30,601 45,300
---------- ---------- ---------- ---------- ---------- ---------- ----------
Income before taxes..... 470,326 335,956 246,600 204,413 147,976 40,122 79,725
Income taxes............ 186,900 123,800 83,900 72,400 36,800 14,900 29,500
---------- ---------- ---------- ---------- ---------- ---------- ----------
Net income (a).......... $ 280,836 $ 212,156 $ 162,700 $ 132,013 $ 111,176 $ 25,222 $ 50,225
========== ========== ========== ========== ========== ========== ==========
Balance Sheet Data (at
period end)
Cash & marketable secu-
rities................. $ 151,823 $ 115,368 $ 175,354 $ 105,050 $ 108,792 $ 94,786 $ 527,635
Working capital......... 358,315 297,158 399,631 272,067 312,894 252,722 473,634
Total assets............ 4,252,732 4,437,498 4,898,787 5,008,668 4,896,692 4,919,338 6,216,574
Long-term obligations... 1,147,020 1,153,447 1,512,621 1,526,343 1,502,177 1,522,257 2,391,134
Shareholders' equity.... 2,080,551 2,209,737 2,278,568 2,246,448 2,171,288 2,150,106 2,217,779
Cash Flow Data
EBITDA (b).............. 800,837 666,430 609,023 595,556 551,984 140,054 196,927
Net cash provided by
operating activities... 522,644 521,818 390,683 406,706 412,713 53,941 132,209
Net cash used in
investing activities... (279,208) (458,182) (592,968) (416,029) (229,892) (55,527) (792,701)
Net cash (used in)
provided by financing
activities............. (169,650) (99,722) 262,917 (56,970) (160,573) 11,237 1,078,255
Capital expenditures.... 290,053 521,598 621,172 422,984 228,879 64,169 38,574
Dividends............... 77,929 89,539 89,778 89,300 88,191 22,056 22,076
Ratio of earnings to
fixed charges.......... 4.90x 3.73x 2.67x 2.27x 1.96x 1.99x 2.57x
</TABLE>
- --------
(a) The 1995 fiscal year includes an extraordinary charge of $2.59 million for
the extinguishment of higher interest rate debt.
(b) EBITDA represents income before taxes plus interest expense, depreciation
and amortization. Westvaco's EBITDA is included in this prospectus
supplement because it is a measure used by Westvaco's management to assess
Westvaco's operating results and liquidity. EBITDA should not be
considered in isolation or viewed as a substitute for cash flow from
operations, net income or other measures of performance as defined by
generally accepted accounting principles and presented in Westvaco's
consolidated financial statements. EBITDA may not be comparable to other
similarly titled measures of other companies.
For the purpose of computing the consolidated ratio of earnings to fixed
charges (1) earnings have been calculated by adding income taxes and fixed
charges (excluding capitalized interest) to net income before the extraordinary
charge and the cumulative effect of accounting changes, and (2) fixed charges
comprise the total of interest charges and a portion of rentals determined to
be representative of the interest factor.
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<PAGE>
DESCRIPTION OF NOTES
The floating rate notes mature on June , 2003 and the fixed rate notes
mature on June , 2007. Neither series of notes has the benefit of a sinking
fund. The notes of each series are unsecured obligations of Westvaco and will
rank equally with all other unsecured and unsubordinated indebtedness of
Westvaco. Each series of notes will be issued in denominations of $1,000 and
multiples thereof.
The Indenture does not limit the amount of other debt that may be issued
by Westvaco except for certain secured debt as described in the prospectus
under "Restrictive Covenants."
Whenever in this Description of Notes reference is made to a "business
day," such reference refers to any day that is not a Saturday, Sunday or date
on which banking institutions in The City of New York are generally authorized
or obligated by law to close. If any day upon which a payment of principal,
premium, if any, or interest on the notes is due is not a business day, such
payment will be made on the next succeeding business day.
Floating Rate Notes
The aggregate principal amount of the series of floating rate notes is
limited to $200,000,000.
Interest
The floating rate notes will bear interest from , 2000 or from the
most recent interest payment date on which Westvaco has paid or provided for
interest on the floating rate notes, at a rate per annum, reset quarterly,
equal to LIBOR (as defined below) plus %, as determined by the calculation
agent. The Bank of New York will initially act as calculation agent. Westvaco
will pay interest on March , June , September and December , each of
which is referred to as a "Floating Rate Interest Payment Date." Except as
described below for the first Interest Period, on each Floating Rate Interest
Payment Date, Westvaco will pay interest for the period commencing on and
including the immediately preceding Floating Rate Interest Payment Date and
ending on and including the day next preceding that Floating Rate Interest
Date. This period is referred to as an "Interest Period." The first Floating
Rate Interest Payment Date will be September , 2000 and the first Interest
Period will begin on and including June , 2000 and end on and including
September , 2000. Westvaco will pay interest on a floating rate note to the
person in whose name that note was registered at the close of business on the
15th calendar day, whether or not a business day, immediately preceding the
Floating Rate Interest Payment Date.
"LIBOR," with respect to an Interest Period, shall be the rate (expressed
as percentage per annum) for deposits in United States dollars for a three-
month period beginning on the second London Banking Day after the
Determination Date that appears on Telerate Page 3750 as of 11:00 a.m., London
time, on the Determination Date. If Telerate Page 3750 does not include this
rate or is unavailable on the Determination Date, LIBOR for the Interest
Period shall be the arithmetic mean of the rates (expressed as a percentage
per annum) for deposits in a Representative Amount in the United States
dollars for a three-month period beginning on the second London Banking Day
after the Determination Date that appear on Reuters Screen LIBO Page as of
11:00 a.m., London time, on the Determination Date. If Reuters Screen LIBO
Page does not include two or more rates or is unavailable on the Determination
Date, the calculation agent will request the principal London office of each
of four major banks in the London interbank market, as selected by the
calculation agent, to provide that bank's offered quotation (expressed as a
percentage per annum) as of approximately 11:00 a.m., London time, on the
Determination Date to prime banks in the London interbank market for deposits
in a Representatives Amount in United States dollars for a three-month period
beginning on the second London Banking Day after the Determination Date. If at
least two offered quotations are so provided, LIBOR for the Interest Period
will be the arithmetic mean of those quotations. If
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<PAGE>
fewer than two quotations are so provided, the calculation agent will request
each of three major banks in New York City, as selected by the calculation
agent, to provide that bank's rate (expressed as a percentage per annum), as of
approximately 11:00 a.m., New York City time, on the Determination Date for
loans in a Representative Amount in United States dollars to leading European
banks for a three-month period beginning on the second London Banking Day after
the Determination Date. If at least two rates are so provided, LIBOR for the
Interest Period will be the arithmetic mean of those rates. If fewer than two
rates are so provided, then LIBOR for the Interest Period will be LIBOR in
effect with respect to the immediately preceding Interest Period.
"Determination Date" with respect to an Interest Period will be the
second London Banking day preceding the first day of the Interest Period. The
Determination Date with respect to the first Interest Period will be June ,
2000.
"London Banking Day" is any day in which dealings in United States
dollars are transacted or, with respect to any future date, are expected to be
transacted in the London interbank market.
"Representative Amount" means a principal amount that is representative
for a single transaction in the relevant market at the relevant time.
"Telerate Page 3750" means the display designated as "Page 3750" on the
Bridge Telerate Service (or such other page as may replace Page 3750 on that
service).
"Reuters Screen LIBO Page" means the display designated as page "LIBO" on
The Reuters Monitor Money Rates Service (or such other page as may replace the
LIBO page on that service).
The amount of interest for each day that the floating rate notes are
outstanding, which is referred to as the "Daily Interest Amount," will be
calculated by dividing the interest rate in effect for that day by 360 and
multiplying the result by the principal amount of the floating rate notes. The
amount of interest to be paid on the floating rate notes for each Interest
Period will be calculated by adding the Daily Interest Amounts for each day in
the Interest Period.
All percentages resulting from any of the above calculations will be
rounded, if necessary, to the nearest one hundred-thousandth of a percentage
point, with five one-millionths of percentage point rounded upwards (e.g.,
9.876545% (or .09876545) being rounded to 9.87655% (or .0987655)) and all
dollar amounts used in or resulting from such calculations will be rounded to
the nearest cent (with one-half cent being rounded upwards).
The interest rate on the floating rate notes will in no event be higher
than the maximum rate permitted by New York law as the same may be modified by
United States law of general application. Under present New York law, the
maximum rate of interest is 25% per annum on a simple interest basis. This
limit may not apply to notes in which $2,500,000 or more has been invested.
The calculation agent will, upon the request of the holder of any
floating rate note, provide the interest rate then in effect. All calculations
of the calculation agent, in the absence of manifest error, shall be conclusive
for all purposes and binding on Westvaco and the holders of the floating rate
notes. Westvaco may appoint a successor calculation agent with the written
consent of the trustee, which consent shall not be unreasonably withheld.
Optional Redemption
Upon not less than 30 nor more than 60 days' notice, Westvaco may redeem
the floating rate notes, in whole or in part, on any Floating Rate Interest
Payment Date on or after June , 2001, at a redemption price equal to 100% of
the principal amount thereof, together with accrued and unpaid interest
thereon, if any, to the redemption date. Notice of redemption shall be mailed
by first class
S-10
<PAGE>
mail at least 30 but not more than 60 days before the redemption date to each
holder of floating rate notes to be redeemed at its registered address.
Floating rate notes called for redemption become due on the date fixed for
redemption. On and after the redemption date, interest ceases to accrue on
floating rate notes called for redemption.
Fixed Rate Notes
The aggregate principal amount of the series of fixed rate notes is
limited to $200,000,000.
Interest
The fixed rate notes bear interest at the rate set forth on the cover
page hereof, payable semiannually on June and December of each year to the
registered holders thereof on the preceding June or December , as the case
may be, commencing December , 2000.
Optional Redemption
Upon not less than 30 nor more than 60 days' notice, Westvaco may redeem
the fixed rate notes, in whole or in part, at any time at a redemption price
equal to 100% of the principal amount thereof plus the Make-Whole Premium,
together with accrued and unpaid interest thereon, if any, to the redemption
date. Notice of redemption shall be mailed by first class mail at least 30 but
not more than 60 days before the redemption date to each holder of fixed rate
notes to be redeemed at its registered address. Fixed rate notes called for
redemption become due on the date fixed for redemption. On and after the
redemption date, interest ceases to accrue on fixed rate notes called for
redemption.
"Make-Whole Premium" means, with respect to any fixed rate note at any
redemption date, the excess, if any, of (a) the present value of the sum of
the principal amount and premium, if any, that would be payable on such fixed
rate note on its maturity date and all remaining interest payments (not
including any portion of such payments of interest accrued as of the
redemption date) to and including such maturity date, discounted on a semi-
annual bond equivalent basis from such maturity date to the redemption date at
a per annum interest rate equal to the sum of the Treasury Yield (determined
on the business day immediately preceding the date of such redemption), plus
basis points, over (b) the principal amount of the fixed rate notes being
redeemed.
"Treasury Yield" means the yield to maturity at the time of computation
of United States Treasury securities with a constant maturity (as compiled by
and published in the most recent Federal Reserve Statistical Release H.15
(519) which has become publicly available at least two business days prior to
the date fixed for redemption (or, if such Statistical Release is no longer
published, any publicly available source of similar data)) most nearly equal
to the then remaining average life of the fixed rate notes, provided that if
the average life of the fixed rate notes is not equal to the constant maturity
of a United States Treasury security for which a weekly average yield is
given, the Treasury yield shall be obtained by linear interpolation
(calculated to the nearest one-twelfth of a year) from the weekly average
yields of United States Treasury securities for which such yields are given,
except that if the average life of the fixed rate notes is less than one year,
the weekly average yield on actually traded United States Treasury securities
adjusted to a constant maturity of one year shall be used.
Book-Entry System
The Depository Trust Company ("DTC"), New York, NY, will act as
securities depository for the notes. The notes will be issued as fully-
registered securities registered in the name of Cede & Co. (DTC's partnership
nominee). One or more fully-registered global notes certificates will be
issued for each series of notes and will be deposited with, or on behalf of,
DTC.
S-11
<PAGE>
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 Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. DTC holds securities that its participants
("Participants") deposit with DTC. DTC also facilitates the settlement among
Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby 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 the DTC 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 Participants are on file with the
Securities and Exchange Commission.
Purchases of notes under the DTC system must be made by or through Direct
Participants, which will receive a credit for the notes on DTC's records. The
ownership interest of each actual purchaser of the notes ("Beneficial Owner")
is in turn to be recorded on the Direct and Indirect Participants' records.
Beneficial Owners will not receive written confirmation from DTC of their
purchase, but Beneficial Owners are expected to receive written confirmations
providing details of the transaction, as well as periodic statements of their
holdings, from the Direct or Indirect Participant through which the Beneficial
Owner entered into the transaction. Transfers of ownership interests in the
notes are to be accomplished by entries made on the books of Participants
acting on behalf of Beneficial Owners. Beneficial Owners will not receive
certificates representing their ownership interests in the notes, except in the
event that use of the book-entry system for the notes is discontinued.
To facilitate subsequent transfers, all notes deposited by Participants
with DTC are registered in the name of DTC's partnership nominee, Cede & Co.
The deposit of notes with DTC and their registration in the name of Cede & Co.
effect no change in beneficial ownership. DTC has no knowledge of the actual
Beneficial Owners of the notes; DTC's records reflect only the identity of the
Direct Participants to whose accounts such notes are credited, which may or may
not be the Beneficial Owners. The Participants will remain responsible for
keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
Neither DTC nor Cede & Co. will consent or vote with respect to the
notes. Under its usual procedures, DTC would mail an Omnibus Proxy to Westvaco
as soon as possible after the record date. The Omnibus Proxy would assign Cede
& Co.'s consenting or voting rights to those Direct Participants to whose
accounts the notes are credited on the record date (identified in a listing
attached to the Omnibus Proxy).
Principal and interest payments on the notes will be made to DTC. DTC's
practice is to credit Direct Participants' accounts on the payable date in
accordance with their respective holdings shown on DTC's records unless DTC has
reason to believe that it will not receive payment on the payable date.
Payments by Participants to Beneficial Owners will be governed by standing
instructions and customary practices, as is the case with securities held for
the accounts of customers in bearer form
S-12
<PAGE>
or registered in "street name", and will be the responsibility of such
Participant and not of DTC, Westvaco or the Trustee, subject to any statutory
or regulatory requirements as may be in effect from time to time. Payment of
principal and interest to DTC is the responsibility of Westvaco or the Trustee,
disbursement of such payments to Direct Participants is the responsibility of
DTC, and disbursement of such payments to the Beneficial Owners is the
responsibility of Direct and Indirect Participants.
DTC may discontinue providing its services as securities depository with
respect to the notes at any time by giving reasonable notice to Westvaco or the
Trustee. Under such circumstances, in the event that a successor securities
depository is not obtained, definitive certificates are required to be printed
and delivered.
Westvaco may decide to discontinue use of the system of book-entry
transfers through DTC (or a successor securities depository). In that event,
definitive certificates will be printed and delivered.
The information in this section concerning DTC and DTC's book-entry
system has been obtained from sources that Westvaco believes to be reliable,
but Westvaco takes no responsibility for the accuracy thereof.
S-13
<PAGE>
UNDERWRITING
Westvaco and the underwriters for the offering named below have entered
into an underwriting agreement and a terms agreement with respect to the notes.
Subject to certain conditions, each underwriter has severally agreed to
purchase the principal amount of notes indicated in the following table.
<TABLE>
<CAPTION>
Principal Principal
Amount of Amount of
Underwriters Floating Rate Notes Fixed Rate Notes
------------ ------------------- ----------------
<S> <C> <C>
Goldman, Sachs & Co. ............... $ $
J.P. Morgan Securities Inc. ........
Merrill Lynch, Pierce, Fenner &
Smith
Incorporated...............
Bear, Stearns & Co. Inc. ...........
Banc of America Securities LLC......
BNY Capital Markets, Inc. ..........
Chase Securities Inc. ..............
Salomon Smith Barney Inc. ..........
Wachovia Securities, Inc. ..........
------------ ------------
Total.......................... $200,000,000 $200,000,000
============ ============
</TABLE>
Notes sold by the underwriters to the public will initially be offered at
the initial public offering prices set forth on the cover of this prospectus
supplement. Any notes sold by the underwriters to securities dealers may be
sold at a discount from the initial public offering prices of up to % and
% of the principal amount of the floating rate notes and the fixed rate
notes, respectively. Any such securities dealers may resell any notes purchased
from the underwriters to certain other brokers or dealers at a discount from
the initial public offering prices of up to % of the principal amount for
both the floating rate and fixed rate notes. If all the notes are not sold at
the initial offering prices, the underwriters may change the offering prices
and the other selling terms.
The notes are new issues of securities with no established trading
market. Westvaco has been advised by the underwriters that the underwriters
intend to make a market in each series of notes but are not obligated to do so
and may discontinue market making at any time without notice. No assurance can
be given as to the liquidity of the trading market for either series of notes.
In connection with the offerings, the underwriters may purchase and sell
notes in the open market. These transactions may include short sales,
stabilizing transactions and purchases to cover positions created by short
sales. Short sales involve the sale by the underwriters of a greater number of
notes than they are required to purchase in the offering. Stabilizing
transactions consist of certain bids or purchases made for the purpose of
preventing or retarding a decline in the market price of the notes while the
offering is in progress.
Westvaco has agreed to indemnify the several underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
In the ordinary course of business, certain of the underwriters and their
affiliates have engaged, and may in the future engage, in investment banking,
commercial banking and/or financial advisory transactions with Westvaco and its
affiliates.
S-14
<PAGE>
EXPERTS
The consolidated financial statements incorporated in this prospectus
supplement and the accompanying prospectus by reference to the Annual Report on
Form 10-K of Westvaco Corporation for the fiscal year ended October 31, 1999
have been so incorporated by reference in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
S-15
<PAGE>
Westvaco Corporation
Debt Securities
---------------
By this prospectus, we may offer up to $800,000,000 of debt securities.
Market conditions at the time these securities are sold will determine the
prices and terms of these securities.
Each issue of securities under this prospectus may have a different
aggregate principal amount, maturity date, public offering price, interest rate
or rates, timing of interest payments, provisions for redemption, sinking fund
requirements, and other variable terms. The specific terms of each offering of
debt securities under this prospectus will be included in an accompanying
prospectus supplement.
This prospectus may not be used to consummate sales of offered securities
unless accompanied by a prospectus supplement. You should read this prospectus
and the accompanying prospectus supplement carefully before you invest.
---------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is
a criminal offense.
---------------
We may sell securities under this prospectus to or through underwriters.
We may also sell these securities directly to other purchasers or through
agents.
---------------
The date of this prospectus is November 30, 1999.
<PAGE>
DOCUMENTS INCORPORATED BY REFERENCE
The Securities and Exchange Commission allows us to "incorporate by
reference" the information we file with them, which means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is an important part of this prospectus,
and information that we file later with the Securities and Exchange Commission
will automatically update and supersede this information. We incorporate by
reference the documents of Westvaco listed below and any future filings made
with the Securities and Exchange Commission pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Securities Exchange Act of 1934, until we sell all of the
securities. A document will be incorporated by reference on the date it is
filed.
. Annual Report on Form 10-K for the fiscal year ended October 31,
1998.
. Quarterly Report on Form 10-Q for the fiscal quarter ended January
31, 1999.
. Quarterly Report on Form 10-Q for the fiscal quarter ended April 30,
1999.
. Quarterly Report on Form 10-Q for the fiscal quarter ended July 31,
1999.
. Current Report on Form 8-K dated October 5, 1999.
. Current Report on Form 8-K dated November 12, 1999.
. Current Report on Form 8-K dated November 18, 1999.
. Definitive proxy statement, dated December 28, 1998, and additional
proxy materials, dated February 1, 1999.
You may request a copy of these filings at no cost, by writing or
telephoning us at the following address: Mr. John W. Hetherington, Vice
President and Secretary, Westvaco Corporation, 299 Park Avenue, New York, New
York 10171, telephone (212) 318-5280.
You should rely only on the information contained or incorporated by
reference in this prospectus or any prospectus supplement. We have not
authorized any other person to provide you with different information. We are
not making an offer of these securities in any jurisdiction where the offer is
not permitted. You should assume that the information appearing in this
prospectus or any prospectus supplement, as well as information we previously
filed with the Securities and Exchange Commission and incorporated by
reference, is accurate as of the date on the front of those documents only.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the Securities and Exchange Commission. Our filings are
available to the public over the Internet at the Securities and Exchange
Commission's web site at http://www.sec.gov. You may also read and copy any
document we file at the Securities and Exchange Commission's public reference
rooms at 450 Fifth Street, N.W., Washington, D.C. 20549; 7 World Trade Center,
New York, New York 10048; and Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661. Please call the Securities and Exchange
Commission at 1-800-SEC-0330 for further information on the public reference
rooms.
This prospectus is a part of a registration statement on Form S-3 and the
related amendments and exhibits filed with the Securities and Exchange
Commission. This prospectus does not contain all of the information in the
registration statement. Please refer to the registration statement and its
exhibits for further information regarding Westvaco and the offered securities.
2
<PAGE>
THE COMPANY
Westvaco Corporation is one of the major producers of paper and
paperboard in the United States. It converts paper and paperboard into a
variety of end-products, manufactures a variety of specialty chemicals,
produces lumber, sells timber from its timberlands and is engaged in land
development. In Brazil, it is a major producer of paperboard and corrugated
packaging for the markets of that country and also operates a folding carton
plant. Westvaco also has a folding carton plant in the Czech Republic. Westvaco
exports products from the United States, Brazil and the Czech Republic to other
countries throughout the world.
Westvaco was incorporated in 1899 under the laws of Delaware as the West
Virginia Pulp and Paper Company; its name was changed to Westvaco Corporation
on March 3, 1969. The principal executive offices of Westvaco are located at
299 Park Avenue, New York, New York 10171, and its telephone number at that
address is 212-688-5000. Unless otherwise indicated or the context otherwise
requires, the term "Westvaco" refers to Westvaco Corporation and its
consolidated subsidiaries.
SUMMARY OF FINANCIAL INFORMATION
The following is a summary of certain financial information of Westvaco
and its consolidated subsidiaries. With the exception of the inclusion of the
ratios of earnings to fixed charges, the following amounts were derived from
Westvaco's consolidated financial statements and other financial data contained
in its Annual Report on Form 10-K for the fiscal year ended October 31, 1998
and its Quarterly Report on Form 10-Q for the fiscal quarter ended July 31,
1999 (see "Documents Incorporated by Reference").
<TABLE>
<CAPTION>
Nine Months
Year Ended October 31, Ended July 31
---------------------------------------------------------- ----------------------
1994 1995 1996 1997 1998 1998 1999
---------- ---------- ---------- ---------- ---------- ---------- ----------
(In thousands, except per share data and ratios)
<S> <C> <C> <C> <C> <C> <C> <C>
Sales................... $2,607,474 $3,272,447 $3,045,450 $2,982,288 $2,885,917 $2,154,126 $2,030,398
Net income.............. 103,606 280,836 212,156 162,700 132,013 98,796 87,503
Net income per share of
common stock--Basic.... 1.03 2.78* 2.09 1.60 1.30 0.97 0.87
Net Income per share of
common stock--Diluted.. 1.03 2.76* 2.07 1.58 1.30 0.97 0.87
Ratio of earnings to
fixed charges.......... 2.25x 4.90x 3.73x 2.67x 2.27x 2.26x 2.17x
</TABLE>
- --------
* The 1995 fiscal year includes an extraordinary charge of $.02 per share for
the extinguishment of higher interest rate debt.
For the purpose of computing the consolidated ratio of earnings to fixed
charges (1) earnings have been calculated by adding income taxes and fixed
charges (excluding capitalized interest) to net income before the extraordinary
charge and the cumulative effect of accounting changes, and (2) fixed charges
comprise the total of interest charges and a portion of rentals determined to
be representative of the interest factor.
USE OF PROCEEDS
Except as otherwise set forth in the accompanying prospectus supplement
relating to an offering of the Securities, the net proceeds from the sale of
the Securities being offered will be added to Westvaco's general corporate
funds and will be available for future capital outlays, for working capital
purposes and for the repayment of existing debt.
3
<PAGE>
DESCRIPTION OF SECURITIES
The Securities are to be issued under an Indenture, dated as of March 1,
1983 (the "Indenture"), between Westvaco and The Bank of New York (formerly
known as Irving Trust Company), as Trustee (the "Trustee"), a copy of which is
filed as an exhibit to the registration statement. The following summaries of
certain provisions of the Indenture do not purport to be complete and are
subject to, and are qualified in their entirety by reference to, all provisions
of the Indenture, including the definitions therein of certain terms. Wherever
particular Sections or defined terms of the Indenture are referred to, it is
intended that such Sections or defined terms shall be incorporated herein by
reference. The following sets forth certain general terms and provisions of the
Securities to which any prospectus supplement may relate. The particular terms
of the Securities offered by any prospectus supplement (the "Offered
Securities") and the extent, if any, to which such general provisions may apply
to the Securities so offered, will be described in the prospectus supplement
relating to such Offered Securities.
General
The Indenture does not limit the aggregate principal amount of Securities
which may be issued thereunder and provides that Securities may be issued from
time to time in one or more series. The Securities will be unsecured
obligations of Westvaco.
Reference is made to the prospectus supplement relating to the particular
series of Securities offered thereby for the following terms of the Offered
Securities:
. the title of the Offered Securities;
. any limit on the aggregate principal amount of the Offered Securities;
. the price or prices (expressed as a percentage of the aggregate
principal amount thereof) at which the Offered Securities will be
issued;
. the date or dates on which the Offered Securities will mature;
. the rate or rates (which may be fixed or variable) per annum at which
the Offered Securities will bear interest, if any;
. the date from which such interest, if any, on the Offered Securities
will accrue, the dates on which such interest, if any, will be payable,
the date on which payment of such interest, if any, will commence and
the Regular Record Dates for such Interest Payment Dates, if any;
. the ranking of the Offered Securities relative to any and all other
securities of Westvaco theretofore issued;
. the dates, if any, on which and the price or prices at which the Offered
Securities will, pursuant to any mandatory sinking fund provisions, or
may, pursuant to any optional sinking fund or to any purchase fund
provisions, be redeemed by Westvaco, and the other detailed terms and
provisions of such sinking and/or purchase funds;
. the date, if any, after which and the price or prices at which the
Offered Securities may, pursuant to any optional redemption provisions,
be redeemed at the option of Westvaco or of the Holder thereof and the
other detailed terms and provisions of such optional redemption; and
. any other terms of the series (which will not be inconsistent with the
provisions of the indenture).
Unless otherwise indicated in the related prospectus supplement,
principal of and premium, if any, and interest, if any, on the Securities will
be payable, and the transfer of the Securities will be
4
<PAGE>
registrable, at the office of the Trustee in the Borough of Manhattan, The City
of New York, except that, at the option of Westvaco, interest may be paid by
mailing a check to the address of the person entitled thereto as it appears on
the Security Register. (Sections 301, 305, 1002)
Unless otherwise indicated in the related prospectus supplement, the
Securities will be issued only in fully registered form without coupons and in
denominations of $1,000 or any integral multiple thereof. No service charge
will be made for any transfer or exchange of the Securities, but Westvaco may
require payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith. (Sections 302, 305)
Securities may be issued as Original Issue Discount Securities to be sold
at a substantial discount below their principal amount. Special federal income
tax and other considerations applicable thereto will be described in the
prospectus supplement relating thereto.
The Indenture does not contain any covenants or other provisions which
would afford Holders of Securities protection in the event of a highly
leveraged transaction involving Westvaco.
Restrictive Covenants
Limitations on Liens. The Indenture provides that so long as any of the
Securities are outstanding Westvaco will not, and will not permit any Domestic
Subsidiary (as defined) to, issue, assume or guarantee any debt for money
borrowed (herein referred to as "Debt") if such Debt is secured by any
mortgage, security interest, pledge or other lien (herein referred to as a
"mortgage") upon any Principal Property (as defined) of Westvaco or any
Domestic Subsidiary or any shares of stock or indebtedness of any Domestic
Subsidiary, whether owned at the date of the Indenture or thereafter acquired,
without effectively securing the Securities equally and ratably with such Debt.
The foregoing restriction does not apply to:
(1) mortgages on any property acquired, constructed or improved
after the date of the Indenture which are created or assumed within 120
days after such acquisition, construction or improvement (or within six
months thereafter pursuant to a firm commitment for financing
arrangements entered into within such 120 day period) to secure or
provide for the payment of the purchase price or cost thereof incurred
after the date of the Indenture, or existing mortgages on property
acquired, provided such mortgages shall not apply to any property
theretofore owned by Westvaco or a Domestic Subsidiary other than
theretofore unimproved real property;
(2) mortgages existing on any property acquired from a corporation
merged with or into Westvaco or a Domestic Subsidiary;
(3) mortgages on property of any corporation existing at the time
it becomes a Domestic Subsidiary;
(4) mortgages securing Debt owed by a Domestic Subsidiary to
Westvaco or to another Domestic Subsidiary;
(5) mortgages in favor of governmental bodies to secure advance or
other payments pursuant to any contract or statute or to secure
indebtedness incurred to finance the purchase price or cost of
constructing or improving the property subject to such mortgages;
(6) mortgages on timberlands in connection with an arrangement
under which Westvaco or a Domestic Subsidiary is obligated to cut or pay
for timber in order to provide the secured party with a specified amount
of money, however determined; or
5
<PAGE>
(7) mortgages for extending, renewing or replacing Debt secured by
any mortgage referred to in the foregoing clauses (1) to (6) inclusive
or in this clause or any mortgages existing on the date of the
Indenture. Such restriction does not apply to the issuance, assumption
or guarantee by Westvaco or any Domestic Subsidiary of Debt secured by a
mortgage which would otherwise be subject to the foregoing restriction
up to an aggregate amount which, together with all other secured Debt
(not including secured Debt permitted under the foregoing exceptions)
and the Value (as defined) of Sale and Lease-back Transactions existing
at such time (other than Sale and Lease-back Transactions the proceeds
of which have been applied to the retirement of Securities or of certain
long-term indebtedness or to the purchase of other Principal Property,
and other than Sale and Lease-back Transactions in which the property
involved would have been permitted to be mortgaged under clause (1)
above), does not exceed 5% of Consolidated Net Tangible Assets (as
defined). (Section 1005)
Limitation on Sale and Lease-back Transactions. Sale and Lease-back
Transactions by Westvaco or any Domestic Subsidiary of any Principal Property
are prohibited (except for temporary leases for a term, including renewals, of
not more than three years and except for leases between Westvaco and a Domestic
Subsidiary or between Domestic Subsidiaries) unless:
. Westvaco or such Domestic Subsidiary would be entitled to incur Debt
secured by a mortgage on the property to be leased without securing the
Securities pursuant to clause (1) under "Limitations on Liens" or
. the value thereof would be an amount permitted under the last sentence
under "Limitations on Liens" or
. Westvaco applied an amount equal to the fair value of such property
(a) to the retirement of Securities (other than pursuant to any
sinking fund obligations applicable to such Securities),
(b) to the retirement of certain long-term indebtedness of
Westvaco or a Domestic Subsidiary or
(c) to the purchase of Principal Property (other than that
involved in such Sale and Lease-back Transaction). (Section 1006)
Events of Default
The following are Events of Default under the Indenture with respect to
Securities of any series:
. failure to pay principal of or any premium on any Security of that
series when due;
. failure to pay any interest on any Security of that series when due,
continued for 30 days;
. failure to deposit any sinking fund payment, when due, in respect of any
Security of that series;
. failure to perform any other covenant of Westvaco in the Indenture
(other than a covenant included in the Indenture solely for the benefit
of a series of Securities other than that series), continued for 60 days
after written notice as provided in the Indenture;
. certain events in bankruptcy, insolvency or reorganization and
. any other Event of Default provided with respect to Securities of that
series. (Section 501)
If an Event of Default with respect to Securities of any series at the
time Outstanding occurs and is continuing, either the Trustee or the Holders of
at least 25% in aggregate principal amount of
6
<PAGE>
the Outstanding Securities of that series may declare the principal amount (or,
if the Securities of that series are Original Issue Discount Securities, such
portion of the principal amount as may be specified in the terms of that
series) of all the Securities of that series to be due and payable immediately.
At any time after a declaration of acceleration with respect to Securities of
any series has been made, but before a judgment or decree based on acceleration
has been obtained, the Holders of a majority in aggregate principal amount of
Outstanding Securities of that series may, under certain circumstances, rescind
and annul such acceleration. (Section 502)
The Indenture provides that, subject to the duty of the Trustee during
default to act with the required standard of care, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders, unless such Holders shall have
offered to the Trustee reasonable indemnity. (Section 603) Subject to such
provisions for the indemnification of the Trustee, the Holders of a majority in
aggregate principal amount of the Outstanding Securities of any series will
have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, with respect to the Securities of that series.
(Section 512)
No Holder of any Security of any series will have any right to institute
any proceeding with respect to the Indenture or for any remedy thereunder,
unless such Holder shall have previously given to the Trustee written notice of
a continuing Event of Default with respect to Securities of that series and
also unless the Holders of not less than 25% in aggregate principal amount of
the Outstanding Securities of that series shall have made written request, and
offered reasonable indemnity, to the Trustee to institute such proceeding as
trustee, and the Trustee shall not have received from the Holders of a majority
in principal amount of the Outstanding Securities of that series a direction
inconsistent with such request and shall have failed to institute such
proceeding within 60 days. (Section 507) However, the Holder of any Security
will have an absolute right to receive payment of the principal of (and
premium, if any) and interest on such Security on or after the due dates
expressed in such Security and to institute suit for the enforcement of any
such payment. (Section 508)
Westvaco is required to furnish to the Trustee annually a statement as to
performance by Westvaco of certain of its obligations under the Indenture and
as to any default in such performance. (Section 1007)
Modification and Waiver
Modifications and amendments of the Indenture may be made by Westvaco and
the Trustee with the consent of the Holders of 66 2/3% in aggregate principal
amount of the Outstanding Securities of each series affected by such
modification or amendment. However, no such modification or amendment may,
without the consent of the Holder of each Outstanding Security affected
thereby:
. change the stated maturity date of the principal of, or any installment
of principal or interest on, any Security;
. reduce the principal amount of, or any premium or interest on, any
Security;
. reduce the amount of principal of an Original Issue Discount Security
payable upon acceleration of the maturity thereof;
. change the place or currency of payment of principal of, or any premium
or interest on, any Security;
. impair the right to institute suit for the enforcement of any payment on
or with respect to any Security; or
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. reduce the percentage in principal amount of Outstanding Securities of
any series the consent of whose Holders is required for modification or
amendment of the Indenture or for waiver of compliance with certain
provisions of the Indenture or for waiver of certain defaults. (Section
902)
The Holders of 66 2/3% in aggregate principal amount of the Outstanding
Securities of each series may, on behalf of all Holders of Securities of that
series, waive, insofar as that series is concerned, compliance by Westvaco with
certain restrictive provisions of the Indenture. (Section 1008) The Holders of
a majority in aggregate principal amount of the Outstanding Securities of each
series may, on behalf of all Holders of Securities of that series, waive any
past default under the Indenture with respect to Securities of that series,
except a default in the payment of principal or any premium or interest or in
respect of a provision which under the Indenture cannot be modified or amended
without the consent of the Holder of each Outstanding Security of that series
affected. (Section 513)
Consolidation, Merger and Sale of Assets
Westvaco may consolidate or merge with or into, or transfer its assets
substantially as an entirety to, any corporation organized under the laws of
any domestic jurisdiction, provided that the successor corporation assumes
Westvaco's obligations on the Securities and under the Indenture, that after
giving effect to the transaction no Event of Default, and no event which, after
notice or lapse of time, would become an Event of Default, shall have occurred
and be continuing, and that certain other conditions are met. (Section 801)
Concerning the Trustee
Westvaco maintains banking relationships with the Trustee in the ordinary
course of its business. Borrowings totalling $500,000,000 are available to
Westvaco under its Credit Agreement with a group of banks that includes the
Trustee. There are no borrowings currently outstanding under this Credit
Agreement. The Trustee is also the trustee under the indentures pursuant to
which Westvaco's publicly held senior debt securities were issued. The Trustee
is also the trustee and a money manager under Westvaco's employee retirement
plans.
PLAN OF DISTRIBUTION
Westvaco may sell Securities to or through underwriters, and also may
sell Securities directly to other purchasers or through agents.
The distribution of the Securities may be effected from time to time in
one or more transactions at a fixed price or prices (which may be changed from
time to time), at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at negotiated prices. Each
prospectus supplement will describe the method of distribution of the
Securities offered thereby.
In connection with the sale of the Securities, underwriters may receive
compensation from Westvaco or from purchasers of Securities for whom they may
act as agents, in the form of discounts, concessions or commissions. The
underwriters, dealers and agents that participate in the distribution of
Securities may be deemed to be underwriters under the Securities Act of 1933
and any discounts or commissions received by them and any profit on the resale
of Securities by them may be deemed to be underwriting discounts and
commissions under such Act. Any such underwriter will be identified and any
such compensation will be described in the prospectus supplement.
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<PAGE>
If so indicated in the prospectus supplement, Westvaco will authorize the
underwriters to solicit offers by certain institutions to purchase Securities
from Westvaco at the public offering price set forth in the prospectus
supplement pursuant to Delayed Delivery Contracts providing for payment and
delivery on the date stated in the prospectus supplement. Each such contract
will be for an amount not less than, and unless Westvaco otherwise agrees, the
aggregate principal amount of Securities sold pursuant to such contracts shall
not be more than, the respective amounts stated in the prospectus supplement.
Institutions with whom such contracts, when authorized, may be made include
commercial and savings banks, insurance companies, pension funds, investment
companies, educational and charitable institutions, and other institutions, but
shall in all cases be subject to the approval of Westvaco. Delayed Delivery
Contracts will not be subject to any conditions except that the purchase by an
institution of the Securities covered thereby shall not at the time of delivery
be prohibited under the laws of any jurisdiction in the United States to which
such institution is subject.
The Underwriting Agreement entered into with respect to any Securities
sold through underwriters provides that the obligations of the underwriter or
underwriters will be subject to certain conditions precedent and that the
underwriters will be obligated to purchase all of the Securities covered by the
applicable prospectus supplement if any are purchased.
Westvaco has agreed to indemnify the several underwriters against certain
civil liabilities, including liabilities under the Securities Act of 1933.
In connection with this offering, the underwriters may over-allot or
effect transactions which stabilize or maintain the market price of the
securities at a level above that which might otherwise prevail in the open
market. Such stabilizing if commenced, may be discontinued at any time.
LEGAL OPINIONS
The legality of the Securities offered hereby will be passed upon for
Westvaco by Wendell L. Willkie, II, Esq., Senior Vice President and General
Counsel of Westvaco and for the Underwriters by Cahill Gordon & Reindel (a
partnership including a professional corporation), New York, New York. Mr.
Willkie is the beneficial owner of shares of Westvaco's common stock held in
trust under Westvaco's Savings and Investment Plan. He is also the recipient of
stock options granted by Westvaco.
EXPERTS
The consolidated financial statements incorporated in this prospectus by
reference to Westvaco's Annual Report on Form 10-K for the fiscal year ended
October 31, 1998 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
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No dealer, salesperson or other person is authorized to give any information
or to represent anything not contained in this prospectus. You must not rely
on any unauthorized information or representations. This prospectus is an
offer to sell only the Notes offered hereby, but only under circumstances and
in jurisdictions where it is lawful to do so. The information contained in
this prospectus is current only as of its date.
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TABLE OF CONTENTS
Prospectus Supplement
<TABLE>
<CAPTION>
Page
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<S> <C>
Documents Incorporated by Reference........................................ S-2
The Company................................................................ S-3
Recent Developments........................................................ S-5
Use of Proceeds............................................................ S-6
Capitalization of Westvaco Corporation..................................... S-7
Summary of Financial Information........................................... S-8
Description of Notes....................................................... S-9
Underwriting............................................................... S-14
Experts.................................................................... S-15
Prospectus
Documents Incorporated by Reference........................................ 2
Where You Can Find More Information........................................ 2
The Company................................................................ 3
Summary of Financial Information........................................... 3
Use of Proceeds............................................................ 3
Description of Securities.................................................. 4
Plan of Distribution....................................................... 8
Legal Opinions............................................................. 9
Experts.................................................................... 9
</TABLE>
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$400,000,000
Westvaco Corporation
$200,000,000 Floating Rate Notes
due June , 2003
$200,000,000 % Notes
due June , 2007
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PROSPECTUS SUPPLEMENT
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Goldman, Sachs & Co.
J.P. Morgan & Co.
Merrill Lynch & Co.
Bear, Stearns & Co. Inc.
Banc of America Securities LLC
BNY Capital Markets, Inc.
Chase Securities Inc.
Salomon Smith Barney
Wachovia Securities, Inc.
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