Rule 424(b)(3)
Registration Statement No.333-27465
Cusip # 12560PAW1
PRICING SUPPLEMENT NO. 2,
Dated October 15, 1998 to
Prospectus, dated September 24, 1998 and
Prospectus Supplement, dated September 25, 1998.
THE CIT GROUP, INC.
(formerly THE CIT GROUP HOLDINGS, INC.)
MEDIUM-TERM FLOATING RATE NOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
(X) Senior Note ( ) Senior Subordinated Note
Principal Amount: U.S. $400,000,000.
Proceeds to Corporation: 100% or $400,000,000.
Underwriting Discount: Variable Price Reoffer, Initially at Par.
Issue Price: 100%.
Specified Currency: U.S. Dollars.
Original Issue Date: October 20, 1998.
Maturity Date: October 20, 1999.
Interest Rate Basis: Prime Rate.
Spread: -280 basis points.
Initial Interest Rate: The Prime Rate determined one Business Day prior to
the Original Issue Date minus 280 basis points.
The Notes are offered by the Underwriters, as specified herein, subject to
receipt and acceptance by it and subject to its right to reject any order in
whole or in part. It is expected that the Notes will be ready for delivery in
book-entry form on or about October 20, 1998.
LEHMAN BROTHERS
CHASE SECURITIES
SALOMON SMITH BARNEY
CREDIT SUISSE FIRST BOSTON
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Form: Global Note.
Interest Reset Date: Each Business Day to but excluding the Maturity Date.
Rate Cut-Off Date: Two Business Days prior to each Interest Payment Date. The
interest rate for each day following the Rate Cut-Off Date to but
excluding the Interest Payment Date will be the rate prevailing on the
Rate Cut-Off Date.
Accrual of Interest: Accrued interest will be computed by adding the Interest
Factors calculated for each day from the Original Issue Date or from the
last date to which interest has been paid or duly provided for up to but
not including the day for which accrued interest is being calculated. The
"Interest Factor" for any Note for each such day will be computed by
multiplying the face amount of the Note by the interest rate applicable to
such day and dividing the product thereof by 360.
Interest Payment Dates: Quarterly on January 20, April 20, July 20, and October
20, commencing January 20, 1999, provided that if any Interest Payment
Date (other than the Maturity Date) would otherwise fall on a day that is
not a Business Day, then the Interest Payment Date will be the first
following day that is a Business Day. If the Maturity Date would otherwise
fall on a day that is not a Business Day, then principal and interest on
the Note will be paid on the next succeeding Business Day, and no interest
on such payment will accrue for the period from and after the Maturity
Date.
Interest payments will include the amount of interest accrued from and
including the most recent Interest Payment Date to which interest has been
paid (or from and including the Original Issue Date) to but excluding the
applicable Interest Payment Date.
Calculation Date: The earlier of (i) the fifth Business Day after each Interest
Determination Date or (ii) the Business Day immediately preceding the
applicable Interest Payment Date.
Interest Determination Date: One Business Day prior to each Interest Reset
Date.
Minimum Interest Rate: 0.0%.
Calculation Agent: The CIT Group, Inc.
Trustee, Registrar, Authenticating and Paying Agent: The First National Bank of
Chicago, under Indenture dated as of September 24, 1998 between the
Trustee and the Corporation.
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UNDERWRITING
Lehman Brothers Inc., Chase Securities Inc., Salomon Smith Barney Inc. and
Credit Suisse First Boston Corporaton (the "Underwriters") are acting as
principals in this transaction.
Subject to the terms and conditions set forth in a Term Sheet and Agreement
dated October 15, 1998 (the "Terms Agreement"), between the Corporation and the
Underwriters, incorporating the terms of a Selling Agency Agreement dated May
15, 1996, between the Corporation and Lehman Brothers, Lehman Brothers Inc.,
Credit Suisse First Boston Corporation, Goldman, Sachs & Co., Merrill Lynch &
Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co.
Incorporated, Salomon Smith Barney Inc. (formerly known as Salomon Brothers
Inc), and Warburg Dillon Read LLC (formerly known as UBS Securities LLC), the
Corporation has agreed to sell to the Underwriters, and the Underwriters have
each severally agreed to purchase the principal amounts of the Notes set forth
below opposite their names.
Underwriter Principal Amount
Lehman Brothers Inc. $150,000,000
Chase Securities Inc. 100,000,000
Salomon Smith Barney Inc. 95,000,000
Credit Suisse First Boston Corporation 55,000,000
Total $400,000,000
Under the terms and conditions of the Terms Agreement, the Underwriters are
committed to take and pay for all of the Notes, if any are taken.
The Underwriters have advised the Corporation that they propose to offer the
Notes for sale from time to time in one or more transactions (which may include
block transactions), in negotiated transactions or otherwise, or a combination
of such methods of sale, at market prices prevailing at the time of sale, at
prices related to such prevailing market prices or at negotiated prices. The
Underwriters may effect such transactions by selling the Notes to or through
dealers, and such dealers may receive compensation in the form of underwriting
discounts, concessions or commissions from the Underwriters and/or the
purchasers of the Notes for whom they may act as agent. In connection with the
sale of the Notes, the Underwriters may be deemed to have received compensation
from the Corporation in the form of underwriting discounts, and the Underwriters
may also receive commissions from the purchasers of the Notes for whom they may
act as agent. The Underwriters and any dealers that participate with the
Underwriters in the distribution of the Notes may be deemed to be underwriters,
and any discounts or commissions received by them and any profit on the resale
of the Notes by them may be deemed to be underwriting discounts or commissions.
The Notes are a new issue of securities with no established trading
market. The Corporation currently has no intention to list the Notes on any
securities exchange. The Corporation has been advised by the Underwriters that
they intend to make a market in the Notes but are not obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given as to the liquidity of the trading market for the Notes.
The Corporation has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.
