<PAGE> 1
===============================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JULY 30, 1997
COMMERCIAL METALS COMPANY
<TABLE>
<S> <C> <C>
DELAWARE 1-4304 75-0725338
(STATE OF INCORPORATION) (COMMISSION FILE NO.) (IRS EMPLOYER IDENTIFICATION NO.)
</TABLE>
7800 STEMMONS FREEWAY, DALLAS, TEXAS 75247
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (214) 689-4300
NOT APPLICABLE
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
===============================================================================
<PAGE> 2
ITEM 5. OTHER EVENTS
On June 30, 1995, Commercial Metals Company (the "Company") filed
Registration Statement No. 33-60809 on Form S-3 with the Securities and
Exchange Commission pursuant to Rule 415, as amended by Amendment No. 1 to
Registration Statement on Form S-3 filed on July 18, 1995 (collectively, the
"Registration Statement"). The Registration Statement provides for the issuance
of Debt Securities in an aggregate amount of $150,000,000, and was declared
effective by the Securities and Exchange Commission on July 25, 1995. Pursuant
to a Prospectus Supplement dated July 30, 1997, and accompanying Prospectus,
dated July 26, 1995, the Company is issuing $50,000,000 of Debt Securities
designated 6.80% Notes Due August 1, 2007 (the "Notes").
Filed as Exhibit 1.1 to the Registration Statement was a form of
Underwriting Agreement for the issuance of the Debt Securities. Pursuant to the
terms of the Underwriting Agreement and in connection with the issuance of the
Notes, the Company has executed a Pricing Agreement dated July 30, 1997, among
the Company, Goldman, Sachs & Co., Lehman Brothers and Morgan Stanley & Co.
Incorporated, a copy of which is filed as Exhibit 1.1 to this Current Report on
Form 8-K.
Filed as Exhibit 4.1 to the Registration Statement was a form of
Indenture for the Debt Securities between the Company and The Chase Manhattan
Bank. Pursuant to the terms of the Indenture and in connection with the
issuance of the Notes, the terms of the Notes have been established in an
Officers' Certificate of the Company, the form of which is filed as Exhibit 4.1
to this Current Report on Form 8-K.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) EXHIBITS DESCRIPTION
1.1 Form of Pricing Agreement among the Company and Goldman, Sachs & Co.,
Lehman Brothers and Morgan Stanley & Co. Incorporated, dated
July 30, 1997, with respect to the issuance and sale of the Notes.
4.1 Form of Officers' Certificate of the Company regarding the Notes,
including the form of Note.
5.1 Opinion Letter of Haynes and Boone, LLP regarding the validity of the
Notes.
12.1 Statement regarding computation of ratios of earnings to fixed
charges.
23.1 Consent of Haynes and Boone, LLP (included as part of Exhibit 5.1).
2
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Company has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
COMMERCIAL METALS COMPANY
July 30, 1997 By: /s/ LAWRENCE A. ENGELS
----------------------------------
Name: Lawrence A. Engels
---------------------------------
Title: Vice President, Treasurer and
--------------------------------
Chief Financial Officer
--------------------------------
3
<PAGE> 4
EXHIBIT INDEX
EXHIBIT
NUMBER DESCRIPTION
- ------- -----------
1.1 Form of Pricing Agreement among the Company and Goldman, Sachs &
Co., Lehman Brothers and Morgan Stanley & Co. Incorporated, dated
July 30, 1997, with respect to the issuance and sale of the Notes.
4.1 Form of Officers' Certificate of the Company regarding the Notes,
including the form of Note.
5.1 Opinion Letter of Haynes and Boone, LLP regarding the validity of the
Notes.
12.1 Statement regarding computation of ratios of earnings to fixed
charges.
23.1 Consent of Haynes and Boone, LLP (included as part of Exhibit 5.1).
<PAGE> 1
EXHIBIT 1.1
Pricing Agreement
Goldman, Sachs & Co.
Lehman Brothers
Morgan Stanley & Co. Incorporated
c/o Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004.
JULY 30, 1997
Ladies and Gentlemen:
Commercial Metals Company, a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated July 26, 1995 (the "Underwriting Agreement"),
between the Company on the one hand and Goldman, Sachs & Co., Lehman Brothers,
and Morgan Stanley & Co. Incorporated on the other hand, to issue and sell to
the Underwriters named in Schedule I hereto (the "Underwriters") the Securities
specified in Schedule II hereto (the "Designated Securities"). Each of the
provisions of the Underwriting Agreement is incorporated herein by reference in
its entirety, and shall be deemed to be a part of this Agreement to the same
extent as if such provisions had been set forth in full herein; and each of the
representations and warranties set forth therein shall be deemed to have been
made at and as of the date of this Pricing Agreement, except that each
representation and warranty which refers to the Prospectus in Section 2 of the
Underwriting Agreement shall be deemed to be a representation or warranty as of
the date of the Underwriting Agreement in relation to the Prospectus (as
therein defined), and also a representation and warranty as of the date of this
Pricing Agreement in relation to the Prospectus as amended or supplemented
relating to the Designated Securities which are the subject of this Pricing
Agreement. Each reference to the Representatives herein and in the provisions
of the Underwriting Agreement so incorporated by reference shall be deemed to
refer to you. Unless otherwise defined herein, terms defined in the
Underwriting Agreement are used herein as therein defined. The Representatives
designated to act on behalf of each of the Underwriters of the Designated
Securities pursuant to Section 12 of the Underwriting Agreement and the address
of the Representatives referred to in such Section 12 are set forth at the end
of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you, is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company, at the time
and place and at the purchase price to the Underwriters set forth in Schedule
II hereto, the principal amount of Designated Securities set forth opposite the
name of such Underwriter in Schedule I hereto.
If the foregoing is in accordance with your understanding, please sign
and return to us six counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding
<PAGE> 2
agreement between each of the Underwriters and the Company. It is understood
that your acceptance of this letter on behalf of each of the Underwriters is or
will be pursuant to the authority set forth in a form of Agreement among
Underwriters, the form of which shall be submitted to the Company for
examination upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very truly yours,
COMMERCIAL METALS COMPANY
By:
------------------------------------
Name:
Title:
Accepted as of the date hereof:
GOLDMAN, SACHS & CO.
LEHMAN BROTHERS
MORGAN STANLEY & CO. INCORPORATED
By:
-----------------------------------
Goldman, Sachs & Co.
<PAGE> 3
SCHEDULE I
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT OF
DESIGNATED SECURITIES
TO BE PURCHASED
---------------------
<S> <C>
UNDERWRITER
-----------
Goldman, Sachs & Co. $ 25,000,000
Lehman Brothers $ 12,500,000
Morgan Stanley & Co. Incorporated $ 12,500,000
------------
Total $ 50,000,000
============
</TABLE>
<PAGE> 4
SCHEDULE II:
TITLE OF DESIGNATED SECURITIES: 6.80% Notes due August 1, 2007
AGGREGATE PRINCIPAL AMOUNT:
$50,000,000
PRICE TO PUBLIC:
100.000% of the principal amount of the Designated Securities, plus accrued
interest from August 1, 1997.
PURCHASE PRICE BY UNDERWRITERS:
99.350% of the principal amount of the Designated Securities, plus accrued
interest from August 1, 1997.
FORM OF DESIGNATED SECURITIES:
Book-entry only form represented by one or more global securities deposited
with The Depository Trust Company ("DTC") or its designated custodian, to
be made available for checking by the Representatives at least twenty-four
hours prior to the Time of Delivery at the office of DTC.
SPECIFIED FUNDS FOR PAYMENT OF PURCHASE PRICE:
Federal (same day) funds
TIME OF DELIVERY:
10:00 a.m. (New York City time), August 4, 1997
INDENTURE:
Indenture dated July 31, 1995, between the Company and The Chase Manhattan
Bank, N.A., as Trustee
MATURITY: August 1, 2007
INTEREST RATE: 6.80%
<PAGE> 5
INTEREST PAYMENT DATES:
August 1 and February 1, commencing February 1, 1998
NAMES AND ADDRESSES OF REPRESENTATIVES:
Designated Representatives: Goldman, Sachs & Co.
Lehman Brothers
Morgan Stanley & Co. Incorporated
Address for Notices, etc.: Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
Attn: Registration Department
<PAGE> 1
EXHIBIT 4.1
COMMERCIAL METALS COMPANY
OFFICERS' CERTIFICATE
Pursuant to the Indenture dated as of July 31, 1995 (the "Indenture")
by and between Commercial Metals Company, a Delaware corporation (the
"Company"), and The Chase Manhattan Bank, as trustee (the "Trustee"), and
resolutions adopted by the Pricing Committee of the Company's Board of
Directors as of July 30, 1997, this Officers' Certificate is being delivered to
the Trustee to establish the terms of a series of Securities in accordance with
Section 301 of the Indenture and to establish the form of the Securities of
such series in accordance with Section 201 of the Indenture.
Capitalized terms used and not otherwise defined herein shall have the
meanings assigned to them in the Indenture.
A. Establishment of Series of Securities Pursuant to Section 301 of the
Indenture.
The Company hereby establishes, pursuant to Section 301 of the
Indenture, a series of Securities that shall have the following terms:
1. The series of Securities being authorized hereby shall bear the
title "6.80% Notes due August 1, 2007" (the "Notes").
2. The aggregate principal amount of the Notes which may be
authenticated and delivered under the Indenture shall be limited to $50,000,000
(except for Notes authenticated and delivered upon registration of transfer of,
or in exchange for, or in lieu of, other Notes pursuant to Sections 304, 305,
306, 906 or 1107 of the Indenture and except for any Notes which, pursuant to
Section 303 of the Indenture, are deemed never to have been authenticated and
delivered under the Indenture).
3. Interest on each Note shall be payable to the person in whose name
the Note (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be January
15 or July 15 (whether or not a Business Day) as the case may be, next
preceding the relevant Interest Payment Date (as defined in the paragraph 5
hereof).
4. The Notes shall mature on August 1, 2007, at which time the entire
principal amount of the Notes and all accrued but unpaid interest on the Notes
will be due and payable.
5. Each Note shall bear interest at the annual rate of 6.80%
commencing on August 1, 1997. Interest on the Notes shall be payable
semi-annually on February 1 and August 1 in each year, commencing February 1,
1998 (each an "Interest Payment Date"), subject to the provisions of Section
113 of the Indenture, with such interest computed in accordance with Section
310 of the Indenture.
<PAGE> 2
6. Notes may not be redeemed by the Company at the option of the
Company prior to maturity.
7. The Company shall have no obligation to redeem or purchase Notes at
the option of a Holder thereof or pursuant to any sinking fund or analogous
provisions.
8. The Notes shall be issued only in minimum denominations of $100,000
and integral multiples of $1,000 in excess thereof.
9. Payments of the principal of and any premium and interest on the
Notes shall be made in the currency of the United States of America.
10. Neither the amount of payments of principal of, or any premium or
interest on, any Notes shall be determined by reference to an index.
11. The Notes shall initially be issued as book-entry notes in the
form of one fully registered Global Security which will be deposited with, or
on behalf of The Depository Trust Company, as depositary (the "Depositary"),
and registered in the name of the Depositary's nominee. Beneficial interests in
the Notes will be shown on, and transfers thereof will be effected only
through, records maintained by the Depositary and its participants. Except as
described in Section 305 of the Indenture, Notes in definitive certificated
form shall not be issuable to any Person other than the Depositary and such
Global Security may not be exchanged for Notes registered in the name of, nor
may any transfer of such Global Security be registered to, any Person other
than the Depositary or its nominee.
12. Payment of the principal of (and premium if any) and any interest
on the Notes shall be made at the office or agency of the Company maintained
for that purpose in New York, New York, in such coin or currency of the United
States of America as at the time of payment is legal tender for the payment of
public and private debts; provided however that at the option of the Company
payment of interest may be made by check mailed on or prior to an Interest
Payment Date to the address of the Person entitled thereto as such address
shall appear in the Security Register.
13. The entire principal amount of the Notes shall be payable upon
declaration of acceleration of the Maturity of the Notes pursuant to Section
502 of the Indenture.
14. The Notes shall be unsecured and unsubordinated obligations of the
Company.
15. The Notes will be issued only in fully registered form, without
coupons.
B. Establishment of Form of Note Pursuant to Section 201 of the Indenture.
The Company hereby establishes, pursuant to Section 201 of the Indenture,
that the Notes shall be substantially in the form attached as Exhibit A hereto.
- 2 -
<PAGE> 3
C. Compliance.
The undersigned have read the pertinent sections of the Indenture relating
to the establishment of (i) a series of Securities, and (ii) the forms of such
series of Securities, including the related definitions contained therein. The
undersigned have examined the resolutions (i) adopted by the Board of Directors
of the Company on June 28, 1995 and July 21, 1997, and (ii) adopted by the
Pricing Committee of the Board of Directors of the Company on July 30, 1997. In
the opinion of each of the undersigned, each of the undersigned has made such
examination or investigation as is necessary to enable each of the undersigned
to express an informed opinion as to whether or not the conditions to the
establishment of (i) a series of Securities, and (ii) the forms of such series
of Securities have been complied with. In the opinion of each of the
undesigned, such conditions have been complied with.
Dated: July 30, 1997
COMMERCIAL METALS COMPANY
By:
-----------------------------------
Lawrence A. Engels
Vice President, Treasurer and Chief
Financial Officer
By:
-----------------------------------
David M. Sudbury
Vice President, General Counsel and
Secretary
- 3 -
<PAGE> 4
EXHIBIT A
Unless this certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation (the "Depositary"), to the
Company or its agent for registration of transfer, exchange or payment, and any
certificate issued is registered in the name of Cede & Co. or in such other
name as is requested by an authorized representative of the Depositary (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of the Depositary), ANY TRANSFER, PLEDGE, OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as
the registered owner hereof, Cede & Co., has an interest herein.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE INDIVIDUAL
SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED
EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A
NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY
OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.
COMMERCIAL METALS COMPANY
-------------------------
No. 1 $50,000,000
CUSIP NO. 201723AB9
Commercial Metals Company, a corporation duly organized and existing under
the laws of the State of Delaware (herein called the "Company"), which term
includes any successor Person under the Indenture hereinafter referred to), for
value received, hereby promises to pay to CEDE & CO. or registered assigns, the
principal sum of Fifty Million Dollars ($50,000,000) on August 1, 2007 and to
pay interest thereon from August 1, 1997 or from the most recent Interest
Payment Date to which interest has been paid or duly provided for,
semi-annually on February 1 and August 1 in each year, commencing February 1,
1998, at the rate of 6.80% per annum, until the principal hereof is paid or
made available for payment. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in such
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the January 15 or July 15
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date. Any such interest not so punctually paid or duly
provided for will forthwith cease to be payable to the Holder on such Regular
Record Date and may either be paid to the Person in whose name this Security
(or one or more Predecessor Securities) is registered at the close of business
on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Securities of this
series not less than 10 days prior to such Special Record Date, or be paid at
any time in any other lawful manner not inconsistent with the requirements of
any securities exchange on which the Securities of this series may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in said Indenture.
<PAGE> 5
Payment of the principal (and premium if any) and any such interest on
this Security will be made at the office or agency of the Company maintained
for that purpose in New York, New York, in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private debts; provided however that at the option of the Company
payment of interest may be made by check mailed on or prior to an Interest
Payment Date to the address of the Person entitled thereto as such address
shall appear in the Security Register.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Dated: August ___, 1997 COMMERCIAL METALS COMPANY
By:
-----------------------------------
ATTEST:
- -----------------------------------
This is one of the Securities
of the series designated
therein referred to in the
within-mentioned Indenture.
Dated: August ___, 1997
THE CHASE MANHATTAN BANK,
as Trustee
By:
-----------------------------------
<PAGE> 6
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated July 31, 1995 (herein called the
"Indenture"), between the Company and The Chase Manhattan Bank, as Trustee
(herein called the "Trustee," which term includes any successor trustee under
the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof, limited in aggregate principal amount to
$50,000,000.
If an Event of Default with respect to Securities to this series shall
occur and be continuing, the principal of the Securities of this series may be
declared due and payable in the manner and with the effect provided in the
Indenture.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of a majority in principal amount of the Securities
at the time Outstanding of each series to be affected. The Indenture also
contains provisions permitting the Holders of specified percentages in
principal amount of the Securities of each series at the time Outstanding, on
behalf of the Holders of all Securities of such series, to waive compliance by
the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the
Holder of this Security shall be conclusive and binding upon such Holder and
upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange hereof or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default with respect to the
Securities of this series, the Holders of not less than 25% in principal amount
of the Securities of this series at the time Outstanding shall have made
written request to the Trustee to institute proceedings in respect of such
Event of Default as Trustee and offered the Trustee reasonable indemnity and
the Trustee shall not have received from the Holders of a majority in principal
amount of Securities of this series at the time Outstanding a direction
inconsistent with such request, and shall have failed to institute any such
proceeding, for 60 days after receipt of such notice, request and offer of
indemnity. The foregoing shall not apply to any suit instituted by the Holder
of this Security for the enforcement of any payment of principal hereof or any
interest hereof on or after the respective due dates expressed herein.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and any premium and
interest on this Security at the times, place and rate, and in the coin or
currency, herein prescribed.
<PAGE> 7
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registerable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any place where the principal of and any
premium and interest on this Security are payable, duly endorsed by, or
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Security Registrar duly executed by, the Holder hereof or such
Holder's attorney duly authorized in writing, and thereupon one or more
Securities of this Series and of like tenor, of authorized denominations and
for the same aggregate principal amount, will be issued to the designated
transferee or transferees.
The Securities of this series are issuable only in registered form without
coupons only in minimum denominations of $100,000 and any integral multiple of
$1,000 in excess thereof. As provided in the Indenture and subject to certain
limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series and of like tenor
of a different authorized denomination, as requested by the Holder surrendering
the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for
all purposes, whether or not this Security be overdue, and neither the Company,
the Trustee nor any such agent shall be affected by notice to the contrary.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
<PAGE> 1
EXHIBIT 5.1
July 30, 1997
Commercial Metals Company
7800 Stemmons Freeway
Dallas, Texas 75247
Re: Registration of $50,000,000 of 6.80% Notes Due August 1, 2007
Gentlemen:
We have acted as special counsel to Commercial Metals Company, a Delaware
corporation (the "Company"), in connection with the registration and sale under
the Securities Act of 1933, as amended (the "Securities Act"), of $50,000,000
in principal amount of its 6.80% Notes Due August 1, 2007 (the "Notes Due
2007") pursuant to an Indenture dated as of July 31, 1995 by and between The
Chase Manhattan Bank (the "Trustee") and the Company (the "Indenture"). We have
participated in the filing of the Registration Statement on Form S-3, SEC File
No. 33-60809 of the Company, as amended (the "Registration Statement"), filed
with the Securities and Exchange Commission (the "Commission") pursuant to the
Securities Act in connection with the public offering of the Notes Due 2007.
The Notes Due 2007 are being sold to Goldman, Sachs & Co., Lehman Brothers and
Morgan Stanley & Co. Incorporated (the "Underwriters") pursuant to (i) an
Underwriting Agreement dated July 26, 1995, by and among the Company and the
Underwriters (the "Underwriting Agreement") and (ii) a Pricing Agreement (the
"Pricing Agreement") dated July 30, 1997, by and among the Company and the
Underwriters.
In connection therewith, we have examined and relied upon the original, or
copies certified to our satisfaction, of (i) the Certificate of Incorporation
and the Bylaws of the Company; (ii) minutes and records of the corporate
proceedings of the Company with respect to the issuance by the Company of the
Notes Due 2007; (iii) the Registration Statement and all exhibits thereto; (iv)
the Underwriting Agreement; (v) the Pricing Agreement; (vi) the Indenture;
(vii) the form of Notes Due 2007; and (viii) such other documents and
instruments as we have deemed necessary for the expression of the opinions
contained herein.
In making the foregoing examinations, we have assumed the genuineness of
all signatures, the authenticity of all documents submitted to us as originals,
the conformity to original documents of all documents submitted to us as
certified or photostatic copies thereof and the authenticity of the originals
of such latter documents. As to various questions of fact material to this
opinion, where such facts
<PAGE> 2
have not been independently established, and as to the content and form of the
Certificate of Incorporation, the Bylaws, certain minutes, records, resolutions
and other documents or writings of the Company, we have relied, to the extent
we have deemed reasonably appropriate, upon representations or certificates of
officers, directors and agents of the Company, upon documents, records and
instruments furnished to us by the Company, without independent check or
verification of their accuracy, and upon governmental officials. In rendering
the opinions expressed below, we have assumed (i) the due execution and
delivery of the Indenture by the Trustee, and (ii) that the Indenture
constitutes the legal, valid and binding obligation of the Trustee.
Based upon the foregoing, and having due regard for such legal
considerations as we deem relevant, we are of the opinion that when the Notes
Due 2007 have been duly executed and delivered by the Company, authenticated by
the Trustee and issued and paid for in accordance with the terms of the
Underwriting Agreement, the Pricing Agreement and the Indenture, the Notes Due
2007 will be valid and legally binding obligations of the Company, enforceable
in accordance with their terms except as enforceability may be limited by (i)
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
now or hereafter in effect affecting the rights of creditors generally, (ii)
provisions of applicable law pertaining to the voidability of preferential or
fraudulent transfers and conveyances and (iii) the fact that the remedy of
specific performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought. In addition, certain other provisions
of the Notes Due 2007 may be unenforceable in whole or in part under the laws
(including judicial decisions) of the State of New York or the United States of
America; provided, however, that the inclusion of any such provisions and any
limitations imposed by such laws on the enforceability of the Notes Due 2007
will not affect the validity or enforceability as a whole of any of the Notes
Due 2007 and will not prevent the holders thereof from the ultimate realization
of the practical rights and benefits afforded by such documents, except for the
economic consequences of any judicial, administrative or other procedural delay
which may result from the application of any such law.
The opinions expressed above are specifically limited to the laws of the
State of New York, the General Corporation Laws, as amended, of the State of
Delaware, and the federal laws of the United States of America.
This opinion (i) is rendered solely for your benefit in connection with
the issuance of the Notes Due 2007, (ii) may not be used or relied upon by any
other person and may not be disclosed, quoted, filed with a governmental agency
or otherwise referred to without our prior written consent, (iii) is rendered
as of the date hereof, and we undertake no, and hereby disclaim any kind of,
obligation to advise you of any change or any new developments that might
affect any matters or opinions set forth herein,
<PAGE> 3
and (iv) is limited to the matters stated herein and no opinions may be
inferred or implied beyond the matters expressly stated herein.
We hereby consent to the incorporation by reference of this opinion in the
Registration Statement.
Very truly yours,
/s/ HAYNES AND BOONE, LLP
Haynes and Boone, LLP
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EXHIBIT 12.1
Summary of Fixed Charge Coverage Ratios (in thousands, except ratios)
<TABLE>
<CAPTION>
Nine months
Fiscal year ended August 31, Ended May 31
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1996 1995 1994 1993 1992 1997 1996
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<S> <C> <C> <C> <C> <C> <C> <C>
Pretax income $72,921 $58,008 $40,907 $35,061 $20,297 $40,875 $51,734
Adjustments to earnings:
Interest expensed 15,822 15,246 9,271 9,397 9,951 11,055 12,072
Amortization of capitalized interest 488 577 440 406 394 360 372
Rent expense 2,611 2,651 2,029 1,998 1,897 2,151 1,890
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Total earnings $91,842 $76,482 $52,647 $46,862 $32,539 $54,441 $66,068
======= ======= ======= ======= ======= ======= =======
Fixed charges:
Interest expensed $15,822 $15,246 $ 9,271 $ 9,397 $ 9,951 $11,055 $12,072
Interest capitalized 320 149 1,176 411 113 250 243
Rent expense 2,611 2,651 2,029 1,998 1,897 2,151 1,890
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Total fixed charges $18,753 $18,046 $12,476 $11,806 $11,961 $13,456 $14,205
======= ======= ======= ======= ======= ======= =======
Ratio of earnings to fixed charges 4.9x 4.2x 4.2x 4.0x 2.7x 4.1x 4.7x
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Pro forma information is not applicable as the ratio of earnings to fixed
charges varies by less than 10%.
