<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 23, 2000
REGISTRATION NOS. 333-
333-
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
CORNING INCORPORATED
(Exact Name of Registrant as Specified in Its Charter)
<TABLE>
<S> <C>
NEW YORK 16-0393470
(State of Incorporation) (I.R.S. Employer Identification Number)
</TABLE>
ONE RIVERFRONT PLAZA
CORNING, NEW YORK 14831
(607) 974-9000
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
CORNING FINANCE B.V.
(Exact Name of Registrant as Specified in Its Charter)
<TABLE>
<S> <C>
THE NETHERLANDS NOT APPLICABLE
(State or Other Jurisdiction of (I.R.S. Employer Identification Number)
Incorporation or Organization)
</TABLE>
STRAWINSKYLAAN 3105
1007 AMSTERDAM
THE NETHERLANDS
31.20.406.4444
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
Registrant's Principal Executive Offices)
WILLIAM D. EGGERS
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
CORNING INCORPORATED
ONE RIVERFRONT PLAZA
CORNING, NEW YORK 14831
(607) 974-9000
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent for Service)
------------------------------
COPIES TO:
DONALD C. WALKOVIK
SULLIVAN & CROMWELL
125 BROAD STREET
NEW YORK, NEW YORK 10004
------------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: from time
to time after the effectiveness of this registration statement.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
------------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED PROPOSED
AMOUNT TO BE MAXIMUM AGGREGATE MAXIMUM AGGREGATE AMOUNT OF
TITLE OF SHARES TO BE REGISTERED REGISTERED(1) PRICE PER UNIT(2) OFFERING PRICE(2) REGISTRATION FEE
<S> <C> <C> <C> <C>
Debt Securities, Debt Warrants, Equity
Warrants, Preferred Stock, Depositary
Shares and Common Stock (including
preferred share purchase rights)........... $4,000,000,000(3) 100% $4,000,000,000 $1,056,000
Guarantees................................... (4) (4) (4) (4)
</TABLE>
(1) In United States dollars or the equivalent thereof in any other currency,
currency unit or units, or composite currency or currencies at the dates of
issuance.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457 under the Securities Act of 1933, as amended.
(3) Such amount represents the offering price of any Preferred Stock, Depositary
Shares and Common Stock, the principal amount of any Debt Securities issued
at their principal face amount, the issue price rather than the principal
amount of any Debt Securities issued at an original issue discount, the
issue price of any Debt Warrants and the exercise price of any Debt
Securities issuable upon the exercise of Debt Warrants, the issue price of
any Equity Warrants and the exercise price of any Preferred Stock or Common
Stock issuable upon the exercise of Equity Warrants. Debt Warrants may be
sold separately or with Debt Securities or other Debt Warrants. Equity
Warrants may be sold separately or with any Preferred Stock or Common Stock
or other Equity Warrants. It is not practicable to determine the number of
Debt Warrants or Equity Warrants and the proposed maximum offering prices
thereof at this time.
(4) No separate consideration will be received for the Guarantees.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
<PAGE>
SUBJECT TO COMPLETION
THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IS NOT SOLICITING AN OFFER TO BUY THESE SECURITIES
IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.
<PAGE>
PRELIMINARY PROSPECTUS DATED AUGUST , 2000
PROSPECTUS
[LOGO]
CORNING INCORPORATED
AND
CORNING FINANCE B.V.
By this prospectus, we may offer from time to time up to $4,000,000,000 of:
- DEBT SECURITIES OF CORNING INCORPORATED;
- GUARANTEED DEBT SECURITIES OF CORNING FINANCE B.V.;
- DEBT WARRANTS AND EQUITY WARRANTS OF CORNING INCORPORATED;
- PREFERRED STOCK OF CORNING INCORPORATED;
- DEPOSITARY SHARES OF CORNING INCORPORATED; AND
- COMMON STOCK OF CORNING INCORPORATED.
------------------------
When we offer securities, we will provide you with a prospectus supplement
describing the terms of the specific issue of securities including the offering
price of the securities. You should read this prospectus and the accompanying
prospectus supplement carefully before you invest.
The common stock of Corning Incorporated is quoted on the New York Stock
Exchange under the symbol GLW. On , , the closing price for the
common stock was $ .
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
This prospectus is dated , 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
--------
<S> <C>
Corning Incorporated................... 2
Corning Finance B.V.................... 2
Use of Proceeds........................ 3
Securities We May Issue................ 3
Ratio of Earnings To Fixed Charges and
Ratio Earnings to Combined
Fixed Charges Including Preferred
Stock Dividends...................... 4
Selected Consolidated Financial Data... 5
Description of Debt Securities and
Guarantees........................... 9
</TABLE>
<TABLE>
Description of Warrants................ 26
<CAPTION>
PAGE
--------
<S> <C>
Description of Preferred Stock......... 31
Description of Depositary Shares....... 34
Description of Common Stock............ 37
Plan of Distribution................... 40
Validity of Securities................. 40
Experts................................ 40
Where You Can Find More Information.... 41
</TABLE>
CORNING INCORPORATED
We trace our origins to a glass business established in 1851. The present
corporation was incorporated in the State of New York in December 1936, and our
name was changed from Corning Glass Works to Corning Incorporated on April 28,
1989.
We are a global, technology-based corporation that operates in three broadly
based operating business segments:
- Telecommunications
- Advanced Materials
- Information Display
The Telecommunications Segment produces optical fiber and cable, optical
hardware and equipment and photonic components for the worldwide
telecommunications industry. The Advanced Materials Segment manufactures
specialized products with unique properties for customer applications utilizing
glass, glass ceramic and polymer technologies. Businesses within this segment
include environmental products, science products, semiconductor materials and
optical and lighting products. The Information Display Segment manufactures
glass panels and funnels for televisions and computer displays, projection video
lens assemblies and liquid-crystal display glass for flat panel displays.
Our principal office is located at One Riverfront Plaza, Corning, New York
14831. Our telephone number is (607) 974-9000.
CORNING FINANCE B.V.
Corning Finance B.V. is an indirect wholly owned subsidiary of Corning
Incorporated, incorporated under the laws of The Netherlands solely for the
purpose of raising capital to meet the financing needs of Corning Incorporated
and its subsidiaries. Corning Finance B.V. has no independent operations. Its
principal executive offices are located at Strawinskylaan 3105, 1007 Amsterdam;
telephone: 31.20.406.4444.
2
<PAGE>
USE OF PROCEEDS
Except as may be set forth in the prospectus supplement, we will use the net
proceeds from the sale of the securities offered under this prospectus and the
prospectus supplement for general corporate purposes. Our general corporate
purposes may include:
- the repayment or reduction of indebtedness;
- working capital requirements; and
- the funding of a portion of our normal, ongoing capital spending program.
Corning Finance B.V. will lend the net proceeds from the sale of any debt
securities offered by it to Corning Incorporated or its subsidiaries to be used
for similar purposes. We will determine any specific allocation of the net
proceeds of an offering of securities to a specific purpose at the time of the
offering and will describe the allocation in the related prospectus supplement.
SECURITIES WE MAY ISSUE
We may use this prospectus to offer up to $4,000,000,000 of:
- debt securities issued by Corning Incorporated;
- debt securities issued by Corning Finance B.V. and fully and
unconditionally guaranteed by Corning Incorporated;
- debt warrants and equity warrants issued by Corning Incorporated;
- preferred stock issued by Corning Incorporated;
- depositary shares relating to preferred stock; and
- common stock issued by Corning Incorporated.
A prospectus supplement will describe the specific types, amounts, prices,
and detailed terms of any of these securities.
3
<PAGE>
RATIOS OF EARNINGS TO FIXED CHARGES AND
RATIOS OF EARNINGS TO COMBINED FIXED CHARGES
INCLUDING PREFERRED STOCK DIVIDENDS
The table below sets forth:
- our historical ratios of earnings to fixed charges; and
- our consolidated ratios of earnings to combined fixed charges including
preferred stock dividends for the periods indicated.
For purposes of computing the ratio of earnings to fixed charges, earnings
consist of:
- income from continuing operations before taxes on income, before equity in
earnings and minority interest;
- Corning's share of pre-tax earnings of fifty-percent owned companies;
- Corning's share of pre-tax earnings of greater than fifty-percent owned
unconsolidated subsidiaries;
- dividends received from less than fifty-percent owned companies and
Corning's share of losses of these companies, if any, if any debt of these
companies is guaranteed by Corning;
- previously capitalized interest amortized during the period; and
- fixed charges net of capitalized interest.
Fixed charges consist of:
- interest on indebtedness;
- amortization of debt issuance costs;
- a portion of rental expenses which represents an appropriate interest rate
factor;
- Corning's share of the fixed charges of fifty-percent owned companies; and
- fixed charges of greater than fifty-percent owned and unconsolidated
subsidiaries.
Preferred dividends consist of preferred dividends paid on:
- Corning's 6% Convertible Monthly Income Preferred Securities, all of which
were redeemed as of March 23, 1999 and none of which are currently
outstanding; and
- Corning's 8% Series B Convertible Preferred Stock.
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEAR ENDED
------------------- ----------------------------------------------------
JUNE 30, JUNE 30, DEC. 31, DEC. 31, DEC. 31, DEC. 31, DEC. 31,
2000 1999 1999 1998 1997 1996 1995
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges.......... 5.7x 4.4x 5.1x 4.3x 5.2x 5.7x 5.5x
Ratio of earnings to combined fixed charges
and preferred dividends................... 5.7x 4.3x 5.0x 3.9x 4.6x 4.9x 4.4x
</TABLE>
4
<PAGE>
SELECTED CONSOLIDATED FINANCIAL DATA
The following tables contain Corning's consolidated financial data for the
periods presented. The historical financial data for each of the five years
ended December 31, 1999 have been derived from our audited financial statements.
The historical financial data for the six months ended June 30, 2000 and 1999
have been derived from our unaudited financial statements. Share and per share
data are presented below on a pro forma basis after giving effect to the
three-for-one stock split of Corning common stock effective to Corning
stockholders of record on September 5, 2000. You should read the following
financial data in conjunction with the financial statements, including the
related notes, which are incorporated by reference in the accompanying
prospectus.
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
JUNE 30, FOR THE YEAR ENDED DECEMBER 31,
------------------------------------- -------------------------------------
2000 1999 1999 1998
-------- -------- -------- --------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C>
OPERATIONS:
Net sales.................. $3,127.0 $2,126.7 $4,741.1 $3,831.9
Nonoperating gains......... 6.8 (a) 30.0 (g) 39.7 (k)(l)
Gross margin............... 1,309.3 819.5 1,810.8 1,471.4
Research, development and
engineering expenses..... 230.2 171.9 378.2 307.4
Amortization of purchased
intangibles including
goodwill................. 62.3 13.9 27.8 22.2
Nonrecurring charges....... 139.7 (b)(c)(d)(e) 1.4 (h)(i) 84.6 (i)
Income from continuing
operations before tax on
income................... 391.1 290.9 674.9 482.3
Minority interest in
earnings of
subsidiaries............. 10.1 27.5 66.8 61.6
Equity in earnings (losses)
of associated companies:
Other than Dow Corning
Corporation............ 73.2 52.0 112.3 97.3
Dow Corning Corporation..
Impairment of equity
investment............... (36.3)(f)
Income (loss) from
continuing operations.... 226.1 (a)(b)(c)(d)(e)(f) 223.5 511.0 (g)(h)(i) 354.8 (k)(i)(l)
Income (loss) from
discontinued operations,
net of income taxes...... 4.8 (j) 66.5 (m)
Extraordinary charge, net
of income taxes and
minority interest........
-------- -------- -------- --------
NET INCOME (LOSS).......... $ 226.1 $ 223.5 $ 515.8 $ 421.3
======== ======== ======== ========
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
-----------------------------------
1997 1996 1995
-------- -------- --------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C>
OPERATIONS:
Net sales.................. $3,831.2 $3,327.5 $2,900.1
Nonoperating gains......... 21.5 (n)
Gross margin............... 1,606.9 1,321.5 1,137.1
Research, development and
engineering expenses..... 262.9 200.1 177.3
Amortization of purchased
intangibles including
goodwill................. 21.8 16.3 15.0
Nonrecurring charges....... 5.9 (o) 26.5 (r)
Income from continuing
operations before tax on
income................... 665.8 519.1 356.9
Minority interest in
earnings of
subsidiaries............. 77.4 59.8 75.2
Equity in earnings (losses)
of associated companies:
Other than Dow Corning
Corporation............ 79.2 83.8 68.2
Dow Corning Corporation.. (348.0)(r)
Impairment of equity
investment...............
Income (loss) from
continuing operations.... 430.6 355.2 (130.3)(r)
Income (loss) from
discontinued operations,
net of income taxes...... 30.9 (136.9)(p) 29.0
Extraordinary charge, net
of income taxes and
minority interest........ (0.9)(q) (1.6)(q)
-------- -------- --------
NET INCOME (LOSS).......... $ 461.5 $ 217.4 $ (102.9)
======== ======== ========
</TABLE>
5
<PAGE>
<TABLE>
<CAPTION>
FOR THE SIX MONTHS ENDED
JUNE 30, FOR THE YEAR ENDED DECEMBER 31,
------------------------------------- -------------------------------------
2000 1999 1999 1998
-------- -------- -------- --------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C>
PRO FORMA BASIC EARNINGS
PER SHARE
Continuing operations.... $ 0.27 $ 0.29 $ 0.67 $ 0.48
Discontinued
operations............. 0.09
-------- -------- -------- --------
Net income (loss)........ $ 0.27 $ 0.29 $ 0.67 $ 0.57
======== ======== ======== ========
PRO FORMA DILUTED EARNINGS
PER SHARE
Continuing operations.... $ 0.27 $ 0.29 $ 0.65 $ 0.47
Discontinued
operations............. 0.01 0.09
-------- -------- -------- --------
Net income (loss)........ $ 0.27 $ 0.29 $ 0.66 $ 0.56
======== ======== ======== ========
Book value per share....... 8.64 2.83 3.15 2.31
Dividends declared per
share.................... $ 0.12 $ 0.12 $ 0.24 $ 0.24
FINANCIAL POSITION:
Cash and cash
equivalents............ $1,379.5 $ 83.8 $ 280.4 $ 59.2
Working capital.......... 2,239.8 561.6 430.2 347.7
Total assets............. 11,933.9 5,960.5 6,526.0 5,464.3
Loans payable beyond one
year(s)................ 1,977.3 1,473.2 1,490.4 1,217.8
Minority interest in
subsidiary companies... 132.6 363.5 284.8 346.1
Convertible preferred
securities of
subsidiary............. 365.2
Convertible preferred
stock.................. 9.6 15.1 13.5 17.9
Common shareholders'
equity(t).............. 7,605.3 2,200.3 2,462.7 1,706.6
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
-----------------------------------
1997 1996 1995
-------- -------- --------
(IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C>
PRO FORMA BASIC EARNINGS
PER SHARE
Continuing operations.... $ 0.59 $ 0.49 $ (0.18)
Discontinued
operations............. 0.04 (0.19) 0.04
-------- -------- --------
Net income (loss)........ $ 0.63 $ 0.30 $ (0.14)
======== ======== ========
PRO FORMA DILUTED EARNINGS
PER SHARE
Continuing operations.... $ 0.57 $ 0.48 $ (0.18)
Discontinued
operations............. 0.04 0.18 0.04
-------- -------- --------
Net income (loss)........ $ 0.61 $ 0.30 $ (0.14)
======== ======== ========
Book value per share....... 1.93 1.55 3.03
Dividends declared per
share.................... $ 0.24 $ 0.24 $ 0.24
FINANCIAL POSITION:
Cash and cash
equivalents............ $ 105.6 $ 221.2 $ 193.5
Working capital.......... 326.2 524.2 349.7
Total assets............. 5,079.7 4,557.7 5,647.0
Loans payable beyond one
year(s)................ 1,277.3 1,333.3 1,417.6
Minority interest in
subsidiary companies... 354.3 320.8 305.8
Convertible preferred
securities of
subsidiary............. 365.3 365.1 364.7
Convertible preferred
stock.................. 19.8 22.2 23.9
Common shareholders'
equity(t).............. 1,428.7 1,132.8 2,222.2
</TABLE>
NOTES TO SELECTED FINANCIAL INFORMATION
All per share data are presented on a pro forma basis to reflect the
three-for-one stock split of Corning common stock effective to Corning
stockholders of record on September 5, 2000.
(a) In January 2000, Corning sold Quanterra Incorporated to Severn Trent
Laboratories for $35 million. In the first quarter of 2000, Corning recorded
a nonoperating gain of $6.8 million ($4.2 million after tax).
(b) During the first quarter of 2000, Corning recognized a charge of $47 million
($43.4 million after tax), or $0.05 per share, for one time acquisition
costs related to the pooling of interests for Oak Industries.
(c) In February of 2000, Corning acquired British Telecommunication's Photonics
Research Center for approximately $66 million in cash. Corning recorded a
first quarter charge of $42 million ($25.7 million after tax), or $0.03 per
share for in-process research and development.
(d) In June 2000, Corning acquired the remaining 67% interest in IntelliSense
Corporation, a manufacturer of micro-electro-mechanical devices in exchange
for 2,016,753 shares of Corning common stock and the assumption of stock
options convertible into 656,104 shares of Corning common stock. This
consideration was valued at approximately $410 million. As part of the
transaction Corning recorded a second quarter charge of $6.7 million, or
$0.01 per share for in-process research and development.
(e) In May 2000, Corning acquired the remaining 84% interest in NZ Applied
Technologies (NZAT), a developer and manufacturer of photonic components for
optical telecommunications applications including the optical data networks
industry, in exchange for Corning common stock. Corning issued 440,583
shares of common stock at closing with a value of approximately $75 million,
and placed an additional 440,583 shares in escrow to be issued over the next
three years contingent upon NZAT
6
<PAGE>
achieving certain product development and sales milestones. Corning recorded
a charge of $44.0 million, or $0.05 per share for in-process research and
development.
(f) Pittsburg Corning (PCC) is a 50% owned equity investment of Corning
Incorporated and PPG Industries, Inc. On April 16, 2000 PCC filed for
Chapter 11 reorganization in the United States Bankruptcy Court for the
Western District of Pennsylvania. It indicated that the high costs of
defending or settling asbestos claims, coupled with sharply increasing
demands, had threatened its financial health and left it with no alternative
means of resolving the asbestos claims brought against it. As a result of
this event, Corning recorded an after tax charge of $36.3 million, or $0.04
per share to impair its entire investment in PCC in the first quarter of
2000.
(g) During the third quarter of 1999, Corning sold Republic Wire and Cable, a
manufacturer of elevator cables and a subsidiary of Siecor Corporation, for
approximately $52 million in cash and short-term notes. Corning recorded a
non-operating gain of $30 million ($9.5 million after tax and minority
interest) or $0.01 per share as a result of this transaction.
(h) In the third quarter of 1999, Corning recognized an impairment loss of
$15.5 million pretax ($10.0 million after tax), or $0.01 per share, in
connection with management's decision to sell Quanterra Incorporated. The
impairment loss reduces Corning's investment in these assets to an amount
equal to management's current estimate of fair value. Disposition of the
business occurred in February 2000.
(i) In the second quarter of 1998, Corning recorded a restructuring charge of
$84.6 million ($49.2 million after tax and minority interests), or $0.06 per
share. During the fourth quarter of 1999, Corning determined that the actual
costs of certain benefits included in the retirement incentive program were
less than estimated in the second quarter of 1998 and released restructuring
reserves totaling $14.1 million ($8.6 million after tax) or $0.01 per share.
(j) During the fourth quarter of 1999, certain indemnification agreements
related to the April 1998 sale of Corning's consumer housewares business
expired. As a result, Corning recognized income from discontinued operations
of $7.8 million ($4.8 million after tax) or $0.01 per share in the fourth
quarter from the release of reserves provided at the date of the
transaction.
(k) In the second quarter of 1998, Molecular Simulations, Inc. (MSI) merged with
Pharmacopeia, Inc., a publicly traded company (NASDAQ: PCOP). Corning
previously owned 35% of MSI and owned approximately 15% of the combined
entity at the time of the merger. Corning realized a gain of $20.5 million
($13.2 million after tax), or $0.02 per share, from this transaction.
(l) In the fourth quarter of 1998, Corning recorded a non-operating gain of
$19.2 million ($9.7 million after tax), or $0.01 per share, related to the
divestiture of several small businesses within the science products
division.
(m) On April 1, 1998, Corning completed the recapitalization and sale of a
controlling interest in its consumer housewares business to an affiliate of
Borden, Inc. Corning received cash proceeds of $593 million and continues to
retain a 3% interest in World Kitchen Inc., formerly the Corning Consumer
Products Company. Corning recorded an after-tax gain of $67.1 million, or
$0.09 per share, in the second quarter of 1998. The $66.5 million net income
from discontinued operations includes a $0.6 million loss from operations of
the discontinued business through March 31, 1998.
(n) During 1996, Oak Industries recorded a pre-tax gain of $21.5 million on the
sale of equity investments.
(o) During 1996, Oak Industries recorded a pre-tax charge of $5.9 million
primarily related to asset write-downs.
(p) On December 31, 1996, Corning distributed all of the shares of Quest
Diagnostics Incorporated and Covance Inc., which collectively comprised
Corning's Health Care Services segment, to its shareholders on a pro rata
basis. Corning recorded a provision for loss on the distributions of
$176.5 million, or $0.23
7
<PAGE>
per share, offset by income from discontinued operations of $9.2 million, or
$0.01 per share, recognized in the first quarter of 1996. Corning recorded
an additional $30.4 million, or $0.04 per share of income from discontinued
operations related to other businesses including $10.8 million related to
discontinued operations at Oak Industries.
(q) Oak Industries previously existing $30 million and $200 million credit
agreements were terminated on August 30, 1995 and November 1, 1996,
respectively. As a result, Oak Industries recorded non-cash, after tax
charges of $1.6 million and $0.9 million in 1995 and 1996, respectively,
related to the early extinguishment of the former credit facilities.
(r) In 1995, Corning recognized a restructuring charge from continuing
operations totaling $26.5 million ($16.1 million after tax), or $0.02 per
share, as a result of severance for workforce reductions in corporate staff
groups and the write-off of production equipment caused by the decision to
exit the manufacturing facility for glass-ceramic memory disks.
Corning also recorded an after-tax charge of $365.5 million, or $0.51 per
share, to fully reserve its investment in Dow Corning Corporation (a
50%-owned equity company) as a result of Dow Corning Corporation filing for
protection under Chapter 11 of the United States Bankruptcy Code in
May 1995. Corning recognized equity earnings totaling $17.5 million from Dow
Corning Corporation in the first quarter of 1995. Corning discontinued
recognition of equity earnings from Dow Corning Corporation beginning in the
second quarter of 1995.
(s) In February of 2000, Corning completed an offering of Euro-denominated
securities which generated net proceeds of $485 million. Corning used the
proceeds as long-term financing of a portion of the cash purchase price for
the Siemens acquisition.
(t) Corning closed an equity offering of 14,950,000 shares of its common stock
on January 31, 2000. The transaction generated net proceeds of $2.2 billion
of which approximately $645 million was used to fund a portion of the
purchase price for its acquisition of Siemens AG's worldwide optical cable
and hardware business and the remaining 50% of its investment in Siecor
Corporation and Siecor GmbH. The purchase price of $1.4 billion included
approximately $120 million of assumed debt and contingent consideration of
$145 million.
8
<PAGE>
DESCRIPTION OF DEBT SECURITIES AND GUARANTEES
GENERAL
THE DEBT SECURITIES WILL BE ISSUED UNDER AN INDENTURE
As required by U.S. federal law for all bonds and notes of companies that
are publicly offered, the debt securities are governed by a document called the
indenture. In the case of debt securities issued by Corning Incorporated, the
applicable indenture is a contract between Corning Incorporated and The Chase
Manhattan Bank, which acts as trustee. In the case of debt securities issued by
Corning Finance B.V., the applicable indenture is a contract among Corning
Finance B.V., Corning Incorporated, which acts as guarantor, and The Chase
Manhattan Bank, which acts as trustee. The trustee has two main roles:
- First, the trustee can enforce your rights against us if we default. There
are limitations on the extent to which the trustee acts on your behalf,
which we describe later under "--Default, Remedies and Waiver of Default";
and
- Second, the trustee performs administrative duties for us, which include
sending you interest payments and notices.
We may issue as many distinct series of debt securities under each indenture
as we wish. This section summarizes terms of the debt securities that are common
to all series. Most of the financial terms and other specific terms of your
series are described in the prospectus supplement attached to the front of this
prospectus. Those terms may vary from the terms described here. The prospectus
supplement may also describe special Federal income tax consequences of the debt
securities.
THIS SECTION IS ONLY A SUMMARY
This section and your prospectus supplement summarize all the material terms
of each indenture and your debt security. They do not, however, describe every
aspect of each indenture and your debt security.
Each indenture and its associated documents, including your debt security,
contain the full text of the matters described in this section and your
prospectus supplement. Each indenture and the debt securities are governed by
New York law. A copy of each indenture has been filed with the SEC as part of
our registration statement. See "Where You Can Find More Information" below for
information on how to obtain a copy.
LEGAL OWNERSHIP OF DEBT SECURITIES
We refer to those who have debt securities registered in their own names, on
the books that we or the trustee maintain for this purpose, as the "holders" of
those debt securities. These persons are the legal holders of the debt
securities. We refer to those who, indirectly through others, own beneficial
interests in debt securities that are not registered in their own names as
indirect holders of those debt securities. As we discuss below, indirect holders
are not legal holders, and investors in debt securities issued in book-entry
form or in street name will be indirect holders.
BOOK-ENTRY HOLDERS
We will issue debt securities in book-entry form only, unless we specify
otherwise in the applicable prospectus supplement. This means debt securities
will be represented by one or more global securities registered in the name of a
financial institution that holds them as depositary on behalf of other financial
institutions that participate in the depositary's book-entry system. These
participating institutions, in turn, hold beneficial interests in the debt
securities on behalf of themselves or their customers.
Under each indenture, only the person in whose name a debt security is
registered is recognized as the holder of that debt security. Consequently, for
debt securities issued in global form, we will recognize only the depositary as
the holder of the debt securities and we will make all payments on the debt
securities to the depositary. The depositary passes along the
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payments it receives to its participants, which in turn pass the payments along
to their customers who are the beneficial owners. The depositary and its
participants do so under agreements they have made with one another or with
their customers; they are not obligated to do so under the terms of the debt
securities.
As a result, investors will not own debt securities directly. Instead, they
will own beneficial interests in a global security, through a bank, broker or
other financial institution that participates in the depositary's book-entry
system or holds an interest through a participant. As long as the debt
securities are issued in global form, investors will be indirect holders, and
not holders, of the debt securities.
STREET NAME HOLDERS
In the future we may terminate a global security or issue debt securities
initially in non-global form. In these cases, investors may choose to hold their
debt securities in their own names or in "street name". Debt securities held by
an investor in street name would be registered in the name of a bank, broker or
other financial institution that the investor chooses, and the investor would
hold only a beneficial interest in those debt securities through an account he
or she maintains at that institution.
For debt securities held in street name, we will recognize only the
intermediary banks, brokers and other financial institutions in whose names the
debt securities are registered as the holders of those debt securities and we
will make all payments on those debt securities to them. These institutions pass
along the payments they receive to their customers who are the beneficial
owners, but only because they agree to do so in their customer agreements or
because they are legally required to do so. Investors who hold debt securities
in street name will be indirect holders, not holders, of those debt securities.
LEGAL HOLDERS
Our obligations, as well as the obligations of the trustee and those of any
third parties employed by us or the trustee, run only to the legal holders of
the debt securities. We do not have obligations to investors who hold beneficial
interests in global securities, in street name or by any other indirect means.
This will be the case whether an investor chooses to be an indirect holder of a
debt security or has no choice because we are issuing the debt securities only
in global form.
For example, once we make a payment or give a notice to the holder, we have
no further responsibility for the payment or notice even if that holder is
required, under agreements with depositary participants or customers or by law,
to pass it along to the indirect holders but does not do so. Similarly, if we
want to obtain the approval of the holders for any purpose--E.G., to amend the
applicable indenture or to relieve us of the consequences of a default or of our
obligation to comply with a particular provision of the applicable indenture--we
would seek the approval only from the holders, and not the indirect holders, of
the debt securities. Whether and how the holders contact the indirect holders is
up to the holders.
When we refer to you, we mean those who invest in the debt securities being
offered by this prospectus, whether they are the holders or only indirect
holders of those debt securities. When we refer to your debt securities, we mean
the debt securities in which you hold a direct or indirect interest.
SPECIAL CONSIDERATIONS FOR INDIRECT HOLDERS
If you hold debt securities through a bank, broker or other financial
institution, either in book-entry form or in street name, you should check with
your own institution to find out:
- how it handles securities payments and notices;
- whether it imposes fees or charges;
- how it would handle a request for the holders' consent, if ever required;
- whether and how you can instruct it to send you debt securities registered
in your own name so you can be a holder, if that is permitted in the
future;
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- how it would exercise rights under the debt securities if there were a
default or other event triggering the need for holders to act to protect
their interests; and
- if the debt securities are in book-entry form, how the depositary's rules
and procedures will affect these matters.
WHAT IS A GLOBAL SECURITY?
We will issue each debt security in book-entry form only, unless we specify
otherwise in the applicable prospectus supplement. A global security represents
one or any other number of individual debt securities. Generally, all debt
securities represented by the same global securities will have the same terms.
We may, however, issue a global security that represents multiple debt
securities that have different terms and are issued at different times. We call
this kind of global security a master global security.
Each debt security issued in book-entry form will be represented by a global
security that we deposit with and register in the name of a financial
institution or its nominee that we select. The financial institution that we
select for this purpose is called the depositary. Unless we specify otherwise in
the applicable prospectus supplement, The Depository Trust Company, New York,
New York, known as DTC, will be the depositary for all debt securities issued in
book-entry form.
A global security may not be transferred to or registered in the name of
anyone other than the depositary or its nominee, unless special termination
situations arise. We describe those situations below under "--Special Situations
When a Global Security Will Be Terminated". As a result of these arrangements,
the depositary, or its nominee, will be the sole registered owner and holder of
all debt securities represented by a global security, and investors will be
permitted to own only beneficial interests in a global security. Beneficial
interests must be held by means of an account with a broker, bank or other
financial institution that in turn has an account with the depositary or with
another institution that does. Thus, an investor whose security is represented
by a global security will not be a holder of the debt security, but only an
indirect holder of a beneficial interest in the global security.
If the prospectus supplement for a particular debt security indicates that
the debt security will be issued in global form only, then the debt security
will be represented by a global security at all times unless and until the
global security is terminated. We describe the situations in which this can
occur below under "--Special Situations When a Global Security Will Be
Terminated". The global security may be a master global security, although your
prospectus supplement will not indicate whether it is a master global security.
If termination occurs, we may issue the debt securities through another
book-entry clearing system or decide that the debt securities may no longer be
held through any book-entry clearing system.
SPECIAL CONSIDERATIONS FOR GLOBAL SECURITIES
As an indirect holder, an investor's rights relating to a global security
will be governed by the account rules of the investor's financial institution
and of the depositary, as well as general laws relating to securities transfers.
We do not recognize this type of investor as a holder of debt securities and
instead deal only with the depositary that holds the global security.
If debt securities are issued only in the form of a global security, an
investor should be aware of the following:
- An investor cannot cause the debt securities to be registered in his or
her name, and cannot obtain non-global certificates for his or her
interest in the debt securities, except in the special situations we
describe below;
- An investor will be an indirect holder and must look to his or her own
bank or broker for payments on the debt securities and protection of his
or her legal rights relating to the debt securities, as we describe under
"--Legal Ownership of Debt Securities" above;
- An investor may not be able to sell interests in the debt securities to
some
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insurance companies and to other institutions that are required by law to
own their securities in non-book-entry form;
- An investor may not be able to pledge his or her interest in a global
security in circumstances where certificates representing the debt
securities must be delivered to the lender or other beneficiary of the
pledge in order for the pledge to be effective;
- The depositary's policies, which may change from time to time, will govern
payments, transfers, exchanges and other matters relating to an investor's
interest in a global security. We and the trustee have no responsibility
for any aspect of the depositary's actions or for its records of ownership
interests in a global security. We and the trustee also do not supervise
the depositary in any way;
- The depositary may (and we understand that DTC will) require that those
who purchase and sell interests in a global security within its book-entry
system use immediately available funds and your broker or bank may require
you to do so as well; and
- Financial institutions that participate in the depositary's book-entry
system, and through which an investor holds its interest in a global
security, may also have their own policies affecting payments, notices and
other matters relating to the debt securities. There may be more than one
financial intermediary in the chain of ownership for an investor. We do
not monitor and are not responsible for the actions of any of those
intermediaries.
SPECIAL SITUATIONS WHEN A GLOBAL SECURITY WILL BE TERMINATED
In a few special situations described below, a global security will be
terminated and interests in it will be exchanged for certificates in non-global
form representing the debt securities it represented. After that exchange, the
choice of whether to hold the debt securities directly or in street name will be
up to the investor. Investors must consult their own banks or brokers to find
out how to have their interests in a global security transferred on termination
to their own names, so that they will be holders. We have described the rights
of holders and street name investors above under "--Legal Owner of Debt
Securities".
The special situations for termination of a global security are as follows:
- if the depositary notifies us that it is unwilling, unable or no longer
qualified to continue as depositary for that global security and we do not
appoint another institution to act as depositary within 60 days;
- if we notify the trustee that we wish to terminate that global security;
or
- if an event of default has occurred with regard to debt securities
represented by that global security and has not been cured or waived; we
discuss defaults later under "--Default, Remedies and Waiver of Default".
If a global security is terminated, only the depositary, and not we or the
trustee, is responsible for deciding the names of the institutions in whose
names the debt securities represented by the global security will be registered
and, therefore, who will be the holders of those debt securities.
RANKING
Each series of debt securities will not be secured by any property or assets
of Corning Incorporated or Corning Finance B.V., and will not be subordinated to
any other obligations of either Corning Incorporated or Corning Finance B.V., as
applicable.
FULL AND UNCONDITIONAL GUARANTEE OF DEBT SECURITIES OF CORNING FINANCE B.V.
All debt securities issued by Corning Finance B.V. will be fully and
unconditionally guaranteed under a guarantee of Corning Incorporated of the
payment of principal of, and any premium, interest and "additional amounts"
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on, these debt securities when due, whether at maturity or otherwise. For a
discussion of the payment of "additional amounts", please see "--Payment of
Additional Amounts with Respect to the Guaranteed Debt Securities". Under the
terms of the full and unconditional guarantee, holders of the guaranteed debt
securities will not be required to exercise their remedies against Corning
Finance B.V. before they proceed directly against Corning Incorporated.
PAYMENT OF ADDITIONAL AMOUNTS WITH RESPECT TO THE GUARANTEED DEBT SECURITIES
Unless otherwise indicated in your prospectus supplement, all amounts of
principal of, and any premium and interest on, any guaranteed debt securities
will be paid by Corning Finance B.V. without deduction or withholding for any
taxes, assessments or other charges imposed by the government of The
Netherlands, or the government of a jurisdiction in which a successor to Corning
Finance B.V. is organized. If deduction or withholding of any of these charges
is required by The Netherlands, or by a jurisdiction in which a successor to
Corning Finance B.V. is organized, Corning Finance B.V. will pay as additional
interest any additional amounts necessary to make the net amount paid to the
affected holders equal the amount the holders would have received in the absence
of the deduction or withholding. However, these "additional amounts" do not
include:
- the amount of any tax, assessment or other governmental charge imposed by
any unit of the United States;
- the amount of any tax, assessment or other governmental charge which is
only payable because either:
-- a type of connection exists between the holder and The Netherlands;
or
-- the holder presented the debt security for payment more than 30 days
after the date on which the relevant payment became due or was
provided for, whichever is later;
- the amount of any tax, assessment or other governmental charge which is
payable other than by deduction or withholding from a payment on the debt
securities;
- the amount of any tax, assessment or other governmental charge that is
imposed or withheld due to the beneficial owner of the debt security
failing to comply with a request from us to either provide information
concerning the beneficial owner's nationality, residence or identity or
make any claim to satisfy any information or reporting requirement, if the
completion of either would have provided an exemption from the applicable
governmental charge; or
- any combination of the taxes, assessments or other governmental charges
described above.
The prospectus supplement will describe any additional circumstances under
which additional amounts will not be paid with respect to debt securities.
REDEMPTION AND REPAYMENT
Unless otherwise indicated in your prospectus supplement, your debt security
will not be entitled to the benefit of any sinking fund--that is, we will not
deposit money on a regular basis into any separate custodial account to repay
your debt securities. In addition, we will not be entitled to redeem your debt
security before its stated maturity unless your prospectus supplement specifies
a redemption commencement date. You will not be entitled to require us to buy
your debt security from you, before its stated maturity, unless your prospectus
supplement specifies one or more repayment dates.
If your prospectus supplement specifies a redemption commencement date or a
repayment date, it will also specify one or more redemption prices or repayment
prices, which will be expressed as a percentage of the principal amount of your
debt security. It may also specify one or more redemption periods during which
the redemption prices relating to a redemption of debt securities during those
periods will apply.
If your prospectus supplement specifies a redemption commencement date, your
debt
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security will be redeemable at our option at any time on or after that date. If
we redeem your debt security, we will do so at the specified redemption price,
together with interest accrued to the redemption date. If different prices are
specified for different redemption periods, the price we pay will be the price
that applies to the redemption period during which your debt security is
redeemed.
If your prospectus supplement specifies a repayment date, your debt security
will be repayable at your option on the specified repayment date at the
specified repayment price, together with interest accrued to the repayment date.
In the event that we exercise an option to redeem any debt security, we will
give to the trustee and the holder written notice of the principal amount of the
debt security to be redeemed, not less than 30 days nor more than 60 days before
the applicable redemption date. We will give the notice in the manner described
below in "--Notices".
If a debt security represented by a global security is subject to repayment
at the holder's option, the depositary or its nominee, as the holder, will be
the only person that can exercise the right to repayment. Any indirect holders
who own beneficial interests in the global security and wish to exercise a
repayment right must give proper and timely instructions to their banks or
brokers through which they hold their interests, requesting that they notify the
depositary to exercise the repayment right on their behalf. Different firms have
different deadlines for accepting instructions from their customers, and you
should take care to act promptly enough to ensure that your request is given
effect by the depositary before the applicable deadline for exercise.
STREET NAME AND OTHER INDIRECT HOLDERS SHOULD CONTACT THEIR BANKS OR BROKERS
FOR INFORMATION ABOUT HOW TO EXERCISE A REPAYMENT RIGHT IN A TIMELY MANNER.
In the event that the option of the holder to elect repayment as described
above is deemed to be a "tender offer" within the meaning of Rule 14e-1 under
the Securities Exchange Act of 1934, we will comply with Rule 14e-1 as then in
effect to the extent it is applicable to us and the transaction.
We or our affiliates may purchase debt securities from investors who are
willing to sell from time to time, either in the open market at prevailing
prices or in private transactions at negotiated prices. Debt securities that we
or they purchase may, at our discretion, be held, resold or canceled.
OPTIONAL TAX REDEMPTION
Unless otherwise indicated in your prospectus supplement, except in the case
of debt securities that have a variable rate of interest, which may be redeemed
on any interest payment date, Corning Finance B.V. may redeem each series of
debt securities at its option in whole but not in part at any time. Except in
the case of outstanding original issue discount debt securities which may be
redeemed at the redemption price specified by the terms of that series of debt
securities, the redemption price will be equal to the principal amount plus
accrued interest to the date of redemption, if:
- Corning Finance B.V. would be required to pay additional amounts, as a
result of any change in the tax laws of The Netherlands which becomes
effective on or after the date of issuance of that series, as explained
above under "--Payment of Additional Amounts With Respect to the
Guaranteed Debt Securities", or
- as a result of any change in any treaty affecting taxation to which The
Netherlands, or a jurisdiction in which a successor to Corning Finance
B.V. is organized, is a party which becomes effective on or after a date
on which Corning Incorporated borrows money from Corning Finance B.V.,
Corning Incorporated would be required to deduct or withhold tax on any
payment to Corning Finance B.V. to enable it to make any payment of
principal, premium, if any, or interest.
In both of these cases, however, we will not be permitted to redeem a series
of debt securities if we can avoid either the payment of additional amounts, or
deductions or withholding, as the case may be, by using reasonable measures
available to us.
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CONVERSION
Your debt securities may be convertible into or exchangeable for common
stock or other securities of Corning Incorporated if your prospectus supplement
so provides. If your debt securities are convertible or exchangeable, your
prospectus supplement will include provisions as to whether conversion or
exchange is mandatory, at your option or at our option. Your prospectus
supplement would also include provisions regarding the adjustment of the number
of shares of common stock or other securities of Corning Incorporated to be
received by you upon conversion or exchange.
MERGERS AND SIMILAR TRANSACTIONS
We are generally permitted to merge or consolidate with another firm. We are
also permitted to sell substantially all our assets to another firm. We may not
take any of these actions, however, unless all the following conditions are met:
- Where we merge out of existence or sell our assets, the successor firm
must agree to be legally responsible for the debt securities and must be
organized as a corporation, partnership, trust, limited liability company
or similar entity. In the case of a merger or consolidation of Corning
Incorporated, the successor firm may not be organized under a foreign
country's laws, that is, it must be organized under the laws of a State or
the District of Columbia or under federal law. In the case of a merger or
consolidation of Corning Finance B.V., the successor firm may be organized
under the laws of any jurisdiction.
- The merger, sale of assets or other transaction must not cause a default
on the debt securities, and we must not already be in default, unless the
merger or other transaction would cure the default. For purposes of this
no-default test, a default would include an event of default that has
occurred and not been cured, as described below under "Event of Default".
A default for this purpose would also include any event that would be an
event of default if the requirements for giving us default notice or our
default having to exist for a specific period of time were disregarded.
- It is possible that the merger, sale of assets or other transaction would
cause some of our property to become subject to a mortgage or other legal
mechanism giving lenders preferential rights in that property over other
lenders or over our general creditors if we fail to pay them back. We have
promised to limit these preferential rights on our property, called
"liens." This limitation is discussed below under "Restrictive Covenant
and Defeasance Restrictions on Liens". If a merger or other transaction
would create any liens on our property, we must comply with that
restrictive covenant. We would do this either by deciding that the liens
were permitted, or by following the requirements of the restrictive
covenant to grant an equivalent or higher-ranking lien on the same
property to you and the other direct holders of the debt securities.
- In the case of the guaranteed debt securities, the successor to Corning
Finance B.V., if not organized in the United States, must agree to pay the
holder of each guaranteed debt security any "additional amounts" or other
expenses imposed on the holder as a result of the merger, consolidation or
sale, as explained above under "--Payment of Additional Amounts with
Respect to the Guaranteed Debt Securities".
RESTRICTIVE COVENANTS AND DEFEASANCE
RESTRICTIONS ON LIENS
In each indenture, Corning Incorporated promises that it will not become
obligated on any new debt that is secured by a lien on any of its principal
domestic manufacturing properties, or on any shares of stock or debt of any of
its domestic subsidiaries, unless it grants an equivalent or higher-ranking lien
on the same
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property to you and the other direct holders of the debt securities and, if
applicable, the guarantees.
Corning Incorporated does not need to comply with this restriction if the
amount of all debt that is secured by liens on its principal domestic
manufacturing properties is less than 10% of its consolidated net tangible
assets. In performing this calculation, debt secured would include the new debt
and the securities which it would secure as described in the previous paragraph.
This restriction on liens does not apply to debt secured by the following
types of liens, and Corning Incorporated can disregard this debt when we
calculate the limits imposed by this restriction:
- liens on the property of any domestic subsidiaries of Corning
Incorporated, or on their shares of stock or debt, if those liens existed
at the time the corporation became a domestic subsidiary of Corning
Incorporated or as of the date that debt securities are first issued under
the applicable indenture;
- liens in favor of Corning Incorporated or its domestic subsidiaries;
- some mechanics' liens, tax liens, liens in favor of, and to secure
payments or the acquisition of property from any governmental body by law
or because of a contract Corning Incorporated has entered into, and other
liens incidental to construction, conduct of business or ownership of its
property or of any domestic subsidiary;
- liens on property that existed at the time Corning Incorporated acquired
the property, including property it may acquire through a merger or
similar transaction, or that it granted in order to purchase, alter or
construct the property, sometimes called "purchase money mortgages"; and
- liens arising from any judgment, decree or order of a court so long as
proceedings to review these judgments have not been terminated or the
period in which to initiate proceedings has not expired.
Corning Incorporated can also disregard debt secured by liens that extend,
renew or replace any of these types of liens.
Corning Incorporated and its subsidiaries are permitted to have as much
unsecured debt as they may choose, and neither indenture restricts liens on any
of the shares of stock of Corning Incorporated or of less than 80%-owned
subsidiaries.
RESTRICTIONS ON SALES AND LEASEBACKS
In each indenture, Corning Incorporated promises that neither it nor any of
its domestic subsidiaries will enter into any sale and leaseback transaction
involving a principal domestic manufacturing property, unless it complies with
this restrictive covenant. A "sale and leaseback transaction" generally is an
arrangement between Corning Incorporated or a domestic subsidiary and a bank,
insurance company or other lender or investor where Corning Incorporated or the
domestic subsidiary lease a principal domestic manufacturing property which was
or will be sold by Corning Incorporated or the domestic subsidiary to that
lender or investor more than 180 days after the completion of construction of
the property and the beginning of its full operation.
Corning Incorporated does not need to comply with this restriction if the
amount of attributable debt is less than 10% of its consolidated net tangible
assets. Corning Incorporated can comply with this restrictive covenant if it
retires an amount of funded debt, within 180 days of the transaction, equal to
at least the net proceeds of the sale of the principal domestic manufacturing
property that it leases in the transaction or the fair value of that property,
subject to credits for voluntary retirements of debt securities and funded debt
we may make, whichever is greater.
This restriction on sales and leasebacks does not apply to any sale and
leaseback transaction that is between Corning Incorporated and one of its
domestic subsidiaries or between domestic
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subsidiaries, or that involves a lease for a period of three years or less.
DEFINITIONS RELATING TO OUR RESTRICTIVE COVENANTS
Following are the meanings of the terms that are important in understanding
the restrictive covenants previously described.
- "attributable debt" means the total net amount of rent, discounted at a
rate of 15% per annum compounded semi-annually, that is required to be
paid during the remaining term of any lease.
- "consolidated net tangible assets" is the total amount of assets, less
reserves and other permitted deductible items, after subtracting all
current liabilities and all goodwill, trade names, trademarks, patents,
unamortized debt discounts and expenses and similar intangible assets, as
these amounts appear on the most recent consolidated balance sheet of
Corning Incorporated and computed in accordance with generally accepted
accounting principles.
- A "domestic subsidiary" means any subsidiary of Corning Incorporated
except one which does not transact a substantial portion of its business
in the United States or does not regularly keep a substantial portion of
its assets, other than intangible assets, in the United States, or one
that is used primarily to finance the operations of Corning Incorporated
outside of the United States. A "subsidiary" is a corporation in which
Corning Incorporated and/or one or more of its other subsidiaries owns at
least 80% of the voting stock, which is a kind of stock that ordinarily
permits its owners to vote for the election of directors.
- "funded debt" means all debt for borrowed money that either has a maturity
of 12 months or more from the date on which the calculation of funded debt
is made or has a maturity of less than 12 months from that date but is by
its terms renewable or extendible beyond 12 months from that date at the
option of the borrower.
- A "principal domestic manufacturing property" is any building or other
structure or facility, and the land on which it sits and its associated
fixtures, that Corning Incorporated uses primarily for manufacturing or
processing, that has a gross book value in excess of 3% of consolidated
net tangible assets and that is located in the United States, other than a
building, structure or other facility that is financed by industrial
revenue bonds or that the board of directors of Corning Incorporated has
determined is not of material importance to the total business that
Corning Incorporated and its subsidiaries conduct.
DEFEASANCE AND COVENANT DEFEASANCE
Unless we say otherwise in the applicable prospectus supplement, the
provisions for full defeasance and covenant defeasance described below apply to
each series of debt securities. In general, we expect these provisions to apply
to each U.S. dollar-denominated debt security that is not a floating rate or
indexed debt security.
FULL DEFEASANCE. If there is a change in U.S. federal tax law, as described
below, we can legally release ourselves from all payment and other obligations
on your debt securities. This is called full defeasance. To do so, each of the
following must occur:
- We must deposit in trust for the benefit of all holders a combination of
money and U.S. government or U.S. government agency notes or bonds that
will generate enough cash to make interest, principal and any other
payments on your debt securities on their various due dates;
- There must be a change in current U.S. federal tax law or an Internal
Revenue Service ruling that lets us make the above deposit without causing
you to be taxed on your debt security any differently than if we did not
make the deposit and just repaid the debt security ourselves. Under
current federal tax law, the deposit and
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our legal release from the debt security would be treated as though we
took back your debt security and gave you your share of the cash and debt
security or bonds deposited in trust. In that event, you could recognize
gain or loss on your debt security; and
- We must deliver to the trustee a legal opinion of our counsel confirming
the tax law change described above.
If we ever fully defease your debt security, you will have to rely solely on
the trust deposit for payments on your debt security. You could not look to us
for payment in the event of any shortfall.
COVENANT DEFEASANCE. Under current U.S. federal tax law, we can make the
same type of deposit described above and be released from some of the
restrictive covenants relating to your debt security. This is called covenant
defeasance. In that event, you would lose the protection of those restrictive
covenants. In order to achieve covenant defeasance, we must do both of the
following:
- We must deposit in trust for the benefit of the holders a combination of
money and government or U.S. government notes or bonds that will generate
enough cash to make interest, principal and other payments on your debt
security on their various due dates.
- We must deliver to the trustee a legal opinion of our counsel confirming
that under current U.S. federal income tax law we may make the above
deposit without causing you to be taxed on your debt security any
differently than if we did not make the deposit and just repaid the debt
security ourselves.
If we accomplish covenant defeasance with regard to your debt security, the
following provisions of the indenture and the debt securities would no longer
apply:
- The condition regarding the treatment of liens when we merge or engage in
similar transactions, as described above under "--Restriction on Liens"
and any other covenants that your prospectus supplement may state are
applicable to your debt security.
- The events of default resulting from a breach of covenants, described
below in the fourth item under "--Default, Remedies and Waiver of
Default--Events of Default".
If we accomplish covenant defeasance, you can still look to us for repayment
of your debt security in the event of any shortfall in the trust deposit. You
should note, however, that if one of the remaining events of default occurred,
like our bankruptcy, and your debt security became immediately due and payable,
there may be a shortfall. Depending on the event causing the default, you may
not be able to obtain payment of the shortfall.
DEFAULT, REMEDIES AND WAIVER OF DEFAULT
You will have special rights if an event of default with respect to your
debt security occurs and is not cured, as described in this subsection.
EVENTS OF DEFAULT
With respect to your debt security, when we refer to an event of default, we
mean any of the following:
- We do not pay interest on a debt security within 30 days of its due date.
- We do not pay the principal or any premium on a debt security on its due
date.
- We do not deposit any sinking fund payment on its due date.
- We remain in breach of our covenant described under "--Restrictive
Covenants and Defeasance--Restrictions on Liens" above, or any other
covenant we make in the indenture for 60 days after we receive a notice of
default stating we are in breach. The notice must be sent by either the
trustee or holders of 25% of the principal amount of debt security of the
affected series.
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- We file for bankruptcy or other events in bankruptcy, insolvency or
reorganization occur.
- Any other event of default described in the prospectus supplement occurs.
REMEDIES IF AN EVENT OF DEFAULT OCCURS
If an event of default has occurred and has not been cured or waived, the
trustee or the holders of 25% or more in principal amount of all debt securities
of the affected series may declare the entire principal amount of all the debt
securities to be due immediately. If an event of default occurs because of
events in bankruptcy, insolvency or reorganization relating to Corning
Incorporated, the entire principal amount of all the debt securities will be
automatically accelerated, without any action by the trustee or any holder.
Each of the situations described above is called an acceleration of the
maturity of the affected debt securities. If the maturity of any debt securities
is accelerated and a judgment for payment has not yet been obtained, the holders
of a majority in principal amount of the debt securities affected by the
acceleration may cancel the acceleration for all the affected debt securities.
If an event of default occurs, the trustee will have special duties. In that
situation, the trustee will be obligated to use those of its rights and powers
under the applicable indenture, and to use the same degree of care and skill in
doing so, that a prudent person would use in that situation in conducting his or
her own affairs.
Except as described in the prior paragraph, the trustee is not required to
take any action under the applicable indenture at the request of any holders
unless the holders offer the trustee reasonable protection from expenses and
liability. This is called an indemnity. If the trustee is provided with an
indemnity reasonably satisfactory to it, the holders of a majority in principal
amount of the relevant series of debt securities may direct the time, method and
place of conducting any lawsuit or other formal legal action seeking any remedy
available to the trustee. These majority holders may also direct the trustee in
performing any other action under the applicable indenture with respect to the
relevant series of debt securities.
Before you bypass the trustee and bring your own lawsuit or other formal
legal action or take other steps to enforce your rights or protect your
interests relating to the debt securities, the following must occur:
- The holder of your debt security must give the trustee written notice that
an event of default has occurred, and the event of default must not have
been cured or waived.
- The holders of 25% or more in principal amount of all of the relevant debt
securities must make a written request that the trustee take action
because of the default, and they or other holders must offer to the
trustee indemnity reasonably satisfactory to the trustee against the cost
and other liabilities of taking that action.
- The trustee must not have taken action for 60 days after the above steps
have been taken. During those 60 days, the holders of a majority in
principal amount of the related series of debt securities must not have
given the trustee directions that are inconsistent with the written
request of the holders of not less than 25% in principal amount of all the
relevant series of debt securities.
You are, however, entitled at any time to bring a lawsuit for the payment of
money due on your debt securities on or after their due date.
WAIVER OF DEFAULT
The holders of a majority in principal amount of the relevant series of debt
securities may waive a default for all of the relevant series of debt
securities. If this happens, the default will be treated as if it has not
occurred. No one can waive a payment default on a particular debt security,
however, without the approval of the holder of that debt security.
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WE WILL GIVE THE TRUSTEE INFORMATION ABOUT DEFAULTS ANNUALLY
We will furnish to the trustee every year a written statement of two of our
officers certifying that to their knowledge we are in compliance with the
indenture and the debt securities, or else specifying any default.
BOOK-ENTRY AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR BROKERS FOR
INFORMATION ON HOW TO GIVE NOTICE OR DIRECTION TO OR MAKE A REQUEST OF THE
TRUSTEE AND HOW TO DECLARE OR CANCEL AN ACCELERATION.
MODIFICATION AND WAIVER OF COVENANTS
There are three types of changes we can make to the indenture and the debt
securities.
CHANGES REQUIRING EACH HOLDER'S APPROVAL
First, there are changes that we or the trustee cannot make without the
approval of each holder of debt security affected by the change. We cannot:
- change the stated maturity for any principal or interest payment on a debt
security;
- reduce the principal amount, the amount payable on acceleration of the
maturity after a default, the interest rate or the redemption price for a
debt security;
- in the case of the guaranteed debt securities, change any obligation to
pay additional amounts, as explained above under "--Payment of Additional
Amounts With Respect to the Guaranteed Debt Securities";
- permit redemption of a debt security if not previously permitted;
- impair any right a holder may have to require repayment of its debt
security;
- change the currency of any payment on a debt security other than as
permitted by the debt security;
- change the place of payment on a debt security, if it is in non-global
form;
- impair a holder's right to sue for payment of any amount due on its debt
security;
- in the case of the guaranteed debt securities, change any obligation to
pay additional amounts, as explained above;
- reduce the percentage in principal amount of the debt securities and any
other affected series of debt securities, taken together, the approval of
whose holders is needed to change the indenture or the debt securities;
- reduce the percentage in principal amount of the debt securities and any
other affected series of debt securities, taken separately or together, as
the case may be, the consent of whose holders is needed to waive our
compliance with the applicable indenture or to waive defaults; and
- change the provisions of the applicable indenture dealing with
modification and waiver in any other respect, except to increase any
required percentage referred to above or to add to the provisions that
cannot be changed or waived without approval.
CHANGES NOT REQUIRING APPROVAL
The second type of change does not require any approval by holders of the
debt securities. This type is limited to clarifications and changes that would
not adversely affect the debt securities in any material respect. Nor do we need
any approval to make any change that affects only debt securities to be issued
under each indenture after the changes take effect.
We may also make changes or obtain waivers that do not adversely affect a
particular debt security, even if they affect other debt securities. In those
cases, we do not need to obtain the approval of the holder of that debt
security; we need only obtain any required approvals from the holders of the
affected debt securities or other debt securities.
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CHANGES REQUIRING MAJORITY APPROVAL
Any other change to each indenture and the debt securities would require the
following approval:
- If the change affects only one series of debt securities, it must be
approved by the holders of a majority in principal amount of the relevant
series of debt securities.
- If the change affects more than one series of debt securities issued under
each indenture, it must be approved by the holders of a majority in
principal amount of the series affected by the change, with all affected
series voting together as one class for this purpose.
In each case, the required approval must be given by written consent.
The same majority approval would be required for us to obtain a waiver of
any of our covenants in each indenture. Our covenants include the promises we
make about merging and putting liens on our interests, which we describe above
under "--Mergers and Similar Transactions" and "--Restrictive Covenants and
Defeasance". If the holders agree to waive a covenant, we will not have to
comply with it.
BOOK-ENTRY AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR BROKERS FOR
INFORMATION ON HOW APPROVAL MAY BE GRANTED OR DENIED IF WE SEEK TO CHANGE THE
APPLICABLE INDENTURE OR THE DEBT SECURITIES OR REQUEST A WAIVER.
FORM, EXCHANGE AND TRANSFER
If the debt securities cease to be issued in global form, they will be
issued:
- only in fully registered form;
- without interest coupons; and
- unless we indicate otherwise in your prospectus supplement, in
denominations of $1,000 and amounts that are multiples of $1,000;
Holders may exchange their debt securities that are not in global form for
debt securities of smaller denominations or combined into fewer debt securities
of larger denominations, as long as the total principal amount is not changed.
Holders may exchange or transfer their debt securities at the office of the
trustee. We have appointed the trustee to act as our agent for registering debt
securities in the names of holders transferring debt securities. We may appoint
another entity to perform these functions or perform them ourselves.
Holders will not be required to pay a service charge to transfer or exchange
their debt securities, but they may be required to pay for any tax or other
governmental charge associated with the transfer or exchange. The transfer or
exchange will be made only if our transfer agent is satisfied with the holder's
proof of legal ownership.
If we have designated additional transfer agents for your debt security,
they will be named in your prospectus supplement. We may appoint additional
transfer agents or cancel the appointment of any particular transfer agent. We
may also approve a change in the office through which any transfer agent acts.
If any debt securities are redeemable and we redeem less than all those debt
securities, we may block the transfer or exchange of those debt securities
during the period beginning 15 days before the day we mail the notice of
redemption and ending on the day of that mailing, in order to freeze the list of
holders to prepare the mailing. We may also refuse to register transfers or
exchanges of any debt securities selected for redemption, except that we will
continue to permit transfers and exchanges of the unredeemed portion of any debt
security being partially redeemed.
If a debt security is issued as a global security, only the depositary will
be entitled to transfer and exchange the debt security as described in this
subsection, since it will be the sole holder of the debt security.
PAYMENT MECHANICS
WHO RECEIVES PAYMENT
If interest is due on a debt security on an interest payment date, we will
pay the interest to
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the person or entity in whose name the debt security is registered at the close
of business on the regular record date (see below) relating to the interest
payment date. If interest is due at maturity but on a day that is not an
interest payment date, we will pay the interest to the person or entity entitled
to receive the principal of the debt security. If principal or another amount
besides interest is due on a debt security at maturity, we will pay the amount
to the holder of the debt security against surrender of the debt security at a
proper place of payment, or, in the case of a global security, in accordance
with the applicable policies of the depositary.
HOW WE WILL MAKE PAYMENTS DUE IN U.S. DOLLARS
We will follow the practice described in this subsection when paying amounts
due in U.S. dollars. Payments of amounts due in other currencies will be made as
described in the next subsection.
PAYMENTS ON GLOBAL SECURITIES. We will make payments on a global security
in accordance with the applicable policies of the depositary as in effect from
time to time. Under those policies, we will pay directly to the depositary, or
its nominee, and not to any indirect holders who own beneficial interests in the
global security. An indirect holder's right to those payments will be governed
by the rules and practices of the depositary and its participants, as described
under "--What Is a Global Security?".
PAYMENTS ON NON-GLOBAL SECURITIES. We will make payments on a debt security
in non-global form as follows. We will pay interest that is due on an interest
payment date by check mailed on the interest payment date to the holder at his
or her address shown on the trustee's records as of the close of business on the
record date. We will make all other payments by check at the paying agent
described below, against surrender of the debt security. All payments by check
will be made in next-day funds--I.E.,funds that become available on the day
after the check is cashed.
Alternatively, if a non-global security has a face amount of at least
$1,000,000 and the holder asks us to do so, we will pay any amount that becomes
due on the debt security by wire transfer of immediately available funds to an
account at a bank in New York City, on the due date. To request wire payment,
the holder must give the paying agent appropriate transfer instructions at least
five business days before the requested wire payment is due. In the case of any
interest payment due on an interest payment date, the instructions must be given
by the person who is the holder on the relevant regular record date. In the case
of any other payment, payment will be made only after the debt security is
surrendered to the paying agent. Any wire instructions, once properly given,
will remain in effect unless and until new instructions are given in the manner
described above.
BOOK-ENTRY AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR BROKERS FOR
INFORMATION ON HOW THEY WILL RECEIVE PAYMENTS ON THEIR DEBT SECURITIES.
HOW WE WILL MAKE PAYMENTS DUE IN OTHER CURRENCIES
We will follow the practice described in this subsection when paying amounts
that are due in a specified currency other than U.S. dollars.
PAYMENTS ON GLOBAL SECURITIES. We will make payments on a global security
in accordance with the applicable policies of the depositary as in effect from
time to time. We understand that these policies, as currently in effect at DTC,
are as follows.
Unless otherwise indicated in your prospectus supplement, if you are an
indirect holder of global notes denominated in a specified currency other than
U.S. dollars and if you elect to receive payments in that other currency, you
must notify the participant through which your interest in the global security
is held of your election:
- on or before the applicable regular record date, in the case of a payment
of interest, or
- on or before the 16th day prior to stated maturity, or any redemption or
repayment date, in the case of payment of principal or any premium.
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You may elect to receive all or only a portion of any interest, principal or
premium payment in a specified currency other than U.S. dollars.
Your participant must, in turn, notify DTC of your election on or before the
third DTC business day after that regular record date, in the case of a payment
of interest, and on or before the 12th DTC business day prior to stated
maturity, or on the redemption or repayment date if your debt security is
redeemed or repaid earlier, in the case of a payment of principal or any
premium.
DTC, in turn, will notify the paying agent of your election in accordance
with DTC's procedures.
If complete instructions are received by the participant and forwarded by
the participant to DTC, and by DTC to the paying agent, on or before the dates
noted above, the paying agent, in accordance with DTC's instructions, will make
the payments to you or your participant by wire transfer of immediately
available funds to an account maintained by the payee with a bank located in the
country issuing the specified currency or in another jurisdiction acceptable to
us and the paying agent.
If the foregoing steps are not properly completed, we expect DTC to inform
the paying agent that payment is to be made in U.S. dollars. In that case, we or
our agent will convert the payment to U.S. dollars in the manner described below
under "--Conversion to U.S. Dollars". We expect that we or our agent will then
make the payment in U.S. dollars to DTC, and that DTC in turn will pass it along
to its participants.
INDIRECT HOLDERS OF A GLOBAL SECURITY DENOMINATED IN A CURRENCY OTHER THAN U.S.
DOLLARS SHOULD CONSULT THEIR BANKS OR BROKERS FOR INFORMATION ON HOW TO REQUEST
PAYMENT IN THE SPECIFIED CURRENCY.
PAYMENTS ON NON-GLOBAL SECURITIES. Except as described in the last
paragraph under this heading, we will make payments on debt securities in
non-global form in the applicable specified currency. We will make these
payments by wire transfer of immediately available funds to any account that is
maintained in the applicable specified currency at a bank designated by the
holder and acceptable to us and the trustee. To designate an account for wire
payment, the holder must give the paying agent appropriate wire instructions at
least five business days before the requested wire payment is due. In the case
of any interest payment due on an interest payment date, the instructions must
be given by the person or entity who is the holder on the regular record date.
In the case of any other payment, the payment will be made only after the debt
security is surrendered to the paying agent. Any instructions, once properly
given, will remain in effect unless and until new instructions are properly
given in the manner described above.
If a holder fails to give instructions as described above, we will notify
the holder at the address in the trustee's records and will make the payment
within five business days after the holder provides appropriate instructions.
Any late payment made in these circumstances will be treated under the indenture
as if made on the due date, and no interest will accrue on the late payment from
the due date to the date paid.
Although a payment on a debt security in non-global form may be due in a
specified currency other than U.S. dollars, we will make the payment in U.S.
dollars if the holder asks us to do so. To request U.S. dollar payment, the
holder must provide appropriate written notice to the trustee at least five
business days before the next due date for which payment in U.S. dollars is
requested. In the case of any interest payment due on an interest payment date,
the request must be made by the person or entity who is the holder on the
regular record date. Any request, once properly made, will remain in effect
unless and until revoked by notice properly given in the manner described above.
BOOK-ENTRY AND OTHER INDIRECT HOLDERS OF A DEBT SECURITY WITH A SPECIFIED
CURRENCY OTHER THAN U.S. DOLLARS SHOULD CONTACT THEIR BANKS OR BROKERS FOR
INFORMATION ABOUT HOW TO RECEIVE PAYMENTS IN THE SPECIFIED CURRENCY OR IN U.S.
DOLLARS.
CONVERSION TO U.S. DOLLARS. When we are asked by a holder to make payments
in U.S. dollars of an amount due in another currency, either on a global
security or a non-global security as described above, we will determine
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the U.S. dollar amount the holder receives as follows. The exchange rate agent
described below will request currency bid quotations expressed in U.S. dollars
from three or, if three are not available, then two, recognized foreign exchange
dealers in New York City, any of which may be the exchange rate agent, as of
11:00 A.M., New York City time, on the second business day before the payment
date. Currency bid quotations will be requested on an aggregate basis, for all
holders of debt securities, if any, requesting U.S. dollar payments of amounts
due on the same date in the same specified currency. The U.S. dollar amount the
holder receives will be based on the highest acceptable currency bid quotation
received by the exchange rate agent. If the exchange rate agent determines that
at least two acceptable currency bid quotations are not available on that second
business day, the payment will be made in the specified currency.
To be acceptable, a quotation must be given as of 11:00 A.M., New York City
time, on the second business day before the due date and the quoting dealer must
commit to execute a contract at the quotation.
A holder that requests payment in U.S. dollars will bear all associated
currency exchange costs, which will be deducted from the payment.
WHEN THE SPECIFIED CURRENCY IS NOT AVAILABLE. If we are obligated to make
any payment in a specified currency other than U.S. dollars, and the specified
currency is not available to us due to circumstances beyond our control--which
may include the imposition of exchange controls or a disruption in the currency
markets--we will be entitled to satisfy our obligation to make the payment in
that specified currency by making the payment in U.S. dollars, on the basis of
the most recently available exchange rate.
For a specified currency other than U.S. dollars, the exchange rate will be
the noon buying rate for cable transfers of the specified currency in New York
City as quoted by the Federal Reserve Bank of New York on the then-most recent
day to which that Bank has quoted that rate.
The foregoing will apply to any debt security, whether in global or
non-global form, and to any payment, including a payment at maturity. Any
payment made under the circumstances and in a manner described above will not
result in a default under any of the indenture.
THE EURO. The euro may be a specified currency for some debt securities. On
January 1, 1999, the euro became the legal currency for the 11 member states
participating in the European Economic and Monetary Union. During a transition
period from January 1, 1999 to December 31, 2001 and for a maximum of six months
thereafter, the former national currencies of these 11 member states will
continue to be legal tender in their country of issue, at rates irrevocably
fixed on December 31, 1998.
EXCHANGE RATE AGENT. If we issue a debt security in a specified currency
other than U.S. dollars, we will appoint a financial institution to act as the
exchange rate agent and will name the institution initially appointed when the
debt security is originally issued in the applicable prospectus supplement. We
may change the exchange rate agent from time to time after the original issue
date of the debt security without your consent and without notifying you of the
change.
All determinations made by the exchange rate agent will be at its sole
discretion unless we state in the applicable prospectus supplement that any
determination is subject to our approval. In the absence of manifest error,
those determinations will be conclusive for all purposes and binding on you and
us, without any liability on the part of the exchange rate agent.
PAYMENT WHEN OFFICES ARE CLOSED
If any payment is due on a debt security on a day that is not a business
day, we will make the payment on the next day that is a business day. Payments
postponed to the next business day in this situation will be treated under the
indenture as if they were made on the original due date. A postponement of this
kind will not result in a default under any debt security or the indenture, and
no interest will accrue on the postponed amount from the original due date to
the next day that is a business day.
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PAYING AGENT
We may appoint one or more financial institutions to act as our paying
agents, at whose designated offices debt securities in non-global form may be
surrendered for payment at their maturity. We call each of those offices a
paying agent. We may add, replace or terminate paying agents from time to time.
We may also choose to act as our own paying agent. Initially, we have appointed
the trustee, at its corporate trust office in New York City, as the paying
agent. We must notify you of changes in the paying agents.
UNCLAIMED PAYMENTS
Regardless of who acts as paying agent, all money paid by us to a paying
agent that remains unclaimed at the end of two years after the amount is due to
a holder will be repaid to us. After that two-year period, the holder may look
only to us for payment and not to the trustee, any other paying agent or anyone
else.
NOTICES
Notices to be given to holders of a global debt security will be given only
to the depositary, in accordance with its applicable policies as in effect from
time to time. Notices to be given to holders of debt securities not in global
form will be sent by mail to the respective addresses of the holders as they
appear in the trustee's records, and will be deemed given when mailed. Neither
the failure to give any notice to a particular holder, nor any defect in a
notice given to a particular holder, will affect the sufficiency of any notice
given to another holder.
BOOK-ENTRY AND OTHER INDIRECT HOLDERS SHOULD CONSULT THEIR BANKS OR BROKERS
FOR INFORMATION ON HOW THEY WILL RECEIVE NOTICES.
OUR RELATIONSHIP WITH THE TRUSTEE
The Chase Manhattan Bank is initially serving as the trustee for the debt
securities and all other series of debt securities to be issued under the
indenture. The Chase Manhattan Bank acts as the trustee of our investment plans
and has provided commercial banking and other services for us and our related
companies in the past and may do so in the future.
SERVICE OF PROCESS
Corning Finance B.V. has appointed CT Corporation System acting through its
office at 1633 Broadway, New York, New York as its authorized agent for service
of process in any legal action or proceeding to which it is a party relating to
the indenture, the guaranteed debt securities or the full and unconditional
guarantee brought in any federal or state court in New York City and has
submitted to the non-exclusive jurisdiction of those courts.
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DESCRIPTION OF WARRANTS
Corning Incorporated may issue warrants to purchase its debt securities, as
well as warrants to purchase its preferred or common stock. Warrants may be
issued independently or together with any securities and may be attached to or
separate from those securities. The warrants will be issued under warrant
agreements to be entered into between Corning Incorporated and a bank or trust
company, as warrant agent, all as will be set forth in the related prospectus
supplement.
DEBT WARRANTS
The following briefly summarizes the material terms of the debt warrant
agreement, other than pricing and related terms disclosed in the accompanying
prospectus supplement. You should read the particular terms of any debt warrants
that are offered by us and the applicable debt warrant agreement which will be
described in more detail in a prospectus supplement. The prospectus supplement
will also state whether any of the generalized provisions summarized below do
not apply to the debt warrants being offered.
GENERAL
Corning Incorporated may issue warrants for the purchase of its debt
securities. As explained below, each debt warrant will entitle its holder to
purchase debt securities at an exercise price set forth in, or to be
determinable as set forth in, the related prospectus supplement. Debt warrants
may be issued separately or together with debt securities.
The debt warrants are to be issued under debt warrant agreements to be
entered into between Corning Incorporated and one or more banks or trust
companies, as debt warrant agent, all as will be set forth in the prospectus
supplement relating to the debt warrants being offered by the prospectus
supplement. A form of debt warrant agreement, including a form of debt warrant
certificate representing the debt warrants, reflecting the alternative
provisions that may be included in the debt warrant agreements to be entered
into with respect to particular offerings of debt warrants, is included as an
exhibit to the registration statement of which this prospectus forms a part. See
"Where You Can Find More Information" below for information on how to obtain a
copy of the form of debt warrant agreement.
TERMS OF THE DEBT WARRANTS TO BE DESCRIBED IN THE PROSPECTUS SUPPLEMENT
The particular terms of each issue of debt warrants, the debt warrant
agreement relating to the debt warrants and the debt warrant certificates
representing debt warrants will be described in the applicable prospectus
supplement. This description will include:
- the initial offering price;
- the currency or currency unit in which the price for the debt warrants is
payable;
- the title, aggregate principal amount and terms of the debt securities
purchasable upon exercise of the debt warrants;
- the title and terms of any related debt securities with which the debt
warrants are issued and the number of the debt warrants issued with each
debt security;
- the date, if any, on and after which the debt warrants and the related
debt securities will be separately transferable;
- the principal amount of debt securities purchasable upon exercise of each
debt warrant and the price at which that principal amount of debt
securities may be purchased upon exercise of each debt warrant;
- the date on which the right to exercise the debt warrants will commence
and the date on which this right will expire;
- if applicable, a discussion of United States federal income tax,
accounting or other considerations applicable to the debt warrants;
- whether the debt warrants represented by the debt warrant certificates
will be issued in registered or bearer form, and, if
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registered, where they may be transferred and registered; and
- any other terms of the debt warrants.
Debt warrant certificates will be exchangeable for new debt warrant
certificates of different denominations and, if in registered form, may be
presented for registration of transfer and debt warrants may be exercised at the
corporate trust office of the debt warrant agent or any other office indicated
in the related prospectus supplement. Before the exercise of debt warrants,
holders of debt warrants will not be entitled to payments of principal, premium,
if any, or interest, if any, on the debt securities purchasable upon exercise of
the debt warrants, or to enforce any of the covenants in the indenture.
EXERCISE OF DEBT WARRANTS
Unless otherwise provided in the related prospectus supplement, each debt
warrant will entitle the holder of debt warrants to purchase for cash the
principal amount of debt securities at the exercise price that will in each case
be set forth in, or be determinable as set forth in, the related prospectus
supplement. Debt warrants may be exercised at any time up to the close of
business on the expiration date specified in the prospectus supplement relating
to the debt warrants. After the close of business on the expiration date or any
later date to which the expiration date may be extended by us, unexercised debt
warrants will become void.
Debt warrants may be exercised as set forth in the prospectus supplement
relating to the debt warrants. Upon receipt of payment and the debt warrant
certificate properly completed and duly executed at the corporate trust office
of the debt warrant agent or any other office indicated in the prospectus
supplement, we will, as soon as practicable, forward the debt securities
purchasable upon exercise of the debt warrants to the person entitled to them.
If fewer than all of the debt warrants represented by the debt warrant
certificate are exercised, a new debt warrant certificate will be issued for the
remaining amount of debt warrants.
If you hold your interest in a debt warrant indirectly, you should check
with the institution through which you hold your interest in the debt warrant to
determine how these provisions will apply to you.
MODIFICATIONS
The debt warrant agreement may be amended by Corning Incorporated and the
debt warrant agent, without the consent of the holder of any debt warrant
certificate, for the purpose of curing any ambiguity, or of curing, correcting
or supplementing any defective provision contained in the debt warrant
agreement, or making any provisions in regard to matters or questions arising
under the debt warrant agreement that Corning Incorporated may deem necessary or
desirable; PROVIDED that the amendment may not adversely affect the interest of
the holders of debt warrant certificates in any material respect. Corning
Incorporated and the debt warrant agent also may modify or amend the debt
warrant agreement and the terms of the debt warrants, with the consent of the
owners of not less than a majority in number of the then outstanding unexercised
debt warrants affected. However, modifications or amendments that result in any
of the following changes may be made only with the consent of the owners
affected by the modification or amendment:
- An increase in the exercise price of the debt warrants;
- A shortening of the period of time during which the debt warrants may be
exercised;
- Any material and adverse change that affects the exercise rights of the
owners of the debt warrants; or
- A reduction in the number of debt warrants whose owners must consent to
the modification or amendment of the debt warrant agreement or the terms
of the equity warrants.
MERGER, CONSOLIDATION, SALE OR OTHER DISPOSITIONS
Under the debt warrant agreement, Corning Incorporated may, to the extent
permitted in the indenture, consolidate with, or sell or convey all or
substantially all of its assets to, or merge with
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or into, any other corporation. If at any time there is a merger, consolidation,
sale, transfer, conveyance or other disposition of substantially all of the
assets of Corning Incorporated, the successor or assuming corporation will
succeed to and be substituted for Corning Incorporated, with the same effect as
if it had been named in the debt warrant agreement and in the debt warrants as
Corning Incorporated. Corning Incorporated will then be relieved of any further
obligation under the debt warrant agreement or under the debt warrants.
ENFORCEABILITY OF RIGHTS, GOVERNING LAW
The debt warrant agent will act solely as the agent of Corning Incorporated
in connection with the issuance and exercise of debt warrants and will not
assume any obligation or relationship of agency or trust for or with any holder
of a debt warrant certificate or any owner of a beneficial interest in debt
warrants. The holders of debt warrant certificates, without the consent of the
debt warrant agent, the trustee, the holder of any debt securities issued upon
exercise of debt warrants or the holder of any other debt warrant certificates,
may, on their own behalf and for their own benefit, enforce, and may institute
and maintain any suit, action or proceeding against Corning Incorporated
suitable to enforce, or otherwise in respect of, their rights to exercise debt
warrants evidenced by their debt warrant certificates. Except as may otherwise
be provided in the related prospectus supplement, each issue of debt warrants
and the applicable debt warrant agreement will be governed by the laws of the
State of New York.
EQUITY WARRANTS
The following briefly summarizes the material terms and provisions of the
equity warrants, other than pricing and related terms disclosed in the
accompanying prospectus supplement. You should read the particular terms of the
equity warrants that are offered by Corning Incorporated, which will be
described in more detail in a prospectus supplement. The prospectus supplement
will also state whether any of the general provisions summarized below do not
apply to the equity warrants being offered.
GENERAL
Corning Incorporated may issue warrants for the purchase of its equity
securities such as its preferred stock or common stock. As explained below, each
equity warrant will entitle its holder to purchase equity securities at an
exercise price set forth in, or to be determinable as set forth in, the related
prospectus supplement. Equity warrants may be issued separately or together with
equity securities.
The equity warrants are to be issued under equity warrant agreements to be
entered into between Corning Incorporated and one or more banks or trust
companies, as equity warrant agent, all as will be set forth in the prospectus
supplement relating to the equity warrants being offered by the prospectus
supplement. A form of equity warrant agreement, including a form of equity
warrant certificate representing the equity warrants, reflecting the alternative
provisions that may be included in the equity warrant agreements to be entered
into with respect to particular offerings of equity warrants, is included as an
exhibit to the registration statement of which this prospectus forms a part. See
"Where You Can Find More Information" below for information on how to obtain a
copy of the form of equity warrant agreement.
TERMS OF THE EQUITY WARRANTS TO BE DESCRIBED IN THE PROSPECTUS SUPPLEMENT
The particular terms of each issue of equity warrants, the equity warrant
agreement relating to the equity warrants and the equity warrant certificates
representing equity warrants will be described in the applicable prospectus
supplement. This description will include:
- the title of the equity warrants;
- the securities for which the equity warrants are exercisable;
- the price or prices at which the equity warrants will be issued;
- if applicable, the designation and terms of the preferred stock or common
stock with which the equity warrants are issued, and the number of equity
warrants issued with
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each share of preferred stock or common stock;
- if applicable, the date on and after which the equity warrants and the
related preferred stock or common stock will be separately transferable;
- if applicable, a discussion of any material federal income tax
considerations; and
- any other terms of the equity warrants, including terms, procedures and
limitations relating to the exchange and exercise of the equity warrants.
Holders of equity warrants will not be entitled, solely by virtue of being
holders, to vote, to consent, to receive dividends, to receive notice as
shareholders with respect to any meeting of shareholders for the election of our
directors or any other matter, or to exercise any rights whatsoever as
shareholders of Corning Incorporated.
The exercise price payable and the number of shares of common stock or
preferred stock purchasable upon the exercise of each equity warrant will be
subject to adjustment if Corning Incorporated issues a stock dividend to holders
of common stock or preferred stock, or if Corning Incorporated declares a stock
split, reverse stock split, combination, subdivision or reclassification of
common stock or preferred stock. Instead of adjusting the number of shares of
common stock or preferred stock purchasable upon exercise of each equity
warrant, Corning Incorporated may elect to adjust the number of equity warrants.
No adjustments in the number of shares purchasable upon exercise of the equity
warrants will be required until cumulative adjustments require an adjustment of
at least 1% of those shares. Corning Incorporated may, at its option, reduce the
exercise price at any time. Corning Incorporated will not issue fractional
shares upon exercise of equity warrants, but Corning Incorporated will pay the
cash value of any fractional shares otherwise issuable.
Notwithstanding the previous paragraph, if there is a consolidation, merger,
or sale or conveyance of substantially all of the property of Corning
Incorporated, the holder of each outstanding equity warrant will have the right
to the kind and amount of shares of stock and other securities and property,
including cash, receivable by a holder of the number of shares of common stock
or preferred stock into which that equity warrant was exercisable immediately
prior to the consolidation, merger, sale or conveyance.
EXERCISE OF EQUITY WARRANTS
Unless otherwise provided in the related prospectus supplement, each equity
warrant will entitle the holder of equity warrants to purchase for cash the
principal amount of equity securities at the exercise price that will in each
case be set forth in, or be determinable as set forth in, the related prospectus
supplement. Equity warrants may be exercised at any time up to the close of
business on the expiration date specified in the prospectus supplement relating
to the equity warrants. After the close of business on the expiration date or
any later date to which the expiration date may be extended by Corning
Incorporated, unexercised equity warrants will become void.
Equity warrants may be exercised as set forth in the prospectus supplement
relating to the equity warrants. Upon receipt of payment and the equity warrant
certificate properly completed and duly executed at the corporate trust office
of the equity warrant agent or any other office indicated in the prospectus
supplement, Corning Incorporated will, as soon as practicable, forward the
equity securities purchasable upon exercise of the equity warrants to the person
entitled to them. If fewer than all of the equity warrants represented by the
equity warrant certificate are exercised, a new equity warrant certificate will
be issued for the remaining amount of equity warrants.
If you hold your interest in an equity warrant indirectly, you should check
with the institution through which you hold your interest in the equity warrant
to determine how these provisions will apply to you.
MODIFICATIONS
The equity warrant agreement may be amended by Corning Incorporated and the
equity warrant agent, without the consent of the
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holder of any equity warrant certificate, for the purpose of curing any
ambiguity, or of curing, correcting or supplementing any defective provision
contained in the equity warrant agreement, or making any provisions in regard to
matters or questions arising under the equity warrant agreement that Corning
Incorporated may deem necessary or desirable; PROVIDED that the amendment may
not adversely affect the interest of the holders of equity warrant certificates
in any material respect. Corning Incorporated and the equity warrant agent also
may modify or amend the equity warrant agreement and the terms of the equity
warrants, with the consent of the owners of not less than a majority in number
of the then outstanding unexercised equity warrants affected. However,
modifications or amendments that result in any of the following changes may be
made only with the consent of the owners affected by the modification or
amendment:
- An increase in the exercise price of the equity warrants;
- A shortening of the period of time during which the equity warrants may be
exercised;
- Any material and adverse change that affects the exercise rights of the
owners of the equity warrants; or
- A reduction in the number of equity warrants whose owners must consent to
the modification or amendment of the equity warrant agreement or the terms
of the equity warrants.
MERGER, CONSOLIDATION, SALE OR OTHER DISPOSITIONS
Under the equity warrant agreement, Corning Incorporated may, to the extent
permitted in the indenture, consolidate with, or sell or convey all or
substantially all of its assets to, or merge with or into, any other
corporation. If at any time there is a merger, consolidation, sale, transfer,
conveyance or other disposition of substantially all of the assets of Corning
Incorporated, the successor or assuming corporation will succeed to and be
substituted for Corning Incorporated, with the same effect as if it had been
named in the equity warrant agreement and in the equity warrants as Corning
Incorporated. Corning Incorporated will then be relieved of any further
obligation under the equity warrant agreement or under the equity warrants.
ENFORCEABILITY OF RIGHTS, GOVERNING LAW
The equity warrant agent will act solely as the agent of Corning
Incorporated in connection with the issuance and exercise of equity warrants and
will not assume any obligation or relationship of agency or trust for or with
any holder of an equity warrant certificate or any owner of a beneficial
interest in equity warrants. The holders of equity warrant certificates, without
the consent of the equity warrant agent, the holder of any equity securities
issued upon exercise of equity warrants or the holder of any other equity
warrant certificates, may, on their own behalf and for their own benefit,
enforce, and may institute and maintain any suit, action or proceeding against
Corning Incorporated suitable to enforce, or otherwise in respect of, their
rights to exercise equity warrants evidenced by their equity warrant
certificates. Except as may otherwise be provided in the related prospectus
supplement, each issue of equity warrants and the applicable equity warrant
agreement will be governed by the laws of the State of New York.
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DESCRIPTION OF PREFERRED STOCK
The following briefly summarizes the material terms of the preferred stock
of Corning Incorporated, other than pricing and related terms disclosed in the
accompanying prospectus supplement. You should read the particular terms of any
series of preferred stock offered by Corning Incorporated which will be
described in more detail in any prospectus supplement relating to such series.
The prospectus supplement will also state whether any of the terms summarized
below do not apply to the series of preferred stock being offered.
GENERAL
Corning Incorporated is authorized to issue up to 10,000,000 shares of
preferred stock, par value $100 per share. Under the certificate of
incorporation of Corning Incorporated, the board of directors is authorized to
issue shares of preferred stock in one or more series, and to establish from
time to time a series of preferred stock with the following terms specified:
- the number of shares to be included in the series;
- the designation, powers, preferences and rights of the shares of the
series; and
- the qualifications, limitations or restrictions of the series, except as
otherwise stated in the certificate of incorporation.
Prior to the issuance of any series of preferred stock, the board of
directors will adopt resolutions creating and designating the series as a series
of preferred stock and will file an amendment to the certificate of
incorporation setting forth the terms of the series. Shareholders will not need
to approve this amendment.
At July 31, 2000, Corning Incorporated had authorized the issuance of:
- 2,400,000 shares of Series A junior participating preferred stock, par
value $100 per share, upon exercise of preferred share purchase rights
associated with each share of common stock outstanding. See "Description
of Common Stock--Rights Agreement"; and
- 316,822 shares of Series B cumulative convertible preferred stock, par
value $100 per share.
In addition, as described under "Description of Depositary Shares", Corning
Incorporated, at its option, instead of offering full shares of any series of
preferred stock, may offer depositary shares evidenced by depositary receipts,
each representing a fraction of a share of the particular series of preferred
stock issued and deposited with a depositary. The fraction of a share of
preferred stock which each depositary share represents will be set forth in the
prospectus supplement relating to the depositary shares.
The rights of holders of the preferred stock offered may be adversely
affected by the rights of holders of any shares of preferred stock that may be
issued in the future. The board of directors may cause shares of preferred stock
to be issued in public or private transactions for any proper corporate purpose.
Examples of proper corporate purposes include issuances to obtain additional
financing in connection with acquisitions, and issuances to officers, directors
and employees pursuant to benefit plans. Shares of preferred stock issued by
Corning Incorporated may have the effect of rendering more difficult or
discouraging an acquisition of Corning Incorporated deemed undesirable by the
board of directors.
The preferred stock will be, when issued, fully paid and nonassessable.
Holders of preferred stock will not have any preemptive or subscription rights
to acquire more stock of Corning Incorporated.
The transfer agent, registrar, dividend disbursing agent and redemption
agent for shares of each series of preferred stock will be named in the
prospectus supplement relating to these series.
RANK
Unless otherwise specified in the prospectus supplement relating to the
shares of any series of preferred stock, shares of one series will rank on an
equal basis with each other series of
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preferred stock and prior to the common stock as to dividends and distributions
of assets.
DIVIDENDS
Holders of each series of preferred stock will be entitled to receive cash
dividends when, as and if declared by the board of directors out of funds
legally available for dividends. The rates and dates of payment of dividends
will be set forth in the prospectus supplement relating to each series of
preferred stock. Dividends will be payable to holders of record of preferred
stock as they appear on the books of Corning Incorporated on the record dates
fixed by the board of directors. Dividends on any series of preferred stock may
be cumulative or noncumulative.
Corning Incorporated may not declare, pay or set apart for payment dividends
on the preferred stock unless full dividends on any other series of preferred
stock that ranks on an equal or senior basis have been paid or sufficient funds
have been set apart for payment for either of the following:
- all prior dividend periods of the other series of preferred stock that pay
dividends on a cumulative basis; or
- the immediately preceding dividend period of the other series of preferred
stock that pay dividends on a noncumulative basis.
Partial dividends declared on shares of preferred stock and any other series
of preferred stock ranking on an equal basis as to dividends will be declared
pro rata. A pro rata declaration means that the ratio of dividends declared per
share to accrued dividends per share will be the same for both series of
preferred stock.
Similarly, Corning Incorporated may not declare, pay or set apart for
payment non-stock dividends or make other payments on the common stock or any of
its other stock ranking junior to the preferred stock until full dividends on
the preferred stock have been paid or set apart for payments for:
- all prior dividend periods if the other series of preferred stock pays
dividends on a cumulative basis; or
- the immediately preceding dividend period if the preferred stock pays
dividends on a noncumulative basis.
CONVERSION AND EXCHANGE
The prospectus supplement for any series of preferred stock will state the
terms, if any, on which shares of that series are convertible into or
exchangeable for shares of common stock of Corning Incorporated.
REDEMPTION
If so specified in the applicable prospectus supplement, a series of
preferred stock may be redeemable at any time, in whole or in part, at our
option or the holder's, and may be mandatorily redeemed.
Any restriction on the repurchase or redemption by Corning Incorporated of
its preferred stock while there is any arrearage in the payment of dividends
will be described in the relevant prospectus supplement.
Any partial redemptions of preferred stock will be made in a way that the
board of directors of Corning Incorporated decides is equitable.
Unless Corning Incorporated defaults in the payment of the redemption price,
dividends will cease to accrue after the redemption date on shares of preferred
stock called for redemption and all rights of holders of these shares will
terminate except for the right to receive the redemption price.
ANTI-TAKEOVER PROVISIONS
See "Description of Common Stock--Fair Price Amendment" and "Description of
Common Stock--Other Anti-takeover Provisions of the Certificate of Incorporation
and By-Laws" for a discussion of provisions of the certificate of incorporation
and by-laws of Corning Incorporated that would have an effect of delaying,
deferring or preventing a change in control of Corning Incorporated.
LIQUIDATION PREFERENCE
Upon any voluntary or involuntary liquidation, dissolution or winding up of
Corning, holders of each series of preferred stock will be entitled to receive
distributions
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upon liquidation in the amount described in the prospectus supplement relating
to each series of preferred stock, plus an amount equal to any accrued and
unpaid dividends. These distributions will be made before any distribution is
made on any securities ranking junior relating to liquidation, including common
stock.
If the liquidation amounts payable relating to the preferred stock of any
series and any other securities ranking on a parity regarding liquidation rights
are not paid in full, the holders of the preferred stock of these series and the
other securities will share in any distribution of available assets of Corning
Incorporated on a ratable basis in proportion to the full liquidation
preferences. Holders of these series of preferred stock will not be entitled to
any other amounts from us after they have received their full liquidation
preference.
VOTING RIGHTS
The holders of shares of preferred stock will have no voting rights, except:
- as otherwise stated in the prospectus supplement;
- as otherwise stated in the certificate of designation establishing the
series; or
- as required by applicable law.
OUTSTANDING PREFERRED STOCK
At July 31, 2000, there were 93,413 shares of Series B preferred stock
outstanding.
SERIES B PREFERRED STOCK
Cumulative cash dividends at the rate of 8% per annum are payable on shares
of the Series B preferred stock that have been issued. Corning Incorporated has
regularly paid dividends on the Series B preferred stock. No dividends may be
paid or declared on the Series A preferred stock or the common stock unless all
dividends for all prior dividend periods have been paid or declared on the
Series B preferred stock.
Holders of Series B preferred stock are entitled to vote, voting together
with the common stock and not as a separate class, on all matters submitted to
holders of the common stock, each share of Series B preferred stock having four
votes, subject to adjustment.
Holders of Series B preferred stock have no preemptive rights. In the event
of a liquidation, dissolution or winding-up of Corning Incorporated, holders of
Series B preferred stock would be entitled to receive a distribution in the
amount of $100 per share, plus accrued and unpaid dividends, before any
distribution on the common stock or Series A preferred stock.
The Series B preferred stock is redeemable, in whole or in part, at the
election of Corning Incorporated, at any time, at $100 per share.
The Series B preferred stock is subject to redemption, at the option of the
holder, at any time upon five business day's notice, at a redemption price equal
to $100 plus accrued and unpaid dividends, if the proceeds are necessary:
- to make a distribution pursuant to an investment election made under one
of the investment plans of Corning Incorporated; or
- to satisfy any indebtedness to which the investment plans of Corning
Incorporated are subject, provided that this payment is necessary to
remedy or prevent a default under the applicable indebtedness.
Corning Incorporated, at its option, may make payment of the redemption
price required upon redemption of shares of Series B preferred stock in cash or
in shares of common stock, or in any combination of shares of common stock and
cash.
The Series B preferred stock is convertible at the option of the holder, at
any time, into common stock at a conversion price of $20.89 per share of common
stock, each share of Series B preferred stock being valued at $100 for the
purpose of this conversion, producing a conversion ratio equal to 4.79 shares of
common stock for each share of Series B preferred stock so converted, subject to
adjustments to prevent dilution.
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DESCRIPTION OF DEPOSITARY SHARES
The following briefly summarizes the material provisions of the deposit
agreement and of the depositary shares and depositary receipts, other than
pricing and related terms disclosed in the accompanying prospectus supplement.
You should read the particular terms of any depositary shares and any depositary
receipts that are offered by us and any deposit agreement relating to a
particular series of preferred stock which will be described in more detail in a
prospectus supplement. The prospectus supplement will also state whether any of
the generalized provisions summarized below do not apply to the depositary
shares or depositary receipts being offered. A form of deposit agreement,
including the form of depositary receipt, is included as an exhibit to the
registration statement of which this prospectus forms a part. See "Where You Can
Find More Information" below for information on how to obtain a copy of the form
of deposit agreement.
GENERAL
Corning Incorporated may, at its option, elect to offer fractional shares of
preferred stock, rather than full shares of preferred stock. If it decides to do
so, Corning Incorporated will issue receipts for depositary shares, each of
which will represent a fraction of a share of a particular series of preferred
stock.
The shares of any series of preferred stock represented by depositary shares
will be deposited under a deposit agreement between Corning Incorporated and a
bank or trust company selected by Corning Incorporated having its principal
office in the United States and having a combined capital and surplus of at
least $50,000,000, as preferred stock depositary. Each owner of a depositary
share will be entitled to all the rights and preferences of the underlying
preferred stock, including dividend, voting, redemption, conversion and
liquidation rights, in proportion to the applicable fraction of a share of
preferred stock represented by the depositary share.
The depositary shares will be evidenced by depositary receipts issued
pursuant to the deposit agreement. Depositary receipts will be distributed to
those persons purchasing the fractional shares of preferred stock in accordance
with the terms of the applicable prospectus supplement.
DIVIDENDS AND OTHER DISTRIBUTIONS
The preferred stock depositary will distribute all cash dividends or other
cash distributions received in respect of the deposited preferred stock to the
record holders of depositary shares relating to the underlying preferred stock
in proportion to the number of the depositary shares owned by the holders.
The preferred stock depositary will distribute any property received by it
other than cash to the record holders of depositary shares entitled to these
distributions. If the preferred stock depositary determines that it is not
feasible to make a distribution, it may, with the approval of Corning
Incorporated, sell the property and distribute the net proceeds from the sale to
the holders of the depositary shares.
REDEMPTION OF PREFERRED STOCK
If Corning Incorporated is to redeem a series of preferred stock represented
by depositary shares, the depositary shares will be redeemed from the proceeds
received by the preferred stock depositary resulting from the redemption, in
whole or in part, of the applicable series of preferred stock. The depositary
shares will be redeemed by the preferred stock depositary at a price per
depositary share equal to the applicable fraction of the redemption price per
share payable in respect of the shares of preferred stock so redeemed.
Whenever Corning Incorporated redeems shares of preferred stock held by the
preferred stock depositary, the preferred stock depositary will redeem as of the
same date the number of depositary shares representing shares of preferred stock
so redeemed. If fewer than all the depositary shares are to be redeemed, the
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depositary shares to be redeemed will be selected by the preferred stock
depositary by lot or ratably or by any other equitable method as the preferred
stock depositary decides.
WITHDRAWAL OF PREFERRED STOCK
Unless the related depositary shares have previously been called for
redemption, any holder of depositary shares may receive the number of whole
shares of the related series of preferred stock and any money or other property
represented by those depositary receipts after surrendering the depositary
receipts at the corporate trust office of the preferred stock depositary.
Holders of depositary shares making these withdrawals will be entitled to
receive whole shares of preferred stock on the basis set forth in the related
prospectus supplement for that series of preferred stock.
However, holders of whole shares of preferred stock will not be entitled to
deposit that preferred stock under the deposit agreement or to receive
depositary receipts for that preferred stock after withdrawal. If the depositary
shares surrendered by the holder in connection with withdrawal exceed the number
of depositary shares that represent the number of whole shares of preferred
stock to be withdrawn, the preferred stock depositary will deliver to that
holder at the same time a new depositary receipt evidencing the excess number of
depositary shares.
VOTING DEPOSITED PREFERRED STOCK
When the preferred stock depository receives notice of any meeting at which
the holders of any series of deposited preferred stock are entitled to vote, the
preferred stock depositary will mail the information contained in the notice to
the record holders of the depositary shares relating to the applicable series of
preferred stock. Each record holder of the depositary shares on the record date
will be entitled to instruct the preferred stock depositary to vote the amount
of the preferred stock represented by the holder's depositary shares. To the
extent possible, the preferred stock depositary will vote the amount of the
series of preferred stock represented by depositary shares in accordance with
the instructions it receives.
Corning Incorporated will agree to take all reasonable actions that the
preferred stock depositary determines are necessary to enable the preferred
stock depositary to vote as instructed. The preferred stock depositary will vote
all shares of any series of preferred stock held by it proportionately with
instructions received if it does not receive specific instructions from the
holders of depositary shares representing that series of preferred stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of depositary receipt evidencing the depositary shares and any
provision of the deposit agreement may at any time be amended by agreement
between Corning Incorporated and the preferred stock depositary. However, any
amendment that imposes additional charges or materially and adversely alters any
substantial existing right of the holders of depositary shares will not be
effective unless the amendment has been approved by the holders of at least a
majority of the affected depositary shares then outstanding. Holders who retain
their depositary receipts after the amendment becomes effective will be deemed
to agree to the amendment and will be bound by the amended deposit agreement.
The deposit agreement automatically terminates if:
- all outstanding depositary shares have been redeemed;
- each share of preferred stock has been converted into or exchanged for
common stock; or
- a final distribution in respect of the preferred stock has been made to
the holders of depositary shares in connection with any liquidation,
dissolution or winding up of Corning Incorporated.
Corning Incorporated may terminate the deposit agreement at any time and the
preferred stock depositary will give notice of that termination to the record
holders of all outstanding depositary receipts not less than
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30 days prior to the termination date. In that event, the preferred stock
depositary will deliver or make available for delivery to holders of depositary
shares, upon surrender of the depositary shares, the number of whole or
fractional shares of the related series of preferred stock as are represented by
those depositary shares.
CHARGES OF PREFERRED STOCK DEPOSITARY; TAXES AND OTHER GOVERNMENTAL CHARGES
No fees, charges and expenses of the preferred stock depositary or any agent
of the preferred stock depositary or of any registrar will be payable by any
person other than Corning Incorporated, except for any taxes and other
governmental charges and except as provided in the deposit agreement. If the
preferred stock depositary incurs fees, charges or expenses for which it is not
otherwise liable at the election of a holder of a depositary receipt or other
person, that holder or other person will be liable for those fees, charges and
expenses.
RESIGNATION AND REMOVAL OF DEPOSITARY
The preferred stock depositary may resign at any time by delivering to
Corning Incorporated notice of its intent to do so, and Corning Incorporated may
at any time remove the preferred stock depositary. Any resignation or removal
will take effect upon the appointment of a successor preferred stock depositary
and its acceptance of the appointment. A successor preferred stock depositary
must be appointed within 60 days after delivery of the notice of resignation or
removal and must be a bank or trust company having its principal office in the
United States and having a combined capital and surplus of at least $50,000,000.
MISCELLANEOUS
The preferred stock depositary will forward all reports and communications
from Corning Incorporated which are delivered to the preferred stock depositary
and which Corning Incorporated is required to furnish to the holders of the
deposited preferred stock.
Neither the preferred stock depositary nor Corning Incorporated will be
liable if it is prevented or delayed by law or any circumstances beyond its
control in performing its obligations under the deposit agreement. The
obligations of Corning Incorporated and the preferred stock depositary under the
deposit agreement will be limited to performance with honest intentions of their
duties under the agreement and they will not be obligated to prosecute or defend
any legal proceeding in respect of any depositary shares, depositary receipts or
shares of preferred stock unless satisfactory indemnity is furnished. Corning
Incorporated and the preferred stock depositary may rely upon written advice of
counsel or accountants, or upon information provided by holders of depositary
receipts or other persons believed to be competent and on documents believed to
be genuine.
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DESCRIPTION OF COMMON STOCK
Corning Incorporated has authorized the issuance of 1,200,000,000 shares of
common stock, par value $.50 per share. As of July 31, 2000, Corning
Incorporated had 293,986,745 shares outstanding. Each holder of common stock is
entitled to one vote per share for all matters to be voted on by shareholders of
Corning Incorporated. Holders of common stock may not cumulate their votes in
the election of directors, and are entitled to share equally in the dividends
that may be declared by the board of directors, but only after payment of
dividends required to be paid on outstanding shares of preferred stock. The
current quarterly cash dividend of Corning Incorporated is $.18 per share of
common stock. The continued declaration of dividends by the board of directors
is subject to the current and prospective earnings, financial condition and
capital requirements of Corning Incorporated and any other factors that the
board of directors deems relevant.
Upon voluntary or involuntary liquidation, dissolution or winding up of
Corning Incorporated, the holders of the common stock share ratably in the
assets remaining after payments to creditors and provision for the preference of
any preferred stock. There are no preemptive or other subscription rights,
conversion rights or redemption or scheduled installment payment provisions
relating to shares of common stock. All of the outstanding shares of common
stock are fully paid and nonassessable. The transfer agent and registrar for the
common stock is Computershare Investor Services, LLC. The common stock is listed
on The New York Stock Exchange, Inc.
RIGHTS AGREEMENT
Attached to each share of common stock is one preferred share purchase
right. Each right entitles the registered holder to purchase from Corning
Incorporated one one-hundredth of a share of Series A preferred stock at a price
of $125.00 per one one-hundredth of a share of Series A preferred stock, subject
to adjustment. The rights expire on July 15, 2006, unless the final expiration
date is extended or unless the rights are earlier redeemed by Corning
Incorporated.
The rights represented by the certificates for common stock are not
exercisable, and are not transferable apart from the common stock, until the
earlier of:
- ten days after a person or group, called an "acquiring person", acquires
beneficial ownership of 20% or more of the common stock of Corning
Incorporated; or
- ten business days, or a later date determined by the board of directors,
after the commencement or first public announcement of a tender or
exchange offer that would result in a person or group beneficially owning
20% or more of the outstanding common stock of Corning Incorporated.
The earlier of these two dates is called the "distribution date". Separate
certificates for the rights will be mailed to holders of record of the common
stock as of the distribution date. The rights could then begin trading
separately from the common stock.
Generally, in the event that a person or group becomes an acquiring person,
each right, other than the rights owned by the acquiring person, will entitle
the holder to receive, upon exercise of the right, common stock having a value
equal to two times the exercise price of the right. In the event that Corning
Incorporated is acquired in a merger, consolidation, or other business
combination transaction or more than 50% of its assets, cash flow or earning
power is sold or transferred, each right, other than the rights owned by an
acquiring person, will entitle the holder to receive, upon the exercise of the
right, common stock of the surviving corporation having a value equal to two
times the exercise price of the right.
At any time after the acquisition by the acquiring person of beneficial
ownership of 20% or more of the outstanding shares of the common stock of
Corning Incorporated and before the acquisition by the acquiring person of 50%
or more of the voting power of the
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<PAGE>
outstanding shares of the common stock of Corning Incorporated, the board of
directors may exchange the rights, other than rights owned by the acquiring
person, which would have become void, in whole or in part, at an exchange ratio
of one share of our common stock per right, subject to adjustment.
The rights are redeemable in whole, but not in part, at $.01 per right until
any person or group becomes an acquiring person. The ability to exercise the
rights terminates at the time that the board of directors elects to redeem the
rights. Notice of redemption will be given by mail to the registered holders of
the rights. At no time will the rights have any voting rights. The rights agent
is Computershare Investor Services, LLC.
The exercise price payable, and the number of shares of Series A preferred
stock or other securities or property issuable, upon exercise of the rights are
subject to adjustment from time to time to prevent dilution:
- in the event of a stock dividend on, or a subdivision, combination or
reclassification of, the shares of Series A preferred stock;
- upon the grant to holders of the shares of Series A preferred stock of
rights or warrants to subscribe for or purchase shares of Series A
preferred stock at a price, or securities convertible into shares of
Series A preferred stock with a conversion price, less than the then
current market price of the shares of Series A preferred stock; or
- upon the distribution to holders of the shares of Series A preferred stock
of evidences of indebtedness or assets, excluding regular periodic cash
dividends paid out of earnings or retained earnings or dividends payable
in shares of Series A preferred stock, or of subscription rights or
warrants, other than those referred to above.
The number of outstanding rights and the number of one one-hundredths of a
share of Series A preferred stock issuable upon exercise of each right are also
subject to adjustment in the event of a stock split of, or stock dividend on, or
subdivision, consolidation or combination of, the common stock prior to the
distribution date. With some exceptions, no adjustment in the exercise price
will be required until cumulative adjustments require an adjustment of at least
1% in the exercise price.
Upon the exercise of the rights, no fractional shares of Series A preferred
stock will be issued and instead an adjustment in cash will be made. However,
fractional shares of Series A preferred stock may be issued where these
fractions are integral multiples of one-hundredth of a share which may, at the
election of Corning Incorporated, be evidenced by depositary receipts.
The rights have certain anti-takeover effects. The rights may cause
substantial dilution to a person or group that attempts to acquire us on terms
not approved by the board of directors of Corning Incorporated, except in the
case of an offer conditioned on a substantial number of rights being acquired.
The rights should not interfere with any merger or other business combination
approved by the board of directors since, subject to exceptions, the rights may
be redeemed by us at $.01 per right at any time prior to the acquisition by a
person or group of beneficial ownership of 20% or more of the common stock. The
redemption of the rights may be made effective at any time, on any basis, and
with any conditions that the board of directors in its sole discretion may
establish.
The shares of Series A preferred stock purchasable upon exercise of the
right will rank junior to all other series of preferred stock of Corning
Incorporated, including the Series B preferred stock, or any similar stock that
specifically provides that it ranks prior to the shares of Series A preferred
stock. The shares of Series A preferred stock will be nonredeemable. Each share
of Series A preferred stock will be entitled to a minimum preferential quarterly
dividend of $1.00 per share, but will be entitled to an aggregate dividend of
100 times the dividend declared per share of common stock. In the event of
liquidation, the holders of the shares of Series A preferred stock will be
entitled to a minimum preferential liquidation payment of $100 per share, but
will be entitled to an aggregate payment of 100 times the
38
<PAGE>
payment made per share of common stock. Each share of Series A preferred stock
will have 100 votes, voting together with the common stock. In the event of any
merger, consolidation or other transaction in which common stock is exchanged,
each share of Series A preferred stock will be entitled to receive 100 times the
amount and type of consideration received per share of common stock. These
rights are protected by customary antidilution provisions. Because of the nature
of the Series A preferred stock's dividend, liquidation and voting rights, the
value of the interest in a share of Series A preferred stock purchasable upon
the exercise of each right should approximate the value of one share of common
stock.
The description of the rights contained in this section does not describe
every aspect of the rights. The rights agreement dated as of June 5, 1996,
between Corning Incorporated and the rights agent, contains the full legal text
of the matters described in this section. A copy of the rights agreement has
been incorporated by reference in the Registration Statement of which this
prospectus forms a part. See "Where You Can Find More Information" below for
information on how to obtain a copy.
FAIR PRICE AMENDMENT
In 1985, shareholders of Corning Incorporated adopted a "fair price
amendment" to the certificate of incorporation of Corning Incorporated that, in
general, requires the approval by the holders of at least 80% of the voting
power of the outstanding capital stock of Corning Incorporated entitled to vote
generally in the election of directors as a condition for mergers and other
forms of business combinations with any beneficial owner of more than 10% of
this voting power unless:
- the transaction is approved by at least a majority of the "continuing
directors", as defined in the certificate of incorporation; or
- minimum price, form of consideration and procedural requirements are met.
Amendment or repeal of this provision or the adoption of any inconsistent
provision requires the affirmative vote of at least 80% of the voting stock
unless the proposed amendment or repeal or the adoption of the inconsistent
provisions were approved by two-thirds of the entire board of directors and a
majority of the continuing directors.
OTHER ANTI-TAKEOVER PROVISIONS OF THE CERTIFICATE OF INCORPORATION AND BY-LAWS
In addition to the preferred share purchase rights and the fair price
amendment, the certificate of incorporation and by-laws of Corning Incorporated
contain other provisions that may discourage a third party from seeking to
acquire Corning Incorporated or to commence a proxy contest or other takeover-
related action. Corning Incorporated has classified its board of directors so
that one-third of the board is elected each year to three-year terms of office.
In addition, holders of common stock may remove a director from office at any
time prior to the expiration of his or her term only with cause and by vote of a
majority of holders of common stock outstanding. These provisions, together with
provisions concerning the size of the board and requiring that premature
vacancies on the board be filled only by a majority of the entire board, may not
be amended, altered or repealed, nor may we adopt any inconsistent provisions
without the affirmative vote of at least 80% of the voting stock of Corning
Incorporated or the approval of two-thirds of the entire board of directors.
The by-laws of Corning Incorporated contain procedural requirements with
respect to the nomination of directors by shareholders that require, among other
things, delivery of notice by nominating shareholders to its Secretary not later
than 90 days nor more than 120 days prior to the date of the shareholders
meeting at which the nomination is to be considered. The by-laws do not provide
that a meeting of the board of directors may be called by shareholders.
The certificate of incorporation of Corning Incorporated provides that no
director will be liable to Corning Incorporated or its shareholders for a breach
of duty as a director except as provided by the New York Business Corporation
Law.
The effect of these provisions may be to deter attempts either to obtain
control of
39
<PAGE>
Corning Incorporated or to acquire a substantial amount of its stock, even if a
proposed acquisition transaction were at a significant premium over the
then-prevailing market value of the common stock, or to deter attempts to remove
the board of directors and management of Corning Incorporated, even though some
or a majority of the holders of common stock may believe these actions to be
beneficial.
PLAN OF DISTRIBUTION
We may sell securities to or through underwriters, and also may sell
securities directly to other purchasers or through agents. Unless otherwise set
forth in the prospectus supplement, the obligations of any underwriters to
purchase the securities will be subject to conditions precedent and these
underwriters will be obligated to purchase all the securities if any are
purchased.
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, at market
prices prevailing at the time of sale, at prices related to these prevailing
market prices or at negotiated prices. The applicable prospectus supplement will
describe the method of distribution of the securities.
In connection with the sale of securities, underwriters may receive
compensation from us or from purchasers of securities for whom they may act as
agents, in the form of discounts, concessions or commissions. Underwriters,
dealers and agents that participate in the distribution of securities may be
deemed to be underwriters, 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 the Securities Act of 1933. Any underwriter,
dealer or agent that will participate in the distribution of the securities will
be identified, and any compensation it will receive will be described, in the
prospectus supplement.
Under agreements which may be entered into by us, underwriters, dealers and
agents who participate in the distribution of securities may be entitled to
indemnification by us against some liabilities, including liabilities under the
Act, or to contribution with respect to payments which the underwriters, dealers
or agents may be required to make relating to these liabilities. Any agreement
in which we agree to indemnify underwriters, dealers and agents against civil
liabilities will be described in the relevant prospectus supplement.
If so indicated in the prospectus supplement, we will authorize dealers or
other persons acting as our agent to solicit offers by some institutions to
purchase securities from us pursuant to contracts providing for payment and
delivery on a future date. Institutions with which these contracts may be made
include commercial and savings banks, insurance companies, pension funds,
investment companies, educational and charitable institutions and others.
VALIDITY OF SECURITIES
The validity of the securities is being passed on for us by William D.
Eggers, Esq., Senior Vice President and General Counsel of Corning Incorporated,
and for any underwriters, dealers or agents by Sullivan & Cromwell, 125 Broad
Street, New York, New York. Mr. Eggers owns substantially less than 1% of the
outstanding shares of Corning Incorporated common stock.
EXPERTS
The consolidated financial statements of Corning Incorporated incorporated
in this prospectus by reference to Corning Incorporated's 1999 Annual Report on
Form 10-K for the year ended December 31, 1999, as amended, have been so
incorporated in reliance on the report of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of that firm as experts in
auditing and accounting.
40
<PAGE>
WHERE YOU CAN FIND MORE INFORMATION
As required by the Securities Act of 1933, we filed a registration statement
(No. 333- ) relating to the securities offered by this prospectus with the
Securities and Exchange Commission. This prospectus is a part of that
registration statement, which includes additional information.
Corning Incorporated files annual, quarterly and current reports, proxy
statements and other information with the SEC. You may read and copy this
information at the SEC's public reference rooms in Washington, D.C., New York,
New York and Chicago, Illinois. You can also request copies of the documents,
upon payment of a duplicating fee, by writing the Public Reference Section of
the SEC. Please call the SEC at 1-800-SEC-0330 for further information on the
public reference rooms. These SEC filings are also available to the public from
the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file with
the SEC. This means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The information
incorporated by reference is considered to be part of this prospectus.
Information that we file later with the SEC will automatically update
information in this prospectus. In all cases, you should rely on the later
information over different information included in this prospectus or the
prospectus supplement.
This prospectus includes by reference the documents listed below that
Corning Incorporated has previously filed with the SEC and that are not included
in or delivered with the documents. They contain important information about our
company and its financial condition.
- Annual Report on Form 10-K for the year ended December 31, 1999;
- Amendment No. 1 to Annual Report on Form 10-K/A for the year ended
December 31, 1999, dated March 8, 2000;
- Amendment No. 2 to Annual Report on Form 10-K/A for the year ended
December 31, 1999, dated April 7, 2000;
- Quarterly reports on Form 10-Q for the quarters ended March 31, 2000 and
June 30, 2000;
- Current Report on Form 8-K, dated January 11, 2000;
- Current Report on Form 8-K, dated January 24, 2000;
- Current Report on Form 8-K, dated January 26, 2000;
- Current Report on Form 8-K, dated February 15, 2000;
- Current Report on Form 8-K, dated February 17, 2000;
- Current Report on Form 8-K, dated February 22, 2000;
- Current Report on Form 8-K, dated March 29, 2000;
- Current Report on Form 8-K/A, dated April 17, 2000;
- Current Report on Form 8-K, dated April 20, 2000;
- Current Report on Form 8-K, dated April 25, 2000;
- Current Report on Form 8-K, dated May 3, 2000;
- Current Report on Form 8-K, dated July 17, 2000; and
- Registration Statement on Form 8-A containing a description of our
preferred share rights plan filed on July 11, 1996.
We incorporate by reference additional documents that we may file with the
SEC after the date of this prospectus and before the completion of this
offering. The documents include periodic reports, like Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as
well as proxy statements.
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<PAGE>
You may request a copy of these filings, at no cost, by writing or
telephoning us at the following address:
Corning Incorporated
One Riverfront Plaza
Corning, New York 14831
Attention: Secretary
(607) 974-9000
Information in this prospectus may add to, update or change information in a
previously filed document incorporated by reference in this prospectus. In that
case, you should rely on the information in this prospectus. Information in a
document filed after the date of this prospectus may add to, update or change
information in this prospectus or in a previously filed document incorporated by
reference in this prospectus. In that case, you should rely on the information
in the later filed document.
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<PAGE>
PART II. INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth all expenses payable by Corning Incorporated
(the "Company") in connection with the issuance and distribution of the
securities, other than underwriting discounts and commissions. The Company will
bear all of such expenses. All the amounts shown are estimates, except the
registration fee.
<TABLE>
<S> <C>
Registration Fee............................................ $1,056,000
Fees and expenses of accountants............................ $ 20,000
Legal Fees.................................................. $ 25,000
Fees and expenses of trustee and counsel.................... $ 18,000
Printing and engraving...................................... $ 100,000
Blue Sky fees and expenses (including counsel).............. $ 10,000
Rating agency fees.......................................... $ 300,000
Miscellaneous............................................... $ 51,000
Total....................................................... $1,580,000
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
CORNING INCORPORATED
Sections 722 and 723 of the Business Corporation Law of the State of New
York (the "BCL") provide that a corporation may indemnify its current and former
directors and officers under certain circumstances. Article VIII of the
Company's By-Laws provides that the Company shall indemnify each director and
officer against all costs and expenses actually and reasonably incurred by him
in connection with the defense of any claim, action, suit or proceeding against
him by reason of his being or having been a director or officer of the Company
to the full extent permitted by, and consistent with, the BCL.
Section 402(b) of the BCL provides that a corporation may include a
provision in its certificate of incorporation limiting the liability of its
directors to the corporation or its shareholders for damages for the breach of
any duty, except for a breach involving intentional misconduct, bad faith, a
knowing violation of law or receipt of an improper personal benefit or for
certain illegal dividends, loans or stock repurchases. Paragraph 7 of the
Company's Restated Certificate of Incorporation contains such a provision.
CORNING FINANCE B.V.
In general, Dutch law provides that a B.V. should indemnify its Managing
Director in the event that he is liable to a third party for damages caused in
his capacity as Managing Director, unless the liability results from his gross
negligence or intentional misconduct. Under certain circumstances, this
provision does not apply, and the B.V. and the Managing Director may agree that
the B.V. will indemnify the Managing Director in such circumstances.
Besides the general concept of tort liability, Netherlands law contains
various specific statutory provisions on the personal civil law liability of the
Managing Directors of a B.V. corporation, both towards the B.V. itself in case
of improper performance, requiring the Managing Director to be seriously at
fault, and towards third parties. Third party liability may inter alia (but not
limitative) result from (i) acquisition of the B.V.'s shares by the B.V. itself
or by any of its subsidiaries contrary to the statutory provisions relating
thereto, (ii) misleading information and, more particularly, misleading annual
accounts or interim of the B.V., (iii) unpaid social security premiums and
certain taxes and
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<PAGE>
(iv) in the event of the B.V.'s bankruptcy, improper performance if such
performance is the cause of the bankruptcy, or non-compliance with other
specific statutory provisions.
The Articles of Association of the Corning Finance B.V. do not contain any
provisions on the indemnification by the Corning Finance B.V. of its Managing
Directors. Under Netherlands law obtaining insurance on Managing Directors is
permitted except that such insurance cannot be applied to any liability
resulting from gross negligence or intentional misconduct.
Reference is made to the forms of Underwriting Agreement incorporated by
reference as Exhibits 1.01 through 1.05 hereto for a description of
indemnification arrangements for offerings of securities pursuant thereto.
For the undertaking in relation to indemnification, please see Item 17
below.
ITEM 16. EXHIBITS.
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBITS
--------------------- --------
<C> <S>
1.01 Form of Underwriting Agreement relating to debt securities
and debt warrants of Corning Incorporated.
1.02 Form of Underwriting Agreement relating to equity warrants
(to be filed as an exhibit to a Current Report on Form 8-K
and incorporated herein by reference).
1.03 Form of Underwriting Agreement relating to preferred stock
and depositary shares.
1.04 Form of Underwriting Agreement relating to common stock.
1.05 Form of Underwriting Agreement relating to debt securities
of Corning Finance B.V. (to be filed as an exhibit to a
Current Report on Form 8-K and incorporated herein by
reference).
4.01 Indenture, dated , , by and between the
Company and The Chase Manhattan Bank, as trustee
(incorporated by reference to the corresponding exhibit to
the Company's registration statement on Form S-3
(Registration Statement Nos. 333-81299, 333-81299-01).
4.02 Indenture, dated , , by and among the
Company, Corning Finance B.V. and The Chase Manhattan Bank,
as trustee (incorporated by reference to the corresponding
exhibit to the Company's registration statement on Form S-3
(Registration Statement Nos. 333-81299, 333-81299-01)).
4.03 Form of Debt Warrant Agreement, including a form of debt
warrant certificate (to be filed as an exhibit to a Current
Report on Form 8-K and incorporated herein by reference).
4.04 Form of Equity Warrant Agreement, including form of equity
warrant certificate (to be filed as an exhibit to a Current
Report on Form 8-K and incorporated herein by reference).
4.05 Form of Deposit Agreement, including form of depositary
receipt (to be filed as an exhibit to a Current Report on
Form 8-K and incorporated herein by reference).
4.06 Form of certificate for shares of the common stock
(incorporated by reference to Exhibit 4 to the Company's
registration statement on Form S-4 dated June 17, 1992
(Registration Statement No. 33-48488)).
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBITS
--------------------- --------
<C> <S>
4.07 Rights Agreement, dated as of June 5, 1996, between the
Company and Computershare Investor Services, LLC, formerly
known as Harris Trust and Savings Bank, as rights agent
(incorporated by reference to Exhibit 1 of the Company's
Current Report on Form 8-K dated July 10, 1996).
5.01 Opinion of William D. Eggers, Esq.
12.01 Calculation of ratio of income to fixed charges and
calculation of ratio of income to combined fixed charges
including preferred stock dividends.
23.01 Consent of PricewaterhouseCoopers LLP, independent
accountants.
23.02 Consent of William D. Eggers, Esq. (included in Exhibit
5.01).
24.01 Power of Attorney of certain directors.
25.01 Form T-1 Statement of Eligibility and Qualification under
the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Trustee.
</TABLE>
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrants hereby undertake
(1) to file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of this registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any increase
or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering
range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement; and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in this registration statement or
any material change to such information in the registration statement;
provided, however, that paragraphs (i) and (ii) do not apply if the information
required to be included in a post-effective amendment thereby is contained in
periodic reports filed by the Company pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 (the "Exchange Act") that are incorporated
by reference in the registration statement;
(2) that, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial BONA FIDE offering thereof;
(3) to remove from registration by means of post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering; and
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<PAGE>
(4) If the registrant is a foreign private issuer, to file a
post-effective amendment to the registration statement to include any
financial statements required by Rule 3-19 of this chapter at the start of
any delayed offering or throughout a continuous offering. Financial
statements and information otherwise required by Section 10(a)(3) of the Act
need not be furnished, PROVIDED, that the registrant includes in the
prospectus, by means of post-effective amendment, financial statements
required pursuant to this paragraph (a)(4) and other information necessary
to ensure that all other information in the prospectus is at least as
current as the date of those financial statements. Notwithstanding the
foregoing, with respect to a registration statement on Form F-3, a
post-effective amendment need not be filed to include financial statements
and information required by Section 10(a)(3) of the Act or Rule 3-19 of this
chapter if such financial statements and information are contained in
periodic reports filed with or furnished to the Commission by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the Form F-3.
(b) The undersigned registrants undertake that, for purposes of determining
any liability under the Securities Act, each filing of the Company's annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial BONA FIDE offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of a
registrant pursuant to the foregoing provisions, or otherwise, the registrants
have been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in such Act and is,
therefore, unenforceable. In the event a claim against a registrant for
indemnification against such liabilities (other than the payment by a registrant
of expenses incurred or paid by a director, officer or controlling person of
such registrant in the successful defense of any action, suit or proceeding) is
asserted by such director, officer or controlling person in connection with the
securities being registered herein, such registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in such Act and will be governed by the
final adjudication of such issue.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Corning, State of New York, on August 23, 2000.
<TABLE>
<S> <C> <C>
CORNING INCORPORATED
-------------------------------------
(Registrant)
By: /s/ WILLIAM D. EGGERS
---------------------------------
William D. Eggers
Senior Vice President
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons on August 23,
2000, in the capacities indicated.
SIGNATURE
<TABLE>
<CAPTION>
SIGNATURE CAPACITY
--------- --------
<C> <S>
/s/ ROGER G. ACKERMAN Chairman of the Board, Principal Executive
------------------------------------------- Officer
(Roger G. Ackerman) and Director
/s/ JAMES B. FLAWS Senior Vice President, Treasurer and Principal
------------------------------------------- Financial Officer
(James B. Flaws)
/s/ KATHERINE A. ASBECK Vice President, Controller and Principal
------------------------------------------- Accounting Officer
(Katherine A. Asbeck)
* Director
-------------------------------------------
(John Seely Brown)
* Director
-------------------------------------------
(John H. Foster)
* Director
-------------------------------------------
(Norman E. Garrity)
* Director
-------------------------------------------
(Gordon Gund)
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE CAPACITY
--------- --------
<C> <S>
* Director
-------------------------------------------
(John M. Hennessy)
* Director
-------------------------------------------
(James R. Houghton)
* Director
-------------------------------------------
(John W. Loose)
* Director
-------------------------------------------
(James J. O'Connor)
* Director
-------------------------------------------
(Catherine A. Rein)
* Director
-------------------------------------------
(Deborah D. Rieman)
* Director
-------------------------------------------
(H. Onno Ruding)
* Director
-------------------------------------------
(William D. Smithburg)
</TABLE>
<TABLE>
<S> <C> <C> <C>
*By: /s/ WILLIAM D. EGGERS
--------------------------------------
(William D. Eggers, Attorney-in-Fact)
</TABLE>
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Corning, state of New York, on August 23, 2000.
<TABLE>
<S> <C> <C>
CORNING FINANCE B.V.
-------------------------------------
(Registrant)
By: /s/ EDWARD W. RICH
---------------------------------
Edward W. Rich
Vice President--Finance
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons on August 23,
2000, in the capacities indicated.
<TABLE>
<CAPTION>
SIGNATURE CAPACITY
--------- --------
<C> <S>
/s/ JAMES B. FLAWS President and Chief Executive Officer
-------------------------------------------
(James B. Flaws)
/s/ EDWARD W. RICH Vice President--Finance, Chief Financial
------------------------------------------- Officer, Chief Accounting Officer and Director
(Edward W. Rich)
* Director
-------------------------------------------
(A. John Peck, Jr.)
* Director
-------------------------------------------
(Mark S. Rogus)
Director
-------------------------------------------
(ABN AMRO Trust Company
(Nederland) B.V.)
</TABLE>
<TABLE>
<S> <C> <C>
*By: /s/ EDWARD W. RICH
--------------------------------------
(Edward W. Rich, Attorney-in-Fact)
</TABLE>
II-7
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBITS
--------------------- --------
<C> <S>
1.01 Form of Underwriting Agreement relating to debt securities
and debt warrants of Corning Incorporated.
1.02 Form of Underwriting Agreement relating to equity warrants
(to be filed as an exhibit to a Current Report on Form 8-K
and incorporated herein by reference).
1.03 Form of Underwriting Agreement relating to preferred stock
and depositary shares.
1.04 Form of Underwriting Agreement relating to common stock.
1.05 Form of Underwriting Agreement relating to debt securities
of Corning Finance B.V. (to be filed as an exhibit to a
Current Report on Form 8-K and incorporated herein by
reference).
4.01 Indenture, dated , , by and between the
Company and The Chase Manhattan Bank, as trustee
(incorporated by reference to the corresponding exhibit to
the Company's registration statement on Form S-3
(Registration Statement Nos. 333-81299, 333-81299-01).
4.02 Indenture, dated , , by and among the
Company, Corning Finance B.V. and The Chase Manhattan Bank,
as trustee (incorporated by reference to the corresponding
exhibit to the Company's registration statement on Form S-3
(Registration Statement Nos. 333-81299, 333-81299-01)).
4.03 Form of Debt Warrant Agreement, including a form of debt
warrant certificate (to be filed as an exhibit to a Current
Report on Form 8-K and incorporated herein by reference).
4.04 Form of Equity Warrant Agreement, including form of equity
warrant certificate (to be filed as an exhibit to a Current
Report on Form 8-K and incorporated herein by reference).
4.05 Form of Deposit Agreement, including form of depositary
receipt (to be filed as an exhibit to a Current Report on
Form 8-K and incorporated herein by reference).
4.06 Form of certificate for shares of the common stock
(incorporated by reference to Exhibit 4 to the Company's
registration statement on Form S-4 dated June 17, 1992
(Registration Statement No. 33-48488)).
4.07 Rights Agreement, dated as of June 5, 1996, between the
Company and Computershare Investor Services, LLC, formerly
known as Harris Trust and Savings Bank, as rights agent
(incorporated by reference to Exhibit 1 of the Company's
Current Report on Form 8-K dated July 10, 1996).
5.01 Opinion of William D. Eggers, Esq.
12.01 Calculation of ratio of income to fixed charges and
calculation of ratio of income to combined fixed charges
including preferred stock dividends.
23.01 Consent of PricewaterhouseCoopers LLP, independent
accountants.
23.02 Consent of William D. Eggers, Esq. (included in Exhibit
5.01).
24.01 Power of Attorney of certain directors.
25.01 Form T-1 Statement of Eligibility and Qualification under
the Trust Indenture Act of 1939, as amended, of The Chase
Manhattan Bank, as Trustee.
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II-8
