<PAGE>
Rule 424(b)(2)
Registration No: 333-16869
PROSPECTUS SUPPLEMENT
(To Prospectus Dated December 12, 1996)
$1,200,000,000 [LOGO OF CROWN CORK & SEAL
COMPANY, INC. APPEARS HERE]
CROWN CORK & SEAL COMPANY, INC.
$350,000,000 7 3/8% DEBENTURES DUE 2026
$150,000,000 7 1/2% DEBENTURES DUE 2096
CROWN CORK & SEAL FINANCE PLC
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY
CROWN CORK & SEAL COMPANY, INC.
$200,000,000 6 3/4% NOTES DUE 2003
$300,000,000 7% NOTES DUE 2006
CROWN CORK & SEAL FINANCE S.A.
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY
CROWN CORK & SEAL COMPANY, INC.
$200,000,000 6 3/4% NOTES DUE 2003
The 7 3/8% Debentures Due 2026, which mature on December 15, 2026 (the "2026
Debentures"), and the 7 1/2% Debentures Due 2096, which mature on December 15,
2096 (the "2096 Debentures" and, together with the 2026 Debentures, the
"Debentures"), are being offered by Crown Cork & Seal Company, Inc., a
Pennsylvania corporation (the "Company"). The 6 3/4% Notes Due 2003, which
mature on December 15, 2003 (the "UK 2003 Notes"), and the 7% Notes Due 2006,
which mature on
(continued on following page)
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) DISCOUNT COMPANY(1)(2)
<S> <C> <C> <C>
Per 2026 Debenture...................... 98.799% .875% 97.924%
Total................................... $345,796,500 $3,062,500 $342,734,000
Per 2096 Debenture...................... 98.349% 1.125% 97.224%
Total................................... $147,523,500 $1,687,500 $145,836,000
Per UK 2003 Note........................ 99.463% .550% 98.913%
Total................................... $198,926,000 $1,100,000 $197,826,000
Per UK 2006 Note........................ 99.667% .650% 99.017%
Total................................... $299,001,000 $1,950,000 $297,051,000
Per French 2003 Note.................... 99.463% .550% 98.913%
Total................................... $198,926,000 $1,100,000 $197,826,000
</TABLE>
- -------------------------------------------------------------------------------
(1) Plus accrued interest, if any, from December 17, 1996 to the date of
delivery.
(2) Before deducting expenses payable by the Company estimated at $1,163,939.
The Debt Securities are offered subject to receipt and acceptance by the
Underwriters, to prior sale and to the Underwriters' right to reject any order
in whole or in part and to withdraw, cancel or modify the offer without
notice. It is expected that delivery of beneficial interests in the Debt
Securities will be made through the facilities of DTC on or about December 17,
1996, against payment therefor in immediately available funds.
SALOMON BROTHERS INC
CS FIRST BOSTON
CHASE SECURITIES INC.
J.P. MORGAN & CO.
The date of this Prospectus Supplement is December 12, 1996.
<PAGE>
(continued from previous page)
December 15, 2006 (the "UK 2006 Notes" and, together with the UK 2003 Notes,
the "UK Notes"), are being offered by Crown Cork & Seal Finance PLC, a public
limited company organized under the laws of England and Wales and an indirect
wholly owned subsidiary of the Company. The 6 3/4% Notes Due 2003, which
mature on December 15, 2003 (the "French 2003 Notes" and, collectively with
the Debentures and the UK Notes, the "Debt Securities"), are being offered by
Crown Cork & Seal Finance S.A., a societe anonyme organized under the laws of
the Republic of France and an indirect wholly owned subsidiary of the Company
(together with Crown Cork & Seal Finance PLC, the "Subsidiary Issuers"). The
Company, in its capacity as an issuer, and the Subsidiary Issuers are
collectively referred to herein as the "Issuers." Each series of Debt
Securities issued by a Subsidiary Issuer will be irrevocably and
unconditionally guaranteed (the "Guarantees") as to principal, interest and
Additional Amounts (as defined herein), if any, by the Company. The Debt
Securities will be redeemable as a whole or in part, at the option of the
Issuer at any time, at a redemption price equal to the greater of (a) 100% of
the principal amount of such Debt Securities and (b) the sum of the present
values of the Remaining Scheduled Payments (as defined herein) thereon
discounted at the Treasury Rate (as defined herein) plus 20 basis points in
the case of the 2096 Debentures, the Treasury Rate plus 15 basis points in the
case of the 2026 Debentures and the Treasury Rate in the case of the UK Notes
and the French 2003 Notes, plus in any case accrued interest to the date of
redemption. See "Description of Debt Securities and Guarantees--Optional
Redemption." In addition, each series of Debt Securities issued by a
Subsidiary Issuer is redeemable at the option of such Subsidiary Issuer, in
whole, but not in part, at the principal amount thereof plus accrued interest
in the event of certain tax law changes requiring the payment of Additional
Amounts as described under "Description of Debt Securities and Guarantees--
Redemption for Taxation Reasons" in the accompanying Prospectus. Upon the
occurence of a Tax Event (as defined herein), the Company will have the right
to shorten the maturity of the 2096 Debentures to the extent required so that
the interest paid on the 2096 Debentures will be deductible for United States
federal income tax purposes. See "Description of Debt Securities and
Guarantees--Conditional Right to Shorten Maturity of the 2096 Debentures."
Interest on the Debt Securities will be payable semi-annually, on June 15 and
December 15 of each year, commencing on June 15, 1997.
Each series of Debt Securities issued by the Company or Crown Cork & Seal
Finance S.A. will be represented by one or more global notes registered in the
name of a nominee of The Depository Trust Company ("DTC"). Each series of Debt
Securities issued by Crown Cork & Seal Finance PLC will be represented by one
or more global notes in bearer form which are expected to be deposited with
The Bank of New York (the "Bearer Security Depositary") under a Bearer
Security Depositary Agreement pursuant to which certificateless depositary
interests in respect of such global notes will be issued to DTC. Beneficial
interests in the Debt Securities will be shown on, and transfers thereof will
be effected only through, records maintained in book-entry form by DTC and its
participants. Except in limited circumstances, the Debt Securities will not be
available in definitive form. Settlement for the Debt Securities will be made
in immediately available funds. The Debt Securities will trade in DTC's Same-
Day Funds Settlement System until maturity, and secondary market trading
activity for the Debt Securities will therefore settle in immediately
available funds. All payments of principal and interest will be made by the
Issuer in immediately available funds. See "Description of Debt Securities and
Guarantees--Global Securities in Registered Form" and "--Global Securities in
Bearer Form" in the accompanying Prospectus. The Debt Securities have been
approved for listing on the New York Stock Exchange, subject to official
notice of issuance.
S-2
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE DEBT
SECURITIES AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN
MARKET. SUCH TRANSACTIONS MAY BE EFFECTED AT ANY TIME ON THE NEW YORK STOCK
EXCHANGE, IN THE OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF
COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
----------------
THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS HAVE NOT RECEIVED
THE VISA OF THE FRENCH COMMISSION DES OPERATIONS DE BOURSE. ACCORDINGLY, THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS MAY NOT BE USED TO MAKE
OFFERS OR SALES IN FRANCE IN CONNECTION WITH THE OFFER DESCRIBED HEREIN.
S-3
<PAGE>
THE COMPANY
GENERAL
The Company is the world's leading manufacturer of packaging products for
consumer goods. The Company believes that it is unique in its industry in its
ability to supply food, beverage and aerosol containers to multinational
consumer marketers on a global basis. The Company currently operates 275
plants located in 53 countries and employs approximately 48,000 people.
The Company's products include metal cans for food, beverage, household and
other consumer products; plastic containers for beverage, processed food,
household, personal care and other products; metal and plastic packaging
products for health and beauty care applications including cosmetics,
fragrances and pharmaceuticals; metal specialty and promotional packaging
products; a wide variety of caps, closures, pumps and dispensing systems; and
composite containers. The Company also manufactures filling and material
handling machinery, primarily for the beverage and brewing industries, as well
as machinery used in the can making process.
Under current management, the Company has pursued a strategy of growth by
acquisition within the global packaging industry. Over the past seven years,
the Company has completed 20 acquisitions of companies with aggregate net
sales of approximately $8 billion. The largest acquisitions over this period
include CarnaudMetalbox (February 1996), Van Dorn Company (April 1993),
CONSTAR International (October 1992), Continental Can International (May
1991), Continental Can's U.S. food and beverage can businesses (July 1990) and
Continental Can Canada (December 1989). This strategy has contributed to an
increase in the Company's net sales from $1.9 billion in 1989 to $5.1 billion
in 1995. The Company's net sales in 1996, which will include the net sales of
CarnaudMetalbox for 10 months, are expected to approach $9 billion
(approximately 62% of which are expected to be generated from operations
located outside the United States, as compared to approximately 33% in 1995).
The Company's acquisition strategy has resulted in numerous benefits to the
Company, including, among others, improved market positions, product and
geographic diversification, and cost savings. The Company believes that the
ongoing rationalization of excess or inefficient capacity within the global
packaging industry, particularly in the core mature markets served by the
Company, has had a beneficial effect on asset utilization. The Company
believes that industry consolidation has generally resulted in fewer but more
competitive packaging suppliers.
In conjunction with its strategy of growth by acquisition, the Company has
invested in new manufacturing capacity, particularly for beverage can
production in emerging markets and for polyethylene terephthalate (PET)
plastic containers globally. The Company has also invested in projects that
improve production efficiencies and product quality, and lower manufacturing
and administrative costs. The Company continually reviews its operations,
especially in terms of their competitiveness and the appropriate number, size
and location of plants, emphasizing service to customers and rate of return to
investors.
The Company was founded in 1892 and is a Pennsylvania corporation. The
principal executive offices of the Company are located at 9300 Ashton Road,
Philadelphia, Pennsylvania 19136, and the telephone number at such address is
(215) 698-5100.
CarnaudMetalbox Acquisition
On February 22, 1996, the Company acquired CarnaudMetalbox, a leading
multinational manufacturer of metal and plastic packaging products with
headquarters in Paris, France, for
S-4
<PAGE>
approximately $4.0 billion. Management believes that the acquisition of
CarnaudMetalbox has positioned the Company to benefit from the following
factors, among others:
. Complementary Geographic Markets. The Company is now significantly more
diversified on a global basis. Prior to the acquisition, the Company was
the leading manufacturer of packaging products for consumer goods in
North America. The acquisition enabled the Company to significantly
increase its market presence in Europe as well as in the Middle East,
Asia-Pacific and Africa regions, where CarnaudMetalbox has a substantial
presence. As a result of the acquisition, the Company has become the
world's leading manufacturer of packaging products for consumer goods.
. Complementary Product Markets. The Company is now able to offer a
broader range of products to existing and new customers, including
packaging for health and beauty care applications, metal specialty and
promotional packaging, metal closures for glass food containers and
easy-open ends for metal food containers. The only area of significant
product overlap with CarnaudMetalbox, tinplate aerosol cans in Europe,
was eliminated by the recently completed, European Community-mandated
divestiture of a portion of the Company's aerosol can operations in that
region.
. Cost Reduction Opportunities. The Company believes that, as in past
acquisitions, it can realize significant cost reductions over time
through more effective management of costs relating to sales, marketing
and administration, and research and development activities. The Company
also expects to reduce costs through rationalization of metal and other
raw material specification requirements, improved coordination of
purchasing activities and greater price discounts on certain items
purchased in larger quantities. For information on the Company's
rationalization of manufacturing operations, see "--1996 Restructuring"
below.
. Leadership in Research, Development and Engineering. The Company
considers its research, development and engineering ("RD&E")
capabilities to be unsurpassed in the industry. The Company's principal
RD&E centers are located near Chicago, Illinois and in Wantage, UK. The
Company uses its RD&E capabilities to (a) promote development of value-
added packaging systems, (b) design cost-efficient manufacturing systems
and materials that also provide continuous quality improvement, (c)
support technical needs in customer and vendor relationships, and (d)
provide engineering services for the Company's worldwide packaging
activities. These capabilities allow the Company to identify market
opportunities by working with customers to develop new products. In
addition, the Company believes that its technical expertise, quality
reputation and customer relationships will enable it to anticipate and
capitalize on shifting customer preferences, such as the conversion to
plastic from other materials, and potential demand for new packaging
shapes.
. Improved Free Cash Flow Generation. The Company believes that the
CarnaudMetalbox acquisition has the potential to improve the Company's
ability to generate free cash flow as a result of the Company's
strengthened competitive position worldwide, opportunities to reduce
operating costs, improved working capital management and lower capital
expenditure requirements for the combined entity. Over the near term,
the Company intends to use a portion of its available free cash flow to
reduce indebtedness.
1996 Restructuring
During the second quarter of 1996, the Company charged against operations
$29.6 million for the costs associated with the closure of a South American
operation and costs associated with restructuring existing businesses in
Europe. The Company anticipates that such restructuring, when complete, will
generate approximately $6.0 million in after-tax cost savings on an annualized
basis.
The Company has made a preliminary assessment of the restructuring and exit
costs related to the acquisition of CarnaudMetalbox. The current plan of
restructuring, which commenced at the end of
S-5
<PAGE>
the first quarter of 1996, is expected to be substantially completed during
the first quarter of 1997. As of September 30, 1996, the Company had accrued
approximately $371 million for the costs associated with restructuring
CarnaudMetalbox operations and allocated such costs to the purchase price of
CarnaudMetalbox in accordance with purchase accounting requirements. These
costs comprise severance pay and benefits, writedown of assets and lease
termination and other exit costs. The cost of providing severance pay and
benefits to employees is currently estimated at approximately $202 million and
is primarily a cash expense. The cost associated with the writedown of assets
(property, equipment, inventory, etc.) is currently estimated at approximately
$139 million and has been reflected as a reduction in the fair value of the
Company's assets. Lease termination costs and other exit costs are currently
estimated at approximately $29 million and are primarily cash expenses. The
$371 million in restructuring costs recorded in connection with the
CarnaudMetalbox acquisition include the $70 million restructuring charge
previously announced by CarnaudMetalbox Asia Ltd., a subsidiary of the
Company.
The Company, on a preliminary basis, estimates that this plan of
restructuring of CarnaudMetalbox operations, when complete, will generate
annual cost savings of approximately $116 million (or $77 million after-tax)
on a full year basis. It is also estimated that capital expenditures of
approximately $50 million will be made to expand and upgrade other facilities
to minimize the adverse effects of the restructuring on existing business and
customer relationships.
The Company expects that there will be other restructurings effected within
the next year. These plans will be finalized when the Company has had time to
properly evaluate and assess business conditions and operating efficiencies to
make such decisions. As the Company continues to restructure the newly
combined Company, costs that do not qualify for purchase accounting will be
charged against operations.
The foregoing estimates of sales, restructuring charges and related cost
savings represent the Company's best estimates, but necessarily make numerous
assumptions with respect to industry performance, general business and
economic conditions, raw materials and product pricing levels, the timing of
implementation of the restructuring and related employee reductions and
facility closings and other matters, many of which are outside the Company's
control. These estimates may change, resulting in lower actual sales and
adjustments to restructuring costs and savings. The Company's estimates and
related assumptions, which are unaudited, are not necessarily indicative of
future performance, which may be significantly more or less favorable than as
set forth above, and are subject to considerations discussed in the Company's
Exchange Act filings with the Commission, including its Quarterly Report on
Form 10-Q for the quarterly period ended March 31, 1996, as amended, which is
incorporated by reference herein. Undue reliance should not be placed on the
estimates and assumptions. Such information may not necessarily be updated to
reflect circumstances existing after the date hereof or to reflect the
occurrence of unanticipated events.
THE SUBSIDIARY ISSUERS
Crown Cork & Seal Finance PLC
Crown Cork & Seal Finance PLC is a public limited company organized under
the laws of England and Wales. The purpose of Crown Cork & Seal Finance PLC is
to undertake major borrowings on behalf of the Company and certain of its
subsidiaries and to advance the proceeds of such borrowings to the Company or
certain of its subsidiaries. At December 4, 1996, Crown Cork & Seal Finance
PLC had no outstanding liabilities or assets (other than a minimal amount of
current assets). The principal executive offices of Crown Cork & Seal Finance
PLC are located at Downsview Road, Wantage, Oxon, United Kingdom OX12 9BL, and
the telephone number at such address is 44-123-577-2929.
S-6
<PAGE>
Crown Cork & Seal Finance S.A.
Crown Cork & Seal Finance S.A. is a societe anonyme organized under the laws
of the Republic of France. The purpose of Crown Cork & Seal Finance S.A. is to
undertake major borrowings on behalf of the Company and certain of its
subsidiaries and to advance the proceeds of such borrowings to the Company or
certain of its subsidiaries. At December 4, 1996, Crown Cork & Seal Finance
S.A. had no outstanding liabilities or assets (other than a minimal amount of
current assets). The principal executive offices of Crown Cork & Seal Finance
S.A. are located at Le Colisee I, rue Fructidor, 75830 Paris Cedex 17, France,
and the telephone number at such address is 33-1-49-18-40-00.
USE OF PROCEEDS
The net proceeds from the sale of the Debt Securities will be used to repay
a portion of the borrowings outstanding under the multicurrency credit
facility (the "Acquisition Facility") which financed the cash portion of the
consideration paid in connection with the acquisition of CarnaudMetalbox in
February 1996. As of December 4, 1996, $1,895.7 million of loans were
outstanding under such facility. Interest accrues on such loans at a floating
rate which, as of December 4, 1996, was 5.9% per annum. A copy of the credit
agreement relating to this facility is filed as an exhibit to the Company's
Current Report on Form 8-K filed December 15, 1995, which is incorporated
herein by reference.
S-7
<PAGE>
CAPITALIZATION
The following table sets forth the consolidated capitalization and short-
term debt of the Company at September 30, 1996 and as adjusted to give effect
to the issuance of the Debt Securities and the application of the estimated
net proceeds therefrom as described under "Use of Proceeds." For additional
information as to the capitalization of the Company, see "Summary Historical
Financial Information" and "Unaudited Pro Forma Consolidated Condensed
Statements of Operations" and the consolidated financial statements of the
Company and the related notes thereto incorporated by reference herein.
<TABLE>
<CAPTION>
SEPTEMBER 30, 1996
-------------------------
ACTUAL AS ADJUSTED
---------- -------------
(DOLLARS IN MILLIONS)
(UNAUDITED)
<S> <C> <C>
SHORT-TERM DEBT
Commercial paper and notes payable.................. $ 1,174.3 $ 1,174.3
Current portion of long-term debt................... 34.2 34.2
---------- ----------
Total short-term debt............................. $ 1,208.5 $ 1,208.5
---------- ----------
LONG-TERM DEBT
Debt Securities offered hereby(1)................... $ -- $ 1,200.0
Acquisition Facility(2)............................. 1,812.9 622.9
Commercial paper(3)................................. 300.0 300.0
5.88% notes due 1998................................ 100.0 100.0
7.00% notes due 1999................................ 100.0 100.0
7.00% notes due 2000................................ 100.0 100.0
6.75% notes due 2003................................ 200.0 200.0
7.49% notes due 2004................................ 105.0 105.0
8.38% notes due 2005................................ 300.0 300.0
8.00% notes due 2023................................ 200.0 200.0
Perpetual notes(4).................................. 201.1 201.1
Preference shares(4)................................ 296.4 296.4
Other indebtedness.................................. 359.4 359.4
Less amounts due within one year.................... (34.2) (34.2)
---------- ----------
Total long-term debt.............................. $ 4,040.6 $ 4,050.6
Cash and cash equivalents........................... (168.7) (168.7)
---------- ----------
Total debt, net of cash and cash equivalents...... $ 5,080.4 $ 5,090.4
MINORITY INTERESTS.................................... 274.8 274.8
SHAREHOLDERS' EQUITY.................................. 3,670.8 3,670.8
---------- ----------
Total Capitalization.............................. $ 9,026.0 $ 9,036.0
========== ==========
</TABLE>
- --------
(1) See "Description of Debt Securities and Guarantees" for information as to
the various rates and maturities of the Debt Securities.
(2) On November 30, 1996, all outstanding loans under the Acquisition Facility
automatically converted into term loans which mature on November 30, 1997.
Because such loans mature within one year, such loans, which are included
as long-term debt in the table above, have been reclassified as short-term
debt as of November 30, 1996. After giving effect to such
reclassification, total short-term debt, as adjusted, would have been
$1,831.4 million and total long-term debt, as adjusted, would have been
$3,427.7 million. The Company expects to replace the Acquisition Facility
with a new $2.5 billion revolving credit facility.
(3) At September 30, 1996, $300.0 million of commercial paper was reclassified
as long-term debt, reflecting the Company's ability to refinance these
borrowings on a long-term basis.
(4) For descriptions of Perpetual Notes and Preference Shares, see Note 11,
"Perpetual Notes and Preference Shares," contained in the audited
consolidated financial statements of CarnaudMetalbox for the years ended
December 31, 1995, 1994 and 1993 which were filed as Exhibit 99.1 to the
Company's Current Report on Form 8-K filed March 1, 1996, as amended.
S-8
<PAGE>
SUMMARY HISTORICAL FINANCIAL INFORMATION
The summary financial information presented below for the years ended
December 31, 1995, 1994, 1993, 1992, and 1991 and as of the end of each such
fiscal year is derived from the consolidated financial statements of the
Company, which have been audited by Price Waterhouse LLP, independent
accountants, and should be read in conjunction with the information and
audited consolidated financial statements contained in the Company's Annual
Report on Form 10-K for the year ended December 31, 1995, which is
incorporated by reference herein. The summary financial information for and as
of the nine-month periods ended September 30, 1996 and 1995 is unaudited and,
in the opinion of the Company's management, includes all adjustments,
consisting of only normal recurring accruals, necessary for a fair
presentation of such information. Such unaudited information should be read in
conjunction with the information and the consolidated financial statements
contained in the Company's Quarterly Reports on Form 10-Q for the quarterly
periods ended March 31, 1996, as amended, June 30, 1996, as amended, and
September 30, 1996, which are incorporated by reference herein. See also
"Unaudited Pro Forma Consolidated Condensed Statements of Operations." The
summary financial information in the table below does not reflect the
financial results of the Company after September 30, 1996.
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,(1) YEAR ENDED DECEMBER 31,(1)
----------------- ------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
--------- -------- -------- -------- -------- -------- --------
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
SUMMARY OF OPERATIONS
Net sales............... $ 6,367.0 $3,939.6 $5,053.8 $4,452.2 $4,162.6 $3,780.7 $3,807.4
--------- -------- -------- -------- -------- -------- --------
Cost of products sold.. 5,169.1 3,343.6 4,319.4 3,706.2 3,474.7 3,203.0 3,291.1
Depreciation and
amortization.......... 359.8 196.5 256.3 218.3 191.7 142.4 128.4
Selling and
administrative
expense............... 277.4 107.8 139.3 135.4 126.6 112.1 105.4
Provision for
restructuring(2)...... 29.6 102.7 102.7 114.6
Gain on sale of
assets................ (22.8) (8.1) (8.4) (6.7) (0.7) (5.6) (0.4)
Interest expense....... 279.6 111.6 148.6 98.8 89.8 77.4 76.6
Interest income........ (56.6) (8.8) (12.5) (7.2) (10.1) (13.5) (10.0)
Translation and
exchange adjustments.. (35.7) (1.3) (1.1) 10.1 10.8 10.2 7.5
--------- -------- -------- -------- -------- -------- --------
Income before income
taxes, equity in
earnings of affiliates
and cumulative effect
of accounting
changes............... 366.6 95.6 109.5 182.7 279.8 254.7 208.8
Income taxes........... 107.7 17.4 24.9 55.6 97.4 101.0 83.8
Equity in earnings of
affiliates, net of
minority interests.... (14.1) (9.4) (9.7) 3.9 (1.5) 1.7 3.1
--------- -------- -------- -------- -------- -------- --------
Net income before
cumulative effect of
accounting changes.... 244.8 68.8 74.9 131.0 180.9 155.4 128.1
Cumulative effect of
accounting
changes(3)............ (81.8)
--------- -------- -------- -------- -------- -------- --------
Net income............. 244.8 68.8 74.9 131.0 99.1 155.4 128.1
Preferred Stock
dividends(4).......... 13.9
--------- -------- -------- -------- -------- -------- --------
Net income available
for common
shareholders.......... $ 230.9 $ 68.8 $ 74.9 $ 131.0 $ 99.1 $ 155.4 $ 128.1
========= ======== ======== ======== ======== ======== ========
RATIO OF EARNINGS TO
FIXED CHARGES(5)....... 2.2x 1.8x 1.7x 2.8x 4.2x 4.3x 3.7x
OTHER DATA
EBITDA(6).............. $ 979.0 $ 497.6 $ 604.6 $ 607.2 $ 551.2 $ 461.0 $ 403.8
Capital expenditures... 428.4 295.4 433.5 439.8 271.3 150.6 42.2
EBITDA as a percentage
of net sales.......... 15.4% 12.6% 12.0% 13.6% 13.2% 12.2% 10.6%
Selling and
administrative expense
as a percentage of net
sales................. 4.4 2.7 2.8 3.0 3.0 3.0 2.8
Total debt as a
percentage of total
capitalization(7)..... 56.3 58.1 56.2 55.3 50.1 52.1 40.5
FINANCIAL POSITION
Total assets........... $12,536.0 $5,235.2 $5,051.7 $4,781.3 $4,236.3 $3,825.1 $2,963.5
Working capital........ 149.9 199.9 429.9 122.6 43.8 174.5 333.3
Total debt............. 5,249.1 2,226.4 2,098.2 1,825.3 1,366.3 1,319.3 769.4
Shareholders' equity... 3,670.8 1,458.1 1,461.2 1,365.2 1,251.8 1,143.6 1,084.4
</TABLE>
S-9
<PAGE>
- --------
(1) Certain reclassifications of prior years' data have been made to improve
comparability. The Company has completed a number of acquisitions during
the periods presented. Such acquisitions were accounted for using the
purchase method and may affect the comparability of data on a year-to-year
basis. See Note C to the Consolidated Financial Statements included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1995
with respect to the effect of certain acquisitions by the Company.
(2) Reflects restructuring of certain facilities announced in 1996, 1995 and
1994. See Note H to the Consolidated Financial Statements included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1995,
and the Company's Quarterly Report on Form 10-Q for the quarterly period
ended September 30, 1996. Does not reflect restructuring costs qualifying
for purchase accounting, including certain restructuring costs in
connection with the acquisition of CarnaudMetalbox. See "The Company--1996
Restructuring." The after-tax impact of the restructuring charges for the
years ended December 31, 1995 and 1994, as reflected in the table above,
was $67.0 million and $73.2 million, respectively. The after-tax impact of
the restructuring charges for the nine months ended September 30, 1996 and
1995 was $21.9 million and $67.0 million, respectively.
(3) Reflects accounting changes related to adoption of SFAS No. 106,
"Employers' Accounting for Postretirement Benefits Other than Pensions,"
SFAS 109, "Accounting for Income Taxes," and SFAS 112, "Employers'
Accounting for Postemployment Benefits." See Note B to the Company's
Consolidated Financial Statements included in the Company's Annual Report
on Form 10-K for the year ended December 31, 1995.
(4) The Company issued Preferred Stock on February 26, 1996 in connection with
the acquisition of CarnaudMetalbox. See Notes N and T to the Company's
Consolidated Financial Statements included in the Company's Annual Report
on Form 10-K for the year ended December 31, 1995.
(5) For purposes of computing the ratio of earnings to fixed charges, earnings
consist of income before income taxes, equity in earnings of affiliates
and cumulative effect of accounting changes plus fixed charges (exclusive
of interest capitalized during the period and Preferred Stock dividend
requirements), amortization of interest previously capitalized and
distributed income from less-than-50%-owned companies. Fixed charges
include interest incurred, Preferred Stock dividend requirements,
amortization of debt issue costs and the portion of rental expense that is
deemed representative of an interest factor. See also "Ratio of Earnings
to Fixed Charges."
(6) "EBITDA" is defined as income before income taxes, equity in earnings of
affiliates and cumulative effect of accounting changes, plus depreciation
and amortization, provision for restructuring and interest expense, minus
interest income. EBITDA is presented solely as a supplement to the other
information provided above. EBITDA is not a substitute for operating and
cash flow data as determined in accordance with generally accepted
accounting principles.
(7) Total capitalization includes total debt (net of cash and cash
equivalents), minority interests and shareholders' equity.
S-10
<PAGE>
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
The following unaudited pro forma consolidated condensed statements of
operations give effect to the acquisition of CarnaudMetalbox under the
purchase method of accounting. The unaudited pro forma consolidated condensed
statement of operations for the year ended December 31, 1995 combines the
historical consolidated statements of operations of the Company and
CarnaudMetalbox giving effect to the acquisition as if it had occurred on
January 1, 1995. The unaudited pro forma consolidated condensed statement of
operations for the nine months ended September 30, 1996 combines the
historical consolidated statements of operations of the Company and
CarnaudMetalbox giving effect to the acquisition as if it had occurred on
January 1, 1996.
The unaudited pro forma consolidated condensed statements of operations are
for illustrative purposes only and have been presented in accordance with
guidelines of the Commission. They are not necessarily indicative of the
results of operations that might have occurred had the acquisition actually
taken place on such dates, or of future results of operations of the Company.
The unaudited pro forma consolidated condensed statements of operations are
based on the historical consolidated financial statements of the Company and
CarnaudMetalbox and should be read in conjunction with such historical
financial statements and the notes thereto, which are, in the case of
CarnaudMetalbox, included as part of the Company's Current Report on Form 8-K
filed on March 1, 1996, as amended (the "CarnaudMetalbox Financial
Statements"), and, in the case of the Company, filed with the Company's Annual
Report on Form 10-K for the year ended December 31, 1995 and the Company's
Quarterly Report on Form 10-Q for the quarterly periods ended March 31, 1996,
as amended, June 30, 1996, as amended, and September 30, 1996, respectively
(and which, in the case of the Company's 1996 quarterly results, include
balance sheet and income statement data reflecting historical results of the
CarnaudMetalbox acquisition since the acquisition date of February 22, 1996).
See also "Summary Historical Financial Information." Certain reclassifications
have been made to CarnaudMetalbox's historical consolidated financial
statements to conform with the presentation of the Company's historical
consolidated financial statements. Furthermore, the historical financial
statements for CarnaudMetalbox, prepared in accordance with French law and
presented in French francs, have for purposes of preparing these unaudited pro
forma consolidated condensed statements of operations been conformed to comply
with U.S. generally accepted accounting principles and, in accordance with
SFAS No. 52, have been translated to U.S. dollars at actual average exchange
rates equal to FF 4.982/$1.00 for the pro forma statement of operations for
the year ended December 31, 1995 and FF 5.007/$1.00 for the pro forma
statement of operations for the period beginning January 1, 1996 and ending on
the acquisition date of February 22, 1996. See Note 1-B of the CarnaudMetalbox
Financial Statements for the reconciliation of CarnaudMetalbox's 1995, 1994
and 1993 net income and shareholders' equity to U.S. generally accepted
accounting principles. Such translations should not be construed as
representations that French franc amounts have been or could be converted into
U.S. dollars at that or any other rate. The use of exchange rates different
from those used in the unaudited pro forma consolidated condensed statements
of operations could have a material impact on the information presented
therein.
In accordance with the purchase method of accounting, the total purchase
price has been allocated to the assets and liabilities of CarnaudMetalbox
based upon their fair values. The accompanying unaudited pro forma
consolidated condensed statements of operations reflect the preliminary
allocation of purchase price to assets and liabilities. Accordingly, the final
allocations may differ from the amounts reflected herein.
The unaudited pro forma consolidated condensed statements of operations
reflect a $3.6 billion excess of purchase price over net assets acquired,
which is being amortized over 40 years at a rate of $90 million per year in
accordance with generally accepted accounting principles, which require that
S-11
<PAGE>
acquired intangibles be amortized over lives not to exceed 40 years.
Intangible assets acquired principally represent CarnaudMetalbox's customer
base and CarnaudMetalbox's European market presence, assets with indefinite
lives which have historically appreciated in value over time. In addition, the
acquisition facilitates the continued expansion of current lines of business
as well as the development of new businesses via the cross-selling of
packaging product offerings of both the Company and CarnaudMetalbox to
existing and potential customers as well as other factors. See "The Company."
The Company believes it will benefit from the acquisition for a period of at
least 40 years and, therefore, a 40-year amortization period is appropriate.
The Company has obtained appraisals and other studies of the significant
assets, liabilities and business operations of CarnaudMetalbox. The unaudited
pro forma consolidated condensed statements of operations reflect the
preliminary results of these reviews, including the Company's estimate of
known restructuring costs and expenses. For a discussion of recent and
possible future restructuring costs and expenses, including restructurings in
connection with the CarnaudMetalbox acquisition, see "The Company--1996
Restructuring." The final allocation of the purchase price will be completed
in the first quarter of 1997 when final appraisals, other studies and
additional information become available.
See the notes to the unaudited pro forma consolidated condensed statements
of operations for a description of the principal assumptions made in the
preparation of the pro forma information. The unaudited pro forma consolidated
condensed statements of operations do not reflect the financial results of the
Company or CarnaudMetalbox after September 30, 1996.
<TABLE>
<CAPTION>
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED
STATEMENT OF OPERATIONS FOR THE
NINE MONTHS ENDED SEPTEMBER 30, 1996 (A)
------------------------------------------------------
HISTORICAL AMOUNTS PRO FORMA
---------------------------- -------------------------
COMPANY CARNAUDMETALBOX ADJUSTMENTS CONSOLIDATED
----------- --------------- ----------- ------------
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
Net sales................ $ 6,367 $ 606 $ 6,973
Cost of products sold.. 5,169 486 5,655
Depreciation and
amortization.......... 360 36 $ (1)(B) 395
Selling and
administrative
expense............... 277 57 334
Provision for
restructuring......... 30 15 45
Gain on sale of
assets................ (23) (23)
Interest expense....... 280 17 19 (C) 316
Interest income........ (57) (3) (60)
Translation and
exchange adjustments.. (36) (36)
----------- ---------- ---- -----------
Income before income
taxes, equity in
earnings of affiliates
and cumulative effect of
accounting changes...... 367 (2) (18) 347
Income taxes........... 108 3 (4)(D) 107
Equity in earnings of
affiliates............ (4) (4)
Minority interests..... (10) 2 (8)
----------- ---------- ---- -----------
Net income............... 245 (3) (14) 228
Preferred Stock
dividends............... (14) (4)(E) (18)
----------- ---------- ---- -----------
Net income available for
common shareholders..... $ 231 $ (3) $(18) $ 210
=========== ========== ==== ===========
Earnings per share....... $ 1.91 $ (0.03) $ 1.63
Average number of common
shares outstanding...... 120,820,436 86,202,056 128,443,961
</TABLE>
S-12
<PAGE>
<TABLE>
<CAPTION>
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED
STATEMENT OF OPERATIONS FOR THE
YEAR ENDED DECEMBER 31, 1995(F)
-----------------------------------------------------
HISTORICAL AMOUNTS PRO FORMA
--------------------------- -------------------------
COMPANY CARNAUDMETALBOX ADJUSTMENTS CONSOLIDATED
---------- --------------- ----------- ------------
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C>
Net sales................ $ 5,054 $ 4,939 $ 9,993
Cost of products sold.. 4,311 3,926 8,237
Depreciation and
amortization.......... 256 292 $ (10)(B) 538
Selling and
administrative
expense............... 139 415 554
Provision for
restructuring......... 103 55 158
Interest expense....... 149 130 138(C) 417
Interest income........ (13) (25) (38)
Translation and
exchange adjustments.. (1) 2 1
Other.................. (13) (13)
---------- ---------- ----- -----------
Income before income
taxes, equity in
earnings of affiliates
and cumulative effect of
accounting changes...... 110 157 (128) 139
Income taxes........... 25 11 (26)(D) 10
Equity in earnings of
affiliates............ 4 1 5
Minority interests..... (14) 3 (11)
---------- ---------- ----- -----------
Net income............... 75 150 (102) 123
Preferred Stock
dividends............... (23)(E) (23)
---------- ---------- ----- -----------
Net income available for
common shareholders..... $ 75 $ 150 $(125) $ 100
========== ========== ===== ===========
Earnings per share....... $ 0.83 $ 1.76 $ 0.78
Average number of common
shares outstanding...... 90,233,518 85,327,985 127,534,336
</TABLE>
S-13
<PAGE>
NOTES TO UNAUDITED PRO FORMA
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
A. Historical amounts for the Company include the results from operations of
CarnaudMetalbox from the date of acquisition, February 22, 1996. Historical
amounts for CarnaudMetalbox include the results from operations of
CarnaudMetalbox for the preacquisition period beginning January 1, 1996 and
ending on the acquisition date. Pro forma adjustments relate only to such
preacquisition period.
B. To reflect the net decrease in depreciation and amortization expense due
to (a) amortization of the excess purchase price over net tangible assets
acquired on a straight-line basis over 40 years, net of elimination of
CarnaudMetalbox historical amortization of excess acquisition costs over the
values assigned to net assets acquired in prior acquisitions, (b) additional
amortization resulting from basis assigned to intangible assets other than
goodwill, (c) net decrease in depreciation resulting from change in asset
basis and lives identified in the appraisal process, and (d) decreased
depreciation resulting from property and equipment written off under existing
plans of restructuring.
C. To reflect the increase in interest expense resulting from the use of new
borrowings to finance a portion of the purchase price. The interest rate on
new borrowings of $1.84 billion is assumed to be 7.5% per annum. Such
borrowings have been made by the Company under the Acquisition Facility, which
bears interest at a variable rate. See Exhibit 10.1 to the Company's Current
Report on Form 8-K filed on December 15, 1995, which is hereby incorporated by
reference, for additional information with respect to the terms of the
Acquisition Facility. See footnote (2) in "Capitalization" for information on
the Company's intention to replace such facility.
D. To reflect the income tax effect of increased interest net of decreased
depreciation at the statutory tax rate of 37.0%. The Company expects that its
effective consolidated income tax rate may be higher than that reflected in
the unaudited pro forma consolidated condensed statements of operations due to
several factors, including the geographical mix in which the Company's future
pre-tax earnings are generated, the non-deductibility for tax purposes of a
significant portion of the purchase price for the CarnaudMetalbox acquisition
and the accounting rules governing utilization of pre-acquisition net
operating losses.
E. To reflect dividends on Preferred Stock of $1.88 per share per annum on
12,432,622 outstanding shares.
F. The unaudited pro forma consolidated condensed statement of operations
for the year ended December 31, 1995 has been updated from that included in
the Company's Current Report on Form 8-K/A filed on May 7, 1996, principally
to reflect increased pro forma goodwill amortization arising from changes in
the estimated fair value of net tangible assets acquired and the acquisition
in the second quarter of 1996 of the remaining 1.3% minority interest in
CarnaudMetalbox.
S-14
<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges for
the Company and its consolidated subsidiaries for the periods shown. The
ratios were derived from the audited consolidated financial statements of the
Company for the years ended December 31, 1991, 1992, 1993, 1994 and 1995 and
from the unaudited consolidated financial statements of the Company for the
nine months ended September 30, 1996.
<TABLE>
<CAPTION>
NINE MONTHS ENDED YEAR ENDED DECEMBER 31,
SEPTEMBER 30, --------------------------
1996 1995 1994 1993 1992 1991
----------------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed
Charges......................... 2.2x* 1.7x* 2.8x* 4.2x 4.3x 3.7x
</TABLE>
- --------
* In 1994 and 1995 and the nine months ended September 30, 1996, the Company
incurred pre-tax restructuring charges of $114.6 million, $102.7 million and
$29.6 million, respectively, reflecting the costs associated with various
restructuring activities. If such charges had not been incurred, the ratio
of earnings to fixed charges for 1994, 1995 and the nine months ended
September 30, 1996 would have been 3.9x, 2.4x and 2.3x, respectively. The
ratio of earnings to fixed charges for the nine months ended September 30,
1996 reflects the interest on the debt incurred by the Company in connection
with the Company's acquisition of CarnaudMetalbox and the results of
operations of CarnaudMetalbox since the acquisition date of February 22,
1996. See "Unaudited Pro Forma Consolidated Condensed Statements of
Operations" for additional information.
For purposes of this ratio, earnings consist of income before income taxes,
equity in earnings of affiliates and cumulative effect of accounting changes
plus fixed charges (exclusive of interest capitalized during the period and
Preferred Stock dividend requirements), amortization of interest previously
capitalized and distributed income from less-than-50%-owned companies. Fixed
charges include interest incurred, Preferred Stock dividend requirements,
amortization of debt issue costs and the portion of rental expense that is
deemed representative of an interest factor.
S-15
<PAGE>
DESCRIPTION OF DEBT SECURITIES AND GUARANTEES
GENERAL
The following description of the Debt Securities offered hereby supplements,
and to the extent inconsistent therewith, supersedes, insofar as such
description relates to such Debt Securities, the description of the general
terms and provisions of the Debt Securities set forth in the accompanying
Prospectus, to which description reference is hereby made. The Debt Securities
will be issued under an Indenture, dated as of December 17, 1996, among the
Company, the Subsidiary Issuers and The Bank of New York, as Trustee.
Reference should be made to the accompanying Prospectus for a detailed summary
of the provisions of the Indenture.
The Debentures are being offered by Crown Cork & Seal Company, Inc., a
Pennsylvania corporation. The 2026 Debentures are limited to $350 million
aggregate principal amount and will mature on December 15, 2026. The 2096
Debentures are limited to $150 million aggregate principal amount and will
mature on December 15, 2096.
The UK Notes are being offered by Crown Cork & Seal Finance PLC, a public
limited company organized under the laws of England and Wales. The UK 2003
Notes are limited to $200 million aggregate principal amount and will mature
on December 15, 2003. The UK 2006 Notes are limited to $300 million aggregate
principal amount and will mature on December 15, 2006.
The French 2003 Notes are being offered by Crown Cork & Seal Finance S.A., a
societe anonyme organized under the laws of the Republic of France. The French
2003 Notes are limited to $200 million aggregate principal amount and will
mature on December 15, 2003.
Each series of Debt Securities issued by a Subsidiary Issuer will be
irrevocably and unconditionally guaranteed as to principal, interest and
Additional Amounts, if any, by the Company. Each series of Debt Securities
issued by a Subsidiary Issuer is redeemable at the option of such Subsidiary
Issuer, in whole, but not in part, at the principal amount thereof plus
accrued interest in the event of certain tax law changes requiring the payment
of Additional Amounts as described under "Description of Debt Securities and
Guarantees--Redemption for Taxation Reasons" in the accompanying Prospectus.
For additional redemption rights of the Issuers, see "--Optional Redemption"
below. There is no provision for a sinking fund for the Debt Securities.
The Debt Securities will each bear interest at the respective rates per
annum set forth on the cover page of this Prospectus Supplement, payable semi-
annually in arrears on June 15 and December 15 of each year, commencing on
June 15, 1997 (each, an "Interest Payment Date") to the persons in whose names
the Debt Securities are registered (or, in the case of bearer securities
deposited with, or on behalf of, a Bearer Security Depositary, the persons in
whose names the certificateless depositary interests therein are registered)
at the close of business (whether or not a business day) on the immediately
preceding June 1 or December 1, as the case may be. Interest on the Debt
Securities will be computed on the basis of a 360-day year of twelve 30-day
months. The Debt Securities will be issued in denominations of $1,000 and
integral multiples thereof.
Each series of Debt Securities issued by the Company or Crown Cork & Seal
Finance S.A. will be represented by one or more global notes registered in the
name of a nominee of The Depository Trust Company. Each series of Debt
Securities issued by Crown Cork & Seal Finance PLC will be represented by one
or more global notes in bearer form which are expected to be deposited with
The Bank of New York under a Bearer Security Depositary Agreement pursuant to
which certificateless depositary interests in respect of such global notes
will be issued to DTC. Beneficial interests in the Debt Securities will be
shown on, and transfers thereof will be effected only through, records
maintained in book-entry form by DTC and its participants. Except in limited
circumstances, the Debt Securities will not be available in definitive form.
See "Description of Debt Securities and Guarantees--Global Securities in
Registered Form" and "--Global Securities in Bearer Form" in the accompanying
Prospectus.
S-16
<PAGE>
The claims of holders under the Debt Securities or the Guarantees will be
effectively subordinated to the claims of creditors of the Company's
subsidiaries. After giving effect to the offering, as of September 30, 1996,
the total outstanding indebtedness (other than the Debt Securities issued by
the Subsidiary Issuers) of the Company's subsidiaries was $2,361.2 million.
The Indenture does not restrict the amount of indebtedness that may be
incurred by the Company or its subsidiaries.
The corporate trust office of the Trustee located in the City of New York
will be designated as the sole Paying Agent for payments with respect to the
Debt Securities. Payment of principal of and interest on the global notes will
be made in immediately available funds. Beneficial interests in the global
notes will trade in DTC's Same-Day Funds Settlement System, and secondary
market trading activity in such interests will therefore settle in same-day
funds.
OPTIONAL REDEMPTION
The Debt Securities will be redeemable as a whole or in part, at the option
of the Issuer at any time, at a redemption price equal to the greater of (a)
100% of the principal amount of the Debt Securities to be redeemed and (b) the
sum of the present values of the Remaining Scheduled Payments (as hereinafter
defined) thereon discounted to the redemption date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Treasury
Rate plus 20 basis points in the case of the 2096 Debentures, the Treasury
Rate plus 15 basis points in the case of the 2026 Debentures and the Treasury
Rate in the case of the UK Notes and the French 2003 Notes, plus in any case
accrued interest on the principal amount being redeemed to the date of
redemption.
"Treasury Rate" means, with respect to any redemption date, the rate per
annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed
as a percentage of its principal amount) equal to the Comparable Treasury
Price for such redemption date.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable
to the remaining term of the Debt Securities to be redeemed that would be
utilized, at the time of selection and in accordance with customary financial
practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such Debt Securities. "Independent
Investment Banker" means one of the Reference Treasury Dealers appointed by
the Trustee after consultation with the Company.
"Comparable Treasury Price" means, with respect to any redemption date, (a)
the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
business day preceding such redemption date, as set forth in the daily
statistical release (or any successor release) published by the Federal
Reserve Bank of New York and designated "Composite 3:30 p.m. Quotations for
U.S. Government Securities" or (b) if such release (or any successor release)
is not published or does not contain such prices on such business day, (i) the
average of the Reference Treasury Dealer Quotations for such redemption date,
after excluding the highest and lowest such Reference Treasury Dealer
Quotations, or (ii) if the Trustee obtains fewer than four such Reference
Treasury Dealer Quotations, the average of all such Quotations. "Reference
Treasury Dealer Quotations" means, with respect to each Reference Treasury
Dealer and any redemption date, the average, as determined by the Trustee, of
the bid and asked prices for the Comparable Treasury Issue (expressed in each
case as a percentage of its principal amount) quoted in writing to the Trustee
by such Reference Treasury Dealer at 5:00 p.m. on the third business day
preceding such redemption date.
"Reference Treasury Dealer" means each of Salomon Brothers Inc, CS First
Boston Corporation, Chase Securities Inc., J.P. Morgan Securities Inc. and
their respective successors; provided, however, that if any of the foregoing
shall cease to be a primary U.S. Government securities dealer in New York City
(a "Primary Treasury Dealer"), the Company shall substitute therefor another
Primary Treasury Dealer.
S-17
<PAGE>
"Remaining Scheduled Payments" means, with respect to any Debt Security, the
remaining scheduled payments of the principal thereof to be redeemed and
interest thereon that would be due after the related redemption date but for
such redemption; provided, however, that, if such redemption date is not an
interest payment date with respect to such Debt Security, the amount of the
next succeeding scheduled interest payment thereon will be reduced by the
amount of interest accrued thereon to such redemption date.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of Debt Securities to be
redeemed.
Unless the Issuer defaults in payment of the redemption price, on and after
the redemption date interest will cease to accrue on the Debt Securities or
portions thereof called for redemption.
CONDITIONAL RIGHT TO SHORTEN MATURITY OF THE 2096 DEBENTURES
The Company intends to deduct interest paid on the 2096 Debentures for
United States federal income tax purposes. However, the Clinton
Administration's budget proposal for Fiscal Year 1997, released on March 19,
1996, contained a series of proposed tax law changes that, among other things,
would prohibit an issuer from deducting interest payments on debt instruments
with a maturity of more than 40 years. On March 29, 1996, the Chairmen of the
Senate Finance Committee and the House Ways and Means Committee issued a
statement to the effect that this proposal, if enacted, would not be effective
prior to the date of "appropriate congressional action." There can be no
assurance, however, that this proposal or similar legislation affecting the
Company's ability to deduct interest paid on the 2096 Debentures will not be
enacted in the future or that any such legislation would not have a
retroactive effective date.
Upon occurrence of a Tax Event (as defined below), the Company will have the
right to shorten the maturity of the 2096 Debentures to the extent required,
in the opinion of a nationally recognized independent tax counsel, such that,
after the shortening of the maturity, interest paid on the 2096 Debentures
will be deductible for United States federal income tax purposes. There can be
no assurance that the Company would not exercise its right to shorten the
maturity of the 2096 Debentures upon the occurrence of such a Tax Event.
In the event that the Company elects to exercise its right to shorten the
maturity of the 2096 Debentures on the occurrence of a Tax Event, the Company
will mail a notice of shortened maturity to each Holder of the 2096 Debentures
by first-class mail not more than 60 days after the occurrence of such Tax
Event, stating the new maturity date of the 2096 Debentures. Such notice shall
be effective immediately upon mailing.
The Company believes that the 2096 Debentures should constitute indebtedness
for United States federal income tax purposes under current law, and an
exercise of its right to shorten the maturity of the 2096 Debentures would not
be a taxable event to holders. Prospective investors should be aware, however,
that the Company's exercise of its right to shorten the maturity of the 2096
Debentures will be a taxable event to holders if the 2096 Debentures are
treated as equity for purposes of United States federal income taxation before
the maturity is shortened, assuming that the 2096 Debentures of shortened
maturity are treated as debt for such purposes.
"Tax Event" means that the Company shall have received an opinion of a
nationally recognized independent tax counsel to the effect that on or after
the date of the issuance of the 2096 Debentures, as a result of (a) any
amendment to, clarification of, or change (including any announced prospective
change) in laws, or any regulations thereunder, of the United States, (b) any
judicial decision, official administrative pronouncement, ruling, regulatory
procedure, notice or announcement, including any notice or announcement of
intent to adopt such procedures or regulations (an "Administrative Action"),
S-18
<PAGE>
or (c) any amendment to, clarification of, or change in the official position
or the interpretation of such Administrative Action or judicial decision that
differs from the theretofore generally accepted position, in each case, on or
after, the date of the issuance of the 2096 Debentures, such change in tax law
creates a more than insubstantial risk that interest paid by the Company on
the 2096 Debentures is not, or will not be, deductible, in whole or in part,
by the Company for purposes of United States federal income tax.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
the applicable Issuers have agreed to sell to each of the Underwriters named
below, and each of the Underwriters has severally agreed to purchase, the
principal amounts of the Debt Securities set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL PRINCIPAL
AMOUNT OF AMOUNT OF AMOUNT OF AMOUNT OF AMOUNT OF
FRENCH 2003 UK 2003 UK 2006 2026 2096
UNDERWRITERS NOTES NOTES NOTES DEBENTURES DEBENTURES
- ------------ ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
Salomon Brothers Inc ... $ 50,000,000 $ 50,000,000 $ 75,000,000 $ 87,500,000 $ 37,500,000
CS First Boston
Corporation............ 50,000,000 50,000,000 75,000,000 87,500,000 37,500,000
Chase Securities Inc. .. 50,000,000 50,000,000 75,000,000 87,500,000 37,500,000
J.P. Morgan Securities
Inc. .................. 50,000,000 50,000,000 75,000,000 87,500,000 37,500,000
------------ ------------ ------------ ------------ ------------
Total................. $200,000,000 $200,000,000 $300,000,000 $350,000,000 $150,000,000
============ ============ ============ ============ ============
</TABLE>
In the Underwriting Agreement, the several Underwriters have agreed, subject
to the terms and conditions set forth therein, to purchase all the Debt
Securities offered hereby if any Debt Securities are purchased. In the event
of default by any Underwriter, the Underwriting Agreement provides that, in
certain circumstances, the Underwriting Agreement may be terminated.
The Issuers have been advised by the Underwriters that the Underwriters
propose initially to offer the Debt Securities to the public at the public
offering price set forth on the cover page of this Prospectus Supplement, and
to certain dealers at such price less a concession of not more than .35% of
the principal amount of each of the French 2003 Notes and the UK 2003 Notes,
.40% of the principal amount of the UK 2006 Notes, .50% of the principal
amount of the 2026 Debentures and .675% of the principal amount of the 2096
Debentures. The Underwriters may allow and such dealers may reallow to certain
other dealers a concession of not more than .25% of the principal amount of
each of the Debt Securities. After the initial public offering, the public
offering price and such concessions may be changed.
The Debt Securities are a new issue of securities with no established
trading market. The Debt Securities have been approved for listing on the New
York Stock Exchange, subject to official notice of issuance, and the
Underwriters intend to make a market in the Debt Securities, subject to
applicable laws and regulations. However, the Underwriters are not obligated
to do so and may discontinue making a market at any time without notice.
Accordingly, there can be no assurance given as to the liquidity of the
trading market for the Debt Securities.
The Underwriting Agreement provides that the Issuers will indemnify the
several Underwriters against certain civil liabilities, including liabilities
under the Securities Act of 1933, or contribute to payments which the
Underwriters may be required to make in respect thereof.
S-19
<PAGE>
Certain Underwriters and their affiliates have from time to time provided,
and may in the future provide, investment banking and commercial banking
services to the Company, for which they received or will receive customary
fees.
Chase Securities Inc., one of the Underwriters, is an affiliate of The Chase
Manhattan Bank, which is an agent on and a lender under the Company's two
revolving credit facilities and otherwise engages in general financing and
banking transactions with the Company. The Company intends to use the net
proceeds of the offering to repay a portion of the loans outstanding under the
Acquisition Facility, and The Chase Manhattan Bank will receive its
proportionate share (approximately 12%) of such repayment. See "Use of
Proceeds." Because an affiliate of a member of the National Association of
Securities Dealers, Inc. (the "NASD") will receive more than 10% of the net
offering proceeds, the offering is being conducted in accordance with Rule
2710(c)(8) of the NASD's Conduct Rules.
The Bank of New York is a lender under one of the Company's two revolving
credit facilities and otherwise engages in general financing and banking
transactions with the Company.
EXPERTS
The financial statements incorporated in this Prospectus Supplement and the
accompanying Prospectus by reference to the Company's Annual Report on Form
10-K for the year ended December 31, 1995, have been so incorporated in
reliance on the report of Price Waterhouse LLP, independent accountants, given
on the authority of said firm as experts in auditing and accounting. The
audited financial statements of CarnaudMetalbox as of December 31, 1994 and
1993 and for each of the two years ending on December 31, 1994 and 1993
included in the Company's Current Report on Form 8-K filed on March 1, 1996,
as amended, incorporated by reference in this Prospectus Supplement and the
accompanying Prospectus have been so incorporated in reliance on the report of
Arthur Andersen LLP, independent accountants, and Befec-Price Waterhouse and
Claude Chevalier, statutory auditors, given on the authority of said firms as
experts in auditing and accounting. The audited financial statements of
CarnaudMetalbox as of December 31, 1995 and for the year ended December 31,
1995 included in such Current Report on Form 8-K have been so incorporated in
reliance on the report of Arthur Andersen LLP, independent accountants, and
Befec-Price Waterhouse and Salustro Reydel, statutory auditors, given on the
authority of said firms as experts in auditing and accounting.
S-20
<PAGE>
Rule 424(b)(2)
Registration No. 333-16869
PROSPECTUS
DEBT SECURITIES
CROWN CORK & SEAL COMPANY, INC. [LOGO OF CROWN CORK & SEAL
COMPANY, INC. APPEARS HERE]
CROWN CORK & SEAL FINANCE PLC
CROWN CORK & SEAL FINANCE S.A.
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY
CROWN CORK & SEAL COMPANY, INC.
Any of Crown Cork & Seal Company, Inc. (the "Company"), Crown Cork & Seal
Finance PLC, a public limited company organized under the laws of England and
Wales and an indirect wholly owned subsidiary of the Company, and Crown Cork &
Seal Finance S.A., a societe anonyme organized under the laws of the Republic
of France and an indirect wholly owned subsidiary of the Company (together with
Crown Cork & Seal Finance PLC, the "Subsidiary Issuers"), may offer and sell
from time to time its debt securities, consisting of debentures, notes and/or
other unsecured evidences of indebtedness (the "Debt Securities"), on terms to
be determined at the time of sale, through dealers, underwriters or agents to
be designated or directly to other purchasers, at an aggregate initial offering
price not exceeding $1,500,000,000 or its equivalent in another currency or
composite currency. The Company, in its capacity as an issuer, and the
Subsidiary Issuers are collectively referred to herein as the "Issuers." The
Debt Securities may be offered as separate series with the same or various
maturities. The specific designation, aggregate principal amount,
denominations, currency of payment, maturity, premium, if any, rate or rates
and times of payment of interest, if any, terms for any redemption at the
option of the applicable Issuer or the holder, terms for any sinking fund
payments, the initial public offering price, the net proceeds to the applicable
Issuer and any other specific terms in connection with the offering and sale of
the Debt Securities in respect of which this Prospectus is being delivered are
set forth in the accompanying Prospectus Supplement (the "Prospectus
Supplement").
The Debt Securities offered by the Subsidiary Issuers will be unconditionally
guaranteed (the "Guarantees") by the Company (in such capacity, the
"Guarantor"), and the Guarantees will rank on a parity with all unsecured and
unsubordinated indebtedness of the Company.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
The dealer's or other purchaser's purchase price or underwriter's or agent's
commission with respect to any Debt Securities is set forth in, or may be
calculated from, the Prospectus Supplement, and the net proceeds to the
applicable Issuer from such sale will be the purchase price of such Debt
Securities in the case of a dealer or other purchaser or the public offering
price less such commission in the case of an underwriter or agent, and less, in
each case, the other attributable issuance expenses. The aggregate proceeds to
the applicable Issuer from all the Debt Securities sold by such Issuer will be
the purchase price of Debt Securities sold less the aggregate of underwriters'
and agents' commissions and other expenses of issuance and distribution. See
"Plan of Distribution" for indemnification arrangements for the dealers, other
purchasers, underwriters and agents. This Prospectus may not be used to
consummate sales of Debt Securities unless accompanied by a Prospectus
Supplement.
The date of this Prospectus is December 12, 1996.
<PAGE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ANY SUBSIDIARY ISSUER OR ANY UNDERWRITER OR DEALER. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY
OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT
IS UNLAWFUL TO MAKE SUCH AN OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY
OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES,
CREATE ANY IMPLICATION THAT THE INFORMATION HEREIN IS CORRECT AS OF ANY TIME
SUBSEQUENT TO THE DATE HEREOF OR THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS
OF THE COMPANY OR ANY SUBSIDIARY ISSUER SINCE SUCH DATE.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Reports, proxy
statements and other information concerning the Company filed with the
Commission may be inspected and copied at the public reference facilities
maintained by the Commission at its principal office at 450 Fifth Street,
N.W., Washington, D.C. 20549 and at the regional offices of the Commission at
7 World Trade Center, 13th Floor, New York, New York 10048 and Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies
of such material can also be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed
rates. The Commission maintains a site on the world wide web that contains
reports, proxy and information statements and other information on
registrants, such as the Company, who must file such material with the
Commission electronically. The Commission's internet address on the world wide
web is http://www.sec.gov. In addition, material filed by the Company may also
be inspected at the office of the New York Stock Exchange, 20 Broad Street,
New York, New York 10005, on which exchange the Common Stock, par value $5.00
per share ("Common Stock"), of the Company and 4.5% Convertible Preferred
Stock, par value $41.8875 per share ("Preferred Stock"), of the Company are
listed.
The Company and, with respect to Debt Securities issued by the Subsidiary
Issuers, the Subsidiary Issuers have filed a registration statement on Form S-
3 (herein, together with all amendments and exhibits thereto, the
"Registration Statement") under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. For further
information, reference is made to the Registration Statement and the exhibits
filed as a part thereof. Statements contained herein concerning any document
filed as an exhibit are not necessarily complete and, in each instance,
reference is made to the copy of such document filed as an exhibit to the
Registration Statement. Each such statement is qualified in its entirety by
such reference.
Crown, on behalf of the Subsidiary Issuers, and each of the Subsidiary
Issuers have made application to the Commission for an order of the Commission
exempting each of the Subsidiary Issuers from the reporting requirements of
the Exchange Act. If such order is granted, or the Commission otherwise grants
relief to the Subsidiary Issuers from such reporting requirements, neither of
the Subsidiary Issuers will be subject to the informational requirements of
the Exchange Act. Subject to Commission relief, the Company also does not
intend to include in its consolidated financial statements any separate
financial information with respect to the Subsidiary Issuers. In addition, in
view of the guarantee of the Debt Securities given by the Company, none of the
Subsidiary Issuers intends to furnish to holders of Debt Securities separate
financial statements or other reports.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission (File No.
1-2227) pursuant to the Exchange Act are hereby incorporated by reference in
this Prospectus: (a) the Company's
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Annual Report on Form 10-K for the fiscal year ended December 31, 1995; (b)
the Company's Quarterly Reports on Form 10-Q for the quarters ended March 31,
1996 (as amended by the Company's Reports on Form 10-Q/A filed on May 16, 1996
and September 26, 1996), June 30, 1996 (as amended by the Company's Report on
Form 10-Q/A filed on September 26, 1996), and September 30, 1996; and (c) the
Company's Current Reports on Form 8-K filed on January 2, 1996, March 1, 1996
(as amended by the Company's Reports on Form 8-K/A filed on March 18, 1996,
May 3, 1996 and May 7, 1996), September 26, 1996, and October 15, 1996.
All other documents filed by the Company pursuant to Section 13(a), 13(c),
14 and 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the Debt Securities shall be
deemed to be incorporated by reference and to be a part of this Prospectus
from the date of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein or in any subsequently filed document
which also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a part of this
Prospectus. Certain statements contained herein or in the accompanying
Prospectus Supplement, including, without limitation, the statements in "The
Company" which are not historical facts, or incorporated by reference herein
constitute forward-looking statements as such term is defined in Section 27A
of the Securities Act and Section 21E of the Exchange Act. Certain factors as
discussed herein or in the Company's Exchange Act filings with the Commission,
including the Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1996, as amended, could cause actual results to differ materially
from those in the forward-looking statements. Unless otherwise specifically
provided herein or in any accompanying Prospectus Supplement, references to
"$" or "dollars" in this Prospectus or any such Prospectus Supplement shall
mean United States dollars.
THE COMPANY HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH PERSON TO
WHOM A COPY OF THIS PROSPECTUS IS DELIVERED, UPON ORAL OR WRITTEN REQUEST OF
ANY SUCH PERSON, A COPY OF ANY OR ALL OF THE DOCUMENTS INCORPORATED HEREIN BY
REFERENCE, OTHER THAN THE EXHIBITS TO SUCH DOCUMENTS (UNLESS SUCH EXHIBITS ARE
SPECIFICALLY INCORPORATED BY REFERENCE IN SUCH DOCUMENTS). REQUESTS SHOULD BE
DIRECTED TO CROWN CORK & SEAL COMPANY, INC., 9300 ASHTON ROAD, PHILADELPHIA,
PENNSYLVANIA 19136, ATTN: CORPORATE SECRETARY, TELEPHONE (215) 698-5100.
THE COMPANY
The Company is the leading supplier of packaging products to consumer
marketing companies around the world. World headquarters are located in
Philadelphia, Pennsylvania. Additional information with respect to the Company
will be set forth in the Prospectus Supplement. Reports, proxy statements and
other information concerning the Company also may be obtained as set forth
under "Available Information."
THE SUBSIDIARY ISSUERS
The Debt Securities may be issued directly by the Company or by either of
the following indirect wholly owned subsidiaries of the Company.
Crown Cork & Seal Finance PLC
Crown Cork & Seal Finance PLC is a public limited company organized under
the laws of England and Wales. The purpose of Crown Cork & Seal Finance PLC is
to undertake major borrowings on behalf of the Company and certain of its
subsidiaries and to advance the proceeds of such borrowings to the Company or
certain of its subsidiaries.
Crown Cork & Seal Finance S.A.
Crown Cork & Seal Finance S.A. is a societe anonyme organized under the laws
of the Republic of France. The purpose of Crown Cork & Seal Finance S.A. is to
undertake major borrowings on behalf of the Company and certain of its
subsidiaries and to advance the proceeds of such borrowings to the Company or
certain of its subsidiaries.
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<PAGE>
Enforceability of Certain Civil Liabilities
Crown Cork & Seal Finance PLC is a public limited company organized under
the Companies Act 1985 of England and Wales. Crown Cork & Seal Finance S.A. is
a societe anonyme organized under the laws of the Republic of France. Many of
the directors and executive officers of each of the Subsidiary Issuers (and
certain of the experts named in this Prospectus) are citizens or residents of
jurisdictions other than the United States. All or a substantial portion of
the assets of such directors, executive officers and experts residing outside
of the United States and all of the assets of the Subsidiary Issuers are or
may be located outside of the United States. As a result, it may not be
possible to effect service of process on such directors and executive
officers, such experts or on the Subsidiary Issuers in the United States or to
enforce, collect or realize, in United States courts, upon judgments that may
be obtained against such persons in United States courts and predicated upon
civil liability under United States securities laws. The Company and the
Subsidiary Issuers have been advised by Titmuss Sainer Dechert and Jeantet &
Associes, special United Kingdom and French counsel, respectively, to the
Company, that (a) there is doubt as to the enforceability in the United
Kingdom, in original actions or actions for the enforcement of judgments of
United States courts, of civil liabilities predicated solely on United States
federal securities laws; and (b) if an original action is brought in France,
predicated solely upon the United States federal securities laws, French
courts may not have the requisite jurisdiction to adjudicate such action or
grant the remedies sought, and that actions for enforcement in France of
judgments of United States courts, rendered against French persons referred to
in the second sentence of this paragraph would require such persons to waive
their right under Article 15 of the French Civil Code to be sued in France
only. The Company believes that none of such persons has waived such right
with respect to actions predicated solely upon United States federal
securities laws. In addition, actions in the United States under United States
federal securities laws could be affected under certain circumstances by the
French law of July 16, 1980, which may preclude or restrict the obtaining of
evidence in France or from French persons in connection with such actions. The
indenture pursuant to which the Debt Securities will be issued will provide
that each of the Subsidiary Issuers will appoint CT Corporation as its agent
for service of process in any suit, action or proceeding with respect to such
indenture brought under federal or state securities laws in any federal or
state court located in the City of New York, and will submit to such
jurisdiction.
USE OF PROCEEDS
Unless otherwise described in the applicable Prospectus Supplement, the net
proceeds from the sale of the Debt Securities will be used for general
corporate purposes of the Company and its subsidiaries, including repayment of
indebtedness, working capital, capital expenditure or other corporate
purposes.
DESCRIPTION OF DEBT SECURITIES AND GUARANTEES
The Debt Securities and Guarantees are to be issued under an Indenture,
dated as of December 17, 1996 (the "Indenture"), among the Company, the
Subsidiary Issuers and The Bank of New York, as Trustee (the "Trustee"), a
form of which has been filed with the Commission as an exhibit to the
Registration Statement. The following summaries of certain provisions of the
Indenture do not purport to be complete and are subject to, and are qualified
in their entirety by reference to, all provisions of the Indenture.
Capitalized terms are defined in the Indenture unless otherwise defined
herein. Wherever particular provisions or defined terms of the Indenture are
referred to, such provisions or defined terms are incorporated herein by
reference. The following sets forth certain general terms and provisions of
the Debt Securities and Guarantees. The particular terms of each series, or of
Debt Securities forming a part of a series, which are offered by a Prospectus
Supplement will be described in such Prospectus Supplement.
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<PAGE>
GENERAL
The Indenture provides for the issuance, from time to time in one or more
series, of unsecured obligations of the applicable Issuer, which may be
debentures, notes or other evidences of indebtedness ("Debt Securities"). The
Company will irrevocably and unconditionally guarantee payments of principal,
interest, premium and Additional Amounts, if any, on any Debt Securities
issued by a Subsidiary Issuer. The Indenture does not limit the amount of Debt
Securities that may be authenticated and delivered thereunder. Each series of
Debt Securities may be established in or pursuant to a resolution of the
Issuer's Board of Directors or in one or more indentures supplemental to the
Indenture. The Indenture does not limit the amount of other indebtedness or
securities that may be issued by the Issuers.
The applicable Prospectus Supplement will name the Issuer, set forth the
price or prices at which the Debt Securities to be offered will be issued and
describe the following terms of such Debt Securities: (a) the title of such
Debt Securities; (b) any limit on the aggregate principal amount of such Debt
Securities; (c) the date or dates on which the principal of, and any premium
on, such Debt Securities is payable; (d) the rate or rates at which such Debt
Securities will bear interest, if any, and the date from which such interest,
if any, will accrue; (e) the dates on which such interest, if any, will be
payable and the Regular Record Dates for such Interest Payment Dates; (f) the
place or places where the principal of and any premium or interest on such
Debt Securities shall be payable and where any of such Debt Securities may be
surrendered for exchange and notices and demands in respect of the Debt
Securities and the Indenture may be served; (g) the period or periods within
which, the price or prices at which, the currency or currency unit in which,
and the terms and conditions upon which such Debt Securities may, pursuant to
any optional or mandatory redemption provisions, be redeemed; (h) the
obligation, if any, of the applicable Issuer to redeem or purchase such Debt
Securities pursuant to any sinking fund or analogous provisions or at the
option of a Holder thereof and the period or periods within which, the price
or prices at which, the currency or currency unit in which, and the terms and
conditions upon which such Debt Securities shall be redeemed or purchased, in
whole or in part, pursuant to such obligation; (i) if other than denominations
of $1,000 and any integral multiple thereof, the denomination in which such
Debt Securities shall be issuable; (j) if other than the principal amount
thereof, the portion of the principal amount of such Debt Securities payable
upon declaration of acceleration of the maturity thereof; (k) any additional
events of default or covenants applicable to such Debt Securities; (l) if
other than U.S. dollars, the currency or currency unit in which payment of the
principal of and any premium or interest on such Debt Securities shall be made
or in which such Debt Securities shall be denominated and the particular
provisions applicable thereto; (m) if the principal of and any premium or
interest on such Debt Securities are to be payable, at the election of the
applicable Issuer or a Holder thereof, in a currency or currency unit other
than that in which such Debt Securities are denominated or stated to be
payable, the currency or currency unit in which the principal of (and premium,
if any) and interest, if any, on such Debt Securities as to which such
election is made shall be payable, the period or periods within which, and the
terms and conditions upon which, such election may be made, and the time and
manner of determining the exchange rate between the currency or currency unit
in which such Debt Securities are denominated or stated to be payable and the
currency or currency unit in which such Debt Securities are to be so payable;
(n) if the amount of payments of the principal of and any premium or interest
on such Debt Securities may be determined with reference to an index based on
a currency or currency unit other than that in which such Debt Securities are
denominated or stated to be payable or any other index or formula, the manner
in which such amounts shall be determined; (o) if applicable, if the Debt
Securities will be entitled to the benefits of the Guarantees afforded by the
Indenture, or otherwise the form of any Guarantees to be endorsed on the Debt
Securities; (p) where appropriate, that such Debt Securities, in whole or any
specified part, are not defeasible pursuant to the provisions of the
Indenture; (q) whether such Debt Securities shall be issued in whole or in
part in the form of one or more Global Securities (as described below under
"--Global Securities in Registered Form" and "--Global Securities in Bearer
Form") and, in such case, the Depositary or Bearer Security Depositary for
such Global Security or Securities, and whether such
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<PAGE>
Global Security or Securities shall be temporary or permanent; and whether
such Debt Securities shall be issued in bearer form (including Securities
registrable as to principal only) with or without interest coupons and the
exchangeability of such Debt Securities for Debt Securities in fully
registered form; (r) if such Debt Securities of any series may be converted
into or exchanged for any other securities, the terms and conditions of such
conversion or exchange; and (s) any other terms of such Debt Securities, which
terms shall not be inconsistent with the provisions of the Indenture (Section
3.01).
Unless otherwise indicated below or in the applicable Prospectus Supplement,
the Debt Securities of the Company and Crown Cork & Seal Finance S.A. will be
issued only in fully registered form without coupons, the Debt Securities of
Crown Cork & Seal Finance PLC will be issued only in bearer form without
coupons in a Global Security held initially by the Bearer Security Depositary,
and, in any case, the Debt Securities will be in denominations and currencies
as established by a resolution of the applicable Issuer's Board of Directors
if other than denominations of $1,000 or any integral multiple thereof. No
service charge will be made for any registration of transfer or exchange or
redemption of the Debt Securities, but the applicable Issuer may require
payment of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith (Sections 3.02 and 3.05).
Debt Securities may be issued as Discounted Securities (bearing no interest
or interest at a rate which at the time of issuance is below market rates) to
be sold at a substantial discount below their principal amount. Certain United
States federal income tax and other considerations applicable thereto are
described herein, and any special United States federal income tax
considerations will be described in the applicable Prospectus Supplement. In
addition, special United States federal income tax and other considerations
applicable to any Debt Securities which are denominated in a currency,
currencies or currency units (including composite currencies) other than US
dollars will be described in the applicable Prospectus Supplement.
The Company anticipates that Crown Cork & Seal Finance S.A. will issue only
Debt Securities meeting the definition of "obligations" under Article 284 of
the French company law of July 24, 1966, providing generally, among other
things, that such Debt Securities must have a minimum maturity of five years.
The terms of the Debt Securities and the Indenture do not afford Holders of
the Debt Securities protection in the event of a highly leveraged transaction
involving the Company or a Subsidiary Issuer that may adversely affect Holders
of the Debt Securities.
GUARANTEES
The Company will irrevocably and unconditionally guarantee to each Holder of
a Debt Security issued by a Subsidiary Issuer the due and punctual payment of
the principal of, and any premium, interest and Additional Amounts on, such
Debt Security, when and as the same shall become due and payable, whether at
maturity, upon acceleration, by call for redemption or otherwise. The Company
has (a) agreed that its obligations under the Guarantees in the event of an
Event of Default will be as if it were principal obligor and not merely
surety, and will be enforceable irrespective of any invalidity, irregularity
or unenforceability of any series of the Debt Securities or the Indenture or
any supplement thereto and (b) waived its right to require the Trustee or the
Holders to pursue or exhaust its legal or equitable remedies against the
applicable Subsidiary Issuer prior to exercising its rights under the
Guarantees.
RANKING
The Debt Securities issued by the Company and the Guarantees will be
unsecured obligations of the Company, and will rank on a parity with all other
unsecured and unsubordinated indebtedness of the Company. The Debt Securities
issued by a Subsidiary Issuer will be unsecured obligations of such Subsidiary
Issuer, and will rank on a parity with all other unsecured and unsubordinated
indebtedness of such Subsidiary Issuer.
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Dividend and other distributions to the Company from its various
subsidiaries may be subject to certain statutory, contractual and other
restrictions (including, without limitation, exchange controls that may be
applicable to foreign subsidiaries). The rights of any creditors of the
Company to participate in the assets of any subsidiary upon such subsidiary's
liquidation or recapitalization will be subject to the prior claims of the
subsidiary's creditors, except to the extent that the Company may itself be a
creditor with recognized claims against such subsidiary. The claims of Holders
under the Debt Securities or the Guarantees will be effectively subordinated
to the claims of creditors of the Company's subsidiaries. The Indenture does
not restrict the amount of indebtedness that may be incurred by the Company or
its subsidiaries.
GLOBAL SECURITIES IN REGISTERED FORM
Unless otherwise specified in the applicable Prospectus Supplement, the
following provisions will apply to Debt Securities issued by the Company or
Crown Cork & Seal Finance S.A.
General. The Debt Securities of a series may be issued in whole or in part
in the form of one or more Global Securities in registered form. Such Global
Securities will be registered in the name of, and deposited with, or on behalf
of, a depositary (the "Depositary") identified in the Prospectus Supplement
relating to such series. Global Securities may be issued in either temporary
or permanent form. Except as otherwise set forth below, unless and until it is
exchanged for Debt Securities in definitive form, a Global Security may not be
transferred except as a whole by the Depositary for such Global Security to a
nominee of such Depositary or by a nominee of such Depositary to such
Depositary or another nominee of such Depositary or by such Depositary or any
such nominee to a successor of such Depositary or a nominee of such successor
(Sections 3.01 and 3.11).
Upon the issuance of a Global Security, the Depositary for such Global
Security or its nominee will credit the accounts of persons held with it with
the respective principal amounts of the Debt Securities represented by such
Global Security. Such accounts shall be designated by the underwriters or
agents with respect to such Debt Securities or by the applicable Issuer if
such Debt Securities are offered and sold directly by such Issuer. Ownership
of beneficial interest in a Global Security will be limited to persons that
have accounts with the Depositary for such Global Security or its
nominee ("participants"), or persons that may hold interests through
participants. Ownership of beneficial interests in such Global Security will
be shown on, and the transfer of that ownership will be effected only through,
records maintained by the Depositary for such Global Security or by
participants or persons that hold through participants. The laws of some
states require that certain purchasers of securities take physical delivery of
such securities in definitive form. Such laws may impair the ability to
transfer beneficial interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
owner of such Global Security, such Depositary or such nominee, as the case
may be, will be considered the sole Holder of the Debt Securities represented
by such Global Security for all purposes under the Indenture governing such
Debt Securities. Accordingly, each person holding a beneficial interest in a
Global Security must rely on the procedures of the Depositary and the
participants through which such person owns such beneficial interest to
exercise any rights and obligations of a Holder under the Indenture. Unless
otherwise specified in the Prospectus Supplement, and except as set forth
below, owners of beneficial interests in a Global Security will not be
entitled to have Debt Securities of the series represented by such Global
Security registered in their names, will not receive or be entitled to receive
physical delivery of Debt Securities of such series in definitive form and
will not be considered the Holders thereof under the Indenture governing such
Debt Securities.
Payments on Global Securities. Payments of principal of and any premium and
interest on the Debt Securities registered in the name of or held by a
Depositary or its nominee will be made to the Depositary or its nominee, as
the case may be, as the Holder of the Global Security representing such Debt
Securities. Neither the Company, the Issuer nor the Trustee for such Debt
Securities will have any responsibility or liability for any aspect of the
records relating to or payments made on account of
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beneficial ownership interests in a Global Security for such Debt Securities
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests.
The Company and Crown Cork & Seal Finance S.A. expect that the Depositary
for Debt Securities of a series, upon receipt of any payment of principal of
and any premium and interest on the Debt Securities in respect of a permanent
Global Security, will credit immediately participants' accounts with payments
in amounts proportionate to their respective beneficial interests in the
principal amount of such Global Security as shown on the records of such
Depositary. The Company and Crown Cork & Seal Finance S.A. also expect that
payments by participants to owners of beneficial interests in such Global
Security held through such participants will be governed by standing
instructions and customary practices, as is now the case with the securities
held for the accounts of customers in bearer form or registered in "street
name," and will be the responsibility of such participants. Receipt by owners
of beneficial interest in a temporary Global Security of payments in respect
of such temporary Global Security may be subject to restrictions. Any such
restrictions will be described in the Prospectus Supplement relating thereto.
Issuance of Definitive Debt Securities. If a Depositary for Debt Securities
of a series is at any time unwilling or unable to continue as Depositary or no
longer registered or in good standing under the Exchange Act or other statute
or regulation, and a successor depositary is not appointed by the applicable
Issuer, such Issuer will issue Debt Securities of such series in definitive
form in exchange for the Global Security or Debt Securities representing Debt
Securities of such series. In addition, if an Event of Default shall have
occurred and be continuing under the Indenture with respect to any series of
Debt Securities, any Holder of such Debt Securities will be entitled to
request and to receive definitive Debt Securities. The applicable Issuer may
at any time and in its sole discretion determine not to have any Debt
Securities of a series represented by one or more Global Securities and, in
such event, will issue Debt Securities of such series in definitive form in
exchange for the Global Security or Debt Securities representing Debt
Securities. Further, if the applicable Issuer so specifies with respect to the
Debt Securities of a series, each Person specified by the Depositary of the
Global Security representing Debt Securities of such series may, on terms
acceptable to such Issuer and the Depositary for such Global Security, receive
Debt Securities of such series in definitive form. In any such instance, each
Person so specified by the Depositary of the Global Security will be entitled
to physical delivery in definitive form of Debt Securities of the series
represented by such Global Security equal in principal amount to such Person's
beneficial interest in the Global Security (Sections 3.01 and 3.11).
GLOBAL SECURITIES IN BEARER FORM
Unless otherwise specified in the applicable Prospectus Supplement, the
following provisions will apply to Debt Securities issued by Crown Cork & Seal
Finance PLC.
General. The Debt Securities of a series may be issued in whole or in part
in the form of one or more Global Securities in bearer form. Such Global
Securities will be deposited with, or on behalf of, a bearer security
depositary (the "Bearer Security Depositary") identified in the Prospectus
Supplement relating to such series. Pursuant to a Bearer Security Depositary
Agreement, such Bearer Security Depositary will issue certificateless
depositary interests (representing a 100% interest in the underlying Global
Securities) to the Depositary identified in the Prospectus Supplement relating
to such series. For a summary of certain provisions of the Bearer Security
Depositary Agreement, see "--Description of the Bearer Security Depositary
Agreement" below.
Global Securities may be issued in either temporary or permanent form.
Except as otherwise set forth below, unless and until a Global Security is
exchanged for Debt Securities in definitive form, (a) a Global Security held
by a Bearer Security Depositary may not be transferred except as a whole by
such Bearer Security Depositary to a nominee thereof or by a nominee thereof
to such Bearer Security Depositary or another nominee thereof or by the Bearer
Security Depositary or any such nominee to a successor of such Bearer Security
Depositary or a nominee of such successor and (b) the
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certificateless depositary interests in a Global Security held by a Depositary
may not be transferred except as a whole by such Depositary to a nominee
thereof or by a nominee thereof to such Depositary or another nominee thereof
or by such Depositary or any such nominee to a successor of such Depositary or
a nominee of such successor (Sections 3.01 and 3.12).
Upon confirmation by the Depositary that the Bearer Security Depositary has
custody of the Global Security and upon acceptance by the Depositary of the
certificateless depositary interests in such Global Security, the Depositary
for such Global Security or its nominee will credit the accounts of persons
held with it with the respective principal amounts of the Debt Securities
represented by such Global Security. Such accounts shall be designated by the
underwriters or agents with respect to such Debt Securities or by the
applicable Issuer if such Debt Securities are offered and sold directly by
such Issuer. Ownership of beneficial interest in a Global Security will be
limited to persons that have accounts with the Depositary for such Global
Security or its nominee ("participants"), or persons that may hold interests
through participants. Ownership of beneficial interests in such Global
Security will be shown on, and the transfer of that ownership will be effected
only through, records maintained by the Depositary for such Global Security or
by participants or persons that hold through participants. The laws of some
states require that certain purchasers of securities take physical delivery of
such securities in definitive form. Such laws may impair the ability to
transfer beneficial interests in a Global Security.
So long as the Bearer Security Depositary or its nominee is the holder of
the Global Security, the Bearer Security Depositary for a Global Security, or
its nominee, as the case may be, will be considered the sole Holder of the
Debt Securities represented by such Global Security for all purposes under the
Indenture governing such Debt Securities. Accordingly, each person holding a
beneficial interest in a Global Security must rely on the procedures of the
Bearer Security Depositary and the Depositary and the participants through
which such persons owns such beneficial interest to exercise any rights and
obligations of a Holder under the Indenture. Unless otherwise specified in the
Prospectus Supplement, and except as set forth below, owners of beneficial
interests in a Global Security will not be entitled to have Debt Securities of
the series represented by such Global Security registered in their names, will
not receive or be entitled to receive physical delivery of Debt Securities of
such series in definitive form and will not be considered the Holders thereof
under the Indenture governing such Debt Securities.
Payments on Global Securities. Payments of principal of and any premium and
interest on the Debt Securities held by a Bearer Security Depositary or its
nominee will be made to the Bearer Security Depositary or its nominee, as the
case may be, as the Holder of the Global Security representing such Debt
Securities. All such amounts will be payable by a Paying Agent located outside
of the United Kingdom. Upon receipt of any payment of principal of and any
premium and interest on the Debt Securities, the Bearer Security Depositary
will distribute all such payments to the Depositary. Neither the Company, the
Issuer nor the Trustee for such Debt Securities will have any responsibility
or liability for any aspect of the records relating to or payments made on
account of beneficial ownership interests in a Global Security for such Debt
Securities or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests.
Crown Cork & Seal Finance PLC expects that the Depositary for Debt
Securities of a series, upon receipt of any payment of principal of and any
premium and interest on the Debt Securities in respect of a permanent Global
Security, will credit immediately participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the
principal amount of such Global Security as shown on the records of such
Depositary. Crown Cork & Seal Finance PLC also expects that payments by
participants to owners of beneficial interests in such Global Security held
through such participants will be governed by standing instructions and
customary practices, as is now the case with the securities held for the
accounts of customers in bearer form or registered in "street name," and will
be the responsibility of such participants. Receipt by owners of beneficial
interest in a temporary Global Security of payments in respect of such
temporary Global Security may be subject to restrictions. Any such
restrictions will be described in the Prospectus Supplement relating thereto.
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Issuance of Definitive Debt Securities. If a Depositary or a Bearer Security
Depositary for Debt Securities of a series is at any time unwilling or unable
to continue as Depositary or Bearer Security Depositary, as the case may be,
or such Depositary is no longer registered or in good standing under the
Exchange Act or other statute or regulation, and a successor depositary or
bearer security depositary, as the case may be, is not appointed by the
applicable Issuer, such Issuer will issue Debt Securities of such series in
definitive form in exchange for the Global Security or Debt Securities
representing Debt Securities of such series. In addition, if an Event of
Default shall have occurred and be continuing under the Indenture with respect
to any series of Debt Securities, any Holder of such Debt Securities will be
entitled to request and receive definitive Debt Securities. The applicable
Issuer may at any time and in its sole discretion determine not to have any
Debt Securities of a series represented by one or more Global Securities and,
in such event, will issue Debt Securities of such series in definitive form in
exchange for the Global Security or Debt Securities representing Debt
Securities. Further, if the applicable Issuer so specifies with respect to the
Debt Securities of a series, each Person specified by the Bearer Security
Depositary of the Global Security representing Debt Securities of such series
may, on terms acceptable to such Issuer, the Bearer Security Depositary and
the Depositary for such Global Security, receive Debt Securities of such
series in definitive form. In any such instance, each Person so specified by
the Bearer Security Depositary will be entitled to physical delivery in
definitive form of Debt Securities of the series represented by such Global
Security equal in principal amount to such Person's beneficial interest in the
Global Security. If any definitive Debt Securities are issued, they will be
issued only in registered form (Sections 3.01, 3.11 and 3.12).
HOLDERS SHOULD BE AWARE THAT, UNDER CURRENT UNITED KINGDOM TAX LAW, UPON THE
ISSUANCE TO A HOLDER OF DEFINITIVE DEBT SECURITIES, SUCH HOLDER WILL BECOME
SUBJECT TO UNITED KINGDOM INCOME TAX (CURRENTLY 20%) TO BE WITHHELD ON ANY
PAYMENTS OF INTEREST ON THE DEBT SECURITIES AS SET FORTH UNDER "TAXATION--
UNITED KINGDOM TAX CONSIDERATIONS." IF SUCH DEFINITIVE DEBT SECURITIES ARE
ISSUED PURSUANT TO THE REQUEST OF A HOLDER FOLLOWING AN EVENT OF DEFAULT,
CROWN CORK & SEAL FINANCE PLC WILL NOT BE OBLIGATED TO PAY ANY ADDITIONAL
AMOUNTS WITH RESPECT TO SUCH DEBT SECURITIES. However, United States holders
of definitive Debt securities may be entitled to receive a refund of withheld
amounts from the United Kingdom Inland Revenue in certain circumstances. See
"Taxation--United Kingdom Tax Considerations." In addition, if a holder of a
beneficial interest in a Debt Security receives definitive Debt Securities
other than pursuant to its request, such holder will be entitled to receive
Additional Amounts with respect to such Debt Securities. See "--Payment of
Additional Amounts."
Description of the Bearer Security Depositary Agreement. The following
summary of certain provisions of the Bearer Security Depositary Agreement does
not purport to be complete and is subject to, and is qualified in its entirety
by reference to, all provisions of the Bearer Security Depositary Agreement, a
form of which has been filed with the Commission as an exhibit to the
Registration Statement.
As soon as practicable after receipt by the Bearer Security Depositary of
notice of any solicitation of consents or request for a waiver or other action
by the holders of beneficial interests in a Global Security, the Bearer
Security Depositary will mail to the Depositary a notice containing (a) such
information as is contained in such notice, (b) a statement that at the close
of business on a specified record date the Depositary will be entitled to
instruct the Bearer Security Depositary as to the consent, waiver or other
action, if any, pertaining to the Global Securities, and (c) a statement as to
the manner in which such instructions may be given. Upon the written request
of the Depositary, the Bearer Security Depositary shall endeavor insofar as
practicable to take such action regarding the requested consent, waiver or
other action in respect of the Global Securities in accordance with any
instructions set forth in such request. The Depositary is expected to follow
the procedures described under
"--Global Securities in Bearer Form--General" above with respect to soliciting
instructions from its participants. The Bearer Security Depositary will not
exercise any discretion in the granting of consents or waivers or the taking
of any other action relating to the Bearer Security Depositary Agreement or
the Indenture.
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The Bearer Security Depositary will immediately send to the Depositary a
copy of any notices, reports and other communications received relating to
Crown Cork & Seal Finance PLC or the Global Securities issued by Crown Cork &
Seal Finance PLC.
Upon the occurrence of a default with respect to the Global Securities, or
in connection with any other right of the Holder of the Global Security under
the Indenture or the Bearer Security Depositary Agreement, if requested in
writing by the Depositary, the Bearer Security Depositary will take any such
action as shall be requested in such notice, provided that the Bearer Security
Depositary has been offered reasonable security or indemnity against the
costs, expenses and liabilities that might be incurred by it in compliance
with such request by the holders of beneficial interests in a Global Security.
The Company and Crown Cork & Seal Finance PLC have agreed to pay all charges
of the Bearer Security Depositary under the Bearer Security Depositary
Agreement. The Company and Crown Cork & Seal Finance PLC have also agreed to
indemnify the Bearer Security Depositary against certain liabilities incurred
by it under the Bearer Security Depositary Agreement.
The Bearer Security Depositary Agreement may be amended by agreement among
the Company, Crown Cork & Seal Finance PLC and the Bearer Security Depositary.
The consent of the Depositary shall not be required in connection with any
amendment to the Bearer Security Depositary Agreement: (a) to cure any
inconsistency or ambiguity in such Agreement; (b) to add to the covenants and
agreements of the Bearer Security Depositary, the Company or Crown Cork & Seal
Finance PLC; (c) to effectuate the assignment of the Bearer Security
Depositary's rights and duties to a qualified successor; (d) to comply with
the Securities Act, the Exchange Act or the Investment Company Act of 1940, as
amended; or (e) to modify, alter, amend or supplement the Bearer Security
Depositary Agreement in any other manner that is not adverse to the Depositary
or the holders of beneficial interests in a Global Security. Except as set
forth above, no amendment that adversely affects the Depositary may be made to
the Bearer Security Depositary Agreement or any Global Security without the
consent of the Depositary.
Upon the issuance of definitive Debt Securities, the Bearer Security
Depositary Agreement will terminate. The Bearer Security Depositary Agreement
may be terminated upon the resignation of the Bearer Security Depositary if no
successor has been appointed within 90 days as set forth below.
The Bearer Security Depositary may at any time resign as Bearer Security
Depositary by written notice delivered to each of the Company, Crown Cork &
Seal Finance PLC and the Trustee, such resignation to take effect upon the
appointment by Crown Cork & Seal Finance PLC of a successor bearer security
depositary and its acceptance of such appointment. If at the end of 90 days
after delivery of such notice, no successor bearer security depositary has
been appointed and has accepted such appointment, the Bearer Security
Depositary may terminate the Bearer Security Depositary Agreement.
The Bearer Security Depositary will assume no obligation or liability under
the Bearer Security Agreement other than to use good faith and reasonable care
in the performance of its duties under such Agreement.
INFORMATION REGARDING DTC
If the Depositary Trust Company ("DTC") is named as the Depositary in
respect of any series of Debt Securities or any certificateless depositary
interests therein, unless otherwise specified in the applicable Prospectus
Supplement, the following information relating to DTC will apply.
DTC is a limited purpose trust company organized under the New York Banking
Law, a "banking organization" within the meaning of the New York Banking Law,
a member of the Federal Reserve
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System, a "clearing corporation" within the meaning of the New York Uniform
Commercial Code, and a "clearing agency" registered pursuant to the provisions
of Section 17A of the Exchange Act. DTC was created to hold securities of its
participants and to facilitate the clearance and settlement of transactions
among its participants in such securities through electronic book-entry
changes in accounts of the participants, thereby eliminating the need for
physical movement of securities certificates. DTC participants include
securities brokers and dealers (including the Underwriters), banks, trust
companies, clearing corporations and certain other organizations, some of whom
(and/or their representatives) own DTC.
Payment of principal of and any premium, interest and Additional Amounts on
any Global Security will be made in immediately available funds. Beneficial
interests in any Global Security will trade in DTC's Same-Day Funds Settlement
System, and secondary market trading activity in such interest will therefore
settle in same-day funds.
PAYMENT OF ADDITIONAL AMOUNTS
All payments of, or in respect of, principal of and any premium and interest
on any Debt Securities issued by a Subsidiary Issuer shall be made without
withholding or deduction for, or on account of, any present or future taxes,
duties, levies, assessments or governmental charges of whatever nature imposed
or levied by or on behalf of the jurisdiction (or any political subdivision or
taxing authority thereof or therein) in which the Subsidiary Issuer is
incorporated or resident (or deemed for tax purposes to be resident) (the
"applicable taxing jurisdiction"), unless such taxes, duties, levies,
assessments or governmental charges are required by the applicable taxing
jurisdiction or any such subdivision or authority to be withheld or deducted.
In that event, the Subsidiary Issuer will pay by way of additional interest
such additional amounts of, or in respect of, principal of and any premium and
interest ("Additional Amounts") as will result (after deduction of such taxes,
duties, levies, assessments or governmental charges and any additional taxes,
duties, levies, assessments or governmental charges payable in respect of such
Additional Amounts) in the payment to each Holder of such Debt Securities of
the amounts which would have been payable in respect of such Debt Securities
had no such withholding or deduction been required, except that no Additional
Amounts shall be so payable for or on account of:
(a) any tax, duty, levy, assessment or other governmental charge which
would not have been imposed but for the fact that such Holder:
(i) was a resident, domiciliary or national of, or engaged in
business or maintained a permanent establishment or was physically
present in, the applicable taxing jurisdiction or otherwise had some
connection with the applicable taxing jurisdiction other than the mere
ownership of such Debt Security;
(ii) presented (if presentation is required) such Debt Security for
payment in the applicable taxing jurisdiction, unless such Debt
Security could not have been presented for payment elsewhere; or
(iii) presented (if presentation is required) such Debt Security, as
the case may be, more than 30 days after the date on which the payment
in respect of such Debt Security first became due and payable or
provided for, whichever is later, except to the extent that the Holder
would have been entitled to such Additional Amounts if it had presented
such Debt Security for payment on any day within such period of 30
days;
(b) any estate, inheritance, gift, sale, transfer, personal property or
similar tax, assessment or other governmental charge;
(c) any tax, assessment or other governmental charge which is payable
otherwise than by withholding or deduction from payments of, or in respect
of, principal of or any premium or interest on the Debt Securities;
(d) any tax, assessment or other governmental charge that is imposed or
withheld by reason of the failure to comply by the Holder or the beneficial
owner of a Debt Security with a request of
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the applicable Subsidiary Issuer addressed to the Holder (i) to provide
information concerning the nationality, residence or identity of the Holder
or such beneficial owner or (ii) to make any declaration or other similar
claim or satisfy any information or reporting requirement, which, in the
case of (i) or (ii), is required or imposed by a statute, treaty,
regulation or administrative practice of the applicable taxing jurisdiction
as a precondition to exemption from all or part of such tax, assessment or
other governmental charge; or
(e) any combination of items (a), (b), (c) and (d);
nor shall Additional Amounts be paid with respect to any payment of the
principal of or any premium or interest on any such Debt Security to any
Holder who is a fiduciary or partnership or other than the sole beneficial
owner of such payment to the extent such payment would be required by the laws
of the applicable taxing jurisdiction to be included in the income for tax
purposes of a beneficiary or settlor with respect to such fiduciary or a
member of such partnership or a beneficial owner who would not have been
entitled to such Additional Amounts had it been the Holder of the Debt
Security (Section 10.07).
Whenever there is mentioned, in any context, the payment of principal of, or
any premium or interest on, or in respect of, any Debt Securities of any
series issued by a Subsidiary Issuer or the net proceeds received on the sale
or exchange of any Debt Security of any series issued by a Subsidiary Issuer,
such mention shall be deemed to include mention of the payment of Additional
Amounts provided for in the Indenture to the extent that, in such context,
Additional Amounts are, were or would be payable in respect thereof pursuant
to the Indenture.
REDEMPTION FOR TAXATION REASONS
If as the result of any change in or any amendment to the laws, regulations
or published tax rulings of the applicable taxing jurisdiction affecting
taxation, or any change in the official administration, application or
interpretation of such laws, regulations or published tax rulings either
generally or in relation to any Debt Securities issued by a Subsidiary Issuer,
which change or amendment becomes effective on or after the original issue
date of such Debt Securities or which change in official administration,
application or interpretation shall not have been available to the public
prior to such issue date, it is determined by the applicable Subsidiary Issuer
that such Subsidiary Issuer (a) would be required to pay any Additional
Amounts pursuant to the Indenture or the terms of any Debt Security (i) in
respect of interest on the next succeeding Interest Payment Date or (ii) in
respect of the principal of any Discounted Securities on the date of such
determination, assuming that a payment in respect of such principal were
required to be made on such date under the terms of the Debt Securities, and
(b) such obligation cannot be avoided by the Company or the Subsidiary Issuer
taking reasonable measures available to it, in either case (i) or (ii) above
the Subsidiary Issuer may, at its option, redeem all (but not less than all)
the Debt Securities of any series in respect of which such Additional Amounts
would be so payable at any time, upon not less than 30 nor more than 60 days'
written notice as provided in the Indenture, at a Redemption Price equal to
100% of the principal amount thereof plus accrued interest to the date fixed
for redemption (except that any such Debt Securities that are Outstanding
Discounted Securities may be redeemed at the Redemption Price specified in the
terms thereof); provided, however, that (a) no such notice of redemption may
be given earlier than 60 days prior to the earliest date on which the
applicable Subsidiary Issuer would be obligated to pay such Additional Amounts
were a payment then due in respect of the Debt Securities, and (b) at the time
any such redemption notice is given, such obligation to pay such Additional
Amounts must remain in effect. If (a) the applicable Subsidiary Issuer shall
have on any date (the "Succession Date") consolidated with or merged into, or
conveyed or transferred or leased its properties and assets substantially as
an entirety to, any Successor referred to under "--Merger and Consolidation"
below which is organized under the laws of any jurisdiction other than the
United States of America, any State thereof or the District of Columbia or the
jurisdiction in which the Subsidiary Issuer is organized, (b) as the result of
any change in or any amendment to the laws, regulations or published tax
rulings of such
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jurisdiction of organization, or of any political subdivision or taxing
authority thereof or therein, affecting taxation, or any change in the
official administration, application or interpretation of such laws,
regulations or published tax rulings either generally or in relation to any
particular Debt Securities, which change or amendment becomes effective on or
after the Succession Date or which change in official administration,
application or interpretation shall not have been available to the public
prior to such Succession Date and is notified to the Subsidiary Issuer of such
series of Debt Securities, such Successor would be required to pay any
Successor Additional Amounts (as defined under "--Merger and Consolidation"
below) pursuant to the Indenture or the terms of any Debt Securities (i) in
respect of interest on any Debt Securities on the next succeeding Interest
Payment Date, or (ii) in respect of the principal of any Discounted Securities
on the date of such determination (assuming such principal were required to be
paid on such date under the terms of the Debt Securities) and (c) such
obligation cannot be avoided by the Company or such Successor taking
reasonable measures available to it, such Subsidiary Issuer or Successor may
at its option, redeem all (but not less than all) of the Debt Securities of
any series in respect of which such Successor Additional Amounts would be so
payable at any time, upon not less than 30 nor more than 60 days' written
notice as provided in the Indenture, at a Redemption Price equal to 100% of
the principal amount thereof plus accrued interest to the date fixed for
redemption (except that any such Debt Securities that are Outstanding
Discounted Securities may be redeemed at the Redemption Price specified in the
terms thereof); provided, however, that (a) no such notice of redemption may
be given earlier than 60 days prior to the earliest date on which a Successor
would be obligated to pay such Successor Additional Amounts were a payment
then due in respect of the Debt Securities, and (b) at the time any such
redemption notice is given, such obligation to pay such Successor Additional
Amounts must remain in effect (Section 11.08).
DEFINITIONS
"Attributable Debt" with respect to any sale leaseback transaction that is
subject to the restrictions described under "Certain Covenants of the Company
and the Subsidiary Issuers--Limitation on Sale and Leaseback" below means the
lesser of (a) the total net amount of rent required to be paid during the
remaining base term of the related lease or until the earliest date on which
the lessee may terminate such lease upon payment of a penalty or a lump-sum
termination payment (in which case the total net rent shall include such
penalty or termination payment), discounted at the weighted average interest
rate borne by the Outstanding Securities (as defined in the Indenture),
compounded semiannually, or (b) the sale price of the property so leased
multiplied by a fraction, the numerator of which is the remaining base term of
the related lease (expressed in months) and the denominator of which is the
base term of such lease (expressed in months).
"Consolidated Net Tangible Assets" means the aggregate amount of assets
(less applicable reserves and other properly deductible items) after deducting
therefrom (a) all current liabilities and (b) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense (to the extent
included in said aggregate amount of assets) and other like intangibles, all
as set forth on the most recent consolidated balance sheet of the Company and
its consolidated Subsidiaries, and computed in accordance with generally
accepted accounting principles, as such accounting principles are generally
accepted as of the date of the Indenture.
"Principal Property" means any single manufacturing or processing plant or
warehouse (excluding any equipment or personalty located therein), other than
any such plant or warehouse or portion thereof that the Board of Directors of
the Company reasonably determines is not of material importance to the
business conducted by the Company and its Subsidiaries as an entirety.
"Restricted Subsidiary" means any Subsidiary that owns, operates or leases
one or more Principal Properties.
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"Subsidiary" means with respect to the Company each corporation of which the
Company, or the Company and one or more Subsidiaries, or any one or more
Subsidiaries, directly or indirectly own securities entitling the holders
thereof to elect a majority of the directors, either at all times or so long
as there is no default or contingency that permits the holders of any other
class or classes of securities to vote for the election of one or more
directors.
CERTAIN COVENANTS OF THE COMPANY AND THE SUBSIDIARY ISSUERS
Limitation on Liens. Except as described below under "--Exempted
Indebtedness", the Company covenants that it will not, nor will it permit any
Restricted Subsidiary to, create, assume or suffer to exist any mortgage,
security interest, pledge or lien ("Lien") of or upon any Principal Property
or any shares of capital stock or evidences of indebtedness for borrowed money
issued by any Restricted Subsidiary and owned by the Company or any Restricted
Subsidiary, whether owned at the date of the Indenture or thereafter acquired,
without providing that the Debt Securities shall be secured equally and
ratably by such Lien with any and all other indebtedness or obligations
thereby secured, so long as such indebtedness or obligations shall be so
secured. This restriction does not apply to: (a) Liens that exist on the date
of the Indenture; (b) Liens on property or shares of capital stock or
evidences of indebtedness of any corporation existing at the time such
corporation becomes a Subsidiary; (c) Liens in favor of the Company or any
Subsidiary; (d) Liens in favor of governmental bodies to secure progress,
advance or other payments pursuant to contract or statute or indebtedness
incurred to finance all or part of construction of or improvements to property
subject to such Liens; (e) Liens (i) on property, shares of capital stock or
evidences of indebtedness for borrowed money existing at the time of
acquisition thereof (including acquisition through merger or consolidation),
and construction and improvement Liens that are entered into within one year
from the date of such construction or improvement; provided that in the case
of construction or improvement the Lien shall not apply to any property
theretofore owned by the Company or any Restricted Subsidiary except
substantially unimproved real property on which the property so constructed or
the improvement is located and (ii) for the acquisition of any Principal
Property which Liens are created within 180 days after the completion of such
acquisition to secure or provide for the payment of the purchase price of the
Principal Property acquired, provided that any such Liens do not extend to any
other property of the Company or any of its Subsidiaries (whether or not such
property is then owned or thereafter acquired); (f) mechanics', landlords' and
similar Liens arising in the ordinary course of business in respect of
obligations not due or being contested in good faith; (g) Liens for taxes,
assessments, or governmental charges or levies that are not delinquent or are
being contested in good faith; (h) Liens arising from any legal proceedings
that are being contested in good faith; (i) any Liens that (i) are incidental
to the ordinary conduct of its business or the ownership of its properties and
assets, including Liens incurred in connection with workmen's compensation,
unemployment insurance or other forms of governmental insurance or benefits,
or to secure performance of tenders, statutory obligations, leases and
contracts, (ii) were not incurred in connection with the borrowing of money or
the obtaining of advances or credit and (iii) do not in the aggregate
materially detract from the value of the property of the Company or any
Subsidiary or materially impair the use thereof in the operation of its
business; (j) Liens securing industrial development or pollution control
bonds; and (k) Liens for the sole purpose of extending, renewing or replacing
(or successively extending, renewing or replacing) in whole or in part any of
the foregoing (Section 10.08).
Limitation on Sale and Leaseback. Except as described below under "--
Exempted Indebtedness", sale and leaseback transactions by the Company or any
Restricted Subsidiary (except for transactions involving temporary leases for
a term of three years or less and leases between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries) of any Principal Property are
prohibited unless either: (a) the Company or such Restricted Subsidiary would
be entitled, pursuant to the covenant described under Limitations on Liens
above, to incur a Lien on the Principal Property
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to be leased without equally and ratably securing the Debt Securities or (b)
the net proceeds of such sale are at least equal to the fair value of the
Principal Property sold and the Company will apply an amount equal to the net
proceeds of such sale to (i) the retirement of Debt Securities or Funded Debt
(as defined in the Indenture) of the Company or a Restricted Subsidiary
ranking prior to or on a parity with the Debt Securities or (ii) the
acquisition, construction or improvement of a Principal Property within 120
days of the effective date of any such arrangement (Section 10.09).
Exempted Indebtedness. Notwithstanding the limitations on Liens and sale and
leaseback transactions outlined above, the Company or any Restricted
Subsidiary may create, assume or suffer to exist Liens or enter into sale and
leaseback transactions not otherwise permitted as described above, provided
that at the time of such event, and after giving effect thereto, the sum of
outstanding indebtedness for borrowed money incurred after the date of the
Indenture and secured by such Liens plus the Attributable Debt in respect of
such sale and leaseback transactions entered into after the date of the
Indenture does not exceed 10% of Consolidated Net Tangible Assets properly
appearing on a consolidated balance sheet of the Company (Sections 1.01,
10.08(b) and 10.09(b)).
MERGER AND CONSOLIDATION
The Indenture provides that for so long as any of the Debt Securities are
Outstanding, the Company may not consolidate with or merge into any other
Person, or convey, transfer or lease its properties and assets substantially
as an entirety to any Person, unless (a) any Person formed by such
consolidation or into which the Company is merged or to whom the Company has
conveyed, transferred or leased its properties and assets substantially as an
entirety is a corporation, partnership or trust or other entity organized and
validly existing under the laws of the United States of America, any state
thereof or the District of Columbia, and such Person assumes the Company's
obligations on the Debt Securities and under the Indenture (including the
Guarantees), (b) immediately after giving effect to such transaction, no Event
of Default, and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have occurred and be continuing, (c) the
Company shall expressly agree by a supplemental indenture (i) to immediately
indemnify (pursuant to the procedure described below under "--Indemnification
Procedure") the Holder of each Debt Security against (A) any tax, assessment
or governmental charge imposed on such Holder or required to be withheld or
deducted from any payment to such Holder (including any governmental charge or
withholding attributable to the Company's indemnifying such Holder) as a
consequence of such consolidation, merger, conveyance, transfer or lease and
(B) any other tax costs or other tax expenses imposed on such Holder as a
result of the act of such consolidation, merger, conveyance, transfer or lease
(except that if the Company or such Person delivers an opinion of an
independent counsel or a tax consultant of recognized standing that the
Holders will not recognize income, gain or loss for United States federal
income tax purposes as a result of such transaction, a Holder will have such
rights to indemnification only if and when gain for United States federal
income tax purposes is actually imposed on such Holder), and (ii) that all
payments pursuant to the Debt Securities in respect of the principal of and
any premium and interest on the Debt Securities, as the case may be, shall be
made without withholding or deduction for, or on account of, any present or
future taxes, duties, assessments or governmental charges of whatever nature
imposed or levied by or on behalf of the jurisdiction or organization of such
Person or any political subdivision or taxing authority thereof or therein,
unless such taxes, duties, assessments or governmental charges are required by
such jurisdiction or any such subdivision or authority to be withheld or
deducted, in which case such Person will pay such additional amounts of, or in
respect of, principal and any premium and interest as will result (after
deduction of such taxes, duties, assessments or governmental charges and any
additional taxes, duties, assessments or governmental charges payable in
respect of such) in the payment of each Holder of a Debt Security of the
amounts which would have been payable pursuant to the Debt Securities had no
such withholding or deduction been required, subject to the same exceptions as
would apply with respect to the payment by such Subsidiary Issuer of
Additional Amounts in respect of the Debt Securities, and (d) if, as a result
of any such consolidation or merger or such conveyance, transfer or lease, any
Principal
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Property of the Company would become subject to a lien that would not be
permitted by the Indenture, such Person takes such steps as are necessary
effectively to secure the Debt Securities equally and ratably with (or, at the
option of the Company, prior to) all indebtedness secured thereby (Section
8.01).
The Indenture provides that for so long as any of the Debt Securities of a
Subsidiary Issuer are Outstanding, such Subsidiary Issuer may not consolidate
with or merge into any other Person, or convey, transfer or lease its
properties and assets substantially as an entirety to any Person, unless (a)
any Person formed by such consolidation or into which such Issuer is merged or
to whom such Subsidiary Issuer has conveyed, transferred or leased its
properties and assets substantially as an entirety (the "Successor") is a
corporation, partnership or trust or other entity organized and validly
existing under the laws of the jurisdiction of organization of such Person,
and such Successor assumes such Subsidiary Issuer's obligations on the Debt
Securities and under the Indenture (including any obligation to pay any
Additional Amounts), (b) immediately after giving effect to such transaction,
no Event of Default, and no event which, after notice or lapse of time or
both, would become an Event of Default, shall have occurred and be continuing,
and (c) any such Successor shall expressly agree by a supplemental indenture
(i) to immediately indemnify (pursuant to the procedure described below under
"--Indemnification Procedure") the Holder of each Debt Security against (A)
any tax, assessment or governmental charge imposed on such Holder or required
to be withheld or deducted from any payment to such Holder as a consequence of
such consolidation, merger, conveyance, transfer or lease, and (B) any other
tax costs or other tax expenses of the act of such consolidation, merger,
conveyance, transfer or lease (except that if the Company or any such Person
delivers an opinion of an independent counsel or a tax consultant of
recognized standing that the Holders will not recognize income, gain or loss
for United States federal income tax purposes as a result of such transaction,
a Holder will have such rights to indemnification only if and when gain for
United States federal income tax purposes is actually imposed on such Holder),
and (ii) that all payments pursuant to the Debt Securities in respect of the
principal of and any premium and interest on the Debt Securities, as the case
may be, shall be made without withholding or deduction for, or on account of,
any present or future taxes, duties, assessments or governmental charges of
whatever nature imposed or levied by or on behalf of the jurisdiction of
organization of such Successor or any political subdivision or taxing
authority thereof or therein, unless such taxes, duties, assessments or
governmental charges are required by such jurisdiction or any such subdivision
or authority to be withheld or deducted, in which case such Successor will pay
such additional amounts of, or in respect of, principal and any premium and
interest ("Successor Additional Amounts") as will result (after deduction of
such taxes, duties, assessments or governmental charges and any additional
taxes, duties, assessments or governmental charges payable in respect of such)
in the payment to each Holder of a Debt Security of the amounts which would
have been payable pursuant to the Debt Securities had no such withholding or
deduction been required, subject to the same exceptions as would apply with
respect to the payment by such Subsidiary Issuer of Additional Amounts in
respect of the Debt Securities (see "--Payment of Additional Amounts")
(Section 8.02).
ASSIGNMENT
The Indenture provides that for so long as any of the Debt Securities of a
Subsidiary Issuer are outstanding, such Subsidiary Issuer may assign its
obligations under any series of Debt Securities to any other Subsidiary (the
"Subsidiary Assignee") and such Subsidiary Assignee shall be treated as the
Successor to such Subsidiary Issuer with respect to such series of Debt
Securities, provided that the conditions set forth under "--Merger and
Consolidation" above that would apply to the merger of such Subsidiary Issuer
into such Subsidiary Assignee are satisfied.
EVENTS OF DEFAULT
An Event of Default with respect to any series of Debt Securities or the
Guarantees thereof is defined in the Indenture as being: (a) default for 30
days in the payment of any installment of interest on any Debt Securities of
such series; (b) default in the payment of any principal of (or premium, if
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any, on) any Debt Securities of such series; (c) default in the deposit of any
sinking fund payments, when and as due with respect to such series; (d)
default by the Issuer or the Guarantor in the performance of any other
covenants or agreements in the Indenture contained therein for the benefit of
any Debt Securities of such series which shall not have been remedied for a
period of 60 days after written notice of such default to the Issuer and the
Guarantor by the Trustee or to the Issuer, the Guarantor and the Trustee by
the Holders of at least 25% in aggregate principal amount of the Debt
Securities of such series; (e) certain events of bankruptcy, insolvency or
reorganization of the Issuer or the Guarantor or (f) any other event of
default provided with respect to Debt Securities of such series (as described
in the Prospectus Supplement with respect to such series of Debt Securities)
(Section 5.01). An Event of Default with respect to the Debt Securities of a
particular series would not necessarily constitute an Event of Default with
respect to the Debt Securities of any other series.
The Indenture provides that if an Event of Default shall have occurred and
be continuing, either the Trustee or the Holders of not less than 25% in
principal amount of the Debt Securities of such series may declare the
principal of all the Debt Securities of such series, together with any accrued
interest, to be due and payable immediately. If an Event of Default under
clause (f) above shall have occurred and be continuing, then the principal of
all the Debt Securities of such series, together with any accrued interest,
will be due and payable immediately without any declaration or other act on
the part of the Trustee or any Holder of Debt Securities of such series. Upon
certain conditions such declaration (including a declaration caused by a
default in the payment of principal or interest, the payment for which has
subsequently been provided) may be annulled by the Holders of a majority in
principal amount of the Debt Securities of a series. In addition, past
defaults may be waived by the Holders of a majority in principal amount of the
Debt Securities of such series, except a default in the payment of principal
of (or premium, if any, on) or interest on any Debt Securities of a series or
in respect of a covenant or provision of the Indenture which cannot be
modified or amended without the approval of the Holder of each Debt Security
of a series (Sections 5.02 and 5.13).
The Indenture contains a provision entitling the Trustee, subject to the
duty of the Trustee during default to act with the required standard of care,
to be indemnified by the Holders of Debt Securities issued thereunder before
proceeding to exercise any right or power under the Indenture at the request
of the Holders of such Debt Securities (Section 6.03). The Indenture also
provides that the Holders of a majority in principal amount of the Outstanding
Securities of all series issued thereunder and affected (each series voting as
a separate class) may direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust or
power conferred on the Trustee, with respect to the Debt Securities of such
series (Section 5.12).
The Indenture contains a covenant that the Company will annually file with
the Trustee a certificate as to the absence of any default or specifying any
default that exists (Section 10.10).
ASSUMPTION BY THE COMPANY
The Company may, at its option, assume the obligations of any Subsidiary
Issuer as obligor under any series of Debt Securities, provided that:
(a) the Company shall expressly assume such obligations in an assumption
agreement or supplemental indenture duly executed and delivered to the
Trustee in form reasonably satisfactory to the Trustee;
(b) immediately after giving effect to such assumption, no Event of
Default, and no event which, after notice or lapse of time or both, would
become an Event of Default, shall have occurred and be continuing; and
(c) the Company shall expressly agree in an assumption agreement or
supplemental indenture to immediately indemnify (pursuant to the procedure
described below under "--Indemnification Procedure") the Holder of each
Debt Security against (i) any tax, assesment or governmental charge imposed
on such Holder or required to be withheld or deducted from any payment to
such Holder (including any governmental charge or withholding tax
attributable to the
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Company's indemnifying such Holder) as a consequence of such assumption,
and (ii) any costs or expenses of such assumption (except that if the
Company delivers an opinion of an independent counsel or a tax consultant
of recognized standing that the Holders will not recognize income, gain or
loss for United States federal income tax purposes as a result of such
assumption, a Holder will have such rights to indemnification only if and
when gain for United States federal income tax purposes is actually imposed
on such Holder).
Upon any such assumption, the Company shall succeed to, and be substituted
for, and may exercise every right and power of, the applicable Subsidiary
Issuer under such series of Debt Securities and the Indenture with the same
effect as if the Company had been the Issuer thereof, and the applicable
Subsidiary shall be released from its liability as obligor under such series
of Debt Securities.
See "Taxation--United States Income Tax Considerations--Taxation of
Dispositions" for a discussion of certain potential United States federal
income tax consequences of an assumption of the Debt Securities pursuant to
this provision.
INDEMNIFICATION PROCEDURE
If a transaction described above under "--Merger and Consolidation" or "--
Assumption by the Company" (an "Indemnifiable Transaction") should constitute
a taxable event for United States federal income tax purposes, the Company or
any Person, as the case may be, must indemnify a Holder of a Debt Security
against any tax, assessment or governmental charge imposed on such Holder or
required to be withheld or deducted from any payment to such Holder (including
any governmental charge or withholding attributable to an indemnification
payment made by or on behalf of the Company or any Person) and any other tax
costs or tax expenses attributable to such Indemnifiable Transaction. In
satisfying such indemnification obligation, the Company or any such Person, as
the case may be, shall comply with the following indemnification procedures.
Unless the Company or any such Person, as the case may be, delivers to the
Trustee by the date of an Indemnifiable Transaction an opinion of an
independent counsel or a tax consultant of recognized standing to the effect
that such Indemnifiable Transaction will not be a taxable event for United
States federal income tax purposes, the Company or any such Person, as the
case may be, shall send to each Holder on or prior to the date of such
Indemnifiable Transaction (a) notification explaining the United States
federal income tax consequences to each such Holder of such Indemnifiable
Transaction and (b) an indemnification claim form requesting (i) information
concerning each such Holder's tax basis and holding period in a Debt Security,
(ii) a statement that the Holder is not an entity that is exempt from United
States federal income tax as described in Section 501 of the Code, and (iii)
setting forth the address to which each such Holder must remit such form. If
the Company or any such Person delivers such an opinion, each Holder will have
the indemnification rights described herein only if and when gain for United
States federal income tax purposes is actually imposed on such Holder.
When the Company or any Person, as the case may be, receives from a Holder
an indemnification claim form, the Company or such Person, as the case may be,
shall within 15 business days remit to such Holder a certified check in an
amount equal to the sum of (a) the product of any gain recognized as a result
of the Indemnifiable Transaction and the highest marginal tax rate in effect
at the time of such Indemnifiable Transaction (the "Indemnification Amount"),
and (b) the product of the Indemnification Amount and such tax rate. For these
purposes, a Holder's gain shall equal the amount by which the fair market
value of a Debt Security at the time of such Indemnifiable Transaction exceeds
such Holder's adjusted tax basis in such Debt Security.
SATISFACTION AND DISCHARGE
The Indenture will cease to be of further effect (except as to, among other
things, surviving rights of registration of transfer or exchange of Debt
Securities, as expressly provided for in the Indenture)
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as to all Debt Securities when: (a) either (i) all Debt Securities theretofore
authenticated and delivered (except, among other things, lost, stolen or
destroyed Debt Securities that have been replaced or paid) have been delivered
to the Trustee for cancellation or (ii) with respect to all Debt Securities
not theretofore delivered to the Trustee for cancellation, the applicable
Issuer or the Guarantor has deposited or caused to be deposited with the
Trustee funds or Government Obligations, or any combination thereof, in an
amount sufficient to pay and discharge the entire indebtedness on the Debt
Securities not theretofore delivered to the Trustee for cancellation, for
unpaid principal and interest to maturity; (b) the applicable Issuer or the
Guarantor has paid all other sums payable by it under the Indenture; (c) the
applicable Issuer or the Guarantor has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that all conditions
precedent under the Indenture to the satisfaction and discharge of the
Indenture have been complied with; and (d) the applicable Issuer or the
Guarantor has delivered to the Trustee an Opinion of Counsel stating that the
Holders of the Debt Securities of all series will not recognize gain or loss
for United States federal income tax purposes or be subject to any taxes or
recognize gain or loss for income tax purposes in the jurisdictions in which
the Issuer is organized, resident or carries on business as a result of the
exercise of such option and will be subject to United States federal income
tax and income taxes, capital and other taxes, including withholding taxes in
such jurisdiction on the same amount and in the same manner and at the same
times as would have been the case if such deposit, defeasance and discharge
had not occurred (Article IV).
COVENANT DEFEASANCE
Unless the terms of the Debt Securities of any series otherwise provide, the
applicable Issuer need not comply with certain restrictive covenants of the
Indenture (including those described under "--Certain Covenants of the Company
and the Subsidiary Issuers" above) if: (a) the applicable Issuer or the
Guarantor deposits in trust with the Trustee money or Government Obligations,
which through the payment of interest thereon and principal thereof in
accordance with their terms, will provide money, in an amount determined in
accordance with the Indenture sufficient to pay all the principal of (and
premium, if any, on) and interest on the Debt Securities of such series when
due; (b) such deposit will not result in a violation or breach of, or
constitute a default under, the Indenture or any other agreement or instrument
by which the applicable Issuer or the Guarantor is bound; (c) no Event of
Default, or event which with the giving of notice or lapse of time, or both,
would become an Event of Default, shall have occurred or be continuing on the
date of such deposit or, in the case of an Event of Default , or event which
with the giving of notice or lapse of time, or both, would become an Event of
Default, by reason of bankruptcy, insolvency or reorganization of the
applicable Issuer or the Guarantor, on the 91st day after such date; (d) the
applicable Issuer or the Guarantor has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel each stating that all conditions
precedent to defeasance have been satisfied; and (e) the applicable Issuer or
the Guarantor has delivered to the Trustee an Opinion of Counsel stating that
the Holders of the Debt Securities of such series will not recognize gain or
loss for United States federal income tax purposes or be subject to any taxes
or recognize gain or loss for income tax purposes in the jurisdictions in
which the Issuer is organized, resident or carries on business as a result of
the exercise of such option and will be subject to U.S. federal income tax and
income taxes, capital and other taxes, including withholding taxes in such
jurisdiction on the same amount and in the same manner and at the same times
as would have been the case if such deposit and defeasance had not occurred
(Section 10.12).
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the applicable
Issuer, the Guarantor and the Trustee with the consent of the Holders of not
less than a majority in aggregate principal amount of each series of
Outstanding Debt Securities affected by such modification or amendment;
provided, however, that no such modification or amendment may, without the
consent of the Holder of each Outstanding Debt Security affected thereby, (a)
change the stated maturity of the
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principal of, or any installment of interest on, any Debt Security, or change
the obligation of the Issuer to pay any Additional Amounts thereon, or reduce
the principal amount thereof, the rate of interest thereon or any premium
payable upon the redemption thereof, or reduce the principal amount of a
Discounted Security or any other Debt Security that would be due and payable
upon its maturity, or change any Place of Payment where, or the coin or
currency in which, any Debt Security or the interest thereon is payable, or
impair the right to institute suit for the enforcement of any such payment
after the stated maturity thereof; (b) reduce the percentage in principal
amount of Outstanding Debt Securities of a series necessary to waive
compliance with certain provisions of the Indenture or to waive certain
defaults; or (c) modify any of the provisions relating to supplemental
indentures requiring the consent of Holders or relating to the waiver of past
defaults or relating to the waiver of certain covenants, except to increase
the percentage of Outstanding Debt Securities of a series required for such
actions or to provide that certain other provisions of the Indenture cannot be
modified or waived without the consent of the Holder of each Debt Security
(Section 9.02).
CONCERNING THE TRUSTEE
The Company maintains banking relationships in the ordinary course of its
business with The Bank of New York. The Bank of New York is a participating
lender pursuant to one of the two credit facilities maintained by the Company.
SERVICE OF PROCESS
The Indenture provides that the Company and each Subsidiary Issuer will
irrevocably appoint CT Corporation System, 1633 Broadway, New York, New York
10019, as its agent for service of process in any suit, action or proceeding
with respect to such Indenture or the Debt Securities issued thereunder and
for actions brought under the Federal or state securities laws brought in any
Federal or state court located in New York City, and submit to such
jurisdiction.
GOVERNING LAW
The Indenture, the Debt Securities and the Guarantees will be governed by
and construed in accordance with the laws of the State of New York, but
without regard to the principles of conflicts of laws thereof, except as may
otherwise be required by mandatory provisions of law and except that all
matters governing the authorization and execution of the Indenture and Debt
Securities by each Subsidiary Issuer will be governed by and construed in
accordance with the laws of the jurisdiction of incorporation of such
Subsidiary Issuer.
LIMITATIONS AFFECTING SECURITY HOLDERS
Crown Cork & Seal Finance PLC
Neither U.K. company law nor Crown Cork & Seal Finance PLC's organizational
documents presently impose any restriction on the ability of non-U.K. holders
to hold or vote the Debt Securities.
Crown Cork & Seal Finance S.A.
Under current French exchange control regulations, there are no limitations
on the payments that may be remitted by Crown Cork & Seal Finance S.A. to
residents of the U.S. Laws and regulations concerning foreign exchange
controls do require, however, that certain payments or transfers of funds made
by a French resident to a non-resident be handled by an authorized
intermediary bank. All credit establishments in France, including all
registered banks, are accredited intermediaries.
Neither French law nor Crown Cork & Seal Finance S.A.'s charter (statuts)
presently imposes any restriction on the ability of non-French holders to hold
or vote the Debt Securities.
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TAXATION
GENERAL
The following is a summary of certain United States federal income, United
Kingdom and French tax matters. The summary describes the principal United
States federal income, United Kingdom and French tax consequences of the
acquisition, ownership and disposition of Debt Securities by US Holders, who
hold the Debt Securities as capital assets and whose functional currency is
the United States Dollar. For purposes of this summary, a "US Holder" is any
initial purchaser of the Debt Securities that purchases such securities at
their issue price pursuant to this offering and is (a) a citizen or resident
of the United States, (b) a corporation, partnership, or other entity created
or organized in or under the law of the United States or any political
subdivision thereof, or (c) an estate or trust the income of which is
includible in gross income for United States federal income tax purposes
regardless of source. This summary does not address all aspects of United
States federal income, United Kingdom or French taxes that may be relevant to
an investment in the Debt Securities, nor does it address the United States,
United Kingdom or French tax treatment applicable to any particular category
of investors, including dealers in securities, banks, insurance companies, and
tax exempt organizations.
The statements below regarding United States federal income, United Kingdom
and French tax consequences are based upon current United States federal
income, United Kingdom and French tax legislation, case law, and practices as
of the date of this Prospectus, which may change. Tax consequences different
from those discussed below could then result.
The statements below regarding United States tax consequences are based upon
the provisions of the United States Internal Revenue Code of 1986, as amended
(the "Code") and regulations, rulings and judicial decisions thereunder as of
the date of this Prospectus. Such authorities may be repealed, revoked or
modified, in which case tax consequences different from those discussed below
could result.
PERSONS CONSIDERING THE PURCHASE, OWNERSHIP OR DISPOSITION OF DEBT
SECURITIES SHOULD CONSULT THEIR OWN TAX ADVISORS CONCERNING THE UNITED STATES
FEDERAL INCOME, UNITED KINGDOM AND FRENCH TAX CONSEQUENCES IN LIGHT OF THEIR
PARTICULAR SITUATIONS AS WELL AS ANY CONSEQUENCES ARISING UNDER THE LAWS OF
ANY OTHER TAXING JURISDICTION.
UNITED STATES INCOME TAX CONSIDERATIONS
Taxation of Interest--The Company as Issuer. The gross amount of interest
paid or accrued in respect of the Debt Securities generally will be includible
in the gross income, generally as ordinary income, of a US Holder. The US
Holder will be required to take such interest into account on the date the
interest is received or accrued in accordance with the US Holder's method of
accounting for federal income tax purposes.
Taxation of Interest--A Subsidiary Issuer as Issuer. The gross amount of
interest (including Additional Amounts, if any, accrued or received in respect
of the Debt Securities) generally will be includible in the gross income of a
US Holder and such income generally will be treated as foreign source passive
income for United States federal income tax purposes.
Taxation of Dispositions. A US Holder that owns the Debt Securities as
capital assets will recognize gain or loss for United States federal income
tax purposes upon the sale or other disposition of the Debt Securities in an
amount equal to the difference between the amount realized and the US Holder's
tax basis in the Debt Securities. Gain or loss recognized by a US Holder on a
sale or other disposition of the Debt Securities will be capital gain or loss
and will be long-term capital gain or loss if the Debt Securities have been
held for more than one year.
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A US Holder of a Debt Security may recognize gain or loss for U.S. federal
income tax purposes equal to the difference between the fair market value of
the Debt Security and such US Holder's adjusted tax basis in such Debt
Security in the event that (a) the Company consolidates with or merges into
any other Person or conveys, transfers or leases its properties and assets
substantially as an entirety to any other Person, (b) the Company assumes the
obligations of a Subsidiary Issuer under any series of Debt Securities or (c)
a Subsidiary Issuer consolidates or merges into any other Person or conveys,
transfers or leases its properties and assets substantially as an entirety to
any other Person. The Indenture provides that, where a US Holder (other than
entities then exempt from taxation under Section 501 of the Code) recognizes
gain for United States federal income tax purposes as a result of such a
merger or assumption, any such Person (in the case of (b) or (c)) or the
Company (in the case of (b)) shall indemnify such US Holder of a Debt Security
in an amount equal to the sum of (i) the Indemnification Amount and (ii) the
product of the Indemnification Amount and the highest marginal tax rate in
effect at the time of such above-described transaction. For a description of
the procedures by which a US Holder may exercise its indemnification rights,
see "Description of Debt Securities and Guarantees--Indemnification Procedure"
above.
Original Issue Discount. The Debt Securities may be issued with original
issue discount for United States federal income tax purposes. US Holders of
the Debt Securities will be required to include original issue discount in
gross income as it accrues, on a constant-yield basis, regardless of their
method of accounting.
The amount of the original issue discount in the Debt Securities will be the
difference between the stated redemption price at maturity and the issue price
of the Debt Securities. The "issue price" of the Debt Securities will be the
price at which a substantial amount of the Debt Securities are sold to the
public for cash (excluding sales to bond houses, brokers or similar persons or
organizations acting in the capacity as underwriters, placement agents or
wholesalers).
The "stated redemption price" at maturity of a debt instrument is the total
of all payments to be made on the instrument other than payments of qualified
stated interest. "Qualified stated interest" includes only interest that is
unconditionally payable in cash or property (other than debt instruments of
the Issuer) at least annually at a single fixed rate that appropriately takes
into account the length of the interval between payments.
Holders of the Debt Securities must include in gross income, as interest,
the daily portions of original issue discount for each day during the taxable
year on which the Debt Securities were held. The daily portions of the
original issue discount will be determined by allocating to each day in each
accrual period the ratable portion of the original issue discount allocable to
that period. (The accrual periods may be of any length and may vary in length
over the term of a debt instrument, provided that each accrual period is no
longer than one year, and each scheduled payment of interest or principal
occurs on either the final day or the first day of an accrual period.) The
original issue discount allocable to an accrual period will equal the product
of the adjusted issue price of the Debt Securities at the beginning of the
accrual period and the Debt Securities' yield to maturity. The adjusted issue
price of the Debt Securities at the start of any accrual period will be the
issue price of the Debt Securities, increased by the amount of the original
issue discount that has accrued in all previous accrual periods and decreased
by the amount of any payments previously made on the Debt Securities and any
payment made on the first day of the current accrual period. Because the US
Holders of the Debt Securities will include original issue discount in income
as it accrues, actual payments of cash interest (other than qualified stated
interest) on the Debt Securities will not trigger any additional interest
income to the holders.
Information Reporting and Backup Withholding. The Issuer will provide annual
information statements to the US Holders of the Debt Securities and
information returns to the United States Internal Revenue Service (the "IRS")
regarding the amount of original issue discount, if any, that accrued on the
Debt Securities during the year.
23
<PAGE>
The Issuer, its paying agent, or other withholding agent may be required to
withhold and remit to the IRS 31% of the interest payments on the Debt
Securities if the IRS notifies the Issuer, its paying agent, or other
withholding agent that the US Holder thereof is subject to backup withholding
or if such US Holder fails to provide a taxpayer identification number,
provides an obviously incorrect taxpayer identification number, fails to
certify that such Holder is not subject to backup withholding, or otherwise
fails to comply with applicable requirements of the backup withholding rules.
Certain Holders (including, among others, corporations) are not subject to
these backup withholding rules. Any amount paid as backup withholding would be
creditable against the US Holder's United States federal income tax liability.
UNITED KINGDOM TAX CONSIDERATIONS
Payments on the Debt Securities. Payments of interest to a US Holder of a
Debt Security will not be subject to United Kingdom withholding taxes provided
that the Debt Security is, as anticipated, and continues to be, listed on a
recognized stock exchange and remains in bearer form and the payments are, as
anticipated, and continue to be, (a) made by or through a person who is not in
the United Kingdom, (b) made by or through a person in the United Kingdom and
the Debt Security is held in a recognized clearing system (including DTC,
Euroclear and Cedel) or (c) made by or through a person in the United Kingdom
and a person who is not resident in the United Kingdom beneficially owns the
Debt Security and is beneficially entitled to the interest. A declaration in a
prescribed form must be made by the depositary of the recognized clearing
system for (b) above to apply or by the non-resident beneficial owner or a
paying agent for (c) above to apply.
Payments of interest to a US Holder of an interest in a Debt Security that
is not described in the preceding paragraph will be subject to United Kingdom
withholding taxes at a rate currently of 20%. Such a US Holder may be entitled
to receive Additional Amounts for any United Kingdom tax that is required to
be withheld with respect to any such Debt Security. See "Description of Debt
Securities and Guarantees--Payment of Additional Amounts." Recipients of
Additional Amounts who are US Holders should generally be entitled to claim a
refund of any such United Kingdom withholding tax pursuant to the United
States/United Kingdom Double Taxation Convention (the "Income Tax Treaty").
However, it is possible that a US Holder may have difficulty in establishing
his claim to a refund, in which case such claim may be denied by the United
Kingdom Inland Revenue.
Where a United Kingdom person acts as a collecting agent, i.e., either (a)
acts as custodian of the Debt Securities and receives interest on the Debt
Securities, or directs that interest on the Debt Securities be paid to another
person, or consents to such payment or (b) collects or secures payment of, or
receives interest on, the Debt Securities for a Holder (except by means of
clearing a check or arranging for the clearing of a check), the collecting
agent will be required to withhold on account of United Kingdom income tax at
the rate currently 20% unless the person beneficially entitled to the interest
and the related Debt Security is either not resident in the United Kingdom or
is specified by regulations or another exemption applies. In the case of the
Debt Securities, the collecting agent will not be a United Kingdom person.
If the interest payable on the Debt Securities is not subject to United
Kingdom withholding tax, then interest on the Debt Securities will not be
chargeable to United Kingdom tax in the hands of a US Holder or any other
beneficial owner who is not resident in the United Kingdom unless such owner
carries on a trade, profession or vocation in the United Kingdom through a
United Kingdom branch or agency in connection with which the interest on the
Debt Securities is attributable. There are certain exemptions for interest
received by certain categories of agent (such as some brokers and investment
managers).
Original Issue Discount. Debt Securities in respect of which the amount
payable on redemption exceeds or could exceed the issue price may constitute
"relevant discounted securities" for United
24
<PAGE>
Kingdom tax purposes. In such a case a holder may be liable for United Kingdom
income tax or corporation tax on any profit or gain arising on a transfer or
redemption of such Debt Securities. For these purposes, transfer means
transfer by a sale, exchange, gift or otherwise including a deemed transfer on
the death of a holder. However, a US Holder or any other beneficial owner who
is not resident in the United Kingdom will not be liable for United Kingdom
tax on the discount, whether by way of withholding or otherwise, unless such
US Holder or owner carries on a trade, profession or vocation in the United
Kingdom through a United Kingdom branch or agency in connection with which the
discount on the Debt Securities is attributable.
Sale or Disposition of Debt Securities. A US Holder will not be subject to
United Kingdom tax (including withholding tax) on the sale or disposition of a
Debt Security, unless the Holder carries on a trade, profession or vocation in
the United Kingdom through a branch or agency and the Debt Securities are or
have been held or acquired for the purpose of such trade, profession or
vocation of such branch or agency.
Transfer Taxes. No United Kingdom stamp duty or stamp duty reserve tax will
be payable on the acquisition or transfer of, or agreement to transfer an
interest, in a Debt Security.
FRENCH TAX CONSIDERATIONS
Because the Debt Securities are "obligations" within the meaning of Article
284 of the French company law of July 24, 1966, all payments made on the Debt
Securities to Holders which are not domiciled in or a resident of or do not
have a permanent establishment in or otherwise have a personal or business
connection with the Republic of France will be made free and clear of, and
without withholding or deduction for, any present or future tax, duty,
assessment or other governmental charge of whatever nature imposed, levied,
collected or withheld thereon by or on behalf of the Republic of France or any
political subdivision or taxing authority thereof or therein, unless such
withholding or deduction is required by French law. See "Description of Debt
Securities and Guarantees--Payment of Additional Amounts" and "Description of
Debt Securities and Guarantees--Redemption for Taxation Reasons." Currently,
the Debt Securities will be entitled to the special tax treatment provided by
Article 131--quarter of the French General Tax Code and, accordingly, under
existing French law, neither the Company, any Subsidiary Issuer, nor any
paying agent will be obligated to deduct or withhold for or on account of any
French taxes in respect of any payments on the Debt Securities. If as a result
of a change in French law, deduction or withholding with respect to a payment
of interest or principal on the Debt Securities is required, current French
law would not permit the payment of Additional Amounts by a Subsidiary Issuer
insofar as Article 1678 of the French General Tax Code would prohibit a
Subsidiary Issuer from bearing any withholding or deduction for tax. In such
case, the Company would be obligated to pay such Additional Amounts.
In general, a US Holder will not be subject to French tax on any capital
gain derived from the redemption, sale or exchange of the Debt Securities,
provided that the US Holder is not domiciled in or a resident of or does not
have a permanent establishment in or otherwise have a personal or business
connection with the Republic of France.
CERTAIN PENNSYLVANIA TAXES
Debt Securities held by or for certain persons, principally individuals and
partnerships resident in Pennsylvania, are subject to the Pennsylvania
Corporate Loans Tax, the annual rate of which is currently $4 per $1,000
principal amount of the debt, and this tax will be withheld by the Company
from interest paid to such persons. Persons resident in Pennsylvania holding
Debt Securities for the benefit of nonresidents should consult their tax
advisors regarding the applicability of the Pennsylvania Corporate Loans Tax.
25
<PAGE>
As a result of the payment of the Corporate Loans Tax, the Debt Securities
will not be subject to any existing Pennsylvania (County) personal property
taxes.
PLAN OF DISTRIBUTION
The Company or any Subsidiary Issuer may sell the Debt Securities (a)
through underwriters or dealers; (b) through agents; (c) directly to one or
more institutional purchasers; or (d) through a combination of any such
methods of sale. The Prospectus Supplement with respect to the Debt Securities
offered thereby will set forth the terms of the offering of such Debt
Securities, including the name or names of any underwriters, dealers or
agents, the purchase price of such Debt Securities and the proceeds to the
Company or the applicable Subsidiary Issuer from such sale, any underwriting
discounts and other items constituting compensation to underwriters, dealers
or agents, any initial public offering price, any discounts or concessions
allowed or reallowed or paid by underwriters or dealers to other dealers and
any securities exchanges on which such Debt Securities may be listed. Only
underwriters so named in the Prospectus Supplement are deemed to be
underwriters in connection with the Debt Securities offered thereby.
If underwriters or dealers are used in the sale, the Debt Securities will be
acquired by the underwriters or dealers for their own account and may be
resold from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. The Debt Securities may be offered to the public either
through underwriting syndicates represented by one or more managing
underwriters or directly by one or more of such firms. Unless otherwise set
forth in the Prospectus Supplement, the obligations of the underwriters to
purchase such Debt Securities will be subject to certain conditions precedent,
and the underwriters will be obligated to purchase all of the Debt Securities
offered by the Prospectus Supplement relating to such series if any are
purchased. Any initial public offering and any discounts or concessions
allowed or reallowed or paid to dealers may be changed from time to time.
The Debt Securities may be sold directly by the Company or any Subsidiary
Issuer or through agents designated by the Company or a Subsidiary Issuer from
time to time. Any agent involved in the offering and sale of the Debt
Securities in respect of which this Prospectus is delivered will be named, and
any commissions payable by the Company or a Subsidiary Issuer to such agent
(or the method by which such commissions can be determined) will be set forth,
in the Prospectus Supplement. Unless otherwise indicated in the Prospectus
Supplement, any such agent will be acting on a best efforts basis for the
period of its appointment.
If so indicated in the Prospectus Supplement, the Company or a Subsidiary
Issuer will authorize underwriters, dealers or other persons acting as the
Company's or the Subsidiary Issuer's agents to solicit offers by certain
specified institutions to purchase Debt Securities from the Company or the
Subsidiary Issuer at the public offering price set forth in the Prospectus
Supplement pursuant to contracts providing for payment and delivery on a
specified date in the future. Institutional investors to which such offers may
be made, when authorized, include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions and such other institutions as may be approved by the Company or
the Subsidiary Issuer. The obligations of any such purchasers pursuant to such
delayed delivery and payment arrangements will not be subject to any
conditions except that such purchase shall not at the time of delivery be
prohibited under the laws of any jurisdiction to which such purchaser is
subject. The Prospectus Supplement will set forth the commission payable for
solicitation of such contracts. The underwriters and other persons soliciting
such contracts will have no responsibility for the validity or performance of
any such contracts.
Each underwriter, dealer and agent participating in the distribution of any
Debt Securities that are issuable as Bearer Securities will agree that it will
not offer, sell or deliver, directly or indirectly, Bearer
26
<PAGE>
Securities in the United States or to United States persons (other than
qualifying financial institutions) in connection with the original issuance of
such Debt Securities. Each of the Company, the Subsidiary Issuers and any
underwriter, dealer or agent participating in the distribution of any Debt
Securities will not publicly offer or sell, directly or indirectly, any Debt
Securities in the Republic of France or to any resident in the Republic of
France and will not publicly circulate or distribute any offering or placement
material in the Republic of France or to any resident of the Republic of
France.
Underwriters, dealers and agents may be entitled under agreements entered
into with the Company to indemnification by the Company against certain civil
liabilities, including liabilities under the Securities Act, or to
contribution by the Company with respect to payments they may be required to
make in respect thereof. Underwriters, dealers and agents may be customers of,
engage in transactions with, or perform services for the Company in the
ordinary course of business.
Each series of Debt Securities will be a new issue of securities with no
established trading market. In the event that Debt Securities of a series
offered hereunder are not listed on a national securities exchange, certain
broker-dealers may make a market in the Debt Securities, but will not be
obligated to do so and may discontinue any market making at any time without
notice. No assurance can be given that any broker-dealer will make a market in
the Debt Securities of any series or as to the liquidity of the trading market
for the Debt Securities.
LEGAL MATTERS
The validity of the Debt Securities and Guarantees offered by the Company
hereby will be passed upon for the Company by Dechert Price & Rhoads,
Philadelphia, Pennsylvania. The validity of the Debt Securities offered hereby
by Crown Cork & Seal Finance PLC will be passed upon for the Company by
Titmuss Sainer Dechert, London, England and Dechert Price & Rhoads. The
validity of the Debt Securities offered hereby by Crown Cork & Seal Finance
S.A. will be passed upon for the Company by Jeantet & Associes, Paris, France
and Dechert Price & Rhoads. Certain other legal matters in connection with the
offerings contemplated herein will be passed upon for the Company by Richard
L. Krzyzanowski, Executive Vice President, Secretary and General Counsel for
the Company, and Dechert Price & Rhoads. Certain legal matters in connection
with the offerings contemplated herein are being passed upon for the
Underwriters by Cravath, Swaine & Moore, New York, New York. Mr. Krzyzanowski
is a director of the Company and, as of March 1, 1996, beneficially owned
0.108% of the outstanding shares of Common Stock. Chester C. Hilinski, of
counsel to Dechert Price & Rhoads, is a director of the Company and, as of
March 1, 1996, beneficially owned 0.013% of the outstanding shares of Common
Stock.
EXPERTS
The financial statements incorporated in this Prospectus by reference to the
Company's Annual Report on Form 10-K for the year ended December 31, 1995,
have been so incorporated in reliance on the report of Price Waterhouse LLP,
independent accountants, given on the authority of said firm as experts in
auditing and accounting. The audited financial statements of CarnaudMetalbox
as of December 31, 1994 and 1993 and for each of the two years ending on
December 31, 1994 and 1993 included in the Company's Current Report on Form 8-
K filed on March 1, 1996, as amended, incorporated by reference in this
Prospectus have been so incorporated in reliance on the report of Arthur
Andersen LLP, independent accountants, and Befec-Price Waterhouse and Claude
Chevalier, statutory auditors, given on the authority of said firms as experts
in auditing and accounting. The audited financial statements of
CarnaudMetalbox as of December 31, 1995 and for the year ended December 31,
1995 included in such Current Report on Form 8-K have been so incorporated in
reliance on the report of Arthur Andersen LLP, independent accountants, and
Befec-Price Waterhouse and Salustro Reydel, statutory auditors, given on the
authority of said firms as experts in auditing and accounting.
27
<PAGE>
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY IN-
FORMATION OR TO MAKE ANY REPRESENTATIONS, OTHER THAN THOSE CONTAINED IN OR IN-
CORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PRO-
SPECTUS, IN CONNECTION WITH THE OFFER CONTAINED IN THIS PROSPECTUS SUPPLEMENT
AND THE ACCOMPANYING PROSPECTUS, AND, IF GIVEN OR MADE, ANY SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY, ANY SUBSIDIARY ISSUER OR ANY UNDERWRITER, DEALER OR AGENT. THIS PRO-
SPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS DO NOT CONSTITUTE AN OFFER
TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE SECURITIES OFFERED
HEREBY BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS
NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER
OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE
ACCOMPANYING PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUM-
STANCES CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF
THE COMPANY OR ANY SUBSIDIARY ISSUER SINCE THE DATE HEREOF.
---------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
PROSPECTUS SUPPLEMENT
<S> <C>
The Company................................................................ S-4
The Subsidiary Issuers..................................................... S-6
Use of Proceeds............................................................ S-7
Capitalization............................................................. S-8
Summary Historical Financial Information................................... S-9
Unaudited Pro Forma Consolidated Condensed Statements of Operations........ S-11
Ratio of Earnings to Fixed Charges......................................... S-15
Description of Debt Securities and Guarantees.............................. S-16
Underwriting............................................................... S-19
Experts.................................................................... S-20
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
The Company................................................................ 3
The Subsidiary Issuers..................................................... 3
Use of Proceeds............................................................ 4
Description of Debt Securities and Guarantees.............................. 4
Taxation................................................................... 22
Plan of Distribution....................................................... 26
Legal Matters.............................................................. 27
Experts.................................................................... 27
</TABLE>
UNTIL JANUARY 6, 1997 (25 DAYS AFTER THE DATE OF THIS PROSPECTUS SUPPLEMENT),
ALL DEALERS EFFECTING TRANSACTIONS IN THE DEBT SECURITIES OF CROWN CORK & SEAL
FINANCE PLC AND CROWN CORK & SEAL FINANCE S.A. OFFERED HEREBY, WHETHER OR NOT
PARTICIPATING IN THIS DISTRIBUTION, MAY BE REQUIRED TO DELIVER A PROSPECTUS
AND PROSPECTUS SUPPLEMENT. THIS IS IN ADDITION TO THE OBLIGATION OF DEALERS TO
DELIVER A PROSPECTUS AND PROSPECTUS SUPPLEMENT WHEN ACTING AS UNDERWRITERS AND
WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
$1,200,000,000
[LOGO OF CROWN CORK & SEAL
COMPANY, INC. APPEARS HERE]
CROWN CORK & SEAL COMPANY, INC.
$350,000,000 7 3/8% DEBENTURES DUE 2026
$150,000,000 7 1/2% DEBENTURES DUE 2096
CROWN CORK & SEAL FINANCE PLC
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY
CROWN CORK & SEAL COMPANY, INC.
$200,000,000 6 3/4% NOTES DUE 2003
$300,000,000 7% NOTES DUE 2006
CROWN CORK & SEAL FINANCE S.A.
IRREVOCABLY AND UNCONDITIONALLY GUARANTEED BY
CROWN CORK & SEAL COMPANY, INC.
$200,000,000 6 3/4% NOTES DUE 2003
SALOMON BROTHERS INC
CS FIRST BOSTON
CHASE SECURITIES INC.
J.P. MORGAN & CO.
PROSPECTUS SUPPLEMENT
DATED DECEMBER 12, 1996
