As filed with the Securities and Exchange Commission on May 31, 1996
Registration No. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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CROWN CORK & SEAL COMPANY, INC.
(Exact name of Registrant as specified in its charter)
Pennsylvania 23-1526444
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
9300 Ashton Road
Philadelphia, Pennsylvania 19136
(215) 698-5100
(Address, including zip code, and telephone number,
including area code, of Registrant's principal executive offices)
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Richard L. Krzyzanowski, Esq. Copies to:
Crown Cork & Seal Company, Inc. Thomas A. Ralph, Esq.
9300 Ashton Road William G. Lawlor, Esq.
Philadelphia, PA 19136 Dechert Price & Rhoads
(215) 698-5208 4000 Bell Atlantic Tower
(Name, address, including zip code, 1717 Arch Street
and telephone number, including area code, Philadelphia, PA 19103
of agent for service) (215) 994-4000
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Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of this Registration Statement.
If the only securities being registered on this Form are offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [X]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, please check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462
(c) under the Securities Act, check the following box and list the Securities
Act registration number of the earlier effective registration statement for the
same offering.[ ]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]
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<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed Proposed Maximum
Title of Amount to Maximum Offering Aggregate Amount of
Securities to be Registered be Registered Price Per Unit(1) Offering Price(1) Registration Fee
<S> <C> <C> <C> <C>
Common Stock, $5.00 par value(2) 10,000,000 $47.31 $473,100,000 $163,146.55
shares
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee in
accordance with Rule 457(c) of the Securities Act of 1933, as amended, and
is based upon the average of the high and low prices of Common Stock, par
value $5.00 per share ("Common Stock"), of Crown Cork & Seal Company, Inc.
on the New York Stock Exchange on May 29, 1996.
(2) Includes associated Rights to purchase Common Stock. Until the occurrence
of certain prescribed events, none of which has occurred, the Rights are not
exercisable, are evidenced by the certificates representing Common Stock,
and will be transferred with and only with Common Stock.
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<PAGE>
PROSPECTUS
[LOGO] CROWN CORK & SEAL COMPANY, INC.
COMMON STOCK
(5.00 Par Value)
DIVIDEND REINVESTMENT AND STOCK PURCHASE PLAN
The Dividend Reinvestment and Stock Purchase Plan (the "Plan") of Crown
Cork & Seal Company, Inc. ("Crown") provides certain holders of shares of Common
Stock, par value $5.00 per share ("Common Stock"), of Crown with a simple and
convenient method of investing cash dividends and optional cash payments in
additional shares of Common Stock without payment of any brokerage commissions.
The price of shares of Common Stock purchased under the Plan depends on whether
the shares are purchased directly from Crown or in market or negotiated
transactions. The price per share of shares purchased from Crown will be the
average of the daily high and low sale prices of Common Stock, as published in
the Wall Street Journal report of New York Stock Exchange composite transactions
(subject to verification), for the period of 10 trading days immediately prior
to the date of purchase. The price per share of any shares purchased in market
or negotiated transactions will be the average cost of all shares so purchased,
excluding any related broker fees or commissions, which will be paid by Crown.
An eligible holder of Common Stock who participates in the Plan (a
"Participant") may obtain additional shares of Common Stock by:
-- reinvesting dividends on all shares registered in the name of the
Participant;
-- reinvesting dividends on part of the shares registered in the name
of the Participant (while continuing to receive cash dividends on
his or her remaining shares); or
-- making optional cash payments in amounts of not less than $25 up to
a total of $25,000 per calendar year, whether or not dividends on
shares registered in the name of the Participant are being
reinvested.
Cash dividends on shares held by First Chicago Trust Company of New
York, or its nominee, in a participant's account under the Plan are
automatically reinvested to purchase additional shares of Common Stock
regardless of which investment option is selected.
Those holders of Common Stock who do not participate in the Plan will
receive cash dividends, as declared, in the usual manner. Holders of shares of
4.5% Convertible Preferred Stock, par value $41.8875 per share ("4.5%
Convertible Preferred Stock"), of Crown will not be eligible to participate in
the Plan with respect to such shares, unless such shares are converted into
shares of Common Stock.
This Prospectus relates to 10,000,000 shares of Common Stock registered for
offer and sale, and reoffer and resale, under the Plan to the extent such
offers, sales, reoffers and resales are not exempt from registration under the
Securities Act of 1933, as amended (the "Securities Act"). Participants should
retain this Prospectus for future reference.
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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.
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The date of this Prospectus is May 31, 1996.
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AVAILABLE INFORMATION
Crown 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 "SEC"). The reports, proxy statements
and other information filed by Crown with the SEC can be inspected and copied at
the public reference facilities maintained by the SEC at its principal office at
450 Fifth Street, N.W., Washington, D.C. 20549 and at the regional offices of
the SEC located 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 by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Washington, D.C. 20549, at
prescribed rates. In addition, material filed by Crown can be inspected at the
offices of the New York Stock Exchange, Inc. (the "NYSE"), 20 Broad Street, New
York, New York 10005. Crown has filed with the SEC a Registration Statement on
Form S-3 (together with all amendments thereto, the "Registration Statement")
under the Securities Act, covering the offer and sale, and reoffer and resale,
of securities described herein to the extent such offers, sales, reoffers and
resales are not exempt from registration under the Securities Act. This
Prospectus does not contain all the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the SEC. Reference is hereby made to the Registration Statement
and related exhibits for further information with respect to Crown and the
securities offered hereby.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by Crown with the SEC (File No. 1-2227)
pursuant to the Exchange Act are hereby incorporated by reference in this
Prospectus:
(1) Crown's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995;
(2) Crown's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1996, as amended by Crown's Report on Form 10-Q/A
filed on May 17, 1996;
(3) Crown's Current Reports on Form 8-K filed January 2, 1996 and March
1, 1996, as amended on March 18, 1996, May 3, 1996 and May 7, 1996;
and
(4) Crown's Registration Statements on Form 8-B filed on May 2, 1989
with respect to Common Stock, and on Form 8-A filed on August 10,
1995 with respect to Crown's common stock purchase rights and filed
on February 20, 1996 with respect to 4.5% Convertible Preferred
Stock.
All reports and other documents subsequently filed by Crown pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to termination of the offers, sales, reoffers and resales
hereunder are hereby incorporated by reference herein and shall be deemed a part
hereof from the respective dates of filing of such reports and other documents.
Any statement contained in a document incorporated by reference herein shall be
deemed to be modified or superseded for all purposes of this Prospectus to the
extent that a statement contained herein, or in any other subsequently filed
document that also is incorporated by reference herein, modifies or supersedes
such statement. Any such statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute part of this
Prospectus.
This Prospectus incorporates documents by reference which are not presented
herein or delivered herewith. These documents (not including exhibits thereto,
unless such exhibits are specifically incorporated by reference) are available,
without charge, to any person, including any beneficial owner, to whom this
Prospectus is delivered upon written or oral request directed to: Crown Cork &
Seal Company, Inc., 9300 Ashton Road, Philadelphia, PA 19136 (telephone number
(215) 698-5208), Attention: Richard L. Krzyzanowski, Executive Vice President,
Secretary and General Counsel.
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CROWN CORK & SEAL COMPANY, INC.
Crown is a leading manufacturer of metal and plastic packaging
products. Following the acquisition of CarnaudMetalbox, a leading European-based
packaging firm, Crown believes it is the largest supplier (based on sales) of
packaging products to consumer marketing companies around the world.
Crown's products include metal cans for beverage, food, aerosol and
other products, plastic containers for beverage, food, household, personal care,
chemical, health and beauty and other products, metal crowns (also known as
bottle caps), metal and plastic closures and composite containers. Crown also
manufactures filling, packaging and handling machinery for the bottling
industry.
Crown was founded in 1892. The principal executive offices of Crown are
located at 9300 Ashton Road, Philadelphia, Pennsylvania 19136, and the telephone
number at such address is (215) 698-5100.
THE PLAN
The Plan became effective on May 31, 1996. The text of the Plan is as
follows:
Purpose
1. What is the purpose of the Plan?
The Plan provides eligible holders of Common Stock with a simple and
convenient way to invest cash dividends and optional cash payments in additional
shares of Common Stock for long-term growth, without payment of any brokerage
commissions. To the extent such shares are purchased from Crown, Crown will
receive additional funds to be used for general corporate purposes. Crown will
not receive any additional funds from shares purchased in open market or
negotiated transactions.
Prior to 1996, Crown historically had not paid cash dividends. On February
22, 1996, the Board of Directors of Crown declared a quarterly cash dividend of
$.25 per share of Common Stock, representing the first cash dividend on Common
Stock since 1956. It is the present intention of the Board of Directors of Crown
to continue paying cash dividends on Common Stock on a quarterly basis.
Accordingly, the Plan represents an opportunity for Crown shareholders to
receive additional Crown shares in lieu of cash dividends on Common Stock.
Shareholders who wish to participate, however, should note that, as discussed in
Question 28, Participants will be taxed on reinvested dividends. For additional
information on Crown's dividend policy, see Question 29.
Advantages
2. What are the advantages of the Plan?
A Participant may (a) have cash dividends on all shares registered in the
name of such Participant automatically reinvested or (b) have cash dividends on
part of such shares automatically reinvested or (c) whether or not the
Participant has elected to have dividends on any such shares automatically
reinvested, invest in additional shares of Common Stock by making optional cash
purchases in amounts of not less than $25 up to a maximum of $25,000 per
calendar year. See Question 16 for information as to the costs of participation
in the Plan.
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Full investment of funds is possible under the Plan because fractions
of shares, as well as whole shares, will be credited to a Participant's account.
Dividends in respect of such fractions, as well as whole shares, can be
reinvested in additional shares and such shares credited to a Participant's
account. A Participant can avoid the need for safekeeping of certificates for
shares credited to his or her account under the Plan through the free custodial
service described in Question 27. Regular statements of account will provide
simplified recordkeeping.
Administration
3. Who administers the Plan?
First Chicago Trust Company of New York ("First Chicago"), as Plan
Administrator, administers the Plan, keeps records, sends statements of account
to Participants and performs other duties relating to the Plan. Shares of Common
Stock purchased under the Plan or, as discussed in Question 27, deposited with
First Chicago under the Plan ("Plan Shares") will be registered in the name of
First Chicago (or its nominee), as agent for each Participant in the Plan, and
will be credited to the accounts of the respective Participants. As record
holder of the Plan Shares held in Participant's accounts under the Plan, First
Chicago will receive dividends on all Plan Shares held on the dividend record
date, will credit such dividends to Participants' accounts on the basis of full
and fractional shares held in these accounts, and will automatically reinvest
such dividends in additional shares of Common Stock. Certificates for any number
of whole shares will be issued to a Participant upon written request. See
Question 19.
Participants can contact First Chicago by telephoning First Chicago
toll free or otherwise contacting First Chicago at the following telephone
numbers or addresses:
Shareholder Customer Service: 1-800-317-4445
Normal hours: 8:00 a.m. - 10:00 p.m., Eastern time,
each business day
8:00 a.m. - 3:30 p.m., Eastern time, Saturdays
Internet: Messages forwarded on the Internet will be
responded to within 24 hours each business day.
First Chicago's address is "HTTP://WWW.FCTC.COM".
U.S. Mail: First Chicago Trust Company of New York
Crown Cork & Seal Company, Inc.
Dividend Reinvestment and Stock Purchase Plan
P.O. Box 2598
Jersey City, New Jersey 07303-2598
Telecommunications Device for the Hearing Impaired:
1-201-222-4955
Costs of Plan administration are paid by Crown.
Participation
4. Who is eligible to participate?
All holders of record of Common Stock (other than Excluded Holders (as
defined below)) are eligible to participate in the Plan. Therefore, if Common
Stock is currently registered in an eligible shareholder's own
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name, the shareholder may participate in the Plan. A beneficial owner of Common
Stock (other than an Excluded Holder) whose shares are registered in a name of a
broker or other nominee is also eligible to participate in the Plan, provided
that the beneficial owner must either become a shareholder of record by having
such shares transferred into his or her own name or make arrangements with his
or her broker or other nominee to participate on his or her behalf. Indirect
participation in the Plan by beneficial owners through brokers or other nominees
may be on terms and conditions which differ from those set forth in this
Prospectus, in which case the terms and conditions established by each broker or
other nominee for the applicable beneficial owner will govern. Such terms and
conditions may include limitations on participation in the Plan and the
requirement that the beneficial owner pay a commission or service fee to the
broker or other nominee. In addition, certain features of the Plan, including
investment of optional cash payments, may not be available to beneficial owners
participating indirectly in the Plan through brokers or other nominees.
Crown has made arrangements with First Chicago to facilitate
reinvestment of dividends under the Plan by record holders such as brokers and
bank nominees, on a per-dividend basis, on behalf of beneficial owners. See
Questions 5 and 7. Crown may from time to time enter into other arrangements
with brokers or other nominees to facilitate indirect participation in the Plan
by beneficial owners. Such arrangements may require payment of service fees by
Crown to the broker or other nominee and indemnification of the broker or other
nominee against securities laws claims in connection with its participation in
the Plan.
Shareholders who reside in jurisdictions in which it is unlawful for
Crown to permit their participation in the Plan, or in any feature of the Plan,
such as the optional cash payment feature ("Excluded Holders"), are not eligible
to participate in the Plan or such feature of the Plan. Shareholders who are
citizens or residents of a country other than the United States, its territories
and possessions should make certain that their participation does not violate
local laws governing such things as taxes, currency, securities registration and
foreign investment. Crown reserves the right to suspend or terminate the
participation of any shareholder in the Plan.
The right to participate in the Plan is not transferable apart from a
transfer of a Participant's underlying shares of Common Stock.
The Plan does not provide for reinvestment of dividends on, or purchase
of, 4.5% Convertible Preferred Stock.
5. How does an eligible shareholder participate?
Any eligible holder of record of Common Stock may join the Plan by
completing and signing the Enrollment Authorization Form accompanying this
Prospectus and returning it to First Chicago at P.O. Box 2598, Jersey City, New
Jersey 07303-2598. A postage-paid envelope is provided for this purpose.
Additional Enrollment Authorization Forms may be obtained at any time by written
request to First Chicago.
If a shareholder returns a properly executed Enrollment Authorization Form
to First Chicago without electing an investment option, such Enrollment
Authorization Form will be deemed to indicate the intention of such shareholder
to apply all cash dividends, together with any optional cash payments, toward
the purchase of additional shares of Common Stock. If a Participant's shares are
registered in more than one name or in a representative capacity (i.e., joint
tenants, trustees, etc.), all registered holders must sign the Enrollment
Authorization Form exactly as their names appear on Crown's stock transfer
records.
Eligible beneficial owners who wish to participate in the Plan but
whose shares are held in the name of a broker or other nominee must make
arrangements with their broker or other nominee to do so. A broker or nominee
may participate in the Plan on behalf of beneficial owners by signing and
returning either the Enrollment Authorization Form or the Broker and Nominee
Authorization Form (the "B&N Form"). See Question 7.
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6. When may an eligible shareholder join the Plan?
An eligible holder of Common Stock may join the Plan at any time. Once
in the Plan, such shareholder will remain a Participant until such shareholder
discontinues participation or the Plan is terminated. See Question 23 regarding
a shareholder's ability to terminate participation in the Plan and Question 30
regarding Crown's ability to terminate the Plan.
If an Enrollment Authorization Form requesting reinvestment of
dividends is received by First Chicago on or before the record date established
for a particular dividend, reinvestment will commence with that dividend.
Approximate dividend record dates for Common Stock (and the related payment
dates) are anticipated to be as follows:
Approximate Record Date
(date by which Enrollment
Authorization Form must be received): Approximate Payment Date:
August 5, 1996 August 20, 1996
November 4, 1996 November 20, 1996
February 3, 1997 February 20, 1997
May 5, 1997 May 20, 1997
It is anticipated that dividend record dates and payment dates for
Common Stock in the future will be at approximately the same times of the year
as set forth above, although there can be no assurance this will actually be the
case. See Question 29 for additional information regarding Crown's dividends.
If an Enrollment Authorization Form is received from a shareholder
after the record date established for a particular dividend, the reinvestment of
dividends will begin on the dividend payment date following the next record date
if such shareholder is still a holder of record.
7. What do the Enrollment Authorization Form and the B&N Form provide?
The Enrollment Authorization Form provides for the purchase of
additional shares of Common Stock through the following investment options:
(a) Full Dividend Reinvestment directs First Chicago to invest
in accordance with the Plan all of the Participant's cash dividends on
all of the shares then or subsequently registered in the Participant's
name, and also permits the Participant to make optional cash payments
for the purchase of additional shares in accordance with the Plan.
Dividends paid on shares accumulated by the Participant under the Plan
and held in the Participant's Plan account will also be fully
reinvested.
(b) Partial Dividend Reinvestment directs First Chicago to
invest in accordance with the Plan the cash dividends on only that
number of shares registered in the Participant's name which the
Participant indicates on the Enrollment Authorization Form. This choice
also permits the Participant to make optional cash payments for the
purchase of additional shares in accordance with the Plan. Dividends on
shares held in the Participant's Plan account will also be fully
reinvested.
(c) Optional Cash Payments Only permits the Participant to
make optional cash payments for the purchase of shares at the time or
times selected by the Participant, or not at all, at the option of the
Participant, in accordance with the Plan. Dividends on shares held in
the Participant's Plan account will be automatically reinvested.
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Under all of the investment options above, dividends paid on shares held in a
Participant's Plan account will continue to be automatically reinvested in
additional shares of Common Stock until the Participant withdraws from the Plan
or the Plan is terminated. Further, under the Plan, dividends paid on all the
shares so designated in the Enrollment Authorization Form will continue to be
reinvested in shares of Common Stock until a Participant specifies otherwise.
For information on tax withholding requirements that may apply to certain
shareholders, see Question 28.
The B&N Form (for brokers and nominees) provides a means whereby a
broker or nominee may inform First Chicago each time Crown declares a cash
dividend of the names of participating beneficial owners and specify as to each
beneficial owner the number of shares of Common Stock with respect to which the
dividend is to be reinvested. The B&N Form, therefore, unlike the Enrollment
Authorization Form, contemplates new instructions to First Chicago each time a
dividend is declared. First Chicago, on the dividend payment date, will reinvest
the dividend payable with respect to the number of shares specified in the
record holder's instructions for each identified beneficial owner in as many
whole shares of Common Stock as can be purchased in accordance with the Plan. As
soon as practical following the dividend payment date, First Chicago will
transmit to the record holder information with respect to each beneficial owner
for whom the record holder has requested dividend reinvestment showing as to
each such beneficial owner: (a) the number of shares specified for reinvestment
of the dividend, (b) the total dividend paid with respect to such shares, (c)
the number of whole shares purchased, (d) the total cost of the shares
purchased, (e) the amount of the total dividend not reinvested, (f) the
aggregate fair market value of the shares purchased and (g) the total dividend
reportable for Federal income tax purposes. Accompanying such information will
be a share certificate, registered in the name of the record holder, for the
total number of shares purchased for each of such beneficial owners, and a check
for the aggregate amount of the dividend not reinvested for such beneficial
owners.
The B&N Form and appropriate instructions must be received by First
Chicago not later than the fifth business day following the record date for such
dividend or no dividends will be reinvested based on such B&N Form.
Because shares representing dividends reinvested pursuant to
instructions received on B&N Forms are issued in certificated form, such shares
are not Plan Shares. Therefore, subsequent cash dividends on such shares (like
all other shares invested pursuant to B&N Forms) will not be reinvested unless a
new B&N Form authorizing reinvestment is received from the broker or nominee for
each such subsequent dividend. See Question 18.
Eligible holders of Common Stock must complete the appropriate forms to
participate in the Plan. Crown and First Chicago will not be bound by oral
instructions by Participants as to participation or other matters concerning the
Plan.
8. How may a Participant change options under the Plan?
Participants may change their investment options at any time by
completing a new Enrollment Authorization Form and returning it to First Chicago
in the envelope provided or to P.O. Box 2598, Jersey City, New Jersey
07303-2598. An Enrollment Authorization Form and postage-paid envelope can be
obtained at any time by contacting First Chicago at the above address or by
telephone toll-free at 1-800-317-4445. Any change relating to the reinvestment
of dividends must be received by First Chicago no later than the record date for
a dividend in order to effect the change for that dividend. In the event a
beneficial owner whose shares are held in the name of a broker or other nominee
would like to change the number of shares on which dividends will be reinvested,
such beneficial owner should contact the broker or other nominee.
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Purchases
9. What is the source of Common Stock purchased under the Plan?
Shares will be, at Crown's discretion, newly issued or treasury shares
purchased directly from Crown or outstanding shares purchased by First Chicago
in market or negotiated transactions, or any combination of the foregoing. The
price of shares purchased under the Plan will vary depending upon the source of
the shares. See Question 11. The source of shares selected by Crown for any
given Plan purchase may not result in the most favorable purchase price to
Participants.
10. When will shares be purchased under the Plan?
Purchases from Crown of newly issued or treasury shares of Common Stock
will be made and be effective on the relevant Investment Date (as defined in the
next paragraph). Purchases of outstanding shares by First Chicago in market or
negotiated transactions will begin on the relevant Investment Date and will be
completed no later than 30 days from such date except where completion at a
later date is required or advisable under applicable federal securities laws.
First Chicago has full discretion as to all matters relating to such purchases,
including the number of shares, if any, to be purchased on any day or at any
time of day, the price paid for such shares, the markets on which such shares
are purchased (including any securities exchange, in the over-the counter market
or in negotiated transactions), and the persons, including brokers or dealers,
from or through whom such purchases are made. First Chicago may grant a broker
discretion as to any or all of the matters described above. Neither Crown nor
any Participant will have any authority or power to direct the time or price at
which shares may be purchased, or the selection of brokers or dealers through or
from whom purchases are to be made.
The "Investment Date" in any month in which a dividend is paid will be
the dividend payment date and, in any other month, will be 20th day of such
month, or if such day is not a business day, the first business day thereafter.
For information as to the timing of dividend payment dates, see Question 6.
Investment Dates and dividend payment dates are subject to change by Crown.
Pending investment pursuant to the Plan, Participants' funds may be
kept in an escrow account or at First Chicago and may be commingled with the
funds of other Participants for the purpose of executing purchase transactions.
The dividend and voting rights of Participants will commence upon settlement of
any purchases. No interest will be paid on funds held pending investment
purusant to the Plan.
11. What will be the price to the Participant of shares purchased under the
Plan?
For purchases of newly issued or treasury shares from Crown, the price
per share to Participants at which shares of Common Stock will be purchased,
whether with reinvested dividends or with optional cash payments, will be equal
to the Average Market Price of Common Stock with respect to the Investment Date.
The "Average Market Price" with respect to any Investment Date will be average
of the daily high and low sales prices for Common Stock (rounded to three
decimal places), as published in the Wall Street Journal report of New York
Stock Exchange composite transactions (subject to verification), for the period
of 10 trading days immediately prior to the Investment Date.
The price per share to Participants of outstanding shares purchased by
First Chicago in market or negotiated transactions will be the weighted average
purchase price of all shares so purchased for the relevant Investment Date,
excluding any related broker fees or commissions, which will be paid by Crown.
See Question 10 for information as to when such purchases will take place.
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Participants will not know the exact price to be paid for shares
purchased under the Plan at the time of any election to participate (or change
of reinvestment options) in the Plan.
For information as to the tax consequences of participation in the
Plan, see Question 28.
12. How will the number of shares purchased for a participant be determined?
A Participant's account in the Plan will be credited with that number
of shares, including fractions computed to three decimal places, equal to the
total amount to be invested by such Participant divided by the purchase price
per share.
Optional Cash Payments
13. How does the optional cash payment feature of the Plan work?
All eligible holders of Common Stock who have submitted (or caused their
broker or other nominee to submit) a signed Enrollment Authorization Form are
eligible to make optional cash payments at any time. Brokers and nominees may
also make optional cash payments on behalf of beneficial owners by using the B&N
Form. A separate B&N Form must be delivered each time a broker or other nominee
wishes to transmit an optional cash payment on behalf of a beneficial owner.
First Chicago will apply any optional cash payment received from a
Participant before an Investment Date to the purchase of Common Stock for the
account of the Participant on such Investment Date if such Common Stock is
purchased from Crown and as soon as practicable (as explained in Question 10
above) after such Investment Date if such Common Stock is purchased on the open
market or in negotiated transactions. Optional cash payments received on or
after an Investment Date will be held until the next following Investment Date,
at which time they will be invested as set forth in the previous sentence.
Interest will not be paid on optional cash payments prior to investment.
Therefore, it is recommended that optional cash payments be sent to First
Chicago so as to arrive shortly before an Investment Date. See Question 10 for
information as to the timing of Investment Dates.
14. How may optional cash payments be made?
An initial optional cash payment may be made by a Participant when
joining the Plan by enclosing a check or money order, payable to "First Chicago
- - - CCK," with the Enrollment Authorization Form. Thereafter, optional cash
payments may be made by use of a cash payment form which will be attached to
each Participant's statement of account or, in the case of registered holders,
through use of the automatic investment feature described below.
Beneficial owners participating in the Plan through brokers or other
nominees may alternatively make an optional cash payment by causing such broker
or other nominee to transmit the payment, by check or money order payable to
"First Chicago - CCK," together with a completed B&N Form, to First Chicago.
In all cases, checks must be drawn on United States-domiciled financial
institutions or money market mutual funds. All optional cash payments must be in
United States dollars.
The same amount of optional cash payment need not be made each month,
and there is no obligation to make a optional cash payment in any month. No
optional cash payment by a Participant shall be in an amount less than $25 nor
may any Participant's optional cash payments total more than $25,000 per
calendar year. This calendar year limitation is based on when optional cash
payments are received by First Chicago, not when the payments are used to
purchase shares.
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Participants who are registered owners of Common Stock may also make
automatic monthly investments of a specified amount (not less than $25 per
purchase nor more than $25,000 per year) by electronic funds transfer from a
predesignated U.S. bank account. A $1.00 transaction fee will be deducted from
the amount withdrawn from the account prior to each investment. To initiate
automatic monthly deductions, the Participant must complete and sign an
Automatic Monthly Deduction Form and return it to First Chicago together with a
voided blank check or a deposit form for the account from which funds are to be
drawn. Automatic Monthly Deduction Forms may be obtained from First Chicago.
Forms will be processed and become effective as promptly as practicable.
Once automatic monthly investment is initiated, funds will be drawn
from the Participant's designated bank account on the third business day prior
to each relevant Investment Date. Participants may change or terminate automatic
monthly investment by completing and submitting to First Chicago a new Automatic
Monthly Deduction Form. To be effective with respect to a particular Investment
Date, however, the new Automatic Monthly Deduction Form must be received by
First Chicago at least six business days preceding such Investment Date.
15. May optional cash payments be returned to a Participant?
Optional cash payments received by First Chicago will be returned to a
Participant (or, in the case of a broker or other nominee making payment on
behalf of a beneficial owner, such broker or other nominee) upon written request
by such person received at least two business days prior to the Investment Date.
Costs
16. What are the costs to a Participant in the Plan?
A Participant will incur no brokerage commissions for purchases made
under the Plan. Further, all costs of administration of the Plan and other
charges incurred in connection with the purchase of shares under the Plan will
be paid by Crown. However, (a) beneficial owners who arrange to participate in
the Plan indirectly through a broker or other nominee may be required to pay a
commission or service fee to such broker or nominee in connection with such
participation (see Question 4), (b) a Participant using the automatic monthly
investment feature of the Plan for optional cash payments will be charged a
transaction fee of $1.00 per investment (see Question 14), and (c) a Participant
who sells through First Chicago all or a part of the shares held for such
Participant under the Plan (including with respect to fractional shares upon
termination of participation in the Plan) will be charged any brokerage
commissions, service fees, transfer taxes or other costs of sale in connection
with such sale (see Questions 21 and 23).
For information as to Crown's ability to modify the terms of the Plan,
including as to payment of brokerage commissions or other charges, see Question
30.
Reports to Participants
17. What kinds of reports will be sent to Participants?
As soon as practical after each purchase of shares on behalf of a
Participant, such Participant will receive a statement of account. These
statements are a record of the cost of purchase of shares under the Plan and
should be retained for tax purposes. In addition, each Participant will receive,
from time to time, copies of all communications sent to shareholders. Duplicate
account statements may also be obtained from First Chicago. Participants will be
charged a fee of $5 for each such statement that is two or more years old, not
to exceed $25 where statements for more than one year are requested.
Each Participant will receive annually Internal Revenue Service
information (on Form 1099-DIV) for reporting dividend income received.
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Issuance of Shares
18. What is the difference between Plan Shares and other shares?
Plan Shares are shares of Common Stock purchased through reinvestment
of dividends or by optional cash payments under the Plan or, as discussed in
Question 27, deposited with First Chicago under the Plan. Certificates are not
issued to Participants for Plan Shares, which are held in the name of First
Chicago or its nominee. This protects against the loss, theft or destruction of
stock certificates evidencing Plan Shares. In contrast, non-Plan Shares are
represented by physical certificates registered in a shareholder's own name or
in the name of a broker or nominee.
Dividends on all Plan Shares are automatically reinvested under the
Plan. Reinvestment of dividends on non-Plan Shares depends on the reinvestment
option chosen by the shareholder on an Enrollment Authorization Form (see
Question 7).
Participants can have certificates issued for the whole Plan Shares
held in their Plan accounts upon written request to First Chicago. See Question
19. Once certificates are issued to the Participant, such shares are no longer
Plan Shares, meaning that reinvestment of dividends on such shares will depend
on the reinvestment option selected by the holder, as with other non-Plan
Shares.
Certificates for shares purchased with dividends reinvested pursuant to
instructions received on B&N Forms will be delivered to the holder of record.
Such shares are not Plan Shares. See Question 7.
19. How may certificates for Plan Shares be obtained?
A Participant may obtain certificates for whole Plan Shares credited to
a Participant's account by notifying First Chicago in writing of the number of
shares for which certificates are to be issued. Certificates for whole shares of
Common Stock in the Participant's Plan account will be issued to and registered
in the name of the Participant. Once certificates are issued to the Participant,
such shares are no longer Plan Shares, meaning that reinvestment of dividends on
such shares will depend on the reinvestment option selected by the holder in his
or her Enrollment Authorization Form. See Question 20.
Plan accounts will be maintained in the names in which certificates of
the Participants were registered at the time of commencement of participation in
the Plan. Certificates for whole Plan Shares will be similarly registered when
issued. However, a Participant may have certificates for whole Plan Shares
issued in the name of another person by forwarding to First Chicago the
documentation necessary to effect the transfer of such shares to such person.
20. Will dividends on shares for which certificates have been issued continue
to be reinvested?
If the Participant has authorized "Full Dividend Reinvestment" (see
Question 7), cash dividends with respect to former Plan Shares for which
certificates have been issued will continue to be reinvested (and shares
purchased with dividends so reinvested will be Plan Shares held as discussed in
Question 18). If, however, cash dividends with respect to only part of the
shares registered in a Participant's name are being reinvested, First Chicago
will continue to reinvest dividends on only the number of shares specified by
the Participant on the Enrollment Authorization Form unless a new Enrollment
Authorization Form specifying a different number of shares is delivered.
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21. Can Plan Shares be sold or transferred?
Participants may transfer Plan Shares within the Plan without having
certificates issued for such shares by forwarding to First Chicago the
documentation necessary to complete such transfer. Participants will not be
charged for such transfers, and the transferee will obtain the transferred Plan
Shares in an account in the transferee's name.
Participants may also request First Chicago to sell any number of whole
shares held in their Plan accounts at any time by giving written or telephonic
instructions acceptable to First Chicago. First Chicago will attempt to process
Participants' orders on the day they are received, provided that instructions
are received before 1:00 p.m., Eastern time, on a business day during which
First Chicago and the relevant securities markets are open. The proceeds of
sale, less any brokerage commissions, any service fee and any other costs of
sale will be sent to the applicable Participant as soon as practicable. The
sale price for shares so sold will be the market price received from the sale of
such shares. Participants can obtain information as to the amount charged by
First Chicago for brokerage commissions and service fees in connection with such
sales by contacting First Chicago at 1-800-317-4445.
Participants may also request First Chicago to issue certificates for
any whole shares held in the Participant's Plan account. Upon receipt of the
certificates, the Participant can sell such shares through a broker of the
Participant's choice or otherwise transfer such shares.
A Participant who wishes to pledge shares credited to such
Participant's Plan account must first withdraw such shares from the Plan account
by having certificates issued for such shares.
See Question 28 for information as to the tax consequences of sales and
transfers of Plan Shares.
22. Will dividends on a Participant's Plan Shares continue to be reinvested if
the Participant sells or transfers the shares of Common Stock registered in
his or her name?
Even if a Participant sells or transfers all of the shares of Common
Stock registered in his or her name, First Chicago will continue to reinvest
dividends on the Plan Shares held for his or her Plan account until a written
request for termination of participation is received from the Participant, or
the Plan is terminated.
Termination of Participation
23. How and when may a Participant terminate participation in the Plan?
A participant may terminate participation in the Plan by giving written
notice to First Chicago. Such notice will be effective upon receipt by First
Chicago, except that if a notice of termination is received by First Chicago
after a record date for a dividend payment date, such request to terminate may
not become effective until any dividend paid on the dividend payment date has
been reinvested and the shares of Common Stock purchased have been credited to
the Participant's account under the Plan. First Chicago, in its sole discretion,
may either pay any such dividend in cash or reinvest it in Common Stock on
behalf of the terminating Participant. If any such dividend is reinvested, First
Chicago may sell the shares and remit the proceeds to the Participant, less any
brokerage commissions, any service fee and any other costs of sale. In such
event, the risk of any price decline in the period between the dividend payment
date and the date of sale will be borne solely by the Participant. For
information as to the tax consequences of sales of Plan Shares, see Question 28.
As soon as practicable following termination, First Chicago will send
the Participant a certificate for the whole Plan Shares in the Participant's
Plan account. If the Participant so requests, First Chicago will sell all or
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a portion of such Plan Shares and remit the proceeds, less any related brokerage
commission, any service fee and any other costs of sale. Any optional cash
payments sent to First Chicago prior to a request to terminate will also be
invested unless return of the amount is expressly requested in the request for
termination and such request is received at least two business days prior to the
relevant Investment Date. See Questions 6 and 10 for the approximate timing of
dividend record and payment dates and Investment Dates. In every case of
termination, the Participant's interest in a fractional share will be paid in
cash and will be based on the actual market price of a share of Common Stock,
less any related brokerage commission, service fee, transfer tax and any other
costs of sale. Participants selling shares through the Plan should be aware that
the price of Common Stock may fluctuate during the period between a request for
sale and the ultimate sale. The risk of a price decline is borne solely by the
Participant.
Participants can obtain information as to the amount charged by First
Chicago for brokerage commissions and service fees by contacting First Chicago
at 1-800-317-4445.
After termination, dividends will be paid to the shareholder in cash
unless and until the shareholder rejoins the Plan, which the shareholder may, if
eligible, do at any time by requesting an Enrollment Authorization Form from
First Chicago. See Questions 4 and 5 above.
Rights Offering; Stock Dividends or Stock Splits
24. If Crown has a rights offering, how will the rights on Plan Shares be
handled?
Participation in any rights offering will be based upon both shares of
Common Stock registered in a Participant's name and any whole Plan Shares
credited to such Participant's Plan account.
25. What happens if Crown issues a dividend payable in stock or declares a
stock split?
Any stock dividends or split shares of Common Stock distributed by
Crown on Plan Shares will be credited pro rata to each Participant's account
with respect to whole and fractional shares. Stock dividends or split shares
distributed on shares registered in a Participant's name will be mailed directly
to the Participant.
The Plan does not provide for reinvestment of special cash dividends,
partial liquidating distributions or non-cash dividends.
Voting Rights
26. How will a Participant's shares be voted at shareholders' meetings?
For each meeting of shareholders, a Participant will receive a proxy
card that will enable the Participant to vote both the shares registered in the
Participant's name directly and any Plan Shares credited to the Participant's
Participant's Plan account (including factional shares).
If the proxy card is signed and returned but no voting instructions are
provided, all of the Participant's shares (including Plan Shares) will be voted
in accordance with the recommendation of Crown's management. This is the same
procedure that is followed for all shareholders who return proxies and do not
provide instructions. If the proxy card is not returned or is returned unsigned
the shareholder, none of the Participant's shares will be voted.
If a Participant elects, he or she may vote his or her shares,
including all Plan shares held for his or her account under the Plan, in
person at the shareholders' meeting.
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Deposit of Additional Certificates
27. How may certificates be deposited with Plan Shares?
A Participant may deposit with First Chicago any Common Stock
certificates now or hereafter registered in the Participant's name for credit
under the Plan. Following deposit with First Chicago, such shares will become
Plan Shares. There is no charge for this custodial service and, by making the
deposit, the Participant will be relieved of the responsibility for loss, theft
or destruction of the certificate. Whenever certificates are issued to the
Participant, either upon request or upon termination of participation, new,
differently numbered certificates will be issued. Since shares represented by
certificates deposited with First Chicago are Plan Shares, dividends will be
automatically reinvested on such shares. See Question 18.
To insure against loss resulting from mailing certificates to First
Chicago for deposit under the Plan, the Plan provides for mail insurance free of
charge for certificates valued at up to $25,000 when mailed first class, using
the brown, pre-addressed envelope provided by First Chicago for this purpose.
If an investor does not use the brown, pre-addressed envelope provided
by First Chicago, certificates should be mailed to First Chicago at the address
in Question 3 and insured for possible mail loss for 2% of the market value of
the certificates (minimum of $20); this represents the replacement cost of the
certificates.
To be eligible for certificate mailing insurance, an investor must
observe the following guidelines. Certificates must be mailed in brown,
pre-addressed envelopes supplied by First Chicago. Certificates mailed to First
Chicago will be insured for up to $25,000 current market value, provided the
certificates are mailed first class. First Chicago will, as soon as practicable,
send the Participant a statement confirming each deposit of certificates.
Participants must notify First Chicago of any claim within 30 calendar days of
the date the certificates were mailed. To submit a claim, an investor must be a
Participant or the investor's loss must be incurred in connection with becoming
a Participant. In the latter case, the claimant must enroll in the Plan at the
time the insurance claim is processed. The maximum insurance protection provided
to the Participant is $25,000, and coverage is available only when the
applicable certificate or certificates are sent to First Chicago in accordance
with the guidelines described above.
Insurance covers the replacement of shares of stock but in no way
protects against any loss resulting from fluctuations in the value of such
shares.
Income Tax Consequences
28. What are the income tax consequences of participation in the Plan?
Reinvested Dividends. In the case of reinvested dividends, when First
Chicago acquires shares for a Participant's account directly from Crown, the
Participant must include in gross income a dividend equal to the number of
shares purchased with the Participant's reinvested dividends multiplied by the
"fair market value" (for federal income tax purposes) of Common Stock on the
relevant dividend payment date. (Fair market value, which will be equal to the
average of the high and low sales prices of shares of Common Stock on the NYSE
on the dividend payment date, may be different from both the purchase price of
the shares purchased through the reinvested dividends and the amount of the cash
dividend.) The Participant's basis in those shares will also equal the fair
market value of the shares on the relevant dividend payment date.
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Examples of the tax treatment of dividends reinvested in shares
acquired directly from Crown are as follows:
Example 1
Cash Dividends Reinvested................................. $500
Assumed Average Market Price.............................. $ 50
Number of Shares Purchased With Reinvested Dividends..... 10
Assumed Fair Market Value (for federal income tax purposes) $ 52
Total Taxable Dividend ($52 x 10 shares).................. $520
Participant's Tax Basis in Purchased Shares............... $520
Example 2
Cash Dividends Reinvested.................................. $500
Assumed Average Market Price............................... $ 52
Number of Shares Purchased With Reinvested Dividends...... 9.615
Assumed Fair Market Value (for federal income tax purposes). $ 50
Total Taxable Dividend ($50 x 9.615 shares)............. $480.75
Participant's Tax Basis in Purchased Shares............. $480.75
Alternatively, when First Chicago purchases Common Stock with
reinvested dividends for a Participant's account on the open market or in
negotiated transactions, a Participant must include in gross income a dividend
equal to the full amount of the cash dividend used to purchase such shares plus
that portion of any brokerage commissions paid by Crown which are attributable
to the purchase of the Participant's shares. The Participant's basis in Plan
Shares held for his or her account will be equal to their purchase price plus
allocable brokerage commissions.
As reflected in the foregoing discussion and examples, Participants
will be taxed on reinvested dividends despite not receiving any cash.
Optional Cash Payments. In the case of shares purchased on the open
market or in negotiated transactions with optional cash investments,
shareholders will be in receipt of a dividend to the extent of any brokerage
commissions paid by Crown. In the case of shares purchased directly from Crown,
Participants who make optional cash payments will be treated as having received
a dividend equal to the excess, if any, of (a) the fair market value of the
shares purchased on the Investment Date over (b) the optional cash payments
made. The Participant's basis in the shares acquired with optional investments
will be the cost of the shares to First Chicago plus the additional amount, if
any, treated as a dividend for federal income tax purposes.
Receipt or Disposition of Shares. A Participant will not realize any
taxable income when he or she receives certificates for whole Plan Shares
credited to his or her account under the Plan, either upon a request for such
certificates or upon termination of the Plan. However, a Participant who
receives, upon termination of participation or termination of the Plan, a cash
payment for the sale of Plan Shares held for such Participant's account or for a
fractional share then held in his or her account will realize gain or loss
measured by the difference between the amount of the cash received, net of
brokerage commissions and any other costs of sale, and the Participant's basis
in such share or fractional share, unless such payment is treated as a dividend
for tax purposes. Such gain or loss will be capital in character if such shares
or fractional shares are a capital asset in the hands of the Participant.
Similarly, a Participant who sells Plan Shares (see Question 21) will generally
recognize gain or loss in an amount equal to the difference between the amount
realized and the tax basis in the Plan Shares that are sold.
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Tax Information and Backup Withholding. Participants will receive annual
tax information with respect to dividend income received in connection with the
Plan, as if such amounts had been paid directly to the Participants.
Participants will continue to be subject to backup withholding requirements of
the federal income tax laws. If such requirements are not satisfied, 31% of the
dividends payable to a Participant will be withheld and paid to the Internal
Revenue Service and will not be reinvested under the Plan. In addition, in the
case of foreign shareholders whose dividends are subject to U.S. federal
withholding tax, such tax will be withheld and paid to the Internal Revenue
Service and will not be reinvested under the Plan.
For further information as to tax consequences of participation in the
Plan, Participants should consult with their own tax advisors. The income tax
consequences for Participants who do not reside in the United States will vary
from jurisdiction to jurisdiction.
Responsibility of Crown and First Chicago
29. What are the responsibilities of Crown and First Chicago under the Plan?
Neither Crown nor First Chicago, as Plan Administrator, will be liable
for any act done in good faith or for any good faith omission to act, including,
without limitation, any claim of liability arising out of failure to terminate a
Participant's account upon such Participant's death, the prices at which shares
are purchased or sold for the Participant's account, the times when purchases or
sales are made or fluctuations in the market value of Common Stock.
Participants should recognize that neither Crown nor First Chicago can
provide any assurance of a profit or protection against loss on any shares
purchased under the Plan. Participants are further cautioned that this
Prospectus does not represent a change in Crown's dividend policy or a guarantee
of future dividends (or the timing or amount thereof), which will continue to
depend on Crown's earnings and financial condition, the availability of funds
therefor under applicable law, Crown's Articles of Incorporation and Bylaws,
contractual restrictions, corporate policy and other considerations. There can
be no assurance that dividends on Common Stock will be declared or paid or as to
the amount of such dividends.
Suspension, Modification or Termination of the Plan
30. May the Plan be suspended, modified or terminated?
While the Plan is intended to continue indefinitely, Crown reserves the
right, in its sole discretion, to suspend or terminate the Plan at any time,
including during the period between a dividend record date and the related
dividend payment date. It also reserves the right to make modifications to the
Plan, including providing for payment by Participants of brokerage commissions
or other fees in connection with the Plan. Participants will be notified of any
such suspension, termination or modification. Participants should note that the
fees set forth in Questions 14 and 17 are subject to change. Crown and First
Chicago also reserve the right to terminate any Participant's participation in
the Plan at any time.
31. Who should be contacted with questions about the Plan?
Unless otherwise directed by Crown in writing, all correspondence
regarding the Plan should be directed to First Chicago at the address in
Question 3. Please mention Crown Cork & Seal Company, Inc. in all
correspondence.
Other Information
32. Who interprets and regulates the Plan?
The Plan, the Enrollment Authorization Form and each Participant's
account will be governed by and construed in accordance with the laws of the
Commonwealth of Pennsylvania. Crown will resolve all questions of interpretation
and will regulate the Plan as deemed desirable or necessary. Any such
interpretation and regulation will be final and binding on Crown and all
Participants.
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33. What if a Participant dies?
In the event of death of a Participant, the account will continue to be
administered according to the decedent's prior instructions until First Chicago
receives other instructions (including a death certificate and any other
documents requested by First Chicago) from the duly authorized representative of
the decedent's estate.
34. Who bears the risk of market fluctuations in Common Stock?
A Participant's investment, both in shares held in the Plan and in
shares registered in the Participant's own name, is no different from that of
nonparticipating shareholders. The Participant bears the risk of loss and has
the opportunity for gain from market price changes with respect to all such
shares.
35. What happens if the Plan Administrator cannot purchase shares?
If Crown determines not to make newly issued or treasury shares
available for purchase pursuant to the Plan, and in the event that applicable
federal securities laws require the temporary curtailment or suspension of open
market and negotiated purchases of shares under the Plan, neither First Chicago
nor Crown will be accountable for the failure of the Plan to purchase shares. If
shares of Common Stock are not available for a period longer than 30 days, First
Chicago will, as soon as practicable, mail to the Participants a check payable
to the Participant's order in the amount, without interest, of any unapplied
funds in the Participant's account.
36. Can successor Plan Administrators be named?
Crown may from time to time designate a bank or trust company as
successor Plan Administrator for all or a part of the Plan Administrator's
functions under the Plan. If Crown does so, references in this Prospectus to
First Chicago shall be deemed to be references to the successor Plan
Administrator, unless the context requires otherwise.
PLAN OF DISTRIBUTION
The shares of Common Stock offered hereby are offered pursuant to the
Plan, which provides for the purchase by First Chicago (or its agent) of shares
of Common Stock, either newly issued or held in treasury, directly from Crown
or, at Crown's option, on the open market or in negotiated transactions. There
will be no brokerage commissions charged to Participants in connection with the
purchase of shares under the Plan, whether directly from Crown or in open market
or negotiated transactions. However, (a) beneficial owners who arrange to
participate in the Plan indirectly through a broker or other nominee may be
required to pay a commission or service fee to such broker or nominee in
connection with such participation (see Question 4), (b) a Participant using the
automatic monthly investment feature of the Plan for optional cash payments will
be charged a transaction fee of $1.00 per investment (see Question 14), and (c)
a Participant who sells through First Chicago all or a part of the shares held
for such Participant under the Plan (including with respect to fractional shares
upon termination of participation in the Plan) will be charged any brokerage
commissions, service fees, transfer taxes or other costs of sale in connection
with such sale (see Questions 21 and 23).
DESCRIPTION OF COMMON STOCK
The following description of Common Stock is a summary and is qualified
in its entirety by reference to Crown's Amended and Restated Articles of
Incorporation (the "Crown Articles") and Amended and Restated Bylaws (the "Crown
Bylaws"), copies of which have been filed with the SEC. The description is
subject in all respects to the Pennsylvania Business Corporation Law of 1988, as
amended (the "PBCL").
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General. Crown's authorized capital stock consists of 500,000,000 shares
of Common Stock, 50,000,000 shares of 4.5% Convertible Preferred Stock, and
30,000,000 shares of additional preferred stock, with such voting rights,
preferences, limitations and special rights as may be specified, subject to the
Crown Articles, by Crown's Board of Directors. As of May 29, 1996, Crown had
outstanding 128,132,573 shares of Common Stock and 12,432,632 shares of 4.5%
Convertible Preferred Stock, and 27,659,059 shares of Common Stock were held in
the treasury of Crown. No shares of such additional preferred stock were
outstanding as of such date. Common Stock and 4.5% Convertible Preferred Stock
are currently listed both on the NYSE and the Bourse de Paris, or Paris Stock
Exchange.
The outstanding shares of 4.5% Convertible Preferred Stock rank prior to
Common Stock both as to dividends and on liquidation. The aggregate liquidation
preference of the outstanding shares of 4.5% Convertible Preferred Stock is
$520,771,454.03, plus any accrued and unpaid dividends. For a description of
4.5% Convertible Preferred Stock, shareholders are referred to Crown's
Registration Statement on Form 8-A filed February 20, 1996, which is
incorporated by reference herein.
Dividends. Holders of Common Stock are entitled to receive such
dividends as may be declared by the Board of Directors. Crown's ability to pay
dividends on Common Stock is subject to the legal availability of funds therefor
as well as contractual restrictions (including prior full payment of dividends
as to 4.5% Convertible Preferred Stock and any other outstanding preferred stock
of Crown). See also Question 29.
Voting Rights. Except as to matters as to which holders of 4.5% Convertible
Preferred Stock (and any other capital stock of Crown) have the right to vote
separately as a class, the holders of shares of Common Stock vote together with
holders of 4.5% Convertible Preferred Stock (and any other capital stock of
Crown entitled to vote with Common Stock) as a class. At every meeting of
shareholders of Crown, the holders of record of shares of Common Stock entitled
to vote at the meeting are entitled to one vote for each share ofCommon Stock
held. When voting with holders of Common Stock as to any matter, holders of 4.5%
Convertible Preferred Stock are entitled, for each share of 4.5% Convertible
Preferred Stock held, to that number of votes equal to the number of shares of
Common Stock into which a share of 4.5% Convertible Preferred Stock is
convertible as of the record date of the vote. As of the date of this
Prospectus, each share of 4.5% Convertible Preferred Stock is convertible into
approximately 0.91 shares of Common Stock.
Holders of 4.5% Convertible Preferred Stock have the right to vote
separately as a class with respect to (a) any amendment, alteration or repeal of
any provision of the Crown Articles which affects, in a manner adverse to such
holders, the relative rights, preferences, qualifications, limitations or
restrictions of 4.5% Convertible Preferred Stock, (b) any creation,
authorization or reclassification of any authorized stock of Crown into, or any
increase in the authorized amount of, any class or series of Crown's capital
stock ranking prior to 4.5% Convertible Preferred Stock as to dividends or as to
rights upon liquidation, dissolution or winding up of Crown, or any security
convertible into shares of such a class or series, or (c) any other action as to
which the holders of 4.5% Convertible Preferred Stock are entitled by law to
vote separately as a class. In addition, whenever dividends accrued on 4.5%
Convertible Preferred Stock are in arrears and unpaid for at least six quarterly
dividend periods, the Crown Articles provide that the size of the Board of
Directors of Crown shall be increased by two directors and that the holders of
4.5% Convertible Preferred Stock will have the right, voting separately as a
class together with holders of any other shares of preferred stock of Crown
having such voting rights, to elect such two additional directors.
Shareholders of Crown are not entitled to cumulative voting in the
election of directors.
No Preemptive Rights. Shareholders of Crown are not entitled to any
preemptive rights to purchase or to subscribe to any additional or increased
stock of any class or any obligations convertible into any class or classes of
stock.
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Liquidation Rights. In any liquidation, dissolution or winding up of
Crown, after the debts of Crown have been paid or provided for, and subject to
the rights upon liquidation of the holders of 4.5% Convertible Preferred Stock
and any other preferred stock of Crown, all of the remaining assets of Crown
shall belong to and shall be distributed ratably among the holders of shares of
Common Stock.
Rights Plan. Pursuant to a Rights Agreement, dated as of August 10,
1995 (the "Rights Plan"), the Board of Directors of Crown declared a dividend
distribution of one Right for each share of Common Stock outstanding on August
10, 1995 (the "Record Date") and authorized the issuance of one Right for each
share of Common Stock that becomes outstanding between the Record Date and the
earliest of the Distribution Date, the Redemption Date and the Final Expiration
Date (as such terms are defined below), including any newly issued or treasury
shares issued pursuant to the Plan. Subject to the terms and conditions of the
Rights Plan, each Right issued pursuant to the Rights Plan entitles the
registered holder to purchase from Crown one share of Common Stock (or in
certain circumstances cash, property or other securities) at a price of $200,
subject to adjustment.
Until the earlier to occur of (a) ten calendar days following the date (the
"Shares Acquisition Date") of public announcement that a person or entity or
group of affiliated or associated persons or entities acquired, or obtained the
right to acquire, beneficial ownership of 15% or more of the outstanding shares
of Common Stock (an "Acquiring Person") or (b) ten business days (or such later
date as is determined by the Board of Directors or, if there has been an Adverse
Change of Control, by a majority of the "continuing directors" (as such terms
are defined below) of Crown) following the commencement or first public
announcement of an intention of any applicable person to make a tender offer or
exchange offer if, upon consummation thereof, such person would be an Acquiring
Person (the earlier of such dates being called the "Distribution Date"), the
Rights are evidenced by the certificates evidencing the Common Stock. Until the
Distribution Date, the Rights will be transferred only with the shares of Common
Stock. As soon as practicable following the Distribution Date, separate
certificates evidencing the Rights ("Rights Certificates") will be mailed to
holders of record of shares of Common Stock as of the close of business on the
Distribution Date, and such separate Right Certificates alone will evidence the
Rights.
The Rights Plan contains special provisions regarding Compagnie
Generale d'Industrie et de Participations, a societe anonyme organized under the
laws of the Republic of France ("CGIP") (and its affiliates and associates),
which presently owns approximately 19.95% of Crown's outstanding voting power.
First, CGIP will not become an "Acquiring Person" under the Rights Plan merely
as a result of CGIP's tender of its former CarnaudMetalbox shares in Crown's
recent exchange offer for such shares. Second, during the Standstill Period
under the Shareholders Agreement between CGIP and Crown (discussed below) and so
long as CGIP has not breached certain provisions of the Shareholders Agreement,
CGIP will not become an "Acquiring Person" when it takes any action which Crown
has agreed to permit during the Standstill Period. Finally, after the expiration
of the Standstill Period, CGIP will be an "Acquiring Person," subject to certain
exceptions including with respect to the acquisition of beneficial ownership of
additional shares of Common Stock within 18 months after certain dilutive
issuances by Crown, only if CGIP acquires beneficial ownership of additional
shares of Common Stock, and CGIP is thereafter the beneficial owner of 15% or
more of the shares of Common Stock then outstanding, excluding securities
granted by Crown to directors of Crown who are affiliates or associates of CGIP.
If, however, at the time of the expiration of the Standstill Period, CGIP has
breached its Shareholders Agreement with Crown, then CGIP will be an "Acquiring
Person" to the extent it would otherwise be deemed as such but for the
provisions noted above.
The Rights are not exercisable until the Distribution Date. The Rights
will expire at the close of business on August 10, 2005 (the "Final Expiration
Date") unless earlier redeemed by Crown as described below.
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<PAGE>
In the event that a person or entity (other than certain specified
persons or entities) becomes the beneficial owner of more than 15% of the then
outstanding shares of Common Stock, each holder of a Right will thereafter have
the right to receive, upon exercise, shares of Common Stock (or, in certain
circumstances, cash, property or other securities of Crown) having a value equal
to two times the exercise price of the Right. Notwithstanding any of the
foregoing, following the occurrence of any of the events set forth above, all
Rights that are, or (under certain circumstances specified in the Rights Plan)
were, beneficially owned by an Acquiring Person will be null and void.
In the event that, at any time following the Shares Acquisition Date,
(a) Crown is acquired in a merger or other business combination transaction,
or (b) 50% or more of Crown's assets or earning power is sold or transferred,
each holder of a Right (except Rights which previously have been voided as set
forth above) shall thereafter have the right to receive, upon exercise, common
stock of the acquiring company having a value equal to two times the exercise
price of the Right. The events set forth in this paragraph and in the preceding
paragraph are referred to as the "Triggering Events."
At any time prior to the earlier of (a) 5:00 p.m. New York City time on
the tenth calendar day following the Shares Acquisition Date and (b) the Final
Expiration Date, Crown may redeem the Rights in whole, but not in part, at a
price of $.01 per Right (the "Redemption Price"). The date of such redemption is
the "Redemption Date." Following an Adverse Change of Control, the decision to
redeem the Rights will require the concurrence of a majority of the "continuing
directors" of Crown. An "Adverse Change of Control" means a change (resulting
from a proxy or consent solicitation) in a majority of the directors of Crown in
office at the commencement of such solicitation where a participant in such
solicitation has stated (or Crown's Board of Directors determines) that such
participant has taken, intends to take or may consider taking any action that
would result in such participant becoming an Acquiring Person or causing the
occurrence of a Triggering Event, and "continuing directors" means any member of
Crown's Board of Directors who is not an Acquiring Person and was a member prior
to the Record Date or any person who subsequently becomes a member of the Board
if such person's nomination for election or election to the Board is recommended
or approved by a majority of the continuing directors. Immediately upon the
action of the Board of Directors of Crown electing to redeem the Rights with, if
required, the concurrence of the continuing directors, Crown shall make
announcement thereof, and upon such action, the right to exercise the Rights
will terminate and the only right of the holders of Rights will be to receive
the Redemption Price.
Until a Right is exercised, the holder thereof, as such, will have no
rights as a shareholder of Crown, including, without limitation, the right to
vote or to receive dividends.
Any of the provisions of the Rights Plan may be amended by the Board of
Directors of Crown prior to the earliest of the Distribution Date, the
occurrence of a Triggering Event or an Adverse Change of Control. After the
Distribution Date, the occurrence of a Triggering Event or an Adverse Change in
Control, the provisions of the Rights Plan may be amended by the Board of
Directors of Crown in order to cure any ambiguity, defect or inconsistency, to
make changes which do not adversely affect the interests of holders of Rights
(excluding the interests of any Acquiring Person), or, with certain limitations,
to shorten or lengthen any time period under the Rights Plan. In addition, the
Board of Directors of Crown may at any time (with the concurrence of the
continuing directors) amend the Rights Plan to provide for the issuance of
shares of Crown's preferred stock under the Rights Plan in place of shares of
Common Stock.
Certain Other Agreements and Provisions. In addition to the currently
outstanding shares of 4.5% Convertible Preferred Stock, Crown's Board of
Directors is authorized to provide for the issuance, at any time or from time to
time, of up to 30,000,000 shares of preferred stock of Crown in one or more
classes or series of a
20
<PAGE>
class as determined by Crown's Board of Directors, to determine the
designation and number of shares of any such class or series and to determine
the voting rights, preferences, limitations and special rights, if any, of such
class or series; provided, however, that under the Crown Articles, such shares
will rank on a parity with or junior to 4.5% Convertible Preferred Stock in
respect of dividend and liquidation rights and provided further that any such
shares will not be entitled to more than one vote per share when voting as a
class with holders of Common Stock.
As mentioned above, Crown has entered into a Shareholders Agreement
with CGIP. Subject to the terms of the Shareholders Agreement, CGIP has agreed
to certain standstill provisions which prohibit CGIP from acquiring beneficial
ownership of voting securities representing more than 19.95% of the outstanding
Total Voting Power (as defined in the Shareholders Agreement) of Crown, making a
Takeover Proposal (as defined in the Shareholders Agreement and described
generally below) for Crown or its subsidiaries and taking certain other actions.
CGIP currently owns approximately 19.95% of Crown's Total Voting Power.
As used in the Shareholders Agreement, the term "Takeover Proposal"
includes (a) any Specified Event (as defined in the Shareholders Agreement and
described generally below), (b) any other proposal to take over control of Crown
or a merger or other business combination, recapitalization, restructuring,
liquidation or similar transaction involving Crown or any of its material
subsidiaries, or any proposal or offer to acquire in any manner voting
securities representing more than 20% of the Total Voting Power of Crown or any
of its material subsidiaries, a substantial equity interest in any of Crown's
material subsidiaries or a substantial portion of the assets of Crown or any of
its material subsidiaries, (c) any request to invite any person or entity to
effect any of the actions CGIP is prohibited from taking under the standstill
provisions of the Shareholders Agreement described generally above or any
request to challenge, waive, opt out of, or amend any provision of the Rights
Plan (as defined below) or any anti-takeover statutes or other anti-takeover
provisions applicable to Crown, or (d) a proposal having similar effect. As used
in the Shareholders Agreement, the term "Specified Event" includes any
unsolicited tender or exchange offer (other than an offer by CGIP or its
affiliates or any group of which CGIP or any such affiliate is a member) for
voting securities representing more of the Total Voting Power of Crown than the
amount beneficially owned by CGIP (but in any event for voting securities
representing not less than 20% of the Total Voting Power of Crown), or an
unsolicited proxy or consent solicitation by any such person or entity to
replace at least a majority of the "continuing directors" of Crown (as defined
in the Shareholders Agreement), or any unsolicited tender or exchange offer for
voting securities representing at least 20% or the Total Voting Power of any
material subsidiary of Crown.
The Shareholders Agreement provides that CGIP is entitled to designate up
to three persons (the "CGIP Designees") to be nominated for election as
directors of Crown at the annual meeting of Crown Shareholders, depending on the
amount of Crown voting securities beneficially owned by CGIP. CGIP has agreed to
vote any Crown voting securities beneficially owned by CGIP during the
Standstill Period (as defined in the Shareholders Agreement and described
generally below) in the manner recommended by Crown's Board of Directors in
connection with the election of directors of Crown and any question relating to
a Takeover Proposal.
The Standstill Period began on February 22, 1996 and terminates under
certain circumstances upon the earliest to occur of (a) the later of February
22, 1999 and the date on which CGIP beneficially owns voting securities of Crown
representing less than 3.5% of the outstanding Total Voting Power of Crown, (b)
the date Crown breaches certain provisions of the Shareholders Agreement
relating to CGIP's board representation or Crown's dividend policy or debt
rating, (c) the date Crown agrees to recommend (or ceases to oppose) the
consummation of a Specified Event or enters into, or takes material steps to
solicit, an agreement with respect to certain
21
<PAGE>
fundamental corporate transactions involving Crown or its subsidiaries, (d)
the date a person other than CGIP acquires 25% of the Total Voting Power of
Crown, or (e) the date any CGIP Designee fails to be elected to Crown's Board of
Directors.
The foregoing agreements and provisions, including the existence under
the Crown Articles of amounts of authorized but unissued preferred stock and
Common Stock, the Rights Plan, and CGIP's voting power and the various
provisions of the Shareholders Agreement, could have the effect of delaying or
preventing a change in control of Crown.
Certain other provisions of the Crown Articles and Crown Bylaws could
also have the effect of preventing or delaying any change in control of Crown,
including (a) the advance notice procedures governing shareholder nomination of
candidates to Crown's Board of Directors and other shareholder proposals or
business to be considered at meetings of Crown's shareholders, (b) the absence
of authority for shareholders to call special shareholder meetings of Crown,
except in certain limited circumstances mandated by the PBCL, (c) director and
officer indemnification and director limitation of liability provisions
discussed generally in "INDEMNIFICATION AND LIMITATION OF LIABILITY" below, (d)
the absence of authority for shareholder action by written consent by less than
all of Crown's shareholders, (e) the reserving to the Board of Directors of
Crown the authority to fill vacancies on the Board of Directors, (f) the
existence of a Strategic Committee of Crown's Board of Directors, one half the
members of which (including its chair) are CGIP Designees, which has authority
to consider, and make non-binding recommendations to Crown's full Board of
Directors regarding, business combinations and other extraordinary transactions
involving Crown and certain other matters, and (g) the limitation on the maximum
number of directors of Crown.
In addition, Crown is subject to Section 2538 and Sections 2551-2556 of
the PBCL, which in certain cases provide for supermajority shareholder approval
of mergers and certain other extraordinary transactions involving Crown and any
"interested shareholder" (as defined in such statutes and including generally,
in the case of Section 2538, shareholders who are party to the extraordinary
transaction or who are treated differently than other shareholders, and, in the
case of Sections 2551-2556, shareholders beneficially owning 20% or more of the
voting power of a "registered" corporation, such as Crown). There are additional
anti-takeover statutes in the PBCL which Crown currently has elected not to be
subject to, including limitations on the voting rights of shareholders achieving
for the first time voting power over 20%-33 1/3%, 33 1/3-50% or 50% or more of
the voting shares of a registered corporation, alternative fiduciary duty
provisions for directors, provisions permitting recovery of short-term profits
realized by persons who acquire or seek to acquire voting power over 20% or
more of the voting shares of registered corporations, provisions permitting
recovery of fair value of shares from persons having voting power over 20% or
more of the voting shares of registered corporations, and provisions mandating
payment of severance benefits and compliance with labor contracts following
certain extraordinary transactions.
The foregoing descriptions of the Rights Plan, the Shareholders Agreement,
the Crown Articles and the Crown Bylaws do not purport to be complete and are
qualified in their entirety by reference to (a) in the case of the Rights Plan,
Crown's Registration Statement on Form 8-A filed August 10, 1995, (b) in the
case of the Shareholders Agreement, the complete text of the Shareholders
Agreement, which is an Exhibit to Crown's Current Report on Form 8-K filed on
March 1, 1996, and (c) in the case of the Crown Articles and Crown Bylaws, the
complete text of the Crown Articles and Crown Bylaws, which are Exhibits to
Crown's Registration Statement on Form 8-A dated February 20, 1996, each of
which is incorporated by reference herein. In addition, the foregoing
descriptions of the anti-takeover provisions of the PBCL is only a summary and
is qualified in its entirety by reference to the PBCL.
First Chicago acts as transfer agent, registrar and dividend disbursing
agent for Common Stock.
22
<PAGE>
USE OF PROCEEDS
Crown cannot estimate either the number of shares of Common Stock that
will ultimately be sold pursuant to the Plan or the prices at which such shares
will be sold. However, Crown intends to use the net proceeds from the sale of
newly-issued or treasury shares of Common Stock purchased directly from Crown
under the Plan for general corporate purposes.
EXPERTS
The financial statements incorporated in this Prospectus by reference to
Crown'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 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 incorporated in this Prospectus by reference to Crown's Current
Report on Form 8-K, as amended, 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 financial statements of
CarnaudMetalbox as of December 31, 1995 and for the year ending on December 31,
1995 incorporated in this Prospectus by reference to 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.
LEGAL OPINION
Certain legal matters with respect to the Common Stock offered
hereby have been passed upon by Dechert Price & Rhoads, counsel to Crown.
Chester C. Hilinski, of counsel of Dechert Price & Rhoads, is a director of
Crown and, as of March 1, 1996, owned 0.013% of the outstanding shares of
Common Stock.
INDEMNIFICATION AND LIMITATION OF LIABILITY
The PBCL provides for the indemnification of any person acting as a
representative of any Pennsylvania corporation, such as Crown, in certain
circumstances and grants to each such corporation the power to indemnify such
persons against liability for certain of their acts. Section 1713 of the PBCL
allows a Pennsylvania corporation to include in its bylaws a provision limiting
the personal liability of the corporation's directors for monetary damages in
certain circumstances.
The Crown Bylaws provide that directors and officers of Crown shall be
indemnified to the fullest extent permitted by applicable law against
liabilities, losses and expenses incurred in certain actions, suits and
proceedings. The Crown Bylaws further limit the personal liability of Crown's
directors for monetary damages in the circumstances currently permitted by the
PBCL.
Crown has purchased directors' and officers' liability insurance
covering certain liabilities which may be incurred by the directors and officers
of Crown in connection with the performance of their duties.
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of Crown
pursuant to the foregoing provisions or otherwise, Crown has been informed that
in the opinion of the SEC such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable.
23
<PAGE>
==================================== ==================================
This Prospectus does not
constitute an offer to sell or
a solicitation a 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 of
solicitation in such jurisdiction.
No person has been authorized to
to give any information or to make
any representations other than
contained in this Prospectus in [LOGO]
connection with the offering made
hereby, and if given or made, such
information or representations
must not be relied upon as
having been authorized by Crown.
Neither the delivery of this
Prospectus nor any sale made
hereunder shall, under any circum-
stances, create any implication
that information herein is correct
as of any time subsequent to the
date hereof. CROWN CORK & SEAL
COMPANY, INC.
-----------------
TABLE OF CONTENTS
Page DIVIDEND
---- REINVESTMENT AND
STOCK PURCHASE PLAN
AVAILABLE INFORMATION.......... 2
INCORPORATION OF CERTAIN
DOCUMENTS BY REFERENCE......... 2
CROWN CORK & SEAL COMPANY, INC . 3
THE PLAN....................... 3
Purpose........................ 3
Advantages..................... 3
Administration................. 4
Participation.................. 4
Purchases...................... 8 Common Stock
Optional cash Payments......... 9 ($5.00 Par Value)
Costs.......................... 10
Reports to Participants........ 10
Issuance of Shares............. 11
Termination of Participants.... 12
Rights Offering: Stock
Dividends or Stock Splits..... 13
Voting Rights.................. 13
Deposit of Additional
Certificates................. 14
Income Tax Consequences........ 14 --------------
Responsibility of Crown PROSPECTUS
and First Chicago............. 16 --------------
Suspension, Modification or
Termination of the Plan........ 16
Other Information.............. 16
PLAN OF DISTRIBUTION........... 17
DESCRIPTION OF COMMON STOCK.... 17
USE OF PROCEEDS................ 23
EXPERTS........................ 23
LEGAL OPINION.................. 23
INDEMNIFICATION AND
LIMITATION OF LIABILITY ....... 23
=================================== ==================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the fees and expenses estimated* to be
incurred in connection with the issuance and distribution of the
securities being registered hereby. All such expenses will be borne by
Crown.
SEC registration fees $163,147
New York Stock Exchange Listing Fees 36,500
Legal fees and expenses 20,000
Printing expenses 6,000
Plan Administration fees 10,000
Miscellaneous 2,000
--------
Total $237,647
========
* All items estimated except for SEC registration fees.
Item 15. Indemnification of Directors and Officers.
Under the Pennsylvania Business Corporation Law of 1988, as
amended (the "PBCL"), Pennsylvania corporations have the power to indemnify any
person acting as a representative of the corporation against liabilities
incurred in such capacity provided certain standards are met, including good
faith and the belief that the particular action or failure to take action is in
the best interests of the corporation. In general, this power to indemnify does
not exist in the case of actions against any person by or in the right of the
corporation if the person otherwise entitled to indemnification shall have been
adjudged to be liable to the corporation unless a court determines that despite
the adjudication of liability but in view of all the circumstances of the case,
the person is fairly and reasonably entitled to indemnity for expenses that the
court deems proper. A corporation is required to indemnify representatives of
the corporation against expenses they may incur in defending actions against
them in such capacities if they are successful on the merits or otherwise in the
defense of such actions. In all other cases, if a representative of the
corporation acted, or failed to act, in good faith and in a manner he or she
reasonably believed to be in or not opposed to the best interests of the
corporation, indemnification is discretionary, except as may be otherwise
provided by a corporation's bylaws, agreement, vote of shareholders or
disinterested directors or otherwise. Indemnification so otherwise provided may
not, however, be made if the act or failure to act giving rise to the claim for
indemnification is determined by a court to have constituted willful misconduct
or recklessness. Expenses (including attorney's fees) incurred in defending any
such action may be paid by the corporation in advance of the final disposition
of the action upon receipt of an undertaking by or on behalf of the
representative to repay the amount if it is ultimately determined that he or she
is not entitled to be indemnified by the corporation.
Section 1746 of the PBCL provides that the foregoing
provisions shall not be deemed exclusive of any other rights to which a person
seeking indemnification may be entitled under, among other things, any bylaw
provision, provided that no indemnification may be made in any case where the
act
II-1
<PAGE>
or failure to act giving rise to the claim for indemnification is determined by
a court to have constituted willful misconduct or recklessness.
The Registrant's Bylaws provide that the Registrant shall indemnify to the
fullest extent permitted by applicable law any person who was or is a party or
is threatened to be made a party to or is otherwise involved in any threatened,
pending or completed action, suit or proceeding by reason of the fact that such
person is or was a director or officer of the Registrant, against all liability,
loss and expense (including attorney's fees and amounts paid in settlement)
actually and reasonably incurred by such person in connection with such
proceeding, whether or not the indemnified liability arises or arose from any
proceeding by or in the right of the Registrant. The Registrant's Bylaws also
provide that (a) prior to any 'change in control" of the Registrant (as defined
in the Bylaws), expenses incurred by a director or officer in defending (or
acting as a witness in) a proceeding may, in the discretion of the Registrant's
Board of Directors, be paid by the Registrant in advance of the final
disposition of such proceeding, subject to the provisions of applicable law,
upon receipt of an undertaking by or on behalf of the director or officer to
repay such amount if it shall ultimately be determined that such person is not
entitled to be indemnified by the Registrant under applicable law and (b)
following any such "change in control", such expenses shall be paid by the
Registrant in advance of the final disposition of such proceeding, subject to
receipt of such an undertaking. Additionally, the Registrant's Bylaws limit
directors' personal liability for monetary damages for any action taken, or any
failure to take any action, unless (a) the director has breached or failed to
perform the duties of his or her office under the PBCL's standard of care and
justifiable reliance provisions and (b) the breach or failure to perform
constitutes self-dealing, willful misconduct or recklessness. However, these
provisions do not apply to the responsibility or liability of a director
pursuant to any criminal statute or for the payment of taxes pursuant to local,
state or federal law. The Registrant has purchased directors and officers'
liability insurance covering certain liabilities which may be incurred by the
officers and directors of the Registrant in connection with the performance of
their duties.
Item 16. Exhibits.
The Exhibit Index appearing on page II-6 is hereby incorporated by
reference.
Item 17. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration Statement;
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of
the Registration Statement (or the most
recent post-effective amendment thereof)
which, individually or in the aggregate,
represent a fundamental change in the
information set forth in the Registration
Statement;
(iii) To include any material information with
respect to the plan of distribution not
previously disclosed in the Registration
Statement or any material change to such
information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the
registration statement is on Form S-3, Form S-8 or Form F-3, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission
II-2
<PAGE>
by the registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934 that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof;
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in the Registration Statement shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-3 and has duly caused this
Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Philadelphia, Commonwealth
of Pennsylvania, on May 29, 1996.
CROWN CORK & SEAL COMPANY, INC.
By: /s/ William J. Avery
--------------------
Name: William J. Avery
Title: Chairman of the Board
and Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes William J.
Avery, Alan W. Rutherford and Richard L. Krzyzanowski, and each of them, his
true and lawful attorneys-in-fact and agents each with full power of
substitution and resubstitution for him in any and all capacities to sign any
and all amendments (including pre- or post-effective amendments) to this
Registration Statement on Form S-3 and to file the same, with all exhibits
thereto, and other documents in connection therewith, with the Securities and
Exchange Commission under the Securities Act of 1933, as amended, hereby
ratifying and confirming all that each such attorney-in-fact, or his substitute
or substitutes, may do or cause to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signature Title Date
/s/ William J. Avery Chairman of the May 29 , 1996
WILLIAM J. AVERY Board and
Chief Executive
Officer (Principal
Executive Officer)
/s/ Alan W. Rutherford Executive Vice May 29, 1996
ALAN W. RUTHERFORD President, Chief
Financial Officer
and Director
(Principal Financial
Officer)
/s/ Timothy J. Donahue Vice President and Controller May 29, 1996
TIMOTHY J. DONAHUE (Principal Accounting Officer)
/s/ Henry E. Butwel Director May 29, 1996
HENRY E. BUTWEL
/s/ Charles F. Casey Director May 29, 1996
CHARLES F. CASEY
II-4
<PAGE>
/s/ Francis X. Dalton Director May 29, 1996
FRANCIS X. DALTON
/s/ Chester C. Hilinski Director May 29, 1996
CHESTER C. HILINSKI
/s/ Richard L. Krzyzanowski Director May 29, 1996
RICHARD L. KRZYZANOWSKI
/s/ Josephine C. Mandeville Director May 29, 1996
JOSEPHINE C. MANDEVILLE
/s/ Michael J. McKenna Director, May 29, 1996
MICHAEL J. MCKENNA President and Chief
Operating Officer
Director
FELIX G. ROHATYN
/s/ J. Douglass Scott Director May 29, 1996
J. DOUGLASS SCOTT
/s/ Ernest-Antoine Seilliere Director May 29, 1996
ERNEST-ANTOINE SEILLIERE
/s/ Robert J. Siebert Director May 29, 1996
ROBERT J. SIEBERT
/s/ Harold A. Sorgenti Director May 29, 1996
HAROLD A. SORGENTI
/s/ Guy de Wouters Director May 29, 1996
GUY DE WOUTERS
II-5
<PAGE>
INDEX TO EXHIBITS
Sequentially
Exhibit No. Description Numbered Page
4.1 Amended and Restated Articles of Incorporation of
Registrant (incorporated by reference to Exhibit 3.1
of Registrant's Form 8-A filed February 20,
1996 (File No. 1-2227)).
4.2 Resolution fixing the terms of Registrant's 4.5%
Convertible Preferred Stock(incorporated by reference
to Exhibit 3.2 of Registrant's Form 8-A filed
February 20, 1996 (File No. 1-2227)).
4.3 Bylaws of Registrant (incorporated by reference to
Exhibit 3.3 of Registrant's Form 8-A filed
February 20, 1996 (File No. 1-2227)).
4.4 Rights Agreement, dated August 7, 1995 between
Crown Cork & Seal Company, Inc. and First
Chicago Trust Company of New York (incorporated by
reference to Exhibit 1 of Registrant's Form 8-A,
filed August 10, 1995 (File No. 1-2227)).
5.1 Opinion of Dechert Price & Rhoads as to legality
of the Common Stock offered hereby. II-7
23.1 Consent of Price Waterhouse LLP. II-8
23.2 Consent of Arthur Anderson LLP,
Befec - Price Waterhouse,
Claude Chevalier and Salustro Reydel. II-9
23.3 Consent of Dechert Price & Rhoads (included
in Exhibit 5.1).
24.1 Power of Attorney. *
* Included on Signature page.
II-6
May 31, 1996
Crown Cork & Seal Company, Inc.
9300 Ashton Road
Philadelphia, PA 19136
Dear Sirs:
We refer to the proposed issuance and sale by Crown Cork & Seal Company,
Inc. (the "Company") of up to 10,000,000 shares of Common Stock, par value $5.00
per share (the "Common Stock"), through the Company's Dividend Reinvestment and
Stock Purchase Plan (the "Plan").
We have acted as counsel in connection with the preparation of
the Registration Statement on Form S-3 (the "Registration Statement")
for the registration of the Common Stock under the Securities Act of 1933,
as amended (the "Securities Act"). We have also examined copies of the
Company's Amended and Restated Articles of Incorporation, as filed by the
Company in the office of the Secretary of State of the Commonwealth of
Pennsylvania, and such Company records and other documents as we have deemed
necessary in order to enable us to express the opinions set forth below.
Upon the basis of the foregoing, we are of the opinion that:
(a) The Company has been duly incorporated and is validly existing
and in good standing as a corporation under the laws of the
Commonwealth of Pennsylvania; and
(b) The Common Stock will be, when issued by the Company
and delivered against payment therefor in accordance
with the terms of the Plan, validly issued, fully
paid and nonassessable.
The opinions expressed herein are rendered solely for your benefit in
connection with the issuance and sale by the Company of the Common Stock
pursuant to the Plan. The opinions expressed herein may not be used or relied on
by any other person, nor may this letter or any copies thereof be furnished to a
third party, filed with a government agency, quoted, cited or otherwise referred
to without our prior written consent, except as noted below.
We hereby consent to the filing of this opinion letter as Exhibit 5.1 to
the Registration Statement and to the reference to this opinion letter under the
caption "Legal Opinion" in the prospectus forming a part of the Registration
Statement. In giving such consent, we do not thereby admit that we are in the
category of persons whose consent is required under Section 7 of the Securities
Act.
Very truly yours,
DECHERT PRICE & RHOADS
II-7
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
March 5, 1996, appearing on page 25 of Crown Cork & Seal Company, Inc.'s Annual
Report on Form 10-K for the year ended December 31, 1995. We also consent to the
reference to us under the heading "Experts" in such Prospectus.
PRICE WATERHOUSE LLP
Philadelphia, PA
May 30, 1996
II-8
Form of Accountants Consent
We hereby consent to the incorporation by reference in this Form S-3 of Crown
Cork & Seal Company, Inc. of our report dated February 21, 1996 relating to the
consolidated financial statements of CarnaudMetalbox, which report is
incorporated by reference into Item 7(a) and appears in Exhibit 99.1 of Crown's
Form 8-K filed on March 1, 1996, as amended by Amendment Nos. 1, 2 and 3.
Paris, 30 May 1996
Arthur Andersen LLP(1) Befec-Price Waterhouse(1)
M.S. Moralee
Salustro Reydel(2) C. Chevalier(3)
J.P. Crouzet
(1) For the years ended December 31, 1995, 1994 and 1993.
(2) For the year ended December 31, 1995.
(3) For the years ended December 31, 1994 and 1993.
II-9
