<PAGE>
Filed Pursuant To Rule 424(b)(5)
Registration No. 33-57807
Prospectus Supplement
(To Prospectus dated April 13, 1999)
[LOGO OF R.R. DONNELLEY & SONS COMPANY APPEARS HERE]
[LOGO OF R.R. DONNELLEY & SONS COMPANY APPEARS HERE]
$200,000,000
6 5/8% Debentures due 2029
Interest payable April 15 and October 15
Issue price: 98.985%
The Debentures will mature on April 15, 2029. Interest will accrue from April
16, 1999. The Company may redeem the Debentures in whole or in part at any time
at the redemption prices described on page S-3 of this Prospectus Supplement.
The Debentures will be issued in minimum denominations of $1,000 increased in
multiples of $1,000.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this Prospectus Supplement or the accompanying
Prospectus. Any representation to the contrary is a criminal offense.
<TABLE>
- -----------------------------------------------------------------------------------
<CAPTION>
Price to Discounts and Proceeds to
Public Commissions the Company
- -----------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Debenture 98.985% .875% 98.110%
- -----------------------------------------------------------------------------------
Total $197,970,000 $1,750,000 $196,220,000
- -----------------------------------------------------------------------------------
</TABLE>
The Debentures will not be listed on any national securities exchange.
Currently, there is no public market for the Debentures.
It is expected that delivery of the Debentures will be made to investors on or
about April 16, 1999.
J.P. Morgan & Co.
Goldman, Sachs & Co.
Morgan Stanley Dean Witter
Loop Capital Markets, LLC
Utendahl Capital Partners, L.P.
April 13, 1999
<PAGE>
No person is authorized to give any information or to make any representations
other than those contained or incorporated by reference in this Prospectus
Supplement or the accompanying Prospectus, and, if given or made, such
information or representations must not be relied upon as having been
authorized. This Prospectus Supplement and the accompanying Prospectus do not
constitute an offer to sell or the solicitation of an offer to buy any
securities other than the securities described in this Prospectus Supplement or
an offer to sell or the solicitation of an offer to buy such securities in any
circumstances in which such offer or solicitation is unlawful. Neither the
delivery of this Prospectus Supplement or the accompanying Prospectus, nor any
sale made hereunder and thereunder shall, under any circumstances, create any
implication that there has been no change in the affairs of the Company since
the date hereof or that the information contained or incorporated by reference
herein or therein is correct as of any time subsequent to the date of such
information.
TABLE OF CONTENTS
Prospectus Supplement
<TABLE>
<CAPTION>
Page
----
<S> <C>
The Company................................................................ S-3
Use of Proceeds............................................................ S-3
Description of the Debentures.............................................. S-3
Underwriting............................................................... S-5
Validity of the Debentures................................................. S-6
Prospectus
About This Prospectus...................................................... 2
Where You Can Find More Information........................................ 2
The Company................................................................ 3
Use of Proceeds............................................................ 3
Ratio of Earnings to Fixed Charges......................................... 3
Description of Debt Securities............................................. 4
Plan of Distribution....................................................... 12
Legal Opinions............................................................. 13
Experts.................................................................... 13
</TABLE>
S-2
<PAGE>
THE COMPANY
R. R. Donnelley & Sons Company is the largest commercial printer in North
America. We are a leading provider of printing and related services to the
merchandising, magazine, book, directory, financial and healthcare markets. We
use our superior skills, scale and technology to deliver solutions that
effectively meet our customers' needs. Our common stock has been publicly
traded since 1956. Today, the Company has approximately 31,000 employees
working in our core printing operations on four continents. We have 49
manufacturing plants with a broad range of capabilities to serve our customers'
needs. While 91% of our revenue is generated in the United States, we have
extended our core competencies into selected international markets.
USE OF PROCEEDS
We will use substantially all of the net proceeds from the sale of the
Debentures to reduce outstanding commercial paper borrowings incurred for
working capital purposes and in connection with the financing of our
acquisitions of Cadmus Financial Communications and the Communicolor division
of The Standard Register Company in March and April of 1999. At April 9, 1999,
our commercial paper borrowings matured no later than 42 days from the date of
issue and bore a weighted average interest rate of 4.88% per year. We will use
the remainder of the net proceeds from the sale of the Debentures for general
corporate purposes.
DESCRIPTION OF THE DEBENTURES
The following description of the terms of the Debentures (referred to in the
accompanying Prospectus as "Debt Securities") supplements the description of
the general terms and provisions of the Debt Securities contained in the
accompanying Prospectus.
General
We will issue the Debentures under an indenture, dated as of November 1, 1990,
between us and Citibank, N.A., as trustee.
The Debentures will be unsecured obligations, ranking equally with each other
and with all of our other unsecured and unsubordinated indebtedness, and will
mature on April 15, 2029. The Debentures will bear interest at the rate of 6
5/8% per year. Interest on the Debentures will accrue from April 16, 1999 or
from the most recent date to which interest has been paid or provided for. We
will pay interest on the Debentures semi-annually on April 15 and October 15 of
each year, commencing on October 15, 1999 to the persons in whose names the
Debentures are registered at the close of business on April 1 or October 1, as
the case may be, immediately preceding an interest payment date. We will
compute interest on the Debentures on the basis of a 360-day year of twelve 30-
day months. The Debentures are not entitled to the benefit of any sinking fund.
If an interest payment date or redemption date or the maturity date falls on a
day which is not a business day, the related payment of interest and principal
and premium, if any, will be made on the next business day without further
accrual of interest.
We will issue $200,000,000 principal amount of Debentures in denominations of
$1,000 and multiples of $1,000.
The Debentures are subject to defeasance and discharge as described under
"Description of Debt Securities--Defeasance" in the accompanying Prospectus.
Redemption at Our Option
We may, at our option, redeem the Debentures in whole or in part at any time at
a redemption price equal to the greater of (i) 100% of the principal amount of
the Debentures to be redeemed and (ii) as determined by the Quotation Agent,
the sum of the present values of the remaining scheduled payments of principal
and interest in respect of the Debentures to be redeemed (not including any
portion of such payments of interest accrued as of the date of redemption)
discounted to the date of redemption on a semi-annual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Adjusted Treasury Rate plus 25
basis points, plus, in each case, accrued interest to the date of redemption.
S-3
<PAGE>
"Adjusted Treasury Rate" means, with respect to any redemption date, the rate
per year equal to the semi-annual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for that redemption date.
"Comparable Treasury Issue" means the United States Treasury security selected
by the Quotation Agent as having a maturity comparable to the remaining term of
the Debentures that would be utilized, at the time of selection and in
accordance with customary financial practice, in pricing new issues of
corporate debt securities of comparable maturity to the remaining term of the
Debentures.
"Comparable Treasury Price" means, with respect to any redemption date (i) the
average of the Reference Treasury Dealer Quotations for that redemption date,
after excluding the highest and lowest of the Reference Treasury Dealer
Quotations, or (ii) if the Trustee obtains fewer than three Reference Treasury
Dealer Quotations, the average of all Reference Treasury Dealer Quotations so
received.
"Quotation Agent" means the Reference Treasury Dealer appointed by us.
"Reference Treasury Dealer" means (i) each of J.P. Morgan Securities Inc.,
Goldman, Sachs & Co. and Morgan Stanley & Co. Incorporated and their respective
successors, unless any of them ceases to be a primary U.S. Government
securities dealer in New York City (a "Primary Treasury Dealer"), in which case
we shall substitute another Primary Treasury Dealer; and (ii) any other Primary
Treasury Dealer selected by us.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by us, of
the bid and asked prices for the Comparable Treasury Issue (expressed in each
case as a percentage of its principal amount) quoted in writing to the Trustee
by that Reference Treasury Dealer at 5:00 p.m., New York City time, on the
third business day preceding that redemption date.
Notice of any redemption will be mailed at least 30 days but not more than 60
days before the redemption date to each holder of the Debentures to be
redeemed. Unless we default in payment of the redemption price, on and after
the redemption date, interest will cease to accrue on the Debentures or
portions of the Debentures called for redemption.
Book-Entry System
The Debentures will be issued in book-entry form. This means that they will be
issued in the form of one or more fully registered Global Securities that will
be deposited with The Depository Trust Company, New York, New York ("DTC") or
its nominee and that we will not issue certificates to a beneficial owner of
Debentures. Each Global Security will be issued to DTC who will keep a
computerized record of its participants (for example, your broker) whose
clients have purchased Debentures. The participant will then keep a record of
its clients who purchased the Debentures. A more complete description of the
handling of book-entry securities is contained in the accompanying Prospectus
under the caption "Description of Debt Securities--Book-Entry Debt Securities."
Neither we, the Trustee, any paying agent nor the registrar for the Debentures
will have any responsibility or liability for any aspect of the records
relating to or payments made on account of beneficial ownership interests in
the Debentures represented by the Global Securities or for maintaining,
supervising or reviewing any records relating to those beneficial interests.
S-4
<PAGE>
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement and
the Pricing Agreement, each dated the date hereof, we have agreed to sell to
each of the Underwriters named below, severally, and each of the Underwriters
has severally agreed to purchase, the principal amount of the Debentures set
forth opposite its name below:
<TABLE>
<CAPTION>
Principal Amount
Underwriter of Debentures
----------- ----------------
<S> <C>
J.P. Morgan Securities Inc. ............................. $100,000,000
Goldman, Sachs & Co. .................................... 40,000,000
Morgan Stanley & Co. Incorporated........................ 40,000,000
Loop Capital Markets, LLC................................ 10,000,000
Utendahl Capital Partners, L.P. ......................... 10,000,000
----------------
Total.................................................. $200,000,000
================
</TABLE>
Under the terms and conditions of the Underwriting Agreement, if the
Underwriters take any of the Debentures, then the Underwriters are obligated to
take and pay for all of the Debentures.
The Debentures are a new issue of securities with no established trading market
and will not be listed on any national securities exchange. The Underwriters
have advised us that they intend to make a market for the Debentures, but they
have no obligation to do so and may discontinue market making at any time
without providing any notice. No assurance can be given as to the liquidity of
any trading market for the Debentures.
The Underwriters initially propose to offer part of the Debentures directly to
the public at the offering prices described on the cover page and part to
certain dealers at a price that represents a concession not in excess of .50%
of the principal amount of the Debentures. Any Underwriter may allow, and any
such dealer may reallow, a concession not in excess of .25% of the principal
amount of the Debentures to certain other dealers. After the initial offering
of the Debentures, the Underwriters may from time to time vary the offering
price and other selling terms.
We have also agreed to indemnify the Underwriters against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or to
contribute to payments which the Underwriters may be required to make in
respect of any such liabilities.
In connection with the offering of the Debentures, the Underwriters may engage
in transactions that stabilize, maintain or otherwise affect the price of the
Debentures. Specifically, the Underwriters may overallot in connection with the
offering of the Debentures, creating a syndicate short position. In addition,
the Underwriters may bid for, and purchase, Debentures in the open market to
cover syndicate short positions or to stabilize the price of the Debentures.
Finally, the underwriting syndicate may reclaim selling concessions allowed for
distributing the Debentures in the offering of the Debentures, if the syndicate
repurchases previously distributed Debentures in syndicate covering
transactions, stabilization transactions or otherwise. Any of these activities
may stabilize or maintain the market price of the Debentures above independent
market levels. The Underwriters are not required to engage in any of these
activities, and may end any of them at any time.
Our expenses associated with this offering are estimated to be $65,000.
In the ordinary course of their respective businesses, the Underwriters and
their affiliates have engaged, and may in the future engage, in commercial
banking and/or investment banking transactions with us and our affiliates.
S-5
<PAGE>
VALIDITY OF THE DEBENTURES
Certain legal matters relating to the Debentures will be passed upon for us by
Monica M. Fohrman, our Senior Vice President, General Counsel and Secretary,
and Sidley & Austin, Chicago, Illinois. As of December 31, 1998, Ms. Fohrman
beneficially owned 10,703 shares of the Company's common stock and held options
to acquire 52,600 shares of such common stock. The validity of the Debentures
will be passed upon for the Underwriters by Winston & Strawn, Chicago,
Illinois. Winston & Strawn from time to time acts as counsel to the Company and
certain of its affiliates in connection with matters unrelated to the offering
of the Debentures.
S-6
<PAGE>
Prospectus
[LOGO OF R.R. DONNELLEY & SONS COMPANY APPEARS HERE]
[LOGO OF R.R. DONNELLEY & SONS COMPANY APPEARS HERE]
Debt Securities
------------------
By this prospectus, we may offer in one or more discrete offerings up to
$500,000,000 of our Debt Securities. The Debt Securities may be issued in one
or more series and will be unsecured obligations of the Company. We will
determine the terms for the Debt Securities at the time of sale. We will
provide the specific terms of the Debt Securities in one or more supplements to
this prospectus. You should read this prospectus and the applicable supplements
carefully before you invest.
Our executive offices are located at 77 West Wacker Drive, Chicago, Illinois
60601, and our telephone number is (312) 326-8000.
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of the Debt Securities or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
We may offer the Debt Securities in any of the following ways:
. directly to purchasers;
. through agents;
. through dealers; or
. through one or more underwriters or a syndicate of underwriters in an
underwritten offering.
Additional information on our plan of distribution can be found inside this
prospectus under the heading "Plan of Distribution." In addition, we will
provide more specific information on the plan of distribution for any
particular series of Debt Securities in the applicable prospectus supplements.
------------------
The date of this Prospectus is April 13, 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
About This Prospectus...................................................... 2
Where You Can Find More Information........................................ 2
The Company................................................................ 3
Use of Proceeds............................................................ 3
Ratios of Earnings to Fixed Charges........................................ 3
Description of Debt Securities............................................. 4
Plan of Distribution....................................................... 12
Legal Opinions............................................................. 13
Experts.................................................................... 13
</TABLE>
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement (No. 33-57807) that we
filed with the Securities and Exchange Commission ("SEC") utilizing a "shelf"
registration process. Under this shelf process, we may sell the Debt Securities
described in this prospectus in one or more offerings with a total principal
amount or initial purchase price of up to $500,000,000. This prospectus
provides you with a general description of the Debt Securities we may offer.
Each time we offer Debt Securities, we will provide you with a prospectus
supplement that will contain specific information about the terms of the Debt
Securities being offered. The prospectus supplement may also add, update or
change information in this prospectus. Please carefully read this prospectus
and the applicable prospectus supplement together with the documents referred
to under the heading "Where You Can Find More Information."
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file with the
SEC at the SEC's public reference room at 450 Fifth Street, N.W., Washington,
D.C. 20549 or at the SEC's regional offices located at Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661-2511 and 7 World Trade
Center, Suite 1300, New York, New York 10048. You may obtain further
information on the operation of the public reference room by calling the SEC at
1-800-SEC-0330. Our SEC filings are also available to the public over the
Internet at the SEC's web site at http://www.sec.gov. In addition, you may
inspect our SEC filings at the offices of the New York Stock Exchange, 20 Broad
Street, New York, New York 10005, the Chicago Stock Exchange, 440 South
LaSalle, Chicago, Illinois 60605 and the Pacific Exchange, 301 Pine Street, San
Francisco, California 94104.
The SEC allows us to "incorporate by reference" into this prospectus the
information we file with the SEC, which means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is an important part of this prospectus and the
information that we file later with the SEC will automatically update and
supersede this information. We incorporate by reference the following document
that we have filed with the SEC and any future filings that we make with the
SEC under Sections 13(a), 13(c), 14, or 15(d) of the Securities Exchange Act of
1934 until we complete our sale of the Debt Securities to the public:
. Annual Report on Form 10-K for the year ended December 31, 1998, as
amended by the Form 10-K/A filed on April 13, 1999.
2
<PAGE>
This prospectus is part of a registration statement we have filed with the
SEC relating to the Debt Securities. As permitted by SEC rules, this prospectus
does not contain all of the information included in the registration statement
and the accompanying exhibits and schedules we file with the SEC. You may refer
to the registration statement and the exhibits and schedules for more
information about us and our Debt Securities. The registration statement and
exhibits and schedules are also available at the SEC's public reference room or
through its web site.
You may obtain a copy of these filings, at no cost, by writing to or
telephoning us at the following address:
R. R. Donnelley & Sons Company
77 West Wacker Drive
Chicago, IL 60601-1696
Telephone: (312) 326-8000
Attention: Monica M. Fohrman, Senior Vice President,
General Counsel and Secretary
You should rely only on the information incorporated by reference or provided
in this prospectus and the applicable prospectus supplement. We have not
authorized anyone else to provide you with different information. You should
not assume that the information in this prospectus or any applicable prospectus
supplement is accurate as of any date other than the date on the front of each
of those documents. We are not making an offer or sale of the Debt Securities
in any state where the offer or sale is not permitted.
THE COMPANY
R. R. Donnelley & Sons Company is the largest commercial printer in North
America. We are a leading provider of printing and related services to the
merchandising, magazine, book, directory, financial and healthcare markets. We
use our superior skills, scale and technology to deliver solutions that
effectively meet our customers' needs. Our common stock has been publicly
traded since 1956. Today, the Company has approximately 31,000 employees
working in our core printing operations on four continents. We have 49
manufacturing plants with a broad range of capabilities to serve our customers'
needs. While 91% of our revenue is generated in the United States, we have
extended our core competencies into selected international markets.
USE OF PROCEEDS
Unless we state otherwise in the applicable prospectus supplement, we expect
to use the net proceeds from the sale of the Debt Securities for general
corporate purposes, including securities repurchase programs, capital
expenditures, working capital, repayment or reduction of long-term and short-
term debt and the financing of acquisitions. We may invest funds that we do not
immediately need in short-term marketable securities.
RATIOS OF EARNINGS TO FIXED CHARGES
The ratio of our earnings to fixed charges for each of the periods indicated
is as follows:
<TABLE>
<CAPTION>
Fiscal Year Ended December 31,
--------------------------------------------------------------------------------------------
1994 1995 1996(1) 1997 1998
---- ---- ------- ---- ----
<S> <C> <C> <C> <C>
5.68 4.17 (0.06) 2.72 6.28
</TABLE>
- --------
(1) The deficiency in earnings to cover fixed charges in 1996 was $123 million,
resulting primarily from pre-tax restructuring and impairment charges of
$442 million and a pre-tax loss from operations of businesses held for sale
of $123 million.
For these ratios, earnings consist of earnings before income taxes and fixed
charges to the extent that such charges are included in the determination of
earnings. Fixed charges consist of interest (whether expensed or capitalized)
and one-third of minimum rental payments under operating leases (the proportion
we believe to be representative of the interest factor of such rentals). Our
earnings and fixed charges include the earnings and fixed charges of the
Company and its subsidiaries on a consolidated basis.
3
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued under an Indenture dated as of November 1,
1990, between us and Citibank, N.A., as Trustee. We have summarized selected
provisions of the Indenture below. This is a summary and is not complete. It
does not describe certain exceptions and qualifications contained in the
Indenture or the Debt Securities. If you would like more information on the
provisions of the Indenture, you should review the Indenture which we have
incorporated by reference as an exhibit to the registration statement for the
Debt Securities. In the summary, we have included references to section numbers
of the Indenture so that you may easily locate these provisions. Capitalized
terms used in the summary have the meanings specified in the Indenture.
General
The Indenture does not limit the amount of Debt Securities which we may issue
under it. The Indenture provides that Debt Securities may be issued from time
to time in one or more series. We have previously issued Debt Securities
pursuant to the Indenture. The Debt Securities will be unsecured obligations
and will rank equally with each other and with all of our other unsecured and
unsubordinated indebtedness.
The Indenture limits our ability to incur certain secured indebtedness and to
engage in certain sale and lease-back transactions. See "Certain Covenants"
below. However, the Indenture does not restrict our ability to incur unsecured
indebtedness or, except as described under "Certain Covenants" below, to engage
in corporate transactions or reorganizations which have the effect of
increasing our indebtedness. Accordingly, unless we state otherwise in the
applicable prospectus supplement, the Debt Securities will not contain any
provisions that afford holders protection against our incurring such
indebtedness or, except as described under "Certain Covenants," engaging in
such transactions or reorganizations. As a result, we could become highly
leveraged.
A supplement to this prospectus will describe the specific terms relating to
the Debt Securities being offered. These terms will include some or all of the
following:
. the title of the Debt Securities;
. the limit, if any, on the total principal amount of the series being
offered;
. the maturity date or dates;
. the interest rate or rates, if any (which may be fixed or variable),
the date or dates from which interest will accrue, the interest
payment dates and the dates used to determine the persons to whom
interest will be paid;
. the place or places where the principal of, and any premium or
interest on, the Debt Securities will be paid;
. whether (and if so, when and under what terms and conditions) the
Debt Securities may be redeemed by us at our option or at the option
of the holders;
. whether there will be a sinking fund;
. if other than U.S. dollars and denominations of $1,000 and any
multiple of $1,000, the currency or composite currencies and
denominations in which the Debt Securities will be issued;
. if other than the principal amount, the portion of the principal
amount of the Debt Securities we will pay upon acceleration of
maturity of the Debt Securities;
. additional events of default with respect to the Debt Securities, if
any, other than those set forth in the Indenture;
. if applicable, the application of the provisions described under
"Defeasance" below to the series being offered; and
. any other terms of the series being offered. (Section 301)
4
<PAGE>
Unless the Debt Securities are issued in book-entry form (see "Book-Entry
Debt Securities" below) or unless otherwise indicated in the applicable
prospectus supplement, the principal of, and any premium or interest on, the
Debt Securities will be paid, and the Debt Securities will be exchangeable and
transfers of the Debt Securities can be registered at the Corporate Trust
Office of the Trustee at 111 Wall Street, New York, New York 10043. However, at
our option, we may make payments of interest by check mailed to the address of
the party entitled to interest as such address appears in the security
register. (Sections 202, 301, 305 and 1002)
Unless otherwise specified in the applicable prospectus supplement, the Debt
Securities will be issued in United States dollars in fully registered form,
without coupons, in denominations of $1,000 or multiples of $1,000. (Section
302) The holders of Debt Securities will not have to pay a service charge for
any transfer or exchange of the Debt Securities, but we may require any holder
to pay an amount sufficient to cover any tax or other governmental charge
payable in connection with transfers and exchanges other than certain exchanges
not involving any transfer. (Sections 304, 305, 906 and 1107)
The Debt Securities may be issued under the Indenture bearing no interest or
interest at a rate below the prevailing market rate at the time of issuance and
be offered and sold at a discount below their stated principal amount. We will
describe any federal income tax, accounting and other considerations applicable
to these discounted Debt Securities in the applicable prospectus supplement.
(Sections 101 and 502)
Certain Covenants
Restrictions On Secured Debt. The Indenture provides that neither we nor any
Restricted Subsidiary will create, incur, issue, assume or guarantee any
indebtedness for borrowed money secured by a mortgage, security interest,
pledge or lien ("mortgage") of or upon any Principal Property or any shares of
capital stock or indebtedness of any Restricted Subsidiary, whether owned at
the date of the Indenture or acquired after the date of the Indenture, without
ensuring that the Debt Securities (together with, if we decide, any other
indebtedness created, issued, assumed or guaranteed by us or any Restricted
Subsidiary and then existing or thereafter created) will be secured by such
mortgage equally and proportionately with (or, at our option, prior to) such
indebtedness. This restriction will not apply to indebtedness secured by any of
the following:
. mortgages on any property acquired, constructed or improved by, or on
any shares of capital stock or indebtedness acquired by, us or any
Restricted Subsidiary after the date of the Indenture to secure
indebtedness incurred for the purpose of financing or refinancing all
or any part of the purchase price of such property, shares of capital
stock or indebtedness or of the cost of any construction or
improvements on such properties, in each case, to the extent that the
indebtedness is incurred prior to or within 180 days after the
applicable acquisition, completion of construction or beginning of
commercial operation of such property, as the case may be;
. mortgages on any property, shares of capital stock or indebtedness
existing at the time we or any Restricted Subsidiary acquire any of
the same;
. mortgages on property of a corporation existing at the time we or any
Restricted Subsidiary merge or consolidate with such corporation or
at the time we or any Restricted Subsidiary acquire all or
substantially all of the properties of such corporation;
. mortgages on any property of, or shares of capital stock or
indebtedness of, a corporation existing at the time such corporation
becomes a Restricted Subsidiary;
. mortgages to secure indebtedness of any Restricted Subsidiary to us
or another Restricted Subsidiary;
. mortgages in favor of certain governmental bodies to secure partial,
progress, advance or other payments pursuant to any contract or
statute or to secure indebtedness incurred or guaranteed to finance
or refinance all or any part of the purchase price of the property,
shares of capital stock or indebtedness subject to such mortgages, or
the cost of constructing or improving the property subject to such
mortgage; and
5
<PAGE>
. extensions, renewals or replacements of any mortgage existing on the
date of the Indenture or any mortgage referred to above; however, the
principal amount of indebtedness secured thereby may not exceed the
principal amount of indebtedness so secured at the time of such
extension, renewal or replacement, and such extension, renewal or
replacement shall be limited to all or a part of the property (plus
improvements and construction on such property), shares of capital
stock or indebtedness which was subject to the mortgage so extended,
renewed or replaced. (Section 1006)
Notwithstanding the restriction outlined above, we or any Restricted
Subsidiary may, without having to equally and proportionately secure the Debt
Securities, issue, assume or guarantee indebtedness secured by a mortgage not
excepted from the restriction if the total amount of (a) such indebtedness plus
(b) all other indebtedness that we and our Restricted Subsidiaries have
incurred or have guaranteed existing at such time and secured by mortgages not
so excepted plus (c) the Attributable Debt existing in respect of Sale and
Lease-Back Transactions existing at such time, does not at the time exceed 10%
of Consolidated Net Tangible Assets. Attributable Debt with respect to the
following types of Sale and Lease-Back Transactions will not be included for
the purposes of calculating Attributable Debt in the preceding sentence:
. Sale and Lease-Back Transactions in respect of which an amount
(equaling at least the greater of the net proceeds of the sale of
property or the fair market value of the property) is used within 180
days after the effective date of the arrangement to make non-
mandatory prepayments on long-term indebtedness, retire long-term
indebtedness or acquire, construct or improve a manufacturing plant
or facility which is, or upon completion will be, a Principal
Property; and
. Sale and Lease-Back Transactions in which the property involved would
have been permitted to be mortgaged under the first bullet point of
the preceding paragraph. (Sections 1006 and 1007)
Restrictions on Sale and Lease-Back Transactions. The Indenture provides that
neither we nor any Restricted Subsidiary will enter into any Sale and Lease-
Back Transaction with respect to any Principal Property unless:
. we or such Restricted Subsidiary are entitled under the provisions
described in bullet point 1 or 6 in the first paragraph under "--
Restrictions On Secured Debt" to create, issue, assume or guarantee
indebtedness secured by a mortgage on the property to be leased
without having to equally and proportionately secure the Debt
Securities;
. we or such Restricted Subsidiary are entitled under the provisions
described in the last paragraph under "--Restrictions on Secured
Debt" to create, issue, assume or guarantee indebtedness secured by a
mortgage on such property in an amount at least equal to the
Attributable Debt in respect of the Sale and Lease-Back Transaction
without having to equally and proportionately secure the Debt
Securities; or
. we apply an amount (equaling at least the greater of the net proceeds
of the sale of property or the fair market value of the property)
within 180 days after the effective date of the arrangement to make
non-mandatory prepayments on long-term indebtedness, retire long-term
indebtedness or acquire, construct or improve a manufacturing plant
or facility which is, or upon completion will be, a Principal
Property.
Certain Definitions
"Attributable Debt" is defined in the Indenture to mean, in the context of a
Sale and Lease-Back Transaction, what we believe in good faith to be the
present value, discounted at the interest rate implicit in the lease involved
in such Sale and Lease-Back Transaction, of the lessee's obligation under the
lease for rental payments during the remaining term of such lease, as it may be
extended. For purposes of this definition, any amounts lessee must pay, whether
or not designated as rent or additional rent, on account of maintenance and
repairs, insurance, taxes, assessments, water rates or similar charges or any
amounts lessee must pay under the lease contingent upon the amount of sales,
maintenance and repairs, insurance, taxes, assessments, water rates or similar
charges are not included in the determination of lessee's obligations under the
lease. (Section 101)
"Consolidated Net Tangible Assets" is defined in the Indenture to mean the
total amount of assets minus:
. all applicable reserves;
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. all current liabilities (excluding any liabilities which are by their
terms extendible or renewable at the option of the obligor to a time
more than 12 months after the time as of which the amount thereof is
being computed and excluding current maturities of long-term
indebtedness); and
. all goodwill, trade names, trademarks, patents, unamortized debt
discount and expense and other like intangible assets,
all as shown in our audited consolidated balance sheet contained in our then
most recent annual report to stockholders, except that assets shall include an
amount equal to the Attributable Debt in respect of any Sale and Lease-Back
Transaction not capitalized on such balance sheet. (Section 101)
"Principal Property" is defined in the Indenture to mean any manufacturing
plant or manufacturing facility owned by us or any Restricted Subsidiary which
is located within the United States and has a gross book value in excess of 1%
of Consolidated Net Tangible Assets at the time of determination, except for
any such plant or facility or any portion of such plant or facility which our
board of directors does not deem material to the total business conducted by us
and our Restricted Subsidiaries considered as one enterprise. (Section 101)
"Restricted Subsidiary" is defined in the Indenture to mean any Subsidiary
that has substantially all of its property located in or that conducts
substantially all of its business within the United States (other than its
territories or possessions and other than Puerto Rico) and that owns a
Principal Property; however, any Subsidiary which is principally engaged in
financing operations outside the United States or which is principally engaged
in leasing or in financing installment receivables will not be considered a
Restricted Subsidiary. (Section 101)
"Sale and Lease-Back Transaction" is defined in the Indenture to mean the
leasing by us or any Restricted Subsidiary of any Principal Property, whether
owned at the date of the Indenture or acquired after the date of the Indenture
(except for temporary leases for a term, including any renewal term, of up to
three years and except for leases between us and any Restricted Subsidiary or
between Restricted Subsidiaries), which property has been or is to be sold or
transferred by us or such Restricted Subsidiary to any party with the intention
of taking back a lease of such property. (Sections 101 and 1007)
"Subsidiary" is defined in the Indenture to mean any corporation in which we
and/or one or more other Subsidiaries own more than 50% of the outstanding
voting stock. (Section 101)
Events of Default
With respect to the Debt Securities of any series, an "Event of Default" is
defined in the Indenture as being:
. a failure to pay interest upon the Debt Securities of that series
that continues for a period of 30 days after payment is due;
. a failure to pay the principal or premium, if any, on the Debt
Securities of that series when due;
. a failure to deposit any sinking fund payment in respect of the Debt
Securities of that series when due;
. a failure to comply with any of our other agreements contained in the
Indenture applicable to the Debt Securities of that series for a
period of 90 days after written notice to us of such failure from the
Trustee (or to us and the Trustee from the holders of at least 25% of
the principal amount of the Debt Securities of that series);
. certain events of bankruptcy, insolvency or reorganization relating
to us; and
. any other event of default provided with respect to the Debt
Securities of that series. (Section 501)
The Indenture provides that if there is a continuing Event of Default with
respect to any outstanding series of Debt Securities, either the Trustee or the
holders of at least 25% of the outstanding principal amount of the
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Debt Securities of that series may declare the principal amount (or, if the
Debt Securities of that series provide for an amount less than the principal
amount of such Debt Securities to be due and payable upon a declaration of
maturity thereof upon an Event of Default, such portion of the principal amount
as may be specified in the terms of that series) of all of the Debt Securities
of that series to be due and payable immediately. However, at any time after the
Trustee or the holders, as the case may be, declare an acceleration with respect
to Debt Securities of any series, but before the applicable person has obtained
a judgment or decree based on such acceleration, the holders of a majority in
principal amount of the outstanding Debt Securities of that series may, under
certain conditions, cancel such acceleration if we have cured all Events of
Default (other than the nonpayment of accelerated principal) with respect to
Debt Securities of that series or all such Events of Default have been waived as
provided in the Indenture. (Section 502) For information as to waiver of
defaults, see "Modification and Waiver." The applicable prospectus supplement
relating to any series of Debt Securities which provides for an amount less than
the principal amount of such Debt Securities to be due and payable upon a
declaration of maturity thereof upon an Event of Default will contain provisions
relating to the terms regarding such declaration of maturity upon an Event of
Default and the continuation thereof.
The Indenture provides that, subject to the duties of the Trustee to act with
the required standard of care, if there is a continuing Event of Default, the
Trustee need not exercise any of its rights or powers under the Indenture at
the request or direction of any of the holders of Debt Securities, unless such
holders have offered to the Trustee reasonable security or indemnity. (Sections
601 and 603) Subject to such provisions for security or indemnification of the
Trustee and certain other conditions, the holders of a majority in principal
amount of the outstanding Debt Securities of any series will have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power the Trustee holds
with respect to the Debt Securities of that series. (Section 512)
No holder of any Debt Security of any series will have any right to institute
any proceeding with respect to the Indenture or for any remedy under the
Indenture unless:
. the Trustee has failed to institute such proceeding for 60 days after
the holder has previously given to the Trustee written notice of a
continuing Event of Default with respect to Debt Securities of that
series;
. the holders of at least 25% in principal amount of the outstanding
Debt Securities of that series have made written request, and offered
reasonable security or indemnity, to the Trustee to institute such
proceeding as Trustee; and
. the Trustee has not received from the holders of a majority in
principal amount of the outstanding Debt Securities of that series a
direction inconsistent with such request. (Section 507)
However, the holder of any Debt Security will have an absolute and
unconditional right to receive payment of the principal of, and any premium or
interest on, such Debt Security on or after the date or dates they are to be
paid as expressed in such Debt Security and to institute suit for the
enforcement of any such payment. (Section 508)
We are required to furnish to the Trustee annually a statement as to the
absence of certain defaults under the Indenture. (Section 1008) The Indenture
provides that the Trustee need not provide holders of Debt Securities of any
series notice of any default (other than the nonpayment of principal, any
premium or interest or sinking fund payments) if it considers it in the
interest of the holders of Debt Securities of that series not to provide such
notice. (Section 602)
Modification and Waiver
With respect to the Debt Securities, we and the Trustee may modify or amend
the Indenture with the consent of the holders of a majority of the principal
amount of the outstanding Debt Securities of each series affected by the
modification or amendment. However, no such modification or amendment may,
without the consent of the holders of all then outstanding Debt Securities of
the affected series:
. change the due date of the principal of, or any installment of
principal of or interest on, the Debt Securities of that series;
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. reduce the principal amount of, or any premium or interest rate on,
the Debt Securities of that series;
. reduce the principal amount payable upon a declaration of maturity
upon an Event of Default if the Debt Securities of that series
provide for an amount less than the principal amount of such Debt
Securities to be due and payable upon such declaration;
. change the place or currency of payment of principal of, or any
premium or interest on, the Debt Securities of that series;
. impair the right to institute suit for the enforcement of any payment
on or with respect to the Debt Securities of that series after the
due date thereof; or
. reduce the percentage in principal amount of the Debt Securities of
that series then outstanding, the consent of whose holders is
required for modification or amendment of the Indenture, for waiver
of compliance with certain provisions of the Indenture or for waiver
of certain defaults. (Section 902)
The holders of a majority of the principal amount of the outstanding Debt
Securities of any series may waive, insofar as that series is concerned, future
compliance by us with certain restrictive covenants of the Indenture. (Section
1009) The holders of at least a majority in principal amount of the outstanding
Debt Securities of any series may waive any past default under the Indenture
with respect to that series, except a failure by us to pay the principal of, or
any premium or interest on, any Debt Securities of that series or a provision
that cannot be modified or amended without the consent of the holders of all
outstanding Debt Securities of the affected series. (Section 513)
Defeasance
Defeasance and Discharge. The Indenture provides that if the Debt Securities
of any series so provide, we may be discharged from any and all obligations in
respect of the Debt Securities of that series (except for certain obligations
to register the transfer or exchange of Debt Securities of that series, to
replace stolen, destroyed, lost or mutilated Debt Securities of that series, to
maintain paying agencies, to compensate and indemnify the Trustee or to furnish
the Trustee (if the Trustee is not the registrar) with the names and addresses
of holders of Debt Securities of that series). We will be so discharged if we
irrevocably deposit with the Trustee, in trust, money and/or securities of the
government which issues the currency in which the Debt Securities of that
series are payable or securities of agencies backed by the full faith and
credit of such government, which, through the payment of interest and principal
in accordance with their terms, will provide money in an amount sufficient in
the opinion of a nationally recognized firm of independent public accountants
to pay each installment of principal of, and any premium and interest on, and
any mandatory sinking fund payments in respect of, the Debt Securities of that
series on the applicable due dates for those payments in accordance with the
terms of those Debt Securities. (Sections 1302 and 1304)
This discharge may occur only if, among other things, we have delivered to
the Trustee an opinion of counsel confirming that the holders of the Debt
Securities of that series will not recognize income, gain or loss for United
States federal income tax purposes as a result of such defeasance and will be
subject to United States federal income tax on the same amounts and in the same
manner and at the same times as would have been the case if the discharge had
not occurred. That opinion must state that we have received from, or there has
been published by, the United States Internal Revenue Service a ruling or,
since the date of execution of the Indenture, there has been a change in the
applicable United States federal income tax law, in any case, in support of
that opinion. (Section 1304)
In addition, we may also obtain a discharge of the Indenture with respect to
all Debt Securities issued under the Indenture by depositing with the Trustee,
in trust, money sufficient to pay all amounts due on the Debt Securities on the
date such payments are due or upon redemption of all of such Debt Securities,
so long as such Debt Securities are by their terms to become due and payable
within one year or are to be called for redemption within one year. (Section
401)
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Defeasance of Certain Covenants and Certain Events of Default. The Indenture
provides that, if provided by the terms of the applicable series of Debt
Securities, upon compliance with certain conditions:
. we may omit to comply with the covenants described under "Certain
Covenants--Restrictions on Secured Debt," "--Restrictions on Sale and
Lease-Back Transactions" and "Consolidation, Merger and Sale of
Assets" (all other obligations under the Debt Securities of that
series shall remain in full force and effect); and
. any omission to comply with those covenants will not constitute an
Event of Default with respect to the Debt Securities of that series
("covenant defeasance"). (Sections 1303 and 1304)
The conditions include:
. depositing with the Trustee money and/or securities of the government
which issues the currency in which the Debt Securities of that series
are payable or securities of agencies backed by the full faith and
credit of such government, which, through the payment of interest and
principal in accordance with their terms, will provide money in an
amount sufficient in the opinion of a nationally recognized firm of
independent public accountants to pay each installment of principal
of, any premium and interest on, and any mandatory sinking fund
payments in respect of, the Debt Securities of that series on the due
dates for those payments in accordance with the terms of those Debt
Securities; and
. delivering to the Trustee an opinion of counsel to the effect that
the holders of the Debt Securities of that series will not recognize
income, gain or loss for United States federal income tax purposes as
a result of the deposit and related covenant defeasance and will be
subject to United States federal income tax on the same amounts and
in the same manner and at the same times as would have been the case
if the deposit and related covenant defeasance had not occurred.
(Section 1304)
Covenant Defeasance and Certain Other Events of Default. If we exercise our
option to effect a covenant defeasance with respect to the Debt Securities of
any series as described above and the Debt Securities of that series are
thereafter declared due and payable because of an Event of Default (other than
an Event of Default caused by failing to comply with the covenants that are
defeased), the amount of money and securities we have deposited with the
Trustee would be sufficient to pay amounts due on the Debt Securities of that
series on their respective due dates but may not be sufficient to pay amounts
due on the Debt Securities of that series at the time of acceleration resulting
from such Event of Default. However, we would remain liable for such payments.
Consolidation, Merger and Sale of Assets
The Indenture provides that we may consolidate with or merge into any other
corporation, or lease, sell or transfer all or substantially all of our
property and assets if:
. the corporation formed by such consolidation or into which we are
merged, or the party which acquires by lease, sale or transfer all or
substantially all of our property and assets is a corporation
organized and existing under the laws of the United States, any state
in the United States or the District of Columbia;
. the corporation formed by such consolidation or into which we are
merged, or the party which acquires by lease, sale or transfer all or
substantially all of our property and assets, agrees to pay the
principal of, and any premium and interest on, all Debt Securities
and perform and observe all covenants and conditions of the Indenture
by executing and delivering to the Trustee a supplemental indenture;
and
. immediately after giving effect to such transaction and treating
indebtedness for borrowed money which becomes our obligation or an
obligation of a Restricted Subsidiary as a result of such transaction
as having been incurred by us or such Restricted Subsidiary at the
time of such transaction, no Event of Default, and no event which,
after notice or lapse of time or both, would become an Event of
Default, has happened and is continuing. (Section 801)
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If, upon any such consolidation or merger, or upon any such lease, sale or
transfer any of our Principal Property or any shares of capital stock or
indebtedness of any Restricted Subsidiary, owned immediately prior to the
transaction, would thereupon become subject to any mortgage, security interest,
pledge or lien securing any indebtedness for borrowed money of, or guaranteed
by, such other corporation or party (other than any mortgage, security
interest, pledge or lien permitted as described under "Certain Covenants--
Restrictions on Secured Debt" above), we, prior to such consolidation, merger,
lease, sale or transfer, will, by executing and delivering to the Trustee a
supplemental indenture, secure the due and punctual payment of the principal
of, and any premium and interest on, the Debt Securities (together with, if we
decide, any other indebtedness of, or guaranteed by, us or any Restricted
Subsidiary and then existing or thereafter created) equally and proportionately
with (or, at our option, prior to) the indebtedness secured by such mortgage,
security interest, pledge or lien. (Section 802)
Book-Entry Debt Securities
All Debt Securities will be fully registered and will be in either book-entry
form or in definitive form.
Debt Securities issued in book-entry form will be issued in the form of one
or more fully registered global securities (each, a "Global Security") that
will be deposited with The Depository Trust Company, New York, New York ("DTC")
or its nominee. This means that we will not issue certificates to each holder.
Each Global Security will be issued to DTC, who will keep a computerized record
of its participants (for example, your broker) whose clients have purchased
Debt Securities. The participant will then keep a record of its clients who
purchased the Debt Securities. Unless it is exchanged in whole or in part for a
certificate, a Global Security may not be transferred, except that DTC, its
nominees, and their successors may transfer a Global Security as a whole to one
another.
Beneficial interests in Global Securities will be shown on, and transfers of
Global Securities will be made only through, records maintained by DTC and its
participants. If you are not a participant in DTC you may beneficially own Debt
Securities held by DTC only through a participant.
The laws of some states require that certain purchasers of securities take
physical delivery of such securities in definitive form. Such limits and laws
may impair the ability to transfer beneficial interests in a Global Security.
DTC has provided us the following information: DTC is a limited-purpose trust
company organized under the New York Banking Law, a "banking organization"
within the meaning of the New York Banking Law, a member of the United States
Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code and a "clearing agency" registered under the
provisions of Section 17A of the Securities Exchange Act of 1934. DTC holds
securities that its participants deposit with DTC. DTC also records the
settlement among participants of securities transactions, such as transfers and
pledges, in deposited securities through computerized records for participants'
accounts. This eliminates the need to exchange certificates. Participants
include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations.
DTC's book-entry system is also used by other organizations such as
securities brokers and dealers, banks and trust companies that work through a
participant. The rules that apply to DTC and its participants are on file with
the SEC.
DTC is owned by a number of its participants and by the New York Stock
Exchange, Inc., The American Stock Exchange, Inc. and the National Association
of Securities Dealers, Inc.
We will wire principal and interest payments to DTC's nominee. We and the
Trustee will treat DTC's nominee as the owner of the Global Securities for all
purposes. Accordingly, we, the Trustee and any paying agent will have no direct
responsibility or liability to pay amounts due on the Global Securities to
owners of beneficial interests in the Global Securities.
It is DTC's current practice, upon receipt of any payment of principal or
interest, to credit participants' accounts on the payment date according to
their respective holdings of beneficial interests in the Global Securities as
shown on DTC's records. In addition, it is DTC's current practice to assign any
consenting or voting rights to participants whose accounts are credited with
Debt Securities on a record date, by using an omnibus proxy. Payments by
participants to owners of beneficial interests in the Global Securities, and
voting
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by participants, will be governed by the customary practices between the
participants and owners of beneficial interests, as is the case with Debt
Securities held for the account of customers registered in "street name."
However, payments will be the responsibility of the participants and not of
DTC, the Trustee or us.
So long as DTC or its nominee is the registered owner of a Global Security,
DTC or that nominee, as the case may be, will be considered the sole owner or
holder of the Debt Securities represented by that Global Security for all
purposes under the Indenture. Except as set forth in the next paragraph, owners
of beneficial interests in a Global Security will not be entitled to have the
Debt Securities represented by that Global Security registered in their names,
will not receive or be entitled to receive physical delivery of the Debt
Securities in definitive form and will not be considered the owners or holders
of the Debt Securities under the Indenture.
We will issue Debt Securities of any series then represented by Global
Securities in definitive form in exchange for those Global Securities if:
. DTC notifies us that it is unwilling or unable to continue as
depositary or if DTC ceases to be a clearing agency registered under
applicable law and a successor depositary is not appointed by us
within 90 days; or
. we determine not to require all of the Debt Securities of a series to
be represented by a Global Security.
If we issue Debt Securities in definitive form in exchange for a Global
Security, an owner of a beneficial interest in the Global Security will be
entitled to have Debt Securities equal in principal amount to the beneficial
interest registered in its name and will be entitled to physical delivery of
those Debt Securities in definitive form. Debt Securities issued in definitive
form will, except as set forth in the applicable prospectus supplement, be
issued in denominations of $1,000 and any multiple of $1,000 in excess thereof
and will be issued in registered form only, without coupons.
Regarding the Trustee
Citibank, N.A. is the Trustee under the Indenture. We maintain banking
relationships in the ordinary course of business with the Trustee and its
affiliates and certain affiliates of the Trustee are commercial lenders under
our credit facilities.
PLAN OF DISTRIBUTION
We may sell the Debt Securities in any of the following ways:
. directly to purchasers;
. through agents;
. through dealers; or
. through one or more underwriters or a syndicate of underwriters in an
underwritten offering.
The applicable prospectus supplement will set forth the names of any
underwriters or agents involved in the sale of the Debt Securities of the
applicable series and any applicable commissions or discounts.
Underwriters, dealers or agents may offer and sell the Debt Securities at a
fixed price or prices, which may be changed, or from time to time at market
prices prevailing at the time of sale, at prices related to such prevailing
market prices or at negotiated prices. In connection with the sale of the Debt
Securities, underwriters or agents may be deemed to have received compensation
from us in the form of underwriting discounts or commissions and may also
receive commissions from purchasers of the Debt Securities for whom they may
act as agent. Underwriters or agents may sell the Debt Securities to or through
dealers, and such dealers may receive compensation in the form of discounts,
concessions or commissions from the underwriters or commissions from the
purchasers for whom they may act as agent.
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The Debt Securities of any series, when first issued, will have no
established trading market. Any underwriters or agents to or through whom Debt
Securities are sold by us for public offering and sale may make a market in
such Debt Securities, but such underwriters or agents will not be obligated to
do so and may discontinue any market making at any time without notice. We give
no assurances as to the liquidity of the trading market for any Debt
Securities.
Any underwriters, dealers or agents participating in the distribution of the
Debt Securities may be deemed to be underwriters and any discounts and
commissions received by them and any profit realized by them on resale of the
Debt Securities may be deemed to be underwriting discounts and commissions
under the Securities Act of 1933. We may enter into agreements with
underwriters, dealers or agents under which we agree to indemnify against, or
contribute payments made in respect of, certain civil liabilities incurred by
such persons, including liabilities under the Securities Act of 1933.
If so indicated in the applicable prospectus supplement, we will authorize
underwriters or agents to solicit offers by certain institutions to purchase
Debt Securities from us pursuant to contracts providing for payment and
delivery on a future date. These contracts may be made with commercial and
savings banks, insurance companies, pension funds, investment companies,
educational and charitable institutions and others, but in all cases such
institutions must be approved by us. The obligations of any purchaser under any
such contract will be subject to the condition that the purchase of the Debt
Securities is at the time of delivery not prohibited under the laws of the
jurisdiction to which such purchaser is subject. The underwriters and such
other persons will not have any responsibility in respect of the validity or
performance of such contracts.
LEGAL OPINIONS
Certain legal matters relating to the Debt Securities will be passed upon for
us by Monica M. Fohrman, our Senior Vice President, General Counsel and
Secretary, and Sidley & Austin, Chicago, Illinois. As of December 31, 1998, Ms.
Fohrman beneficially owned 10,703 shares of the Company's common stock and held
options to acquire 52,600 shares of such common stock.
EXPERTS
The financial statements and schedules incorporated by reference in this
Prospectus and elsewhere in the Registration Statement have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect thereto, and are included herein in reliance upon the
authority of said firm as experts in accounting and auditing in giving said
reports.
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