<PAGE> 1
Pursuant to Rule 424(b)(1)
Registration No. 33-63713
$250,000,000
[DOVER CORPORATION LOGO]
6.45% NOTES DUE NOVEMBER 15, 2005
------------------------
Interest on the Notes is payable on May 15 and November 15 of each year,
commencing May 15, 1996. The Notes are not redeemable prior to maturity. The
Notes will be represented by one or more global Notes and registered in the name
of the nominee of The Depository Trust Company. Beneficial interests in the
global Notes will be shown on, and transfers thereof will be effected only
through, records maintained by DTC and its participants. Except as described
herein, Notes in definitive form will not be issued. The Notes will be issued
only in registered form in denominations of $1,000 and integral multiples
thereof. The Notes will trade in DTC's Same-Day Funds Settlement System until
maturity, and secondary market trading activity for the Notes will therefore
settle in immediately available funds. All payments of principal and interest
will be made by the Company in immediately available funds. See "Description of
the Notes -- Same-Day Settlement and Payment."
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
------------------ ------------------ ------------------
<S> <C> <C> <C>
Per Note........................... 99.795% 0.650% 99.145%
Total.............................. $249,487,500 $1,625,000 $247,862,500
</TABLE>
- ---------------
(1) Plus accrued interest, if any, from November 14, 1995.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deducting estimated expenses of $350,000 payable by the Company.
------------------------
The Notes are offered severally by the Underwriters, as specified herein,
subject to receipt and acceptance by them and subject to their right to reject
any order in whole or in part. It is expected that the Notes will be ready for
delivery in book-entry form only through the facilities of DTC in New York, New
York on or about November 14, 1995, against payment therefor in immediately
available funds.
GOLDMAN, SACHS & CO.
LEHMAN BROTHERS
J.P. MORGAN SECURITIES INC.
------------------------
The date of this Prospectus is November 9, 1995.
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
------------------------
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports and other information (including
proxy and information statements) filed by the Company can be inspected and
copied at the public reference facilities maintained by the Commission at its
principal office at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549,
and at the following Regional Offices of the Commission: New York Regional
Office, 7 World Trade Center, Suite 1300, New York, New York 10048 and Chicago
Regional Office, 500 West Madison, Suite 1400, Chicago, Illinois 60661. Copies
of such material can be obtained at prescribed rates from the Public Reference
Section of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549. Such
reports, proxy statements and other information concerning the Company can also
be inspected at the office of the New York Stock Exchange, Inc., 20 Broad
Street, New York, New York 10005, on which the Company's common stock is listed.
This Prospectus constitutes a part of a Registration Statement filed by the
Company with the Commission under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. Reference is hereby
made to the Registration Statement and related exhibits for further information
with respect to the Company and the Notes offered hereby. Statements contained
herein concerning the provisions of any document are not necessarily complete
and, in each instance, reference is made to the copy of such document filed as
an exhibit to the Registration Statement or otherwise filed with the Commission.
Each such statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission pursuant
to the Exchange Act are hereby incorporated by reference in this Prospectus: (1)
Annual Report on Form 10-K for the fiscal year ended December 31, 1994, (2)
Quarterly Reports on Form 10-Q for the quarters ended March 31, June 30 and
September 30, 1995, (3) Current Report on Form 8-K dated August 7, 1995, as
filed on August 11, 1995 and amended on August 17, 1995, and (4) Current Report
on Form 8-K dated September 29, 1995, as filed on October 16, 1995 and amended
on October 25, 1995.
All reports and other documents filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the termination of this offering shall be deemed to be incorporated
by reference herein and to be a part hereof from the respective dates of filing
of such reports and other documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for all purposes to the extent that a statement
contained in this Prospectus or in any other subsequently filed document that is
also incorporated by reference herein modifies or replaces such statement. Any
such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
The Company herein undertakes to provide without charge to each person to
whom this Prospectus is delivered, upon written or oral request of such person,
a copy of any and all documents incorporated by reference in this Prospectus
(other than exhibits to such documents unless such exhibits are incorporated by
reference therein). Requests for such copies should be directed to Dover
Corporation, 280 Park Avenue, New York, New York 10017-1292, Attn: Corporate
Secretary, telephone number (212) 922-1640.
2
<PAGE> 3
THE COMPANY
The Company is a diversified industrial manufacturing corporation
encompassing over 50 different operating companies which manufacture a broad
range of specialized industrial products and sophisticated manufacturing
equipment. As used herein, the term the "Company" refers to Dover Corporation
and its consolidated subsidiaries, unless otherwise indicated or unless the
context otherwise requires.
The Company's businesses are divided into five business segments. Dover
Resources manufactures products primarily for the automotive, fluid handling,
petroleum and chemical industries. Dover Industries makes products for use in
the waste handling, bulk transport, automotive service, commercial food service
and machine tool industries. Dover Technologies builds primarily sophisticated
automated assembly equipment for the electronics industry and, to a lesser
degree, specialized electronic components. Dover Diversified builds
sophisticated assembly and production machines, heat transfer equipment and
specialized compressors, as well as sophisticated products and control systems
for use in the defense, aerospace and commercial building industries. Dover
Elevator manufactures, installs and services elevators primarily in North
America.
The Company emphasizes growth and strong internal cash flow. It has a
long-standing and successful acquisition program pursuant to which, from January
1, 1990 through September 30, 1995, the Company made 48 acquisitions at a total
acquisition cost of $1.038 billion. These acquisitions have had a substantial
impact on the increase in the Company's sales and earnings since 1990. The
Company's acquisition program traditionally focused on acquiring new or stand-
alone businesses. However, since 1993, increased emphasis has been placed on
acquiring businesses which can be added on to existing operations. The Company
aims to be in businesses marked by growth, innovation and higher than average
profit margins. It seeks to have each of its businesses be a leader in its
market as measured by market share, innovation, profitability and return on
assets.
The Company practices a highly decentralized management style. The
presidents of operating companies are very autonomous and have a high level of
independent responsibility for their businesses and their performance. This is
in keeping with the Company's operating philosophy that small independent
operations are better able to serve customers by focusing closely on their
products and reacting quickly to customer needs. The Company's executive
management becomes involved only to guide and manage capital, assist in major
acquisitions, evaluate, motivate and, if necessary, replace operating
management, and provide selected other services.
Dover Resources, which accounted for 16% of the Company's sales in the
nine-month period ended September 30, 1995, manufactures components and
equipment primarily for the automotive, fluid handling, petroleum and chemical
industries. Its largest businesses are De-Sta-Co (compressor valves and
workholding devices), OPW Fueling Components (gasoline nozzles and related
service station equipment), and Blackmer (rotary vein and progressive cavity
pumps and gas compressors). At the beginning of 1994, Dover Resources acquired
Midland Manufacturing, a market leader in safety valves and gauging equipment
for rail tank cars. Other Dover Resources companies produce liquid monitoring,
filtration and control systems, oil and gas production equipment, and other
valve, instrumentation and control systems and products.
Dover Industries, which accounted for 22% of the Company's sales in the
nine-month period ended September 30, 1995, manufactures a diverse mix of
equipment and components for use in the waste handling, bulk transport,
automotive service, commercial food service, machine tool and other industries.
The largest operations are Heil, acquired in 1993 (trailerized tanks and refuse
collecting vehicles), Tipper Tie (clip closures for food packaging), Marathon,
acquired at the end of 1990 (solid waste compaction, transporting and recycling
equipment), Rotary Lift (automotive lifts), and Groen (food service equipment).
In 1994, Tipper Tie acquired Technopack of Hamburg, Germany, a former licensee,
and combined it with Tipper Tie's European operations. Other Dover Industries
operations produce auto collision measuring and repair systems, commercial
refrigeration, welding torches, plasma cutting products and screw machines.
3
<PAGE> 4
Dover Technologies, which accounted for 22% of the Company's sales in the
nine-month period ended September 30, 1995, sells assembly equipment, screen
printers, and soldering machines for the printed circuit board industry, as well
as components for communications (including wireless) and military applications.
Its primary competitors are Japanese producers, including Fuji Machine,
Panasonic and TDK. The most significant business in this segment is Universal
Instruments which, in the nine-month period ended September 30, 1995, accounted
for almost 70% of the sales and a higher percentage of the operating profit of
Dover Technologies. Universal Instruments' sales and operating profit for such
period in 1995 grew 42% and 112%, respectively, over the comparable period in
1994. Universal Instruments is the world's largest producer of thru-hole printed
circuit board assembly equipment, as well as a significant manufacturer of
surface mount printed circuit board assembly equipment. At the end of the third
quarter of 1995, Dover acquired Imaje, S.A., for approximately $205 million. See
"-- Recent Development -- Acquisition of Imaje, S.A."
Dover Diversified, which accounted for 18% of the Company's sales in the
nine-month period ended September 30, 1995, manufactures equipment and
components for industrial, commercial, and defense applications. The largest
operations are Belvac, acquired in 1993 (can-making machinery), Tranter (process
industry heat exchangers), A-C Compressor, acquired in 1992 (process industry
compressors), and Hill Phoenix, acquired in 1993-94 (refrigeration cases and
systems for supermarkets). In the second quarter of 1995, Dover Diversified
acquired Mark Andy, a leading manufacturer of narrow web flexographic printing
presses. Other Dover Diversified businesses produce such products as fluid film
and self-lubricating bearings, metal and fabric expansion joints, submarine and
aircraft hydraulic controls, remote manipulators and industrial cleaning
equipment.
Dover Elevator, which accounted for 22% of the Company's sales in the
nine-month period ended September 30, 1995, is the nation's largest manufacturer
and installer, and one of the largest servicers, of elevators for low- and
mid-rise buildings. Dover Elevator also participates in the high-rise market for
new equipment and service. Its primary competitors are Otis,
Westinghouse/Schindler and Montgomery/Kone. Dover Elevator also sells and
services elevators in foreign markets, principally the United Kingdom and
Canada. Somewhat less than half of Dover Elevator's sales and all of its profits
are generated by the service business. During the third quarter of 1995, Dover
Elevator took a charge against earnings of $15 million in connection with the
decision to close manufacturing operations in Canada. Recent changes have been
made in Dover Elevator's operating management reflecting the Company's intention
to conduct business in North America in a more unified and centralized manner.
The address and telephone number of the Company's principal executive
offices are 280 Park Avenue, New York, New York 10017-1292, (212) 922-1640.
Dover Corporation is a Delaware corporation which conducts substantially all its
business through subsidiaries.
RECENT DEVELOPMENT -- ACQUISITION OF IMAJE, S.A.
On September 29, 1995, the Company, through a wholly-owned subsidiary,
acquired 88% of the outstanding stock of Imaje, S.A., a French company. The
Company currently holds approximately 94% of the outstanding shares of Imaje and
intends to purchase the remainder thereof, including 1% that has been tendered
and is being processed for payment and another 4% that the Company has an option
to purchase within one year. The economic cost to acquire 100% of the stock of
Imaje, including all direct costs, is approximately $205 million, where
"economic cost" is defined as total cash consideration plus long-term debt
assumed less cash acquired. Under generally accepted accounting principles, the
comparable purchase price is approximately $212 million. To fund the
acquisition, the Company increased its short term commercial paper borrowings by
approximately $200 million and used some internally-generated funds.
Based in Valence, France, Imaje is one of the world's three largest
manufacturers of industrial continuous ink jet printers and specialized inks
used for coding and marking a wide variety of
4
<PAGE> 5
products and consumables. It also produces laser and contact marking printers.
Imaje had sales of $144 million and operating profit of $27 million for 1994,
and sales of $82 million and operating profit of $22 million for the six months
ended June 30, 1995. These operating profit figures include charges for employee
profit sharing, goodwill amortization and certain exceptional expenses. Imaje
employs approximately 900 people, 45% in France and the balance in subsidiaries
throughout the world.
Certain financial statements of Imaje and pro forma financial information
of the Company reflecting the Imaje acquisition are contained in the Company's
Current Report on Form 8-K dated September 29, 1995, as filed on October 16,
1995 and amended on October 25, 1995, which is incorporated herein by reference.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the Notes offered hereby
(before deducting estimated expenses of $350,000 payable by the Company) will be
approximately $248 million. The net proceeds will be used to reduce the level of
the Company's commercial paper outstanding. Commercial paper totaled $745
million at September 30, 1995, with a weighted average interest rate of 5.785%
and an average maturity of 33 days. The Company has historically used commercial
paper, together with internally-generated cash, to finance acquisitions. See
"The Company -- Recent Development -- Acquisition of Imaje."
CAPITALIZATION
The following table sets forth the short-term debt and capitalization of
the Company at September 30, 1995, and as adjusted to reflect the issuance and
sale of the Notes offered hereby and the application of the net proceeds
therefrom to reduce commercial paper. See "Use of Proceeds."
<TABLE>
<CAPTION>
SEPTEMBER 30, 1995
--------------------------
ACTUAL AS ADJUSTED
---------- -----------
(IN THOUSANDS)
<S> <C> <C>
Short-Term Debt:
Commercial paper.......................................................... $ 495,000 $ 247,000
Other notes payable....................................................... 2,315 2,315
---------- ----------
Total notes payable................................................ 497,315 249,315
Current portion of long-term debt......................................... 297 297
---------- ----------
Total Short-Term Debt.............................................. $ 497,612 $ 249,612
========== ==========
Long-Term Debt:
Commercial paper.......................................................... $ 250,000 $ 250,000
6.45% Notes due November 15, 2005......................................... -- 250,000
Other long-term debt including capital leases............................. 2,208 2,208
---------- ----------
Total Long-Term Debt............................................... $ 252,208 $ 502,208
Stockholders' Equity:
Common stock, $1 par value, authorized 200,000,000 shares; issued
113,578,000 shares...................................................... $ 120,996 $ 120,996
Cumulative translation adjustments and unrealized holding losses.......... 6,964 6,964
Retained earnings......................................................... 1,100,758 1,100,758
---------- ----------
1,228,718 1,228,718
Less common stock in treasury, at cost -- 2,889,000 shares................ 53,595 53,595
---------- ----------
Total Stockholders' Equity......................................... 1,175,123 1,175,123
---------- ----------
Total Capitalization........................................................ $1,427,331 $ 1,677,331
========== ==========
</TABLE>
5
<PAGE> 6
SELECTED CONSOLIDATED FINANCIAL DATA
The following selected consolidated financial data concerning the Company
for, and as of the end of, each of the five years in the period ended December
31, 1994, has been derived from consolidated financial statements which have
been audited by KPMG Peat Marwick LLP, independent auditors. The information for
interim periods is unaudited; however, in the opinion of management, all
adjustments (consisting only of normal recurring adjustments) necessary for a
fair presentation of such information have been included. The interim results of
operations may not be indicative of the results for the full year. The selected
consolidated financial information should be read in conjunction with the
consolidated financial statements and related notes incorporated herein by
reference.
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
------------------------------------------------------------------
1990 1991 1992 1993 1994
---------- ---------- ---------- ---------- ----------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C> <C>
EARNINGS STATEMENT DATA:
Net sales............................ $2,210,345 $2,195,786 $2,271,580 $2,483,928 $3,085,276
Gross profit......................... 693,592 615,736 669,985 750,672 947,799
Selling and administrative
expenses........................... 440,313 452,394 466,777 496,799 622,434
---------- ---------- ---------- ---------- ----------
Operating profit..................... 253,279 163,342 203,208 253,873 325,365
Interest expense..................... 30,658 23,161 20,059 22,339 36,461
Other income, net.................... 21,497 63,907 17,186 14,008 17,955
---------- ---------- ---------- ---------- ----------
Earnings before taxes on income and
cumulative effects of changes in
accounting principles.............. 244,118 204,088 200,335 245,542 306,859
Federal and other taxes on income.... 88,439 75,880 71,192 87,288 104,486
---------- ---------- ---------- ---------- ----------
Earnings before cumulative effects of
changes in accounting principles... 155,679 128,208 129,143 158,254 202,373
Cumulative effects at January 1,
1992, of changes in accounting for:
Income taxes....................... 12,951
Postretirement benefits other than
pensions (net of income tax
benefits, $7,159)................ (12,387)
---------- ---------- ---------- ---------- ----------
Net earnings......................... $ 155,679 $ 128,208 $ 129,707 $ 158,254 $ 202,373
========== ========== ========== ========== ==========
OTHER OPERATING DATA:
Cash flow(1)......................... $ 233,210 $ 213,575 $ 207,164 $ 235,223 $ 298,162
Capital expenditures................. 44,980 46,618 42,441 47,532 84,473
Acquisitions......................... 102,834 13,192 111,243 321,002 187,704
Ratio of earnings to fixed
charges(2)......................... 7.3x 7.4x 8.0x 9.0x 7.8x
BALANCE SHEET DATA (AT PERIOD END):
Current assets....................... $ 814,713 $ 756,368 $ 773,991 $ 903,640 $1,133,139
Net property, plant and equipment.... 268,386 251,145 251,270 283,363 342,685
Intangible assets, net of
amortization....................... 335,334 289,794 348,680 535,136 564,420
Other intangible assets.............. 10,258 10,258 10,258 10,258 10,258
Other assets and deferred charges.... 39,675 49,055 41,925 41,292 20,135
---------- ---------- ---------- ---------- ----------
Total assets................ $1,468,366 $1,356,620 $1,426,124 $1,773,689 $2,070,637
========== ========== ========== ========== ==========
Current liabilities.................. $ 607,965 $ 475,465 $ 572,350 $ 595,794 $ 772,223
Long-term obligations................ 35,057 17,268 27,337 287,484 300,010
Deferred income taxes................ 37,684 35,513 21,500 20,409 2,545
Stockholders' equity................. 787,660 828,374 804,937 870,002 995,859
---------- ---------- ---------- ---------- ----------
Total liabilities and
stockholders' equity...... $1,468,366 $1,356,620 $1,426,124 $1,773,689 $2,070,637
========== ========== ========== ========== ==========
</TABLE>
- ---------------
(1) Represents net earnings plus depreciation and amortization.
(2) Computed by dividing fixed charges of the Company into earnings before
income taxes plus fixed charges. Fixed charges consist of interest expense
and the portion of rental expense which is deemed to be representative of
the interest factor.
6
<PAGE> 7
<TABLE>
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
------------------------- ---------------------
1994 1995 1994 1995
---------- ---------- -------- --------
(DOLLARS IN THOUSANDS)
<S> <C> <C> <C> <C>
EARNINGS STATEMENT DATA:
Net sales.......................................... $2,246,411 $2,736,836 $804,460 $934,543
Gross profit....................................... 694,056 862,691 245,228 289,619
Selling, general and administrative expenses....... 450,649 533,193 157,149 177,111
---------- ---------- -------- --------
Operating profit................................... 243,407 329,498 88,079 112,508
Interest expense................................... 25,029 27,101 9,911 9,559
Other income, net.................................. 10,655 13,666 1,424 246
---------- ---------- -------- --------
Earnings before taxes on income.................... 229,033 316,063 79,592 103,195
Federal and other taxes on income.................. 82,150 106,224 27,722 32,047
---------- ---------- -------- --------
Net earnings....................................... $ 146,883 $ 209,839 $ 51,870 $ 71,148
========== ========== ======== ========
OTHER OPERATING DATA:
Cash flow(1)....................................... $ 216,482 $ 287,444 $ 76,511 $ 99,077
Capital expenditures............................... 55,256 71,269 21,035 24,207
Acquisitions....................................... 182,615 301,806 32,834 203,114
Ratio of earnings to fixed charges(2).............. 8.3x 10.3x 7.9x 10.2x
BALANCE SHEET DATA (AT PERIOD END):
Current assets..................................... $1,097,749 $1,314,240
Net property, plant and equipment.................. 331,314 392,189
Intangible assets, net of amortization............. 618,392 813,054
Other intangible assets............................ 10,258 10,258
Other assets and deferred charges.................. 38,140 27,929
---------- ----------
Total assets.............................. $2,095,853 $2,557,670
========== ==========
Current liabilities................................ $ 785,632 $1,067,943
Long-term obligations.............................. 303,640 306,322
Deferred income taxes.............................. 16,895 8,282
Stockholders' equity............................... 989,686 1,175,123
---------- ----------
Total liabilities and stockholders'
equity.................................. $2,095,853 $2,557,670
========== ==========
</TABLE>
- ---------------
(1) Represents net earnings plus depreciation and amortization.
(2) Computed by dividing fixed charges of the Company into earnings before
income taxes plus fixed charges. Fixed charges consist of interest expense
and the portion of rental expense which is deemed to be representative of
the interest factor.
7
<PAGE> 8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
GENERAL
Set forth below are the sales and operating profits of the Company's five
business segments for the periods indicated. Such information should be read in
conjunction with the other financial information set forth or incorporated by
reference herein.
<TABLE>
<CAPTION>
NINE MONTHS
YEAR ENDED DECEMBER 31, ENDED THREE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
----------------------- ----------------------- -------------------
1993 1994 1994 1995 1994 1995
---------- ---------- ---------- ---------- -------- --------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
SALES TO UNAFFILIATED CUSTOMERS:
Dover Resources............... $ 472,643 $ 525,971 $ 387,678 $ 433,548 $137,430 $143,813
Dover Industries.............. 501,364 691,342 509,615 594,841 179,489 197,265
Dover Technologies............ 488,248 603,068 440,191 615,030 157,354 210,626
Dover Diversified............. 244,597 472,706 317,662 488,216 131,035 176,928
Dover Elevator................ 777,720 793,559 592,249 608,868 199,514 207,047
Intramarket sales............. (644) (1,370) (984) (3,667) (362) (1,136)
---------- ---------- ---------- ---------- -------- --------
Consolidated total..... $2,483,928 $3,085,276 $2,246,411 $2,736,836 $804,460 $934,543
========== ========== ========== ========== ======== ========
OPERATING PROFIT:
Dover Resources............... $ 70,290 $ 83,979 $ 62,578 $ 68,396 $ 22,771 $ 21,654
Dover Industries.............. 59,942 81,028 62,278 88,167 23,431 29,259
Dover Technologies............ 41,797 76,205 51,985 96,995 20,720 32,990
Dover Diversified............. 39,360 67,220 43,488 67,144(1) 13,399 29,233(1)
Dover Elevator................ 56,404 46,123 41,722 29,936(2) 12,109 1,956(2)
Interest income, interest
expense and general
corporate expenses, net..... (22,251) (47,696) (33,018) (34,575) (12,838) (11,897)
---------- ---------- ---------- ---------- -------- --------
Earnings before taxes
on income............ $ 245,542 $ 306,859 $ 229,033 $ 316,063 $ 79,592 $103,195
========== ========== ========== ========== ======== ========
</TABLE>
- ---------------
(1) Includes contract settlement pre-tax gain of $9.5 million in the 1995 third
quarter and $11.6 million for the nine months ended September 30, 1995.
(2) Includes a pre-tax charge of $15 million in the 1995 third quarter in
connection with the closing of manufacturing operations in Canada.
RESULTS OF OPERATIONS:
NINE MONTHS AND THREE MONTHS ENDED SEPTEMBER 30, 1995 COMPARED WITH 1994
PERIODS.
Sales in the nine months ended September 30, 1995 increased 22% to $2.7
billion compared to the 1994 period and net earnings increased approximately $63
million, or 43%. For the third quarter, sales of $935 million were up 16% from
last year's third quarter and net earnings increased approximately $19 million,
or 37%. The 1995 third quarter results included two non-recurring items -- a $15
million pre-tax provision for costs to close an elevator manufacturing facility
(included in the Dover Elevator segment) that was partially offset by a pre-tax
gain of $9.5 million from the settlement of contract claims on a government
program (included in the Dover Diversified segment).
8
<PAGE> 9
A discussion of results of operations by segments follows:
Dover Resources: Sales in the Dover Resources segment increased 12% and 5%
for the nine-month and three-month periods, respectively. Operating earnings
were up 9% for the nine months but declined by 5% in the third quarter,
primarily as a result of lower sales of vapor recovery products at Blackmer and
OPW as a result of weaker market conditions in the product area after very
strong growth in recent years. De-Sta-Co's sales increased but margins dropped
due to sales mix and a temporary shortage of skilled labor that resulted in
excessive overtime, higher turnover and increased training costs at its Detroit
facilities. Seven of Dover Resources' 16 companies achieved earnings gains in
the third quarter. Backlog at September 30, 1995 was $83 million, which was 15%
above the 1994 level.
Dover Industries: Dover Industries reported sales increases of 17% for the
nine months and 10% for the third quarter. Operating earnings were up 42% for
the nine months and 25% in the third quarter. Seven of Dover Industries' 12
businesses reported earnings gains for the third quarter as compared to the
prior year period, with Heil, Marathon, Davenport and Texas Hydraulics each
reporting profit growth in excess of 25%. Auto service equipment (Rotary and
Chief) and commercial restaurant equipment (Groen and Randell) recorded a
decline in sales and earnings as a result of the softness in the U.S. economy
earlier in the year. Backlog at September 30, 1995 was $155 million, a 1%
increase above the 1994 level.
Dover Technologies: Sales and operating profits grew 40% and 87% in the
nine-month period and 34% and 59% in the third quarter. Almost all of the $45
million profit increase in the nine months and the $12.3 million increase in the
third quarter was achieved at Universal Instruments, although four of Dover
Technologies' six other businesses also achieved sales and operating earnings
gains. The results at Universal Instruments reflected a favorable mix of higher
margin thru-hole products compared to the generally more rapidly growing surface
mount equipment. Backlog of $186 million at September 30, 1995 was 36% higher
than the prior year.
Dover Diversified: Dover Diversified's sales increased 54% and 35% in the
nine-month period and third quarter, respectively. Operating earnings for the
same periods increased 28% and 47%, excluding the contract settlement
contribution of $11.6 million for the nine months and $9.5 million for the third
quarter. These increases were primarily due to strong gains at Belvac (beverage
can making equipment) and Tranter (heat transfer products). Disappointing profit
levels at Hill Phoenix and A-C Compressor, whose combined third quarter sales
exceeded $70 million, had an adverse effect on overall operating margins for the
segment. Backlog was $344 million at September 30, 1995, an increase of 37% over
the prior year.
Dover Elevator: Dover Elevator's sales increased 3% in the nine-month
period and 4% in the third quarter of 1995 compared to the 1994 periods.
Operating profits of $45 million for the nine-month period were up 8% over the
prior year period. Third quarter operating profits of approximately $17 million
were up 40% over the 1994 quarter. General Elevator, which had recorded a loss
in the 1994 period, was profitable in the 1995 third quarter. As indicated,
Dover Elevator established a $15 million provision in the 1995 third quarter for
cash costs and property write-downs associated with the decision to close
manufacturing operations in Canada. Backlog at September 30, 1995 was $270
million, an increase of 6% over 1994.
1994 COMPARED WITH 1993.
Sales in 1994 rose 24% to almost $3.1 billion, an increase of $601 million,
reflecting both internal growth at most Dover companies and the effect of the
Company's significant acquisition activity in 1993 and 1994.
Companies acquired in 1993 added $155 million to Dover's 1993 sales. The
internal growth of these businesses, and their inclusion for a full year, led to
a further sales contribution in 1994 of approximately $260 million, representing
about 10 percentage points of the 24% year-to-year sales
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gain. Additionally, the companies acquired during 1994 added $151 million to
1994 sales, accounting for 6 percentage points of the sales gain. The 1994 sales
growth of businesses Dover owned at the start of 1993 averaged approximately 10%
(adjusted for the effect of the spin-off of DOVatron in mid-1993).
While acquisitions provided much of the Company's sales growth, the major
portion of the $44 million, or 28%, gain in earnings came from the internal
growth of existing companies. Companies acquired in 1994 made no contribution to
earnings because of acquisition-related costs and interest income foregone.
Companies acquired in 1993 contributed about 13 percentage points to the overall
reported gain, with a portion reflecting internal growth after acquisition.
A discussion of results of operations by industry segments follows:
Dover Resources: Profits at Dover Resources improved 19% in 1994 compared
to 1993 on an 11% sales gain. Some of the sales and earnings gains resulted from
the acquisition of Midland Manufacturing at the start of the year, but the
largest portion came from internal growth as a result of strong demand for
De-Sta-Co's domestic valve and clamp products and OPW's vapor recovery products.
Dover Industries: Dover Industries achieved record sales of $691 million
in 1994, up 38% from the prior year, and operating income of $81 million, up
35%, also a record level. These results reflect both acquisitions and strong
internal growth. Each of Dover Industries' 12 businesses achieved an earnings
improvement in 1994 with particularly impressive percentage increases at Rotary
Lift, Texas Hydraulics, Tipper Tie and Bernard. In addition, Heil, which was
acquired in 1993 and is the largest company in the Dover Industries segment,
recorded record levels of sales and profits.
Dover Technologies: Dover Technologies also had a record year in 1994,
with an earnings gain of 82% compared to 1993 on a sales gain of 24%. Most of
the gains in this segment were attributable to a record performance by Universal
Instruments, which benefited from the continuing demand for capital equipment
within the electronics industry, as well as from market share gains in the very
profitable thru-hole technology sector of its business and successful new
product offerings in the surface mount technology sector. Strong sales gains and
record earnings were also achieved by DEK.
Dover Diversified: Profits at Dover Diversified increased a record 71% in
1994 on a sales gain of $228 million, or more than 90%. Acquisitions made during
1994 provided $93 million of this sales gain, but made no contribution to
earnings, as acquisition-related write-offs and the expected low operating
margins at the Hill Refrigeration Company offset good profit results at
Tranter's newly acquired European companies. A further portion of the sales
gain -- approximately $110 million -- resulted from having several 1993
acquisitions, most notably Belvac and Phoenix Refrigeration, for a full year,
and from growth at those companies. Most Dover Diversified companies showed
sales and earnings growth in 1994, with particular strength at Belvac because of
the widespread acceptance of its die-necking technology within the can-making
industry.
Dover Elevator: Profits at Dover Elevator International fell a
disappointing 18% on flat sales. All of the decline was attributable to poor
results at General Elevator, which has been primarily a service and
modernization company serving the U.S. elevator aftermarket for non-Dover
equipment. A modest operating loss at General Elevator was exacerbated by
approximately $11.5 million in write-offs and unusual expenses incurred during
the year.
LIQUIDITY AND CAPITAL RESOURCES:
Working capital decreased from $360.9 million at the end of 1994 to $246.3
million at September 30, 1995. The $114.6 million decrease represents positive
cash flow during 1995 net of $302 million paid for acquisitions.
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At September 30, 1995, net debt (defined as long-term debt plus current
maturities of long-term debt plus notes payable less cash and equivalents and
marketable securities) amounted to $590 million representing 33% of total
capital. This compares with 27% at December 31, 1994.
The Company's current ratio (current assets divided by current liabilities)
decreased to 1.23 at September 30, 1995, compared with 1.47 at December 31,
1994. The quick ratio (current assets net of inventories, divided by current
liabilities) also decreased to 0.82 at September 30, 1995 compared with 1.00 at
December 31, 1994. Working capital expressed as a percentage of sales was 9.0%
at September 30, 1995, and 11.7% at December 31, 1994.
At September 30, 1995, the Company had bank lines of $404 million, all of
which were unused. Additional bank lines of credit are available at the
Company's request.
DESCRIPTION OF THE NOTES
The Notes are to be issued under an Indenture, to be dated as of November
14, 1995 (the "Indenture"), between the Company and The First National Bank of
Chicago, as Trustee (the "Trustee"), a copy of which is filed as an exhibit to
the Registration Statement of which this Prospectus is a part. The following
summaries of certain provisions of the Indenture do not purport to be complete
and are subject to, and are qualified in their entirety by reference to, all the
provisions of the Indenture, including the definitions therein of certain terms.
Wherever particular Sections or defined terms of the Indenture are referred to,
such Sections or defined terms are incorporated herein by reference.
GENERAL
The Notes will be unsecured obligations of the Company, will be limited to
$250,000,000 aggregate principal amount and will mature on November 15, 2005.
The Notes will bear interest at the rate per annum shown on the front cover of
this Prospectus from November 14, 1995 or from the most recent Interest Payment
Date to which interest has been paid or provided for, payable semi-annually on
May 15 and November 15 of each year, commencing May 15, 1996. Interest on each
Note will be paid to the Person in whose name the Note (or any predecessor Note)
is registered at the close of business on the preceding May 1 or November 1, as
the case may be. (Sections 301 and 307)
The Notes will not be redeemable prior to maturity and will not have the
benefit of any sinking fund.
The Company conducts substantially all its business through subsidiaries.
Although the Notes are senior obligations of the Company, they are effectively
subordinated to all existing and future liabilities of the Company's
subsidiaries. The Indenture does not restrict the ability of the Company's
subsidiaries to incur indebtedness. Because the Company is a holding company,
the Company's ability to service its indebtedness is dependent on dividends and
other payments made to it on its investments in its subsidiaries.
BOOK-ENTRY SYSTEM
The Notes will be issued in the form of fully registered global notes
(collectively, the "Global Notes"), which will be deposited with, or on behalf
of, The Depository Trust Company, New York, New York (the "Depositary") and
registered in the name of the Depositary's nominee. Except as set forth below,
the Global Notes may be transferred, in whole and not in part, only to the
Depositary or another nominee of the Depositary.
So long as the Depositary or its nominee is the registered owner thereof,
the Depositary or such nominee, as the case may be, will be considered the sole
owner or Holder of the Notes represented by such Global Note for all purposes
under the Indenture. Except as provided below, owners of beneficial interests in
a Global Note will not be entitled to have Notes represented by such Global
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Note registered in their names, will not receive or be entitled to receive
physical delivery of Notes in definitive form and will not be considered the
owners or Holders thereof under the Indenture.
The following is based on information furnished by the Depositary:
The Depositary will act as securities depository for the Notes. The Notes
will be issued as fully registered securities registered in the name of Cede &
Co. (the Depositary's partnership nominee). One fully registered Global Note
will be issued with respect to $200,000,000 of principal amount and an
additional Global Note will be issued with respect to the remaining $50,000,000
principal amount, and the Global Notes will be deposited with the Depositary.
The Depositary is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. The Depositary holds securities that its participants
("Participants") deposit with the Depositary. The Depositary also facilitates
the settlement among Participants of securities transactions, such as transfers
and pledges, in deposited securities through electronic computerized book-entry
changes in Participants' accounts, thereby eliminating the need for physical
movement of securities certificates. Direct Participants ("Direct Participants")
include securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations. The Depositary is owned by a
number of its Direct Participants and by the New York Stock Exchange, Inc., the
American Stock Exchange, Inc., and the National Association of Securities
Dealers, Inc. Access to the Depositary's system is also available to others such
as securities brokers and dealers, banks and trust companies that clear through
or maintain a custodial relationship with a Direct Participant, either directly
or indirectly ("Indirect Participants"). The rules applicable to the Depositary
and its Participants are on file with the Securities and Exchange Commission.
Purchases of Notes under the Depositary's system must be made by or through
Direct Participants, which will receive a credit for such Notes on the
Depositary's records. The ownership interest of the actual purchaser of each
Note represented by a Global Note ("Beneficial Owner") is in turn to be recorded
on the Direct and Indirect Participants' records. Beneficial Owners will not
receive written confirmation from the Depositary of their purchase, but
Beneficial Owners are expected to receive written confirmations providing
details of the transaction, as well as periodic statements of their holdings,
from the Direct or Indirect Participants through which such Beneficial Owner
entered into the transaction. Transfers of ownership interests in a Global Note
representing Notes are to be accomplished by entries made on the books of
Participants acting on behalf of Beneficial Owners. Beneficial Owners of a
Global Note representing Notes will not receive Notes in definitive form
representing their ownership interests therein, except in the event that use of
the book-entry system for such Notes is discontinued or upon the occurrence of
certain other events described herein.
To facilitate subsequent transfers, all Global Notes representing Notes
which are deposited with the Depositary are registered in the name of the
Depositary's nominee, Cede & Co. The deposit of Global Notes with the Depositary
and their registration in the name of Cede & Co. effect no change in beneficial
ownership. The Depositary has no knowledge of the actual Beneficial Owners of
the Global Notes representing the Notes; the Depositary's records reflect only
the identity of the Direct Participants to whose accounts such Notes are
credited, which may or may not be the Beneficial Owners. The Participants will
remain responsible for keeping account of their holdings on behalf of their
customers.
Conveyance of notices and other communications by the Depositary to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed by
arrangements among them, subject to any statutory or regulatory requirements as
may be in effect from time to time.
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Neither the Depositary nor Cede & Co. will consent or vote with respect to
the Global Notes representing the Notes. Under its usual procedures, the
Depositary mails an omnibus proxy (an "Omnibus Proxy") to the Company as soon as
possible after the applicable record date. The Omnibus Proxy assigns Cede &
Co.'s consenting or voting rights to those Direct Participants to whose accounts
the Notes are credited on the applicable record date (identified in a listing
attached to the Omnibus Proxy).
Principal and interest payments on the Global Notes representing the Notes
will be made to the Depositary. The Depositary's practice is to credit Direct
Participants' accounts on the applicable payment date in accordance with their
respective holdings shown on the Depositary's records unless the Depositary has
reason to believe that it will not receive payment on such date. Payments by
Participants to Beneficial Owners will be governed by standing instructions and
customary practices, as is the case with securities held for the accounts of
customers in bearer form or registered in "street name", and will be the
responsibility of such Participant and not of the Depositary, the Trustee or the
Company, subject to any statutory or regulatory requirements as may be in effect
from time to time. Payment of principal and interest to the Depositary is the
responsibility of the Company or the Trustee, disbursement of such payments to
Direct Participants shall be the responsibility of the Depositary, and
disbursement of such payments to the Beneficial Owners shall be the
responsibility of Direct and Indirect Participants. Neither the Company nor the
Trustee will have any responsibility or liability for the disbursements of
payments in respect of ownership interests in the Notes by the Depositary or the
Direct or Indirect Participants or for maintaining or reviewing any records of
the Depositary or the Direct or Indirect Participants relating to ownership
interests in the Notes or the disbursement or payments in respect thereof.
A Beneficial Owner shall give notice to elect to have its Notes repaid by
the Company, through its Participant, to the Trustee, and shall effect delivery
of such Notes by causing the Direct Participant to transfer the Participant's
interest in the Global Note or Global Notes representing such Notes, on the
Depositary's records, to the Trustee. The requirement for physical delivery of
Notes in connection with a demand for repayment will be deemed satisfied when
the ownership rights in the Global Note or Global Notes representing such Notes
are transferred by Direct Participants on the Depositary's records.
The Depositary may discontinue providing its services as securities
depository with respect to the Notes at any time by giving reasonable notice to
the Company or the Trustee. Under such circumstances, and in the event that a
successor securities depository is not obtained, Notes in definitive form are
required to be printed and delivered to each holder.
The Company may decide to discontinue use of the system of book-entry
transfers through the Depositary (or a successor securities depository). In that
event, Notes in definitive form will be printed and delivered.
The information in this section concerning the Depositary and the
Depositary's system has been obtained from sources that the Company believes to
be reliable, but is subject to any changes to the arrangements between the
Company and the Depositary and any changes to such procedures that may be
instituted unilaterally by the Depositary.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made in immediately available funds. All
payments of principal and interest will be made by the Company in immediately
available funds or the equivalent. Secondary trading in long-term notes and
debentures of corporate issuers is generally settled in clearing-house or
next-day funds. In contrast, the Notes will trade in the Depositary's Same-Day
Funds Settlement System, and secondary market trading activity in the Notes will
therefore be required by the Depositary to settle in immediately available
funds. No assurances can be given to the effect, if any, of settlement in
immediately available funds on trading activity in the Notes.
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COVENANTS
The Indenture contains the following covenants:
LIMITATION ON SECURED DEBT
The Company may not, and may not permit any Restricted Subsidiary to, incur
or guarantee any evidence of indebtedness for money borrowed ("Debt") secured by
a Lien on any (i) Principal Property or any part thereof, (ii) Capital Stock of
a Restricted Subsidiary now owned or hereafter acquired by the Company or any
Restricted Subsidiary or (iii) Debt of a Restricted Subsidiary owed to the
Company or any Restricted Subsidiary of the Company, without in any such case
(i), (ii) or (iii) effectively providing that the Notes are secured equally and
ratably with (or, at the Company's option, prior to) such secured Debt and any
other Debt required to be so secured, unless the aggregate amount of all such
secured Debt, plus all Attributable Debt of the Company and its Restricted
Subsidiaries with respect to Sale and Leaseback transactions involving Principal
Properties (with the exception of such transactions which are excluded as
described in "Limitation on Sale and Leaseback Transactions" below), would not
exceed 10% of Consolidated Net Tangible Assets.
The foregoing restriction shall not apply to, and there will be excluded
from Debt in any computation under such restriction, (i) Debt secured by a Lien
in favor of the Company or a Restricted Subsidiary, (ii) Debt secured by a Lien
in favor of governmental bodies to secure progress or advance payments or
payments pursuant to contracts or statute, (iii) Debt secured by a Lien on
property, Capital Stock or Debt existing at the time of acquisition thereof
(including acquisition through merger, consolidation or otherwise), (iv) Debt
incurred or guaranteed to finance the acquisition of property, Capital Stock or
Debt, or to finance construction on, or improvement or expansion of, property,
which Debt is incurred within 180 days of such acquisition or completion of
construction, improvement or expansion, and is secured solely by a Lien on the
property, Capital Stock or Debt acquired, constructed, improved or expanded, (v)
Debt consisting of industrial revenue or pollution control bonds or similar
financing secured solely by a Lien on the property the subject thereof, or (vi)
any extension, renewal or replacement of any Debt referred to in the foregoing
clauses (iii) or (iv). (Section 1008)
LIMITATION ON SALE AND LEASEBACK TRANSACTIONS
Neither the Company nor any Restricted Subsidiary shall enter into any Sale
and Leaseback Transaction involving any Principal Property or any part thereof
after the date of original issuance of the Notes unless the aggregate amount of
all Attributable Debt of the Company and its Restricted Subsidiaries with
respect to such transactions plus all secured Debt to which the restrictions
described in "Limitation on Secured Debt" above apply would not exceed 10% of
Consolidated Net Tangible Assets.
The foregoing restriction shall not apply to, and there shall be excluded
from Attributable Debt in any computation under such restriction, any Sale and
Leaseback Transaction if (i) the lease is for a period of not in excess of three
years, including renewal rights, (ii) the lease secures or relates to industrial
revenue or pollution control bonds or similar financing, (iii) the transaction
is between the Company and a Restricted Subsidiary or between Restricted
Subsidiaries, or (iv) the Company or such Restricted Subsidiary, within 180 days
after the sale is completed, applies an amount equal to the greater of (A) the
net proceeds of the sale of the Principal Property leased or (B) the fair market
value of the Principal Property leased either to (1) the retirement of Notes,
other Funded Debt of the Company ranking on a parity with the Notes, or Funded
Debt of a Restricted Subsidiary or (2) the purchase of other property which will
constitute a Principal Property having a value at least equal to the value of
the Principal Property leased. (Section 1009)
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MERGERS, CONSOLIDATIONS AND CERTAIN SALES OF ASSETS
The Company shall not, in a single transaction or a series of related
transactions, consolidate with or merge with or into any other Person or sell,
assign, convey, transfer or lease or otherwise dispose of all or substantially
all of its properties and assets to any Person or group of affiliated Persons,
or permit any of its Restricted Subsidiaries to enter into any such transaction
or transactions if such transaction or transactions, in the aggregate, would
result in a sale, assignment, transfer, lease or disposal of all or
substantially all of the properties and assets of the Company and its Restricted
Subsidiaries on a consolidated basis to any other Person or group of affiliated
Persons, unless: (1) in a transaction in which the Company does not survive or
in which the Company sells, leases or otherwise disposes of all or substantially
all of its assets, the successor entity to the Company is organized under the
laws of the United States of America or any State thereof or the District of
Columbia and shall expressly assume, by a supplemental indenture executed and
delivered to the Trustee in form satisfactory to the Trustee, all of the
Company's obligations under the Indenture; (2) immediately before and after
giving effect to such transaction and treating any Debt which becomes an
obligation of the Company or a Restricted Subsidiary as a result of such
transaction as having been incurred by the Company or such Restricted Subsidiary
at the time of the transaction, no Event of Default or event that with the
passing of time or the giving of notice, or both, would constitute an Event of
Default shall have occurred and be continuing; (3) if, as a result of any such
transaction, property or assets of the Company or any Restricted Subsidiary
would become subject to a Lien prohibited by the provisions of the Indenture
described under "Limitation on Secured Debt" above, the Company or the successor
entity to the Company shall have secured the Notes as required by said covenant;
and (4) certain other conditions are met. (Section 801)
CERTAIN DEFINITIONS
Set forth below is a summary of certain of the defined terms used in the
Indenture. Reference is made to the Indenture for the full definition of all
such terms, as well as any other terms used herein for which no definition is
provided. (Section 101)
"Attributable Debt" means, with respect to a lease in a Sale and Leaseback
Transaction, the total net amount of rent required to be paid during the
remaining primary term of such lease, discounted at a rate per annum equal to
the interest rate on the Notes, calculated in accordance with generally accepted
accounting practices. The net amount of rent required to be paid under any such
lease for any such period shall be the aggregate amount of rent payable by the
lessee with respect to such period after excluding amounts required to be paid
on account of maintenance, repairs, insurance, taxes, assessments, utility,
operating and labor costs and similar charges.
"Capital Stock" of any Person means any and all shares, interests,
participations or other equivalents (however designated) of corporate stock or
other equity participation, including partnership interests, whether general or
limited, of such Person.
"Consolidated Net Tangible Assets" means the aggregate amount of assets of
the Company and its Subsidiaries after deducting (i) all liabilities other than
deferred income taxes, commercial paper, short-term bank Debt, Funded Debt and
shareholders' equity, and (ii) all goodwill and other intangibles.
"Funded Debt" means (i) all Debt having a maturity of more than 12 months
from the date as of which the determination is made or having a maturity of 12
months or less but by its terms being renewable or extendible beyond 12 months
from such date at the option of the borrower and (ii) rental obligations payable
more than 12 months from such date under leases which are capitalized in
accordance with generally accepted accounting principles (such rental
obligations to be included as Funded Debt at the amount so capitalized at the
date of such computation and to be included for the purposes of the definition
of Consolidated Net Tangible Assets both as an asset and as Funded Debt at the
amount so capitalized).
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"Lien" means, with respect to any property or assets, any mortgage or deed
of trust, pledge, hypothecation, assignment, deposit arrangement, security
interest, lien, charge, easement (other than any easement not materially
impairing usefulness or marketability), encumbrance, preference, priority or
other security agreement, or any equivalent of any of the foregoing under the
laws of any applicable jurisdiction, on or with respect to such property or
assets (including, without limitation, any conditional sale or other title
retention agreement having substantially the same economic effect as any of the
foregoing).
"Principal Property" means any facility owned by the Company or any
Restricted Subsidiary the gross book value of which (including related land,
improvements, machinery and equipment so owned, without deduction of any
depreciation reserves) on the date as of which the determination is being made
exceeds 1% of Consolidated Net Tangible Assets.
"Restricted Subsidiary" means any Subsidiary which owns a Principal
Property.
"Sale and Leaseback Transaction" means an arrangement with any lender or
investor or to which such lender or investor is a party providing for the
leasing by such Person of any property or asset of such Person which has been or
is being sold or transferred by such Person more than 180 days after the
acquisition thereof or the completion of construction or commencement of
operation thereof to such lender or investor or to any person to whom funds have
been or are to be advanced by such lender or investor on the security of such
property or asset. The stated maturity of such arrangement shall be the date of
the last payment of rent or any other amount due under such arrangement prior to
the first date on which such arrangement may be terminated by the lessee without
payment of a penalty.
"Subsidiary" means (i) a corporation more than 50% of the voting stock of
which is owned by the Company and/or one or more Subsidiaries or (ii) any other
Person (other than a corporation) of which the Company and/or one or more
Subsidiaries has at least a majority ownership and power to direct the policies,
management and affairs.
EVENTS OF DEFAULT
The following will be Events of Default under the Indenture: (a) failure to
pay principal of any Note when due; (b) failure to pay any interest on any Note
when due, continued for 30 days; (c) failure to perform any other covenant of
the Company in the Indenture, continued for 60 days after written notice as
provided in the Indenture; or (d) certain events of bankruptcy, insolvency or
reorganization involving the Company or any Restricted Subsidiary. (Section 501)
Subject to the provisions of the Indenture relating to the duties of the Trustee
in case an Event of Default shall occur and be continuing, the Trustee will be
under no obligation to exercise any of its rights or powers under the Indenture
at the request or direction of any of the Holders, unless such Holders shall
have offered to the Trustee reasonable indemnity. (Section 603) Subject to such
provisions for the indemnification of the Trustee, the Holders of a majority in
aggregate principal amount of the Outstanding Notes 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 conferred on the
Trustee. (Section 512)
If an Event of Default (other than an Event of Default described in Clause
(d) above) shall occur and be continuing, either the Trustee or the Holders of
at least 25% in aggregate principal amount of the Outstanding Notes may
accelerate the maturity of all Notes; provided, however, that after such
acceleration, but before a judgment or decree based on acceleration, the Holders
of a majority in aggregate principal amount of Outstanding Notes may, under
certain circumstances, rescind and annul such acceleration if all Events of
Default, other than the non-payment of accelerated principal, have been cured or
waived as provided in the Indenture. If an Event of Default specified in clause
(d) above occurs, the Outstanding Notes will ipso facto become immediately due
and payable without any declaration or other act on the part of the Trustee or
any Holder. (Section 502) For information as to waiver of defaults, see
"Modification and Waiver".
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No Holder of any Note will have any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder, unless such Holder shall
have previously given to the Trustee written notice of a continuing Event of
Default and unless also the Holders of at least 25% in aggregate principal
amount of the Outstanding Notes shall have made written request, and offered
reasonable indemnity, to the Trustee to institute such proceeding as trustee,
and the Trustee shall not have received from the Holders of a majority in
aggregate principal amount of the Outstanding Notes a direction inconsistent
with such request and shall have failed to institute such proceeding within 60
days. (Section 507) However, such limitations do not apply to a suit instituted
by a Holder of a Note for enforcement of payment of the principal of or interest
on such Note on or after the respective due dates expressed in such Note.
(Section 508)
The Company will be required to furnish to the Trustee annually a statement
as to the performance by the Company of certain of its obligations under the
Indenture and as to any default in such performance. (Section 1004)
DEFEASANCE
The Indenture will provide that, at the option of the Company, (A) if
applicable, the Company will be discharged from any and all obligations in
respect of the Outstanding Notes or (B) if applicable, the Company may omit to
comply with certain restrictive covenants and that such omission shall not be
deemed to be an Event of Default under the Indenture and the Notes, in either
case (A) or (B) upon irrevocable deposit with the Trustee, in trust, of money
and/or U.S. government obligations which will provide money in an amount
sufficient in the opinion of a nationally recognized firm of independent
certified public accountants to pay the principal of, and each installment of
interest, if any, on, the Outstanding Notes. With respect to clause (B), the
obligations under the Indenture other than with respect to such covenants and
the Events of Default other than the Events of Default relating to such
covenants shall remain in full force and effect. Such trust may only be
established if, among other things (i) with respect to clause (A), the Company
has received from, or there has been published by, the Internal Revenue Service
a ruling or there has been a change in law, which in the opinion of Counsel
provides that Holders of the Notes will not recognize gain or loss for Federal
income tax purposes as a result of such deposit, defeasance and discharge and
will be subject to Federal income tax on the same amount, in the same manner and
at the same times as would have been the case if such deposit, defeasance and
discharge had not occurred; or, with respect to clause (B), the Company has
delivered to the Trustee an Opinion of Counsel to the effect that the Holders of
the Notes will not recognize gain or loss for Federal income tax purposes as a
result of such deposit and defeasance and will be subject to Federal income tax
on the same amount, in the same manner and at the same times as would have been
the case if such deposit and defeasance had not occurred; (ii) no Event of
Default or event that with the passing of time or the giving of notice, or both,
shall constitute an Event of Default shall have occurred or be continuing; (iii)
the Company has delivered to the Trustee an Opinion of Counsel to the effect
that such deposit shall not cause the Trustee or the trust so created to be
subject to the Investment Company Act of 1940; and (iv) certain other customary
conditions precedent are satisfied. (Article Eleven)
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the Company
and the Trustee with the consent of the Holders of a majority in aggregate
principal amount of the Outstanding Notes; provided, however, that no such
modification or amendment may, without the consent of the Holder of each
Outstanding Note affected thereby, (a) change the Stated Maturity of the
principal of, or any installment of interest on, any Note, (b) reduce the
principal amount of, or the rate of interest on, any Note, (c) change the place
or currency of payment of principal of, or interest on, any Note, (d) impair the
right to institute suit for the enforcement of any payment on or with respect to
any Note, (e) reduce the above-stated percentage of Outstanding Notes necessary
to modify or
17
<PAGE> 18
amend the Indenture or (f) reduce the percentage of aggregate principal amount
of Outstanding Notes necessary for waiver of compliance with certain provisions
of the Indenture or for waiver of certain defaults. (Section 902)
The Holders of a majority in aggregate principal amount of the Outstanding
Notes may waive compliance by the Company with certain restrictive provisions of
the Indenture. (Section 1010) The Holders of a majority in aggregate principal
amount of the Outstanding Notes may waive any past default under the Indenture,
except a default in the payment of principal or interest. (Section 513)
REGARDING THE TRUSTEE
The Indenture provides that, except during the continuance of an Event of
Default, the Trustee will perform only such duties as are specifically set forth
in the Indenture. During the existence of an Event of Default, the Trustee will
exercise such rights and powers vested in it under the Indenture and use the
same degree of care and skill in its exercise as a prudent person would exercise
under the circumstances in the conduct of such person's own affairs. (Sections
601 and 603)
The Indenture and provisions of the Trust Indenture Act incorporated by
reference therein contain limitations on the rights of the Trustee, should it
become a creditor of the Company, to obtain payment of claims in certain cases
or to realize on certain property received by it in respect of any such claim as
security or otherwise. (Section 613) The Trustee is one of the lenders party to
the Company's unused bank lines of credit and is permitted to engage in other
transactions with the Company or any Affiliate, provided, however, that, if it
acquires any conflicting interest (as defined in the Indenture or in the Trust
Indenture Act), it must eliminate such conflict or resign. (Section 608)
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting
Agreement, the Company has agreed to sell to each of the Underwriters named
below, and each of the Underwriters has severally agreed to purchase, the
principal amount of the Notes set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
UNDERWRITER OF NOTES
--------------------------------------------------------------------- ------------
<S> <C>
Goldman, Sachs & Co. ................................................ $200,000,000
Lehman Brothers Inc. ................................................ 25,000,000
J.P. Morgan Securities Inc. ......................................... 25,000,000
------------
Total...................................................... $250,000,000
============
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all of the Notes, if any are
taken.
The Underwriters propose to offer the Notes in part directly to the public
at the initial public offering price set forth on the cover page of this
Prospectus and in part to certain securities dealers at such price less a
concession of 0.40% of the principal amount of the Notes. The Underwriters may
allow, and such dealers may reallow, a concession not to exceed 0.25% of the
principal amount of the Notes to certain brokers and dealers. After the Notes
are released for sale to the public, the offering price and other selling terms
may from time to time be varied by the Underwriters.
The Notes are a new issue of securities with no established trading market.
The Company has been advised by the Underwriters that they intend to make a
market in the Notes but are not obligated to do so and may discontinue market
making at any time without notice. No assurance can be given as to the liquidity
of the trading market for the Notes.
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<PAGE> 19
Settlement for the Notes will be made in immediately available funds and
all secondary trading in the Notes will settle in immediately available funds.
See "Description of the Notes -- Same-Day Settlement and Payment".
Certain of the Underwriters perform investment banking and other capital
markets services for the Company in the normal course of business.
The Company has agreed to indemnify the several Underwriters against
certain liabilities, including liabilities under the Securities Act of 1933.
VALIDITY OF THE NOTES
The validity of the Notes offered hereby will be passed upon for the
Company by Robert G. Kuhbach, Esq., Vice President, General Counsel and
Secretary of the Company, and for the Underwriters by Sullivan & Cromwell, New
York, New York. At the date of this Prospectus, Mr. Kuhbach was the owner of
4,000 shares of the Company's common stock and held options to acquire 24,086
shares of such common stock.
EXPERTS
The consolidated financial statements and related supplemental schedule of
the Company incorporated by reference in this Prospectus from the Company's
Annual Report on Form 10-K for the fiscal year ended December 31, 1994 have been
audited by KPMG Peat Marwick LLP, independent auditors, as stated in their
report which is incorporated herein by reference, and have been so incorporated
in reliance upon the report of such firm given upon their authority as experts
in accounting and auditing.
The financial statements of Imaje, S.A. for the year ended and as at
December 31, 1994 incorporated by reference in this Prospectus from the
Company's Current Report on Form 8-K dated September 29, 1995, which was filed
on October 16, 1995 and amended on October 25, 1995, have been audited by Ernst
& Young Audit, statutory auditors, as stated in their general report which is
incorporated herein by reference, and have been so incorporated in reliance upon
the report of such firm given upon their authority as experts in accounting and
auditing.
As reported in the Company's Current Report on Form 8-K dated August 7,
1995, which was filed on August 11, 1995 and amended on August 17, 1995, the
Company has engaged Coopers & Lybrand L.L.P. as its independent accountants to
audit its financial statements for the fiscal year ending December 31, 1995.
This change of accountants was not the result of any disagreement with KPMG Peat
Marwick LLP.
19
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES
DESCRIBED IN THIS PROSPECTUS 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 NOR ANY SALE MADE HEREUNDER
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 HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
------------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information................... 2
Incorporation of Certain Documents by
Reference............................. 2
The Company............................. 3
Use of Proceeds......................... 5
Capitalization.......................... 5
Selected Consolidated Financial Data.... 6
Management's Discussion and Analysis of
Financial Condition and Results of
Operations............................ 8
Description of the Notes................ 11
Underwriting............................ 18
Validity of the Notes................... 19
Experts................................. 19
</TABLE>
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$250,000,000
DOVER CORPORATION
6.45% NOTES DUE
NOVEMBER 15, 2005
------------------
DOVER LOGO
------------------
GOLDMAN, SACHS & CO.
LEHMAN BROTHERS
J.P. MORGAN SECURITIES INC.
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