RULE 424(B)(2)
REGISTRATION STATEMENT
NO. 33-52735
PROSPECTUS SUPPLEMENT
(To Prospectus dated March 25, 1994)
500,000 Shares
CBI INDUSTRIES, INC.
7.48% Cumulative Preferred Stock, Series D
(Liquidation Preference $100 per Share)
Dividends on the 7.48% Cumulative Preferred Stock, Series D,
$1.00 par value per share (the " 7.48% Preferred Stock"), are
cumulative from the date of original issue and are payable
quarterly, commencing June 15, 1995. See "Certain Terms of the
% Preferred Stock--Dividends." On April 1, 2000, to the extent
funds are legally available therefor, CBI Industries, Inc. (the
"Company" or "CBI") is required to redeem for cash all of the
outstanding shares of the 7.48% Preferred Stock at a redemption
price of $100 per share, plus an amount equal to accrued and
unpaid dividends. The 7.48% Preferred Stock will not be redeemable
prior to that date. The 7.48% Preferred Stock will not be entitled
to the benefits of any sinking fund. See "Certain Terms of the
% Preferred Stock--Redemption."
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 SUPPLEMENT OR THE PROSPECTUS. ANY REPRE-
SENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Price to Underwriting Proceeds to
Public(1) Discount(2) Company(1)(3)
Per Share $100.00 $ .875 $99.125
Total $50,000,000 $437,500 $49,562,500
(1)Plus accrued dividends, if any, from the date of original
issue.
(2)The Company has agreed to indemnify the several Underwriters
against certain liabilities, including liabilities under the
Securities Act of 1933. See "Underwriting."
(3)Before deducting expenses payable by the Company estimated at
$70,000.
The 7.48% Preferred Stock offered hereby is offered by the
Underwriters, as specified herein, subject to prior sale, when,
as and if delivered to, and accepted by, the Underwriters named
herein and subject to the approval of certain legal matters by
counsel to the Underwriters, and certain other conditions. The
Underwriters reserve the right to withdraw, cancel or modify any
order and to reject any order in whole or in part. It is
expected that delivery of the 7.48% Preferred Stock will be made on
or about March 31, 1995 through the facilities of The Depository
Trust Company, against payment therefor in immediately available
funds.
Lehman Brothers Merrill Lynch & Co.
March 29, 1995
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-
ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE
MARKET PRICE OF THE 7.48% PREFERRED STOCK OFFERED HEREBY AT A LEVEL
ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH TRANSACTIONS MAY BE EFFECTED IN THE OVER-THE-COUNTER MARKET
OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
THE COMPANY
The Company operates through three major business segments.
CBI's Industrial Gases segment, which is organized under Liquid
Carbonic Industries Corporation, produces, processes and markets,
on a worldwide basis, carbon dioxide and a wide variety of other
industrial and specialty gases and chemicals. CBI's
Contracting Services segment is organized under Chicago Bridge &
Iron Company as a worldwide construction group that provides,
through separate subsidiaries, a broad range of services
including design, engineering, fabrication and construction of
metal plate structures, project management, general contracting,
and other specialty construction and related services. CBI's
Investments segment includes hydrocarbon products and special
products terminal businesses and certain real estate and
financial investments.
The Company is incorporated in Delaware. Its principal
executive offices are located at 800 Jorie Boulevard, Oak Brook,
Illinois and its telephone number is (708) 572-7000.
USE OF PROCEEDS
The net proceeds to the Company from the sale of the 7.48%
Preferred Stock offered hereby will be used to reduce outstanding
commercial paper borrowings and indebtedness under the Company's
three-year extendible revolving credit facility which was used
primarily to fund its capital investment program. At March 18,
1995, (i) the Company's outstanding commercial paper totalled
$133 million, had maturities no longer than 98 days from the date
of issue and bore interest at rates ranging from approximately
6.2% to 6.4% per annum, and (ii) the Company's indebtedness under
its three-year extendible revolving credit facility totalled $123
million, had maturities no longer than 135 days from the date of
issue and bore interest at rates ranging from approximately 6.3%
to 6.6% per annum.
SELECTED RATIOS
For purposes of calculating the ratio of earnings to fixed
charges and preferred stock dividends, 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, including interest on ESOP
debt (whether expensed or capitalized), and one-third of minimum
rental payments under operating leases (estimated by management
to be the interest factor of such rentals).
Years Ended December 31,
1994 1993 1992 1991 1990
Ratio of Earnings to Fixed 2.66 (1) 3.68 3.43 3.05
Charges and Preferred Stock
Dividends
(1) Earnings were inadequate to cover fixed charges and
preferred stock dividends by $13,770,000 for the year ended
December 31, 1993. During that year, the Company recorded a
pre-tax special charge of $91.6 million.
CERTAIN TERMS OF THE 7.48% PREFERRED STOCK
The following description of certain terms of the 7.48%
Preferred Stock supplements the description of the general terms
and provisions of the authorized shares of preferred stock, par
value $1.00 per share (the "Preferred Stock") of the Company set
forth under the heading "Description of Capital Stock - Preferred
Stock" in the accompanying Prospectus, to which reference is made
hereby. The description of certain provisions of the 7.48%
Preferred Stock set forth below does not purport to be complete
and is subject to and qualified in its entirety by reference to
the Certificate of Designations relating to the 7.48% Preferred
Stock, which will be filed with the Securities and Exchange
Commission prior to the issuance of the 7.48% Preferred Stock.
General
The 7.48% Preferred Stock will rank on a parity as to payment
of dividends and distributions of assets with the Company's
Convertible Voting Preferred Stock, Series C (the "Series C
Preferred Stock"). The 7.48% Preferred Stock will rank senior to
the Company's Series A Junior Participating Preferred Stock (the
"Series A Preferred Stock") and the Company's Common Stock with
respect to payment of dividends and distributions of assets (see
"Description of Capital Stock" in the accompanying Prospectus).
Dividends
Dividends on the stated value per share of the 7.48% Preferred
Stock will be payable at an annual rate of 7.48%, will be
cumulative from the date of original issue, and will be payable
quarterly on the fifteenth day of March, June, September and
December in each year (commencing June 15, 1995) to holders of
record on the record date, which date shall be not more than 45
days nor less than 10 days preceding the date of the dividend
payment when, as and if declared by the Board of Directors of
CBI, out of funds of the Company legally available therefor. The
Company is a party to certain agreements that subject the payment
of dividends to the satisfaction of certain financial tests. The
Company is in compliance with these financial tests and expects
that it will remain so. Quarterly dividend periods will commence
on the sixteenth day of December, March, June and September. The
amount of dividends payable for the initial dividend period or
any period shorter than a full dividend period shall be computed
on the basis of 30-day months, a 360-day year and the actual
number of days elapsed in the period. The stated value per share
of the 7.48% Preferred Stock is $100.
No dividend will be declared or paid on the shares of any
series of Preferred Stock ranking on a parity with the 7.48%
Preferred Stock as to payment of dividends unless all accumulated
dividends on all outstanding shares of any series of Preferred
Stock ranking on a parity with the 7.48% Preferred Stock as to
payment of dividends have been paid or declared and set apart for
payment or contemporaneously are paid or declared and set apart
for payment to the last date to which such dividends are payable.
Whenever all accumulated dividends are not paid in full on any
series of Preferred Stock ranking on a parity with the 7.48%
Preferred Stock as to payment of dividends, all dividends
declared or other distributions made upon shares of any series of
Preferred Stock ranking on a parity with 7.48% Preferred Stock as
to payment of dividends shall be declared or made pro rata so
that the amount of dividends declared or other distributions made
per share shall in all cases bear to each other the same ratio
that accumulated and unpaid dividends per share on each such
series of Preferred Stock bear to each other. The holders of the
7.48% Preferred Stock will be entitled to receive cumulative
dividends before any dividends are declared or paid or set apart
for payment upon the Company's Series A Preferred Stock or Common
Stock or any other class of stock of the Company ranking junior
to the 7.48% Preferred Stock as to payment of dividends. The
Company may not purchase shares of its Common Stock or of any
other series of Preferred Stock if dividends on the 7.48% Preferred
Stock are in arrears.
Rights Upon Liquidation
In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company, the holders of the 7.48%
Preferred Stock outstanding at the time on a parity with the
holders of the Series C Preferred Stock outstanding at the time
will be entitled to receive to the extent assets of the Company
are available for distribution to stockholders, before any
distribution of assets is made to holders of the Series A
Preferred Stock or the Common Stock or any other class of capital
stock ranking junior to the 7.48% Preferred Stock upon liquidation,
liquidating distributions in the amount of $100 per share plus an
amount equal to accrued and unpaid dividends for the then-current
dividend period and all dividend periods prior thereto.
Redemption
On April 1, 2000, to the extent funds are legally available
therefor, CBI is required to redeem for cash all of the 7.48%
Preferred Stock at a redemption price of $100 per share, plus an
amount equal to accrued and unpaid dividends thereon to the date
of mandatory redemption. The 7.48% Preferred Stock will not be
redeemable prior to that date. The Company is a party to certain
agreements that subject the redemption of the 7.48% Preferred
Stock to the satisfaction of certain financial tests. The
Company is in compliance with these financial tests and expects
that it will remain so. Notwithstanding the foregoing, CBI may
repurchase the 7.48% Preferred Stock in open market or private
transactions. The 7.48% Preferred Stock will not be entitled to
the benefits of any sinking fund.
Voting Rights
The 7.48% Preferred Stock will have no voting rights except as
set forth below or as otherwise provided by law. In the event
that any six cumulative quarterly dividends, whether consecutive
or not, payable upon the 7.48% Preferred Stock or cumulative
dividends for the equivalent period on any one or more other
series of Preferred Stock of the Company entitled to receive
cumulative preferred dividends shall be in arrears, the holders
of the 7.48% Preferred Stock shall have the right, voting
separately as a class with holders of shares of the Series A
Preferred Stock, the Series C Preferred Stock and any one or more
other series of Preferred Stock upon which like voting rights
have been conferred and are exercisable, at the next meeting of
stockholders called for the election of directors, to elect two
members of the Company's Board of Directors. The right of such
holders of such shares of the 7.48% Preferred Stock to elect
(together with the holders of shares of any one or more other
series of Preferred Stock upon which like voting rights have been
conferred and are exercisable) members of the Board of Directors
of the Company as aforesaid shall continue until such time as all
dividends accumulated on such shares of the 7.48% Preferred Stock
and on such other series shall have been paid in full, at which
time such right shall terminate, except as by law expressly
provided, subject to revesting in the event of each and every
subsequent failure to pay dividends of the character above
mentioned. Upon any termination of the right of the holders of
shares of Preferred Stock, including the 7.48% Preferred Stock, to
vote as a class for directors as herein provided, the term of
office of all directors then in office elected by such holders
voting as a class shall terminate immediately.
The Certificate of Designations may be amended, altered or
repealed by the unilateral action of the Board of Directors of
the Company without the consent or vote of the holders of the
7.48% Preferred Stock. Notwithstanding the preceding sentence, the
Certificate of Incorporation of the Company (including the
Certificate of Designations) shall not be amended, altered or
repealed in any manner which would adversely alter or change the
powers, preferences or special rights of the 7.48% Preferred Stock
without the affirmative vote or consent of the holders of two-
thirds or more of the outstanding shares of the 7.48% Preferred
Stock, voting separately as a series; provided, that any increase
in the authorized Preferred Stock or the creation and issuance of
any other class or series of Preferred Stock ranking on a parity
with or junior to the 7.48% Preferred Stock as to payment of
dividends and upon liquidation, dissolution or winding up, or any
decrease in the number of shares which constitute the 7.48%
Preferred Stock (but not below the number of shares thereof then
outstanding), shall be deemed not to adversely alter or change
such powers, preferences or special rights.
On any item in which the holders of 7.48% Preferred Stock are
entitled to vote, such holders shall be entitled to one vote for
each share of 7.48% Preferred Stock held.
Conversion Rights
The holders of the 7.48% Preferred Stock will not have any
rights to convert shares of the 7.48% Preferred Stock into shares
of any other class or series of capital stock (or any other
security) of the Company.
Book-Entry System
The 7.48% Preferred Stock will be issued in the form of one or
more fully registered Global Preferred Stock Certificates
("Global Certificate") which will be deposited with, or on behalf
of, The Depository Trust Company, New York, New York (the
"Depository") and registered in the name of the Depository's
nominee.
The Depository has advised as follows: It is a limited-
purpose trust company which was created to hold securities for
its participating organizations (the "Participants") and to
facilitate the clearance and settlement of securities
transactions between Participants in such securities through
electronic book-entry changes in the accounts of its
Participants. Participants include securities brokers and
dealers (including the Underwriters), banks and trust companies,
clearing corporations and certain other organizations. Access to
the Depository's system is also available to others such as
banks, brokers, dealers and trust companies that clear through or
maintain a custodial relationship with a Participant, either
directly or indirectly ("indirect participants"). Persons who
are not Participants may beneficially own securities held by the
Depository only through Participants or indirect participants.
Dividend payments on, and payments made upon mandatory
redemption of, the 7.48% Preferred Stock registered in the name of
the Depository's nominee will be made to the Depository's nominee
as the registered owner of the Global Certificate. The
Depository has advised the Company that its present practice is,
upon receipt of any dividend payment or payment made upon
mandatory redemption, to immediately credit the accounts of the
Participants with such payment in amounts proportionate to their
respective holdings in the Global Certificate as shown on the
records of the Depository.
Same-Day Settlement and Payment
Settlement for the 7.48% Preferred Stock will be made by the
Underwriters in immediately available funds. All payments of
dividends, redemption value and liquidation value will be made by
the Company in immediately available funds.
The 7.48% Preferred Stock will trade in the Depository's Same-
Day Funds Settlement System until the mandatory redemption date,
and secondary market trading in the 7.48% Preferred Stock will,
therefore, be required by the Depository to settle in immediately
available funds. No assurance can be given as to the effect, if
any, of settlement in immediately available funds on trading
activity in the 7.48% Preferred Stock.
TAX CONSIDERATIONS
The following is a summary of the expected material United
States federal income tax consequences to holders of the 7.48%
Preferred Stock (each a "Holder"). The following discussion does
not (i) consider the tax consequences of the 7.48% Preferred Stock
offering under state, local and foreign law or (ii) purport to
address all aspects of federal income taxation that may affect
certain taxpayers, such as financial institutions, broker-
dealers, life insurance companies, foreign taxpayers, and other
special status taxpayers. The statements of law and legal
conclusions contained in this summary are based upon the opinion
of Mayer, Brown & Platt, special tax counsel to the Company
("Counsel"). Such opinion is based upon the provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), its
legislative history, existing and proposed regulations
thereunder, published rulings and court decisions, all as in
effect and existing on the date hereof and all of which are
subject to change at any time, possibly on a retroactive basis.
The conclusions of Counsel are not binding on the Internal
Revenue Service (the "Service") or the courts. Furthermore, the
Company has not requested and will not receive rulings from the
Service with respect to any of the matters summarized in this
discussion. Therefore, there is no assurance that the Service or
a court would agree with the conclusions reached by Counsel.
EACH PROSPECTIVE PURCHASER IS ADVISED TO CONSULT A TAX ADVISOR AS
TO THE FEDERAL, STATE, LOCAL, FOREIGN, OR OTHER TAX CONSEQUENCES
OF ACQUIRING, HOLDING AND DISPOSING OF THE 7.48% PREFERRED STOCK.
In the opinion of Counsel, the 7.48% Preferred Stock will
constitute capital stock of the Company and distributions with
respect to the 7.48% Preferred Stock will be taxable as dividends
to the extent of the Company's current or accumulated earnings
and profits for federal income tax purposes.
Dividends paid on the 7.48% Preferred Stock may qualify for
the 70% dividends received deduction (80% for corporate
shareholders which own 20% or more of the voting power and value
of the stock of the Company) generally allowable to corporations,
subject to any limitations imposed by Sections 243 through 246A
and 1059 of the Code. Further, a corporate Holder should be
aware that dividend income which is not subject to regular tax as
a consequence of the dividends received deduction may be subject
to the alternative minimum tax.
Section 246A of the Code provides, in general, that if a
corporation incurs indebtedness "directly attributable" to a
portfolio stock investment in another company (which is likely to
include the 7.48% Preferred Stock), the dividends received
deduction on such stock will be proportionately reduced. In
addition, under Section 246(c) of the Code, the dividends
received deduction will not be available with respect to stock
which is held for 45 days or less (90 days in the case of a
dividend attributable to a period or periods aggregating more
than 366 days). The length of time that a taxpayer is deemed to
have held stock for these purposes is reduced for the period
during which the taxpayer's risk of loss with respect to the
stock is diminished by reason of certain options, contracts to
sell, the holding of one or more positions with respect to
substantially similar or related property, or other similar
transactions. Moreover, Section 1059 of the Code would require a
corporate stockholder to reduce its basis in the 7.48% Preferred
Stock if an "extraordinary dividend" is received and the
corporate stockholder has not held the stock for more than two
years before the dividend announcement date. An "extraordinary
dividend" on the 7.48% Preferred Stock would be a dividend that (i)
equals or exceeds 5% of the holder's basis in the stock, treating
all dividends having ex-dividend dates within an 85-day period as
one dividend, or (ii) exceeds 20% of the holder's basis in the
stock, treating all dividends having ex-dividend dates within a
365-day period as one dividend. The length of time that a
taxpayer is deemed to have held the stock for purposes of Section
1059 of the Code is determined under principles similar to those
contained in Section 246(c) of the Code as discussed above.
Distributions with respect to the 7.48% Preferred Stock in
excess of both current and accumulated earnings and profits will
be (i) treated as a return of capital to the extent of the cash
or fair market value of property received, up to the amount of
the Holder's tax basis in its 7.48% Preferred Stock (and will
correspondingly reduce such basis) and (ii) taxed as an amount
received in exchange for such 7.48% Preferred Stock to the extent
the cash or fair market value of any property received exceeds
the Holder's tax basis in its 7.48% Preferred Stock. Any reduction
in basis could subject the Holder to the payment of additional
tax on a subsequent sale or other disposition of such 7.48%
Preferred Stock. Although the Company currently expects its
current and accumulated earnings and profits to be sufficient for
all distributions on the 7.48% Preferred Stock to qualify as
dividends for federal income tax purposes, there can be no
assurance that the Company will have current or accumulated
earnings and profits in any year in which a distribution is made
with respect to the 7.48% Preferred Stock.
Upon the sale, exchange or redemption of the 7.48% Preferred
Stock (assuming, in the case of a redemption, that all of the 7.48%
Preferred Stock is redeemed and that a Holder does not own any
other stock in the Company, either directly or by application of
certain attribution rules), a Holder who holds the 7.48% Preferred
Stock as a capital asset will realize a capital gain or loss
measured by the difference between the amount realized on the
sale or other disposition and Holder's adjusted tax basis in the
7.48% Preferred Stock. Such gain or loss will be long-term capital
gain if the Holder's holding period with respect to the 7.48%
Preferred Stock is more than one year at the time of the sale,
exchange or redemption. A Holder who, directly or by application
of certain attribution rules, holds stock in the Company other
than the 7.48% Preferred Stock should consult its tax advisor as
to the federal income tax treatment of a redemption of the 7.48%
Preferred Stock, including the possible treatment of the entire
proceeds of such redemption as a dividend to such Holder.
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 number of shares of 7.48%
Preferred Stock set forth opposite its name below.
Number of
Shares of
Underwriter 7.48% Preferred Stock
Lehman Brothers Inc. 325,000
Merrill Lynch, Pierce, Fenner
& Smith Incorporated 175,000
Total 500,000
The Underwriting Agreement provides that the obligations of
the Underwriters are subject to certain conditions precedent.
The Underwriters will be obligated to purchase all of the shares
of 7.48% Preferred Stock if any of the shares of 7.48% Preferred
Stock are purchased.
The Company has been advised that the Underwriters propose
to offer the 7.48% Preferred Stock initially at the offering price
set forth on the cover page of this Prospectus Supplement and to
certain dealers at such price less a selling concession of $.50
per share of 7.48% Preferred Stock that the Underwriters may allow,
and such dealers may reallow to other dealers a concession not
exceeding $.25 per share of 7.48% Preferred Stock; and that
after the initial public offering, such public offering price and
such concession and reallowance may from time to time be varied
by the Underwriters.
The Company has agreed to indemnify the Underwriters against
certain liabilities, including liabilities under the Securities
Act of 1933.
VALIDITY OF SECURITIES
The validity of the 7.48% Preferred Stock will be passed upon
for the Company by Charles O. Ziemer, Senior Vice President and
General Counsel of CBI, and by Mayer, Brown & Platt, counsel for
the Underwriters. As of the date of this Prospectus Supplement,
Mr. Ziemer is a full-time employee and an officer of CBI and owns
and holds options to purchase shares of Common Stock of the
Company. Mayer, Brown & Platt is currently representing the
Company in certain legal matters., and, in addition, is also
serving as special tax counsel to CBI in connection with the
offering and sale of the 7.48% Preferred Stock.
PAGE>PROSPECTUS
$300,000,000
CBI INDUSTRIES, INC.
Debt Securities, Preferred Stock and Common Stock
CBI Industries, Inc. (the "Company" or "CBI") may from time to time
offer Debt Securities consisting of debentures, notes and/or other
unsecured evidences of indebtedness in one or more series;
preferred stock, par value $1.00 per share, in one or more series
(the "Preferred Stock"); and shares of its common stock, par value
$2.50 per share (the "Common Stock") (collectively, the
"Securities"), at an aggregate offering price not to exceed
$300,000,000 at prices and on terms to be determined at the time
of sale. The Debt Securities, Preferred Stock and Common Stock may
be offered independently or together in any combination for sale
directly to purchasers or to or through dealers, underwriters or
agents to be designated by the Company.
Certain specific terms of the particular Securities in respect of
which this Prospectus is being delivered are set forth in the
accompanying prospectus supplement (the "Prospectus Supplement"),
including, where applicable, the initial public offering price of
the Securities, the listing on any securities exchange, other
special terms, and (i) in the case of Debt Securities, the
specific designation, aggregate principal amount, original issue
discount, if any, authorized denominations, maturity, premium, if
any, rate (which may be fixed or variable), time and method of
calculating payment of interest, if any, the place or places where
principal of, premium, if any, and interest, if any, on such Debt
Securities will be payable, the currency in which principal of,
premium, if any, and interest, if any, on such Debt Securities will
be payable, any terms of redemption at the option of the Company
or the holder, any sinking fund provisions and any terms for
conversion or exchange into other securities of the Company and
(ii) in the case of Preferred Stock, the specific title and stated
value, any dividend, liquidation, redemption, voting and other
rights and any terms for conversion or exchange into other
securities of the Company. If so specified in the applicable
Prospectus Supplement, Securities may be issued in whole or in
part in the form of one or more temporary or permanent global
securities.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
The Company may sell the Securities to or through underwriters or
dealers, and may also sell Securities directly to other purchasers
or through agents. See "Plan of Distribution." The Prospectus
Supplement sets forth the names of any underwriters, dealers or
agents involved in the sale of the Securities in respect of which
this Prospectus is being delivered and any applicable fee,
commission or discount arrangements with them.
This Prospectus may not be used to consummate sales of Securities
unless accompanied by a Prospectus Supplement.
The date of this Prospectus is March 25, 1994
</PAGE>
<PAGE> AVAILABLE INFORMATION
CBI Industries, Inc., (the "Company") is subject to the
informational requirements of the Securities Exchange Act of 1934
(the "Exchange Act") and, in accordance therewith, files reports,
proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Reports, proxy statements
and other information filed by the Company may be inspected and
copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Judiciary Plaza, Washington,
D.C. 20549; and at its regional offices located at 500 West
Madison Street, Chicago, Illinois 60661 and 7 World Trade Center,
Thirteenth Floor, New York, New York 10048. Such reports, proxy
materials and other information concerning the Company may also be
inspected at the offices of the New York Stock Exchange, Inc., 20
Broad Street, New York, New York 10005. Copies of such materials
may be obtained from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549.
This Prospectus does not contain all the information set forth in
the Registration Statement and exhibits thereto which the Company
has filed with the Commission under the Securities Act of 1933 (the
"Securities Act") and to which reference is hereby made.
Statements contained in this Prospectus as to the contents of any
contract or other document referred to 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 all respects by such reference. Although the Company
may not be required to send a copy of its latest Annual Report to
Shareholders to holders of Debt Securities, the Company will, upon
request, send to any holder of Securities a copy of its latest
Annual Report to Shareholders, as filed with the Commission, which
contains financial information that has been examined and reported
upon, with an opinion expressed by independent certified public
accountants.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed by the Company with the
Commission (File No. 1-7833) are incorporated in this Prospectus
by reference: (i) Annual Report on Form 10-K for the fiscal year
ended December 31, 1993, together with the reports of independent
public accountants which includes an explanatory paragraph that
describes changes in accounting principles with respect to the
methods of accounting for income taxes and for postretirement
benefits other than pensions, (ii) the description of the Common
Stock as set forth in Item 1 of the Company's Registration
Statement on Form 8-A filed with the Commission on April 20, 1979,
and (iii) the description of preferred stock purchase rights as
set forth in Item 1 of the Company's Amendment No. 1 to
Registration Statement on Form 8-A filed with the Commission on
August 8, 1989.
All 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 the offering of
the Securities shall be deemed to be incorporated by reference
herein and to be a part hereof from the date of filing such
documents. Any statement contained herein or in a document
incorporated or deemed to be incorporated by reference herein shall
be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein, in a
Prospectus Supplement or in any other subsequently filed document
which also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.
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<PAGE>
The Company will provide without charge and upon request to
each person to whom this Prospectus has been delivered a copy of
any or all of the documents incorporated herein by reference
(other than exhibits to such documents unless such exhibits are
specifically incorporated by reference herein). Requests for such
copies should be directed to the Secretary, C.C. Toerber, CBI
Industries, Inc., 800 Jorie Boulevard, Oak Brook, Illinois
60521-2268 (telephone (708) 572-7000). References in this
Prospectus to the "Company" or "CBI" include CBI Industries, Inc.
and its consolidated subsidiaries, unless the context otherwise
indicates.
THE COMPANY
The Company operates through three major business segments.
CBI's Contracting Services segment is organized under Chicago
Bridge & Iron Company as a worldwide construction group that
provides, through separate subsidiaries, a broad range of services
including design, engineering, fabrication and construction of
metal plate structures, project management, general contracting,
and other specialty construction and related services. CBI's
Industrial Gases segment, which is organized under Liquid Carbonic
Industries Corporation, produces, processes and markets, on a
worldwide basis, carbon dioxide and a wide variety of other
industrial and specialty gases and chemicals. CBI's Investments
segment includes petroleum and special product terminal businesses
and certain real estate and financial investments.
The Company is incorporated in Delaware and its principal
executive offices are located at 800 Jorie Boulevard, Oak Brook,
Illinois.
USE OF PROCEEDS
Unless otherwise indicated in an accompanying Prospectus
Supplement, the net proceeds to the Company from the sale of the
Securities offered hereby will be available for general corporate
purposes and may be used for capital expenditures, working
capital, repayment of short and long term indebtedness, and future
acquisitions. Pending such use, the net proceeds may be
temporarily invested.
SELECTED RATIOS
For the purposes of calculating the ratio of earnings to
fixed charges and the ratio of earnings to fixed charges and
preferred stock dividends, 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, including interest on ESOP debt (whether expensed or
capitalized), and one-third of minimum rental payments under
operating leases (estimated by management to be the interest
factor of such rentals).
Years Ended December 31,
1993 1992 1991 1990 1989
Ratio of Earnings to
Fixed Charges (1) 3.68 3.43 3.05 2.18
Ratio of Earnings to Fixed
Charges and Preferred
Stock Dividends (2) 3.68 3.43 3.05 2.18
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<PAGE>
(1) Earnings were inadequate to cover fixed charges by
$13,770,000 for the year ended December 31, 1993.
(2) Earnings were inadequate to cover fixed charges and preferred
stock dividends by $13,770,000 for the year ended December 31,
1993.
DESCRIPTION OF DEBT SECURITIES
The following description sets forth certain general terms
and provisions of the Debt Securities to which any Prospectus
Supplement may relate. The particular terms and provisions of any
series of Debt Securities offered by any Prospectus Supplement,
and the extent to which such general terms and provisions
described below may apply thereto, will be described in the
Prospectus Supplement relating to such series of Debt Securities.
Debt Securities may be issued in one or more series under an
indenture (the "Indenture") dated as of March 1, 1994 between the
Company and Chemical Bank, as trustee (the "Trustee"). The
statements under this heading do not purport to be complete and
are subject to the detailed provisions of the Indenture, a copy of
which is filed as an exhibit to the Registration Statement of
which this Prospectus is a part. Wherever particular provisions of
the Indenture or terms defined therein are referred to, such
provisions or definitions are incorporated by reference as a part
of the statements made and the statements are qualified in their
entirety by such reference. A copy of the Indenture is filed as
an exhibit to this registration statement.
General
The Indenture does not limit the aggregate principal amount
of Debt Securities which may be issued thereunder and provides
that Debt Securities of any series may be issued thereunder up to
an aggregate principal amount which may be authorized by the
Company from time to time. (Section 301) Any securities issued
under the Indenture are referred to herein as the "Debt
Securities." The Indenture does not limit the amount of other
debt, secured or unsecured, which may be issued by the Company or
its subsidiaries, subject to limitations on liens described below.
All Debt Securities will be unsecured and rank pari passu with all
other unsecured and unsubordinated indebtedness of the Company
provided that such other unsecured and unsubordinated indebtedness
may contain covenants, events of default and other provisions
which are different from or which are not contained in the Debt
Securities. However, because the Company is a holding company
which conducts substantially all of its operations through
subsidiaries, the right of the Company, and hence the right of
creditors of the Company (including the Holders of Debt
Securities), to participate in any distribution of the assets of
any subsidiary upon its liquidation or reorganization or otherwise
is necessarily subject to the prior claims of creditors of the
subsidiary, except to the extent that claims of the Company itself
as a creditor of the subsidiary may be recognized. There are no
covenants or provisions contained in the Indenture that may afford
the Holders of Debt Securities protection in the event of a highly
leveraged transaction involving the Company. Unless otherwise
provided in the applicable Prospectus Supplement, the Company will
maintain in New York, New York, one or more offices or agencies
where the Debt Securities may be presented for payment and for
transfer or exchange (which initially will be the Trustee's offices
maintained for that purpose in New York, New York), provided that
interest may at the option of the Company be paid by check mailed
to the person entitled thereto. (Sections 301 and 1102)
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The Debt Securities will be issued in fully registered form,
without coupons unless otherwise specified in the applicable
Prospectus Supplement. The Debt Securities will be exchangeable
for other Debt Securities of the same series of a like aggregate
principal amount in authorized denominations and will be
transferable at any time or from time to time at the Corporate
Trust Office of the Trustee or at any other office or agency of
the Company maintained for that purpose. No service charge will
be made for any transfer or exchange of the Debt Securities or
other Securities issued under the Indenture, but the Company may
(unless otherwise provided in such Debt Securities) require
payment of a sum sufficient to cover any tax or other governmental
charge payable in connection therewith. (Section 305)
Reference is made to the Prospectus Supplement which
accompanies this Prospectus for the following terms and other
information with respect to any Debt Securities in respect of
which this Prospectus is being delivered: (1) the designation,
aggregate principal amount and authorized denominations of such
Debt Securities; (2) the purchase price of such Debt Securities;
(3) the date or dates on which such Debt Securities will mature or
the method of determining such date or dates; (4) the rate or
rates (which may be fixed or variable) at which such Debt
Securities will bear interest, if any, or the method of
calculating such rate or rates, and the date, dates, or the method
of determining such date or dates, from which such interest, if
any, will accrue; (5) the date or dates on which any such interest
will be payable and the record date or dates therefor; (6) whether
such Debt Securities may be issued in temporary or permanent
global form, and, if so, the initial Depositary with respect
thereto; (7) the terms of any mandatory or optional redemption
(including any sinking fund) and any remarketing arrangements
related thereto; (8) the place or places where the principal (and
premium, if any) and interest will be payable; (9) whether such
Debt Securities will be convertible into or exchangeable for
Common Stock or other securities of the Company, and the terms and
conditions of any such conversions or exchanges; (10) the
applicability of any provisions described under "Limitations of
Liens" or "Limitations on Sale and Leaseback Transactions"; (11)
the applicability of any provision described under "Defeasance and
Covenant Defeasance"; (12) the securities exchange, if any, on
which the Debt Securities will be listed; (13) the currency,
currencies or composite currencies for which such Debt Securities
may be purchased and/or in which principal and interest and
premium, if any, will or may be payable; and (14) any other
specified term of such Debt Securities.
One or more series of Debt Securities may be sold as Original
Issue Discount Securities at a substantial discount below their
stated principal amount, bearing no interest or interest at a rate
which at the time of issuance is below market rates. Federal
income tax consequences and special considerations applicable to
any such series will be described in the Prospectus Supplement
relating thereto.
The Indenture provides that the Debt Securities of a single
series may be issued at various times, with different maturity
dates and may bear interest at different times. (Section 301)
If the purchase price of any Debt Securities is payable in
one or more foreign currencies or currency units or if any Debt
Securities are denominated in one or more foreign currencies or
currency units or if the principal of, premium, if any, or
interest, if any, on any Debt Securities is payable in one or more
foreign currencies or currency units, the restrictions, elections,
certain Federal income tax considerations, specific terms and other
information with respect to such issue of Debt Securities and such
foreign currency or currency units will be set forth in the
applicable Prospectus Supplement. </PAGE>
<PAGE>
Certain Definitions
The term "Secured Debt" means indebtedness for money borrowed
and any Funded Debt which is secured by a mortgage, pledge, lien,
security interest or encumbrance on (a) any Principal Property of
the Company or a Restricted Subsidiary or on (b) any shares of
capital stock or indebtedness of any Restricted Subsidiary.
(Section 101)
The term "Funded Debt" means all indebtedness for money
borrowed having a maturity of more than twelve months from the
date of the most recent consolidated balance sheet of the Company
and its Restricted Subsidiaries (excluding indebtedness of
Unrestricted Subsidiaries) or renewable and extendible beyond
twelve months at the option of the borrower and all obligations in
respect of lease rentals which under generally accepted accounting
principles would be shown on a consolidated balance sheet of the
Company as a liability item other than a current liability;
provided, however, that Funded Debt shall not include any of the
foregoing to the extent that such indebtedness or obligations are
not required by generally accepted accounting principles to be
shown on the balance sheet of the Company. (Section 101)
The term "Voting Stock" means outstanding shares of capital
stock having under ordinary circumstances (not dependent on the
happening of a contingency) voting power for the election of
directors. (Section 101)
The term "Subsidiary" means any corporation a majority of the
Voting Stock of which is owned, directly or indirectly, by the
Company or by one or more of its other subsidiaries or by the
Company or one or more of its other Subsidiaries. (Section 101)
The term "Restricted Subsidiary" means (a) any Subsidiary
other than an Unrestricted Subsidiary and (b) any Subsidiary which
was an Unrestricted Subsidiary but which, subsequent to March
1,1994, is designated by the Company (by or pursuant to board
resolution) to be a Restricted Subsidiary, provided, however, that
the Company may not designate any such Subsidiary to be a
Restricted Subsidiary if the Company would thereby breach any
covenant or agreement herein contained (on the assumptions that
any outstanding Secured Debt of such Subsidiary was incurred at
the time of such designation and that any Sale and Leaseback
Transaction (as defined) to which such Subsidiary is then a party
was entered into at the time of such designation). (Section 101)
The term "Unrestricted Subsidiary" means (a) any Subsidiary
acquired or organized after March 1, 1994, provided that such
Subsidiary shall not be a successor, directly or indirectly, to
any Restricted Subsidiary; (b) any Subsidiary whose principal
business or assets are located outside the United States of
America, its territories and possessions, Puerto Rico or Canada;
(c) any Subsidiary the principal business of which consists of
financing or assisting in financing of customer construction
projects or the acquisition or disposition of products of dealers,
distributors or other customers; (d) any Subsidiary engaged in the
insurance business or whose principal business is the ownership,
leasing, purchasing, selling or development of real property; and
(e) any Subsidiary substantially all the assets of which consist of
stock or other securities of a Subsidiary or Subsidiaries referred
to above in this sentence, unless and until any such Subsidiary is
designated to be a Restricted Subsidiary, as referred to above.
(Section 101)
The term "Principal Property" means any manufacturing plant
or other facility of the Company or any Restricted Subsidiary,
whether presently owned or hereafter acquired, which, in the
opinion of
</PAGE>
<PAGE>
the board of directors of the Company, is of material importance
to the business conducted by the Company and its Restricted
Subsidiaries as a whole. (Section 101)
The term "Consolidated Net Tangible Assets" means
Consolidated Tangible Assets less Consolidated Current
Liabilities. (Section 101)
The term "Consolidated Tangible Assets" means the aggregate
of all assets of the Company and its Restricted Subsidiaries
(including the value of all existing Sale and Leaseback
Transactions (as defined) and any assets resulting from the
capitalization of other long-term lease obligations in accordance
with generally accepted accounting principles, but excluding the
value of assets or investment in any Unrestricted Subsidiary or
any non-majority owned Subsidiary) appearing on the most recent
available consolidated balance sheet of the Company and its
Restricted Subsidiaries at their net book values, after deducting
related depreciation, amortization and other valuation reserves and
excluding (a) any capital write-ups resulting from reappraisals of
assets or of other investments after March 1, 1994 (other than a
write-up of any assets constituting part of the assets and
business of another corporation made in connection with the
acquisition, direct or indirect, of the assets and business of
such other corporation), except as permitted in accordance with
generally accepted accounting principles, (b) treasury stock, (c)
patent and trademark rights, good will, unamortized discounts and
expenses and any other intangible items, all in accordance with
generally accepted accounting principles. (Section 101)
The term "Consolidated Current Liabilities" means the
aggregate of the current liabilities of the Company and its
Restricted Subsidiaries (excluding liabilities of Unrestricted
Subsidiaries) appearing on the most recent available consolidated
balance sheet of the Company and its Restricted Subsidiaries, all
in accordance with generally accepted accounting principles. In
no event shall Consolidated Current Liabilities include any
obligation of the Company and its Restricted Subsidiaries issued
under a revolving credit or similar agreement if the obligation
issued under such agreement matures by its terms within 12 months
from the date thereof but by the terms of such agreement such
obligation may be renewed or extended or the amount thereof
reborrowed or refunded at the option of the Company or any
Restricted Subsidiary for a term in excess of 12 months from the
date of determination. (Section 101)
Foreign Currency Denominated or Indexed Debt Securities
Debt Securities denominated or payable in foreign currencies
may entail significant risks. These risks include, without
limitation, the possibility of significant fluctuations in foreign
currency exchange rates. These risks may vary depending upon the
currency or currencies involved. These risks will be more fully
described in the applicable Prospectus Supplement.
Limitation on Liens
The Company will not, and will not permit any Restricted
Subsidiary to, create, assume or guarantee any Secured Debt
without making effective provision for securing the Debt
Securities (and any other indebtedness of or guaranteed by the
Company or such Restricted Subsidiary then entitled thereto)
equally and ratably with such Secured Debt.
The above restrictions do not apply to debt secured by (i)
certain purchase money mortgages created to secure payment for the
acquisition or completion of construction and commencement of
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<PAGE>
operation of any property including, but not limited to, any
indebtedness incurred by the Company or a Restricted Subsidiary
prior to, at the time of, or within 365 days after the later of
the acquisition, the completion of construction (including any
improvements on an existing property) or the commencement of
commercial operation of such property, which indebtedness is
incurred for the purpose of financing all or any part of the
purchase price of such property or construction or improvements on
such property, (ii) mortgages, pledges, liens, security interests
or encumbrances (collectively referred to herein as "liens") on
property existing at the time of acquisition thereof, whether or
not assumed by the Company or a Restricted Subsidiary, (iii) liens
on property or shares of capital stock or indebtedness of any
corporation existing at the time such corporation becomes a
Restricted Subsidiary, (iv) liens on property or shares of capital
stock or indebtedness of a corporation existing at the time such
corporation is merged into or consolidated with the Company or a
Restricted Subsidiary or at the time of a sale, lease, or other
disposition of the properties of a corporation or firm as an
entirety or substantially as an entirety to the Company or a
Restricted Subsidiary, provided that no such lien shall extend to
any other Principal Property of the Company or such Restricted
Subsidiary prior to such acquisition or to other Principal
Property thereafter acquired other than additions to such acquired
property or other Principal Property which, together with such
acquired property, is part of a single construction or development
program, (v) liens on property of the Company or a Restricted
Subsidiary in favor of the United States of America or any state
thereof, or in favor of any other country, or any department,
agency, instrumentality or political subdivision thereof, to
secure certain payments pursuant to any contract or statute
(including, without limitation, liens to secure indebtedness of
the pollution control or industrial revenue type) or to secure
indebtedness incurred for the purpose of financing all or any part
of the purchase price for the cost of constructing or improving
the property subject to such liens, (vi) liens on any property or
assets of any Restricted Subsidiary to secure indebtedness owing
by it to the Company or to another Restricted Subsidiary, or (vii)
any extension, renewal or replacement (or successive extensions,
renewals or replacements), in whole or in part, of any lien
referred to in the foregoing clauses (i) to (vi) inclusive,
provided that the principal amount of Secured Debt secured thereby
does not exceed the principal amount of Secured Debt so secured at
the time of such extension, renewal or replacement, and that such
extension, renewal or replacement shall be limited to the property
which secured the lien so extended, renewed or replaced and
additions or improvements to such property. This covenant also
does not apply to production payments or overriding royalty
payments with respect to the sale or other transfer of crude oil,
natural gas or other hydrocarbons. (Section 1104)
Limitation on Sale and Leaseback Transactions
Sale and Leaseback Transactions (which are defined to
include, among other things, certain leases of more than three
years) by the Company or any Restricted Subsidiary of any
Principal Property, completion of construction of which and
commencement of full operation of which have occurred more than 365
days prior to such sale or transfer, will be prohibited unless
either (a) the Company or such Restricted Subsidiary would be
entitled to incur Secured Debt equal in amount to the amount
realized or to be realized upon such sale or transfer secured by
a lien on the property to be leased without equally and ratably
securing the Debt Securities, or (b) an amount equal to the "value"
(as defined) of the Principal Property so leased is applied
(subject to credits for certain voluntary retirements of Debt
Securities) to the retirement, within 120 days of the effective
date of such arrangement, of indebtedness for borrowed money
incurred or assumed by the Company or a Restricted Subsidiary which
is recorded as Funded Debt as shown on the most recent
consolidated balance sheet of the Company and which in
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<PAGE>
the case of such indebtedness of the Company, is not subordinate
and junior in right of payment to the prior payment of the Debt
Securities. (Sections 101 and 1105)
Exempted Indebtedness
Notwithstanding the limitations on liens and Sale and
Leaseback Transactions described above, the Company and any one or
more Restricted Subsidiaries may, without securing the Debt
Securities, issue, assume or guarantee Secured Debt which would
otherwise be subject to the foregoing restrictions, provided that,
after giving effect thereto, the aggregate amount of such
Secured Debt then outstanding (not including Secured Debt
permitted under the foregoing exceptions) and the aggregate value
of Sale and Leaseback Transactions (other than such transactions
in connection with which indebtedness has been, or will be,
retired in accordance with clause (b) of the preceding paragraph)
at such time does not exceed 10% of Consolidated Net Tangible
Assets. (Section 1104)
Consolidation or Merger
The Company, without the consent of the Holders of any of the
Debt Securities under the Indenture, may consolidate with or merge
into, or transfer or lease its assets substantially as an entirety
to, any Person which is a corporation, partnership or trust
organized and validly existing under the laws of any domestic
jurisdiction, or may permit any such Person to consolidate with or
merge into the Company or convey, transfer or lease its properties
and assets substantially as an entirety to the Company, provided
that any successor Person assumes the Company's obligations on the
Debt Securities and under the Indenture, that after giving effect
to the transaction (treating any indebtedness which becomes an
obligation of the Company or any Subsidiary as a result of such
transaction as having been incurred by the Company or such
Subsidiary at the time of such transaction) no Event of Default,
and no event which, after notice or lapse of time, would become an
Event of Default, shall have occurred and be continuing, and that
certain other conditions are met. (Sections 901 and 1104)
Events of Default; Notice
Any one of the following events will constitute an Event of
Default under the Indenture with respect to Debt Securities of any
series (unless such event is specifically inapplicable to a
particular series as described in the Prospectus Supplement
relating thereto): (i) default for 30 days in the payment of
interest on any Debt Securities of such series, (ii) default in the
payment of any principal of or premium, if any, on any Debt
Securities of such series, (iii) default in the making or
satisfaction of any sinking fund installment or analogous
obligation, if any is required, on the Debt Securities of such
series, (iv) default, for 90 days after notice to the Company, in
the performance of any other covenant in the Indenture in respect
of the Debt Securities of such series, (v) default resulting in
acceleration of maturity in connection with any other series of
Debt Securities under the Indenture or other indebtedness of the
Company, the aggregate principal amount of which exceeds
$5,000,000, not annulled within 30 days after notice to the Company
from the Trustee or to the Company and to the Trustee from the
Holders of at least 25% in principal amount of Debt Securities of
such series, and (vi) certain events of bankruptcy, insolvency or
reorganization. (Section 601) </PAGE>
<PAGE>
The Indenture provides that if an Event of Default with
respect to any series of Debt Securities shall happen and be
continuing, the Trustee or the Holders of 25% in principal amount
of Debt Securities of such series may declare the principal of all
Debt Securities of such series to be due and payable. (Section
602)
The Indenture provides that the Trustee will, within 90 days
after the occurrence of a default in respect of any series of Debt
Securities known to it, give to Holders of Debt Securities of such
series notice of such uncured default (as defined, not including
any grace period) with respect to the Debt Securities of such
series; but, except in the case of a default in the payment of
principal of, premium, if any, or interest on, or any sinking fund
installment or analogous obligation with respect to, any of the
Debt Securities of such series, the Trustee shall be protected in
withholding such notice if it in good faith determines that the
withholding of such notice is in the interest of such Holders of
Debt Securities of such series. (Section 702)
The Indenture contains a provision entitling the Trustee,
subject to the duty of the Trustee during default in respect of
any series of Debt Securities to act with the required standard of
care, to be indemnified by the Holders of Debt Securities of such
series. (Sections 702 and 703) Subject to such right of
indemnification, the Indenture provides that the Holders of a
majority in principal amount of the Debt Securities of any series
may direct the time, method, and place of conducting any
proceeding for any remedy available to the Trustee or exercising
any trust or power conferred upon the Trustee with respect to the
Debt Securities of such series. (Section 612)
The Company will be required to furnish to the Trustee
annually a statement as to the fulfillment by the Company of all
of its obligations under the Indenture. (Section 1106)
Modification and Waiver
The Indenture contains provisions permitting the Company and
the Trustee, with the consent of the Holders of not less than a
majority in aggregate principal amount of the Debt Securities of
each series affected (all such Holders voting as a single class)
(which Holders, in the case of a Global Security, shall be the
Depositary appointed by the Company (herein referred to as the
"Depositary") as the Holder of the Global Security (as defined
below) which represents the Debt Securities), to execute
supplemental indentures adding any provisions to or changing in
any manner or eliminating any of the provisions of the Indenture
or modifying in any manner the rights of the Holders of Debt
Securities of such series, provided that no such supplemental
indenture shall, among other things, (i) change the fixed maturity
of any Debt Securities or reduce the principal amount thereof,
reduce the redemption premium thereon or reduce the rate or extend
the time of payment of interest thereon, without the consent of
the Holder of each Security so affected, or (ii) reduce the
aforesaid percentage of the Debt Securities of any series, the
consent of the Holders of which is required for any supplemental
indenture or for any waiver of default under the Indenture with
respect to the Debt Securities of such series, without the consent
of the Holders of all the Debt Securities of each series so
affected. (Section 1002)
The Holders of a majority in aggregate principal amount of
the Debt Securities of any series may on behalf of all the Holders
of the Debt Securities of such series waive compliance with
certain covenants with respect to the Debt Securities of such
series (Section 1107) or waive any past default with respect to
the Debt Securities of such series except a default (i) in the
payment of the principal of, premium, if
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<PAGE>
any, or interest on any Debt Securities or in the payment of any
sinking fund installment or analogous obligation, if any is
required, or (ii) a default in respect of a covenant or provision
of the Indenture which cannot be modified or amended without the
consent of the Holder of each Debt Security of such series
affected. (Section 613)
Global Securities
The provisions set forth below in this section headed "Global
Securities" will apply to the Debt Securities of any series if the
Prospectus Supplement relating to such series so indicates.
The Debt Securities of such series will be represented by one
or more global securities (collectively, a "Global Security")
registered in the name of a depositary (the "Depositary") or a
nominee of the Depositary identified in the Prospectus Supplement
relating to such series. Except as set forth below, a Global
Security may be transferred, in whole and not in part, only to the
Depositary or another nominee of the Depositary.
Upon the issuance of a Global Security, the Depositary will
credit, on its book-entry registration and transfer system, the
respective principal amounts of the Debt Securities represented by
such Global Security to the accounts of institutions that have
accounts with the Depositary or its nominee ("Participants"). The
accounts to be credited will be designated by the underwriters,
dealers or agents. Ownership of beneficial interests in a Global
Security will be limited to Participants or persons that may hold
interests through Participants. Ownership of interests in such
Global Security will be shown on, and the transfer of those
ownership interests will be effected only through, records
maintained by the Depositary (with respect to Participants'
interests) and such Participants (with respect to the owners of
beneficial interests in such Global Security). The laws of some
jurisdictions may 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.
So long as the Depositary, or its nominee, is the registered
holder and owner of such Global Security, the Depositary or such
nominee, as the case may be, will be considered the sole owner and
holder of the related Debt Securities for all purposes of such
Debt Securities and for all purposes under the Indenture. Except
as set forth below or as otherwise provided in the applicable
Prospectus Supplement, owners of beneficial interests in a Global
Security will not be entitled to have the Debt Securities
represented by such Global Security registered in their names,
will not receive or be entitled to receive physical delivery of
Debt Securities in definitive form and will not be considered to
be the owners or holders of any Debt Securities under the
Indenture or such Global Security. (Section 305)
Accordingly, each person owning a beneficial interest in a
Global Security must rely on the procedures of the Depositary and,
if such person is not a Participant, on the procedures of the
Participant through which such person owns its interest, to
exercise any rights of a holder of Debt Securities under the
Indenture or such Global Security. The Company understands that
under existing industry practice, in the event the Company requests
any action of holders of Debt Securities or an owner of beneficial
interest in a Global Security desires to take any action that the
Depositary, as holder of such Global Security is entitled to take,
the Depositary would authorize the Participants to take such
action, and that the Participants would authorize beneficial
owners owning through such Participants to take such action or
would otherwise act upon the instructions of beneficial owners
owning through them. </PAGE>
<PAGE>
Payment of principal of and premium, if any, and interest, if
any, on Debt Securities represented by a Global Security will be
made to the Depositary or its nominee, as the case may be, as the
registered owner and holder of such Global Security.
The Company expects that the Depositary, upon receipt of any
payment of principal, premium, if any, or interest, if any, in
respect of a Global Security, will credit immediately
Participants' accounts with payments in amounts proportionate to
their respective beneficial interests in the principal amount of
such Global Security as shown on the records of the Depositary.
The Company expects that payments by Participants to owners of
beneficial interests in a Global Security held through such
Participants will be governed by standing instructions and
customary practices, as is now 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 Participants. Neither
the Company not the Trustee nor any agent of the Company or the
Trustee will have any responsibility or liability for any aspect
of the records relating to, or payments made on account of,
beneficial ownership interests in a Global Security for any Debt
Securities or for maintaining, supervising or reviewing any
records relating to such beneficial ownership interests or for any
other aspect of the relationship between the Depositary and its
Participants or the relationship between such Participants and the
owners of beneficial interests in such Global Security owning
through such Participants.
Unless and until it is exchanged in whole or in part for Debt
Securities in definitive form, a Global Security may not be
transferred except as a whole by the Depositary to a nominee of
such Depositary or by a nominee of such Depositary to such
Depositary or another nominee of such Depositary.
Unless otherwise provided in the applicable Prospectus
Supplement, Debt Securities represented by a Global Security will
be exchangeable for Debt Securities in definitive form of like
tenor as such Global Security in denominations of $1,000 and in
any greater amount that is an integral multiple thereof if (i) the
Depositary notifies the Company that it is unwilling or unable to
continued as Depositary for such Global Security or if at any time
the Depositary ceases to be a clearing agency registered under the
Exchange Act; (ii) the Company in its discretion at any time
determines not to have all of the Debt securities represented by
a Global Security and notifies the Trustee thereof; or (iii) an
Event of Default has occurred and is continuing with respect to
the Debt Securities. (Section 305) Any Debt Security that is
exchangeable pursuant to the preceding sentence is exchangeable for
Debt Securities issuable in authorized denominations and
registered in such names as the Depositary shall direct. Subject
to the foregoing, a Global Security is not exchangeable, except
for a Global Security or Global Securities of the same aggregate
denominations to be registered in the name of the Depositary or its
nominee.
Defeasance
The Indenture provides that, if such provision is made
applicable to the Debt Securities of any series pursuant to the
provisions of the Indenture, the Company may elect (i) to defease
and be discharged from any and all obligations in respect of such
Debt Securities except for certain obligations to register the
transfer or exchange of such Debt Securities, to replace temporary,
destroyed, stolen, lost or mutilated Debt Securities, to maintain
paying agencies and to hold monies for payment in trust
("Defeasance") or (ii) (A) to omit to comply with certain
restrictive covenants in Sections 1104 and 1105 (the covenants
described above under "Limitation of Liens" and "Limitation on
Sale and Leaseback Transactions") and
</PAGE>
<PAGE>
(B) to deem the occurrence of any event referred to in clauses
(iv) with respect to Sections 1104 and 1105, (v) and (vi) under
"Events of Default" above not to be or result in an Event of
Default if, in each case with respect to the Debt Securities of
any series as provided in Section 1302 on or after the date the
conditions set forth in Section 1303 are satisfied ("Covenant
Defeasance"); in either case upon the deposit with the Trustee (or
other qualifying trustee), in trust, of money and/or U.S.
Government Obligations, which through the payment of interest and
principal in respect thereof in accordance with their terms will
provide money in an amount sufficient to pay the principal of and
any premium and interest on the Debt Securities of such series on
the respective stated maturities and any mandatory sinking fund
payments or analogous payments on the days payable, in accordance
with the terms of the Indenture and the Debt Securities of such
series. The Prospectus Supplement relating to a series may
further describe the provisions, if any, permitting such
Defeasance or Covenant Defeasance with respect to the Debt
Securities of a particular series. (Article Thirteen)
In the event the Company omits to comply with certain
covenants of the Indenture with respect to the Debt Securities of
any series as described above, and the Debt Securities of such
series are declared due and payable because of the occurrence of
an Event of Default, the amount of money and U.S. Government
Obligations on deposit with the Trustee will be sufficient to pay
amounts due on the Debt Securities of such series at the time of
their Maturity but may not be sufficient to pay amounts due on the
Debt Securities of such series at the time of the acceleration
resulting from such Event of Default. The Company shall, however,
remain liable for such payments.
Such defeasance could be treated as a redemption of the Debt
Securities of that series prior to maturity in exchange for the
property deposited in trust. In such event, each holder would
generally recognize, at the time of defeasance, gain or loss
measured by the difference between the amount of any cash and the
fair market value of any property deemed received and the holder's
tax basis in the Debt Securities deemed surrendered. Thereafter,
each holder would generally be subject to tax liability in respect
of interest income and would recognize any gain or loss upon any
disposition, including redemption, of the assets held in trust.
Although tax might be owed, the holder of a defeased Debt Security
would not receive cash (except for current payments of interest on
the Debt Securities) until the maturity or earlier redemption of
the Debt Securities. Such tax treatment could affect the purchase
price that a holder would receive upon the sale of the Debt
Securities.
Concerning the Trustee
Chemical Bank is the Trustee under the Indenture. The
Trustee has from time to time made loans to the Company (including
a current participation under the Company's three-year extendible
revolving credit facility) and has performed other services for
the Company in the normal course of its business and may provide
such other services in the future. The Trustee may resign with
respect to any series of the Debt Securities at any time, in which
event the Company will be obligated to appoint a successor
trustee. If the Trustee ceases to be eligible to continue as
Trustee with respect to a series of Debt Securities or becomes
incapable of acting as Trustee or becomes insolvent, the Company
may remove such Trustee, or any Holder of the Debt Securities of
such series for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent
jurisdiction for the removal of such Trustee and the appointment
of a successor trustee with respect to such series. Any
resignation or removal of the Trustee with respect to a series of
Debt Securities and appointment of a successor trustee for such
</PAGE>
<PAGE>
Trust does not become effective until acceptance of the
appointment by the successor trustee. (Section 710) Pursuant to
such resignation and successor trustee provisions, it is possible
that a different trustee could be appointed to act as a successor
trustee with respect to each series of Debt Securities. All
references in this Prospectus to the Trustee should be read to take
into account the possibility that each series of Debt Securities
could have different successor trustees in the event of such a
resignation or removal.
DESCRIPTION OF CAPITAL STOCK
The Company may issue, separately or together with or upon
the conversion of or exchange for other Securities, Common Stock
and Preferred Stock, all as set forth in the accompanying
Prospectus Supplement relating to the Common Stock or Preferred
Stock in respect of which this Prospectus is being delivered. The
following summaries do not purport to be complete and are subject
to, and are qualified in their entirety by reference to, the
following documents: (i) the Company's Certificate of
Incorporation, as amended (the "Certificate"), (ii) the Company's
bylaws, as amended (the "Bylaws"), and (iii) an Amendment and
Restatement dated as of August 8, 1989 of a Rights Agreement dated
as of March 4, 1986 between the Company and First Chicago Trust
Company of New York, as Rights Agent (the "Rights Agreement"). A
copy of each of the Certificate, the Bylaws and Rights Agreement
is filed as an exhibit to the Registration Statement.
The Company's authorized capital stock consists of
120,000,000 shares of common stock, par value $2.50 per share, and
20,000,000 shares of preferred stock, par value $1.00 per share,
of which 800,000 shares have been designated as Series A Junior
Participating Preferred Stock (the "Series A Preferred Stock") and
3,945,000 have been designated as Convertible Voting Preferred
Stock, Series C (the "Series C Preferred Stock").
At the close of business on March 1, 1994, there were
37,786,859 shares of Common Stock outstanding, including
approximately 1,812,186 shares held by LaSalle National Trust,
N.A. in its capacity as trustee (the "ESOP Trustee") of the CBI
Salaried Employee Stock Ownership Plan (1987) (the "ESOP"), but not
including (i) employee options to purchase an aggregate of
1,114,850 shares of Common Stock (of which options to purchase an
aggregate of 894,550 shares of Common Stock were currently
exercisable); (ii) 55,000 shares of Common Stock reserved under
the CBI Restricted Stock Plan 1989; and (iii) 521,833 shares of
Common Stock reserved for the CBI Employee Stock Purchase and
Savings Plan (1992).
Common Stock
All outstanding shares of Common Stock are, and any shares of
Common Stock sold hereunder will be, fully paid and nonassessable.
Each holder of Common Stock is entitled to one vote per share held
of record on all matters submitted to the stockholders for action.
A vote by the holders of a majority of shares present at a meeting
at which a quorum is present is necessary to take action, except
for certain extraordinary corporate actions which require the vote
of two-thirds of all outstanding shares entitled to vote thereon
(or a majority of such outstanding shares if the extraordinary
action is recommended by the Board of Directors). In addition,
pursuant to a "fair price" provision in the Company's Certificate
of Incorporation, certain business combinations involving the
Company and any holder of more than 10% of the outstanding voting
stock must be approved by the holders of 80% of the outstanding
voting stock, unless approved by a majority of continuing
directors or certain minimum price </PAGE>
<PAGE>
and procedural requirements are met. Any action required or
permitted to be taken by stockholders may be taken only at a
stockholders' meeting and not by written consent.
There are no cumulative voting rights in the election of
directors to the Company's Board of Directors, which is divided
into three classes, with members of each class serving a three-
year term. Under the Company's By-Laws, written notice of any
stockholder nomination of an individual for election as director
must be received by the Secretary of the Company not less than 60
days prior to the first anniversary of the last meeting of
stockholders called for the election of directors, and such notice
must set forth certain specified information concerning the
nominee.
Subject to the preferences applicable to any series of
Preferred Stock described herein, holders of Common Stock are
entitled to dividends when and as declared by the Board of
Directors from funds legally available therefor and are entitled,
in the event of liquidation, to share ratably in all assets
remaining after the payment of liabilities. The Common Stock is
neither redeemable nor convertible, and the holders thereof have
no pre-emptive or subscription rights to purchase any securities
of the Company.
The Company is the transfer agent for the Common Stock.
Preferred Stock
Under the Certificate of Incorporation, the Board of
Directors is authorized, without further action of the
stockholders, to provide for the issuance, and to fix the number,
of shares of Preferred Stock, in one or more additional series,
with such voting powers and with such designations, preferences,
and relative, participating, optional or other special rights and
qualifications, limitations or restrictions thereof as shall be set
forth in resolutions providing for the issue thereof adopted by
the Board of Directors or a duly authorized committee thereof.
Reference is made to the Prospectus Supplement which
accompanies this Prospectus for the following terms and other
information with respect to any series of Preferred Stock in
respect of which this Prospectus is being delivered: (1) the
specific title and stated value and the number of shares offered;
(2) the price at which such offered shares shall be issued; (3)
dividend rate (or method of calculation thereof); (4) dates on
which dividends shall be payable; (5) whether such dividends shall
be cumulative and if cumulative, the date from which dividends
shall commence to cumulate; (6) liquidation preferences; (7) the
terms of any mandatory or optional redemption (including any
sinking fund) provisions and the terms and conditions of any such
redemption; (8) whether such Preferred Stock will be convertible
into or exchangeable for Common Stock or other securities of the
Company, and the terms and conditions of any such conversions or
exchanges; (9) voting rights; (10) the securities exchange, if
any, on which the Preferred Stock will be listed; and (11) any
other preferences, privileges, limitations and restrictions with
respect to such series of Preferred Stock.
No holder of Preferred Stock, solely by virtue of such
holdings, has or will have any pre-emptive right to subscribe for
or purchase any shares of any class or series of stock which is
now or may hereafter be authorized or issued. All of the
outstanding shares of Preferred Stock of the Company are, and
shares sold hereby will be, fully paid and non-assessable.
</PAGE>
<PAGE>
Unless otherwise specified in the applicable Prospectus
Supplement, upon any liquidation, dissolution or winding up of the
Company whether voluntary or involuntary, the holders of any
series of Preferred Stock in respect of which this Prospectus is
being delivered will have preference and priority over the Common
Stock and any other class or series of stock of the Company
ranking on liquidation junior to such series of Preferred Stock,
for payment out of the assets of the Company or proceeds thereof,
whether from capital or surplus, in the amount set forth in the
applicable Prospectus Supplement. After such payment, the holders
of such series of Preferred Stock will be entitled to no other
payments unless otherwise provided in the applicable Prospectus
Supplement. If, in the case of any such liquidation, dissolution
or winding up of the Company, the assets of the Company or
proceeds thereof shall be insufficient to make the full
liquidation payment in respect of such series of Preferred Stock
and liquidating payments on any other series of Preferred Stock
ranking as to liquidation on a parity with such series, then those
assets and proceeds will be distributed among the holders of such
series of Preferred Stock and any such other series of Preferred
Stock ratably in accordance with the respective amounts which
would be payable on such shares of such series of Preferred Stock
and such other series of Preferred Stock if all amounts thereon
were paid in full. A sale of all or substantially all of the
Company's assets or a consolidation or merger of the Company with
one or more corporations shall not be deemed to be a liquidation,
dissolution or winding up of the Company unless otherwise provided
in the applicable Prospectus Supplement.
The Preferred Stock may be issued in the form of global
Preferred Stock Certificates, registered in the name of a
depositary or its nominee. If global Preferred Stock Certificates
are issued, holders will not be entitled to receive definitive
certificates representing shares of Preferred Stock. In such
instance, a holder's ownership of Preferred Stock will be recorded
on or through the records of the brokerage firm or other entity
that maintains such holder's account. In turn, the total number
of shares of Preferred Stock held by an individual brokerage firm
for its clients will be maintained on the records of the
depositary in the name of such brokerage firm or its agent.
Transfer of ownership of any shares of Preferred Stock represented
by a global Preferred Stock Certificate will be effected only
through the selling holder's brokerage firm.
Unless otherwise specified in the applicable Prospectus
Supplement, the series of Preferred Stock in respect of which this
Prospectus is being delivered will rank as to dividends and upon
liquidation on a parity with the Series C Preferred Stock and
senior to the Series A Junior Participating Preferred Stock.
Series A Preferred Stock Purchase Rights and Series A Preferred
Stock
On March 4, 1986, the Board of Directors of the Company
declared a dividend distribution of one preferred stock purchase
right ("Right"), for each share of Common Stock outstanding on
March 18, 1986 and for each share of Common Stock issued
thereafter until the Distribution Date (as defined below) and, in
certain circumstances, for shares issued after such date. Each
Right entitles the registered holder to purchase from the Company
one one-hundredth (1/100) of a share of Series A Preferred Stock
at a Purchase Price of $50.00 (the "Purchase Price"). The terms
and conditions of the rights are contained in an Amendment and
Restatement dated as of August 8, 1989 of a Rights Agreement dated
as of March 4, 1986 between the Company and First Chicago Trust
Company of New York, as Rights Agent (the "Rights Agreement").
</PAGE>
<PAGE>
As discussed below, until the occurrence of certain events,
initially the Rights will not be exercisable, certificates for the
Rights will not be issued, and the Rights will automatically trade
with the Common Stock.
Until the close of business on the Distribution Date, which
will occur on the earlier of (i) the tenth day following the date
of a public announcement that a person or group of affiliated or
associated persons ("Acquiring Person") has acquired, or obtained
the right to acquire, beneficial ownership of 20% or more of the
outstanding Common Stock (the "Stock Acquisition Date") or (ii) the
tenth business day (or such later date as may be determined by the
Board of Directors prior to any person becoming an Acquiring
Person) after the commencement of a tender or exchange offer by a
Person (as defined in the Rights Agreement) which could result in
the ownership by such Person of 20% or more of the outstanding
Common Stock, the Rights will be represented by and transferred
only with the Common Stock. Until the Distribution Date, new
certificates issued for Common Stock will contain a legend
incorporating the Rights Agreement by reference, and the surrender
for transfer of any of the Common Stock certificates will also
constitute the transfer of the Rights associated with the Common
Stock represented by those certificates. As soon as practicable
following the Distribution Date, separate Rights Certificates will
be mailed to holders of record of Common Stock at the close of
business on the Distribution Date, and thereafter the Rights
Certificates alone will evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire at the close of business on March 18, 1996,
unless redeemed or exchanged earlier as described below.
Currently, there are no shares of Series A Preferred Stock
issued or outstanding. The Series A Preferred Stock will be
nonredeemable and, unless otherwise provided in connection with
the creation of a subsequent series of Preferred Stock,
subordinate to all other series of the Preferred Stock. Each
share of Series A Preferred Stock will be entitled to receive,
when, as and if declared, a quarterly dividend in an amount equal
to the greater of $10.00 per share or 100 times the quarterly cash
dividend declared on the Common Stock. In addition, the Series A
Preferred Stock is entitled to 100 times any non-cash dividends
(other than dividends payable in Common Stock) declared on the
Common Stock, in like kind. In the event of liquidation, the
holders of Series A Preferred Stock will be entitled to receive a
liquidation payment in an amount equal to the greater of $50.00
per share or 100 times the liquidation payment made per share of
Common Stock. Each share of Series A Preferred Stock will have
100 votes, voting together with the Common Stock and not as a
separate class (except during a dividend default period (occurring
when dividends equal to six quarterly dividends are in arrears),
during which there will be a right to elect two directors voting
as a class), unless otherwise required by law or by the Company's
Certificate of Incorporation. In the event of any merger,
consolidation or other transaction in which shares of Common Stock
are exchanged or changed, each share of Series A Preferred Stock
will be entitled to receive 100 times the amount received per
share of Common Stock. The rights of the Series A Preferred Stock
as to dividends, voting rights and liquidation are protected by
antidilution provisions.
If (i) any Person becomes an Acquiring Person other than
pursuant to a tender or exchange offer for all outstanding shares
of Common Stock that the Board of Directors, taking into account
the long-term value of the Company and all other factors that the
Board considers relevant, determines to be at a price and on terms
that are fair to the holders of Common Stock (a "Permitted Tender
Offer"), or (ii) during
</PAGE>
<PAGE>
such time as there is an Acquiring Person, there shall be a
reclassification of securities, recapitalization, reorganization
or other transaction involving the Company which increases the
proportionate equity share of the Acquiring Person, then in either
such event each holder of a Right, other than the Acquiring
Person, upon exercise of the Right and payment of the Purchase
Price, will have the right to receive, in lieu of Series A
Preferred Stock, a number of shares of Common Stock ("Adjustment
Shares") having a value, based upon the market price during the
period immediately preceding such event, equal to twice the
Purchase Price. To the extent that insufficient shares of Common
Stock are available for the exercise in full of the Rights,
holders of Rights will receive upon exercise shares of Common
Stock to the extent available and then cash, property or other
securities of the Company (which may be accompanied by a reduction
in the Purchase Price), in proportions determined by the Company,
so that the aggregate value received is equal to the value of the
Adjustment Shares. The Board of Directors may, at its option up
to the time an Acquiring Person beneficially owns 50% or more of
the outstanding Common Stock, exchange all or part of the then
outstanding and exercisable Rights for Common Stock, at an
exchange rate of one share of Common Stock per Right, subject to
adjustment. Rights are not exercisable following the acquisition
of shares of Common Stock by an Acquiring Person as referred to in
clause (i) of this paragraph until the expiration of the period
during which the Rights may be redeemed as described below.
Notwithstanding the foregoing, after an event described in clause
(i) or (ii) of this paragraph, Rights that are (or, under certain
circumstances, Rights that were) beneficially owned by the
Acquiring Person will be null and void.
If, after any Person becomes an Acquiring Person, unless the
Rights are redeemed earlier, (i) the Company is a party to a
merger or other business combination in which any shares of the
Common Stock are changed into or exchanged for other securities or
assets or (ii) more than 50% of the assets or earning power of the
Company and its subsidiaries (taken as a whole) are sold or
transferred in one or more transactions, proper provision shall be
made so that each holder of record of a Right will from and after
that time have the right to receive, upon exercise of the Right
and payment of the Purchase Price, that number of shares of common
stock of the principal third party to the transaction which is
equal to the Purchase Price divided by one-half of the average
market price of a share of such party's common stock during the
period immediately preceding such transaction.
At any time until twenty days following the Stock Acquisition
Date, the Board of Directors may cause the Company to redeem the
Rights in whole, but not in part, at a price of $.05 per Right,
subject to adjustment ("the Redemption Price"). Upon the action
of the Board of Directors authorizing redemption of the Rights,
the right to exercise the Rights will terminate, and the holders of
Rights will only be entitled to receive the Redemption Price.
The terms of the Rights may be amended by the Board of
Directors, but (following the Distribution Date) no amendment may
adversely affect the interests of the holders of Rights. Until a
Right is exercised, the holder, as such, will have no rights as a
stockholder of the Company, including without limitation, the
right to vote or to receive dividends.
Series C Preferred Stock
All outstanding shares of the Series C Preferred Stock are
held by the ESOP Trustee. The Series C Preferred Stock has a
liquidation preference over the Common Stock and the Series A
Preferred Stock of $32.40 per share (plus accrued and unpaid
dividends), pays cumulative dividends semi-annually in the amount
of $2.27 per share per annum and is convertible, either at the
option of the holder or
</PAGE>
<PAGE>
automatically in the event such Series C Preferred Stock is no
longer held by the ESOP Trustee, into one and one-half shares of
Common Stock per share of Series C Preferred Stock, subject to
antidilution adjustment under certain circumstances. Holders of
the Series C Preferred Stock are entitled to vote on all matters
upon which holders of the Common Stock are entitled to vote, based
on the number of shares of Common Stock into which the Series C
Preferred Stock could be converted on the record date.
Participants in the ESOP confidentially direct the ESOP Trustee as
to how any Stock allocated to their accounts shall be voted. The
ESOP Trustee exercises its discretion to vote shares, both
allocated and unallocated, for which no directions are received.
In the event of a tender offer for any Common Stock or Series C
Preferred Stock ("Stock") held by the ESOP, each participant is to
instruct the ESOP Trustee regarding Stock allocated to his
account. Stock which has not been allocated will be dealt with by
the ESOP Trustee in proportion to the directions received (or not
received) for the allocated Stock. In the event of a business
combination, as defined, the ESOP terminates and the ESOP assets
are used first to repay a loan obligation of the ESOP and then
allocated pro rata among the participants.
If at any time dividends payable on any of the Preferred
Stock entitled to receive cumulative preferred dividends are in
arrears and unpaid in an amount equal to the amount of dividends
payable thereon for six quarterly dividend periods, the number of
members of the Board of Directors shall increase by two and the
holders of the Preferred Stock, voting separately as a class,
shall have the exclusive right to elect such two directors. In
addition, the vote of a majority of the outstanding shares of
Series C Preferred Stock, voting separately as a series, is
required before certain rights of the Series C Preferred Stock may
be adversely affected. The Series C Preferred Stock may be
redeemed by the Company, in whole or in part, at the Company's
option, commencing May 1, 1990, at a price equal initially to 105%
of the purchase price, or $34.02 per share, declining by 1% each
year until May 1, 1995, at and after which date the redemption
price will be equal to the purchase price of $32.40 per share,
plus in each case, an amount equal to all dividends accrued and
unpaid on such share to the date fixed for redemption.
Delaware Law and Certain Charter and Bylaw Provisions
The Company is subject to the provisions of Section 203 of
the General Corporation Law of the State of Delaware. In general,
the statute prohibits a publicly-held Delaware corporation from
engaging in a "business combination" with an "interested
stockholder" for a period of three years after the date that the
person became an interested stockholder unless (with certain
exceptions) the business combination or the transaction in which
the person became an interested stockholder is approved in a
prescribed manner. Generally, a "business combination" includes
a merger, asset or stock sale or other transaction resulting in a
financial benefit to an interested
stockholder. Generally, an "interested stockholder" is a person
who, together with affiliates and associates, owns (or within
three years prior, did own) 15% or more of the corporation's
voting stock.
The Certificate of Incorporation, as amended, and the Bylaws,
as amended, also include provisions which could be utilized to
make more difficult, and possibly discourage, attempts to acquire
control of the company. These provisions include, without
limitations, a "classified board" (election of approximately one-
third of the directors at each annual meeting), the authorized but
unissued shares of Preferred Stock, "fair price" provisions
relating to certain proposed business combinations between the
Company and an "Interested Stockholder" (i.e., the beneficial
owner of 10% or more of the company
</PAGE>
<PAGE>
voting stock). Any action required or permitted to be taken by
stockholders may be taken only at a stockholders' meeting and not
by written consent. Written notice of any stockholder nomination
of an individual for election as director must be received by the
Secretary of the Company not less than 60 days prior to the first
anniversary of the last meeting of stockholders called for the
election of directors, and such notice must set forth certain
specified information concerning the nominee.
PLAN OF DISTRIBUTION
General
The Company may sell the Securities (i) through underwriters
or dealers; (ii) directly to one or more other purchasers; (iii)
through agents; (iv) to both investors and/or dealers through a
specific bidding or auction process or otherwise; or (v) through
a combination of such methods of sale. The Prospectus Supplement
with respect to the Securities will set forth the terms of the
offering of such Securities, including the name or names of any
underwriters, dealers or agents, the purchase price of such
Securities and the proceeds to the Company from such sale, any
underwriting discounts and other items constituting underwriters'
compensation, any initial public offering price and any discounts,
commissions or concessions allowed or reallowed or paid to
dealers, and any bidding or auction process. Any initial offering
price and any discounts, concessions or commissions allowed or
reallowed or paid to dealers may be changed from time to time.
If underwriters are used in an offering, the Securities will
be acquired by the underwriters for their own account. The
Securities may be offered to the public either through
underwriting syndicates represented by one or more managing
underwriters or directly by one or more of such firms. The
specific managing underwriter or underwriters, if any, will be set
forth in the Prospectus Supplement relating to the Securities
together with the members of the underwriting syndicate, if any.
Unless otherwise set forth in the Prospectus Supplement, the
obligations of the underwriters to purchase the Securities will be
subject to certain conditions precedent and the underwriters will
be obligated to purchase all such Securities if any are purchased.
The Securities may be sold directly by the Company or through
agents designated by the Company from time to time. The
Prospectus Supplement will set forth the name of any agent
involved in the offer or sale of the Securities in respect of
which the Prospectus Supplement is delivered and any commissions
payable by the Company to such agent. Unless otherwise indicated
in the Prospectus Supplement, any such agent is acting on a best
efforts basis for the period of its appointment.
The Securities may be sold from time to time in one or more
transactions, at a fixed price, at varying prices determined at
the time of sale, at market prices prevailing at the time of sale,
at prices related to such prevailing market prices or at
negotiated prices. The Company may also offer and sell the
Securities in exchange for one or more of its outstanding issues of
debt securities or preferred stock.
Any underwriters, dealers, or agents participating in the
distribution of the Securities may be deemed to be underwriters
and any discounts or commissions received by them on the sale or
resale of the Securities may be deemed to be underwriting
discounts and commissions under the Securities Act of 1933, as
amended (the "Securities Act"). Underwriters, dealers or agents
may be entitled, under agreements entered into with the Company,
to indemnification by the Company, against certain liabilities,
</PAGE>
<PAGE>
including liabilities under the Securities Act, and to
contribution with respect to payments which the underwriters,
dealers or agents may be required to make in respect thereof.
Underwriters, dealers and agents may engage in transactions with
or perform services for the Company in the ordinary course of
business.
The Securities, other than the Common Stock, will be a new
issue or issues of securities with no established trading market.
The Common Stock is listed, and the Company may apply for the
listing of any Preferred Stock, on the New York Stock Exchange.
No assurance can be given that the underwriters, dealers or
agents, if any, involved in the sale of the Securities will make a
market in such Securities. Whether or not any of the Securities
are listed on a national securities exchange or the underwriters,
dealers or agents, if any, involved in the sale of the Securities
make a market in such Securities, no assurance can be given as to
the liquidity of the trading market for such Securities.
If so indicated in the Prospectus Supplement, the Company
will authorize underwriters or other persons acting as the
Company's agents to solicit offers by certain institutions to
purchase Securities from the Company pursuant to contracts
providing for payment and delivery on a future date. Institutions
with which such contracts may be made include commercial and
savings banks, insurance companies, pension funds, investment
companies, educational and charitable institutions and others, but
in all cases will be subject to the approval of the Company. The
obligations of any purchaser under any such contract will be
subject to the condition that the purchase of the Securities shall
not at the time of delivery be prohibited under the laws of the
jurisdiction to which such purchaser is subject. The underwriters
and such agents will not have any responsibility in respect of the
validity or performance of such contracts.
Offers to purchase Securities may be solicited directly by
the Company and sales thereof may be made by the Company directly
to institutional investors or others who may be deemed to be
underwriters within the meaning of the Securities Act with respect
to any resale thereof. The terms of any such sales will be
described in the Prospectus Supplement relating thereto. Except
as set forth in the applicable Prospectus Supplement, no director,
officer or employee of the Company or its subsidiaries will
solicit or receive a commission in connection with direct sales by
the Company of the Securities, although such persons may respond
to inquiries by potential purchasers and perform ministerial and
clerical work in connection with any such direct sales.
EXPERTS
The Annual Report on Form 10-K for the fiscal year ended
December 31, 1993 of the Company incorporated by reference in this
prospectus and elsewhere in the registration statement has been
audited by Arthur Andersen & Co., independent public accounts, as
indicated in their reports with respect thereto, and is included
herein in reliance upon the authority of said firm as experts in
accounting and auditing in giving said reports. Reference is made
to said reports, which call attention to 1992 changes in accounting
principles with respect to the methods of accounting for income
taxes and for
postretirement benefits other than pensions.
</PAGE>
<PAGE>
VALIDITY OF SECURITIES
The validity of the Securities offered hereby will be passed
upon for the Company by Charles O. Ziemer, Esq., General Counsel
of the Company, and will be passed upon for any underwriter,
dealer or agent by Mayer, Brown & Platt, Chicago, Illinois. As
of March 1, 1994, Mr. Ziemer beneficially owned 25,421 shares of
Common Stock. The opinions of Mr. Ziemer and Mayer, Brown & Platt
with respect to certain series of Securities may be subject to
certain conditions and assumptions, as indicated in the Prospectus
Supplement describing such series. Mayer, Brown & Platt is
currently representing the Company in certain legal matters.
</PAGE>
<PAGE>
No dealer, salesman or other person has been authorized to
give any information or to make any representation not contained
in this Prospectus Supplement or the accompanying Prospectus and,
if given or made, such information or representation must not be
relied upon as having been authorized by the Company, by the
Underwriters or by any other person. This Prospectus Supplement
and the accompanying Prospectus do not constitute an offer to
sell or a solicitation of any offer to buy any of the securities
offered hereby to any person or by anyone in any state in which
such offer or solicitation may not lawfully be made. Neither the
delivery of this Prospectus Supplement or any Prospectus nor any
sale made hereunder or thereunder shall, under any circumstances,
create any implication that there had been no change in the
affairs of the Company since the date hereof.
TABLE OF CONTENTS
Page
Prospectus Supplement
The Company S-2
Use of Proceeds S-2
Selected Ratios S-2
Certain Terms of the 7.48% Preferred Stock S-3
Tax Considerations S-5
Underwriting S-7
Validity of Securities S-7
Experts S-7
Prospectus
Available Information 2
Documents Incorporated by Reference 2
The Company 3
Use of Proceeds 3
Selected Ratios 3
Description of Debt Securities 3
Description of Capital Stock 11
Plan of Distribution 16
Experts 18
Validity of Securities 18
500,000 Shares
CBI INDUSTRIES, INC.
7.48% Cumulative Preferred Stock, Series D
Liquidation Preference
$100 per share
PROSPECTUS SUPPLEMENT
March 29, 1995
Lehman Brothers
Merrill Lynch & Co.
