Rule 423(b)
Registration No.333-82883
PROSPECTUS
INTERNATIONAL COMFORT PRODUCTS CORPORATION
------------------------------------------
1,488,162 Ordinary Shares
------------------------------------------
The following selling shareholders are offering up to 1,488,162 ordinary
shares ("Shares") of International Comfort Products Corporation (the
"Company," which sometimes in this Prospectus is referred to as "we" or "us"
and in the possessive as "our").
Watsco Investments I, Inc. 1,398,872 Shares
Watsco Investments II, Inc. 89,290 Shares
Watsco Investments I, Inc. and Watsco Investments II, Inc. each are
subsidiaries of Watsco, Inc. and are referred to in this Prospectus as the
"Selling Shareholders."
Our Shares trade on both the American Stock Exchange ("AMEX") and the
Toronto Stock Exchange ("TSE") under the symbol "ICP." On July 26, 1999, the
last reported sale price of the Shares on Amex was $11.69 (U.S.) and on the
TSE was $17.60 (Can.). WE URGE YOU TO OBTAIN A CURRENT MARKET QUOTATION.
Our principal executive offices are located at 501 Corporate Centre
Drive, Suite 200, Franklin, Tennessee 37067. The phone number there is (615)
771-0200.
We will not be paying any underwriting discounts or commissions in this
offering.
INVESTING IN OUR SHARES INVOLVES CERTAIN
RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE 3.
We will not receive any proceeds from the sale of Shares by the Selling
Shareholders. We have agreed to pay certain expenses of registration of the
Shares under United States federal and state securities laws. We are not
required to pay commissions and discounts of agents or broker-dealers and
transfer taxes, if any, that the Selling Shareholders may be required to pay
when they sell their Shares. We also have agreed to indemnify the Selling
Shareholders against certain liabilities, including certain liabilities under
the Securities Act of 1933, as amended (the "Securities Act").
__________________________________________________
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY
STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED
OF THESE SECURITIES OR PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
___________________________________________________
The date of this Prospectus is July 29, 1999.
AVAILABLE INFORMATION
We have filed a Registration Statement on Form S-3 under the Securities
Act (the "Registration Statement") with the Securities and Exchange
Commission (the "Commission") in Washington, D.C. The Registration Statement
covers the Shares offered by this Prospectus. This Prospectus does not
contain all of the information set forth in the Registration Statement and
the exhibits thereto. 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 such statement is qualified by reference to
each such contract or document filed (or incorporated by reference) as an
exhibit to the Registration Statement.
We are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith file reports and other information with the Commission. Reports
and other information filed by us with the Commission can be inspected
without charge and copied at the public reference facilities maintained by
the Commission at the following addresses: New York Regional Office, Seven
World Trade Center, New York, New York 10048; and Chicago Regional Office,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661-2511. Copies of
such material can be obtained upon written request from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549
at prescribed rates. Information on the operation of the Public Reference
Room may be obtained by calling the Commission at 1-800-SEC-0330. The
Commission maintains a Web site at http://www.sec.gov that contains reports,
proxy statements and other information regarding issuers that file
electronically with the Commission.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission (File
No. 1-7955) are incorporated in and made a part of this Prospectus by this
reference:
(i) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998, filed with the Commission on March 31, 1999.
(ii) The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1999, filed with the Commission on May 14, 1999.
(iii) The Company's Current Report on Form 8-K filed with the Commission
on July 28, 1999.
(iv) The description of the Company's Ordinary Shares contained in its
Registration Statement on Form 8-A filed under the Exchange Act with the
Commission on March 14, 1990, including any amendment or report filed for the
purpose of updating such description.
All reports and other documents filed by the Company pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to the filing of a post-effective amendment which
indicates that all Shares offered hereby have been sold or which deregisters
all Shares then remaining unsold shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of filing such reports
and documents. Any statement contained in a document incorporated or deemed
to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus to the extent that a statement
contained herein or in any 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.
In particular, the discussion of the tender offer and related legal matter
below under RISK FACTORS and on page 5 of this Prospectus under MATERIAL
CHANGES should be read in conjunction with the financial statements contained
in reports that are incorporated herein by reference.
2
Copies of all documents that are incorporated herein by reference (not
including the exhibits to such documents, unless such exhibits are
specifically incorporated by reference into such documents or into this
Prospectus) will be provided without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon a written or oral
request to the Company, Attention: David P. Cain, 501 Corporate Centre Drive,
Suite 200, Franklin, Tennessee 37067, telephone number (615) 771-0216.
RISK FACTORS
On June 30, 1999, Titan Acquisitions, Ltd., a New Brunswick corporation,
and a wholly owned subsidiary of United Technologies Corporation
(collectively, "UTC"), commenced a tender offer to acquire all of our
outstanding Shares at a price of $11.75 (U.S.) per Share (the "Tender Offer
Price"). SEE MATERIAL CHANGES below. Currently, the tender offer expires
at 12:00 p.m. on August 9, 1999. The completion of the tender offer is
subject to a number of conditions, including regulatory approval.
Accordingly, there is no assurance that the tender offer will be completed.
If the tender offer is not completed, there is no assurance that you would be
able to resell your Shares for the Tender Offer Price or for the price that
you paid for the Shares. The Tender Offer Price exceeds the trading prices
for the Shares that had prevailed during the six months preceding the
announcement of the tender offer.
In addition, if the tender offer is completed but you fail to tender
your Shares, there is no assurance of the continuing liquidity of your
Shares. The Shares may cease to trade on both the AMEX and the TSE and there
may be no other market for the Shares. Although UTC has indicated that it
intends to subsequently acquire all Shares that are not tendered through a
merger, amalgamation or other similar transaction, there is no assurance that
this will occur or when it will occur. Accordingly, your investment in the
Shares could become illiquid for an indeterminate length of time.
THE COMPANY
The Company is one of North America's leading manufacturers of quality
residential and light commercial heating and cooling products. Its products
are marketed under the Arcoaire, Comfortmaker, Airquest, Heil, Tempstar,
ICP Commercial, Lincoln, Dettson, Clare and KeepRite brand names to dealers,
contractors and builders through independent distributors. These products
include a variety of heating and cooling products, including gas and oil
furnaces, split-system and package air conditioners, split-system and package
heat pumps, and gas/electric combination units.
The executive offices of the Company are located at 501 Corporate Centre
Drive, Suite 200, Franklin, Tennessee 37067, telephone number (615) 771-0200.
USE OF PROCEEDS
The Shares that are the subject of this offering are being sold by the
Selling Shareholders. Accordingly, we will not receive any of the proceeds
from the sale of these Shares.
SELLING SHAREHOLDERS
The Selling Shareholders are wholly owned subsidiaries of Watsco,
Inc.("Watsco"). Watsco is one of our two largest customers. In addition,
the shares owned by the Selling Shareholders were issued to affiliates of
Watsco in exchange for substantially all of the assets of what now is A-1
Components Corp., one of our subsidiaries. That transaction occurred and
the Shares were issued on May 29, 1998.
3
When we acquired the assets of A-1 Components, the Shares that were
issued (and that now are being sold by the Selling Shareholders) were not
registered under the Securities Act. They were issued in an exempt offering
and, therefore, were "restricted" securities. Accordingly, the Shares could
not be sold by the Selling Shareholders without registration or an exemption.
Because of this restriction, in the A-1 Components transaction, we agreed that
we would register the Shares owned by the Watsco affiliates prior to them
having owned the Shares for two years, at which time they could be sold
without registration.
On July 1, 1999 Watsco exercised it right to require that we register
the Shares issued in the A-1 transaction. That is the reason that we have
filed the registration statement of which this Prospectus is a part.
As of the date of this Prospectus, the Selling Shareholders own
1,488,162 Shares. The Selling Shareholders may sell all, a portion or none of
these Shares. If the offering is completed, the Selling Shareholders will own
no Shares. This information is based upon data supplied to us by the Selling
Shareholders.
PLAN OF DISTRIBUTION
We have been advised by the Selling Shareholders that they intend to
sell all or a portion of the Shares offered hereby, from time to time, on the
Toronto Stock Exchange and/or the American Stock Exchange, and that sales
will be made at prices prevailing at the time of such sales. The Selling
Shareholders also may make sales on the over-the-counter market, pursuant to
Rule 144 promulgated under the Securities Act or otherwise at prices and on
terms then prevailing or at prices related to the then current market price,
or in negotiated transactions. The Selling Shareholders may sell Shares in
(i) a block trade in which the broker or dealer so engaged will attempt to
sell Shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction, (ii) transactions in which a broker
or dealer acts as principal and resells Shares for its account pursuant to
this Prospectus, (iii) an exchange distribution in accordance with the rules
of such exchange, (iv) ordinary brokerage transactions and transactions in
which the broker solicits purchases, (v) privately negotiated transactions,
(vi) a combination of any such methods of sale or (vii) any other method of
sale permitted pursuant to applicable laws.
In effecting sales, brokers or dealers engaged by the Selling
Shareholders may arrange for other brokers or dealers to participate. The
Selling Shareholders also from time to time, may authorize underwriters
acting as their agents to offer and sell Shares upon such terms and
conditions as shall be set forth in a prospectus supplement, to the extent
required. Underwriters, brokers or dealers will receive commissions or
discounts from the Selling Shareholders in amounts to be negotiated
immediately prior to sale. The Selling Shareholders, as well as such
underwriters, brokers or dealers and any other participating brokers or
dealers, may be deemed to be "underwriters" within the meaning of Section
2(11) of the Securities Act in connection with such sales and any discounts
and commissions received by them and any profit realized by them on the
resale of Shares may be deemed to be underwriting discounts and commissions
under the Securities Act.
There is no assurance that the Selling Shareholders will offer for sale
or sell any or all of the Shares covered by this Prospectus. We have been
advised by the Selling Shareholders that they or their pledgees, donees,
transferees or other successors in interest may sell all, a portion of, or
none of the Shares covered by this Prospectus.
4
At the time a particular offer of Shares is made by either of the
Selling Shareholders, to the extent required, a supplement to this Prospectus
will be distributed which will identify and set forth the aggregate amount of
Shares being offered and the terms of the offering.
LEGAL MATTERS
Certain legal matters in connection with the sale of the Shares offered
by this Prospectus will be passed upon for us by Tuke Yopp & Sweeney, PLC,
Nashville, Tennessee.
EXPERTS
Our consolidated financial statements and schedules as of December 31,
1998, and for each of the two years then ended, incorporated by reference in
this Prospectus and elsewhere in the Registration Statement have been audited
by Arthur Andersen LLP, Chartered Accountants, as indicated in their reports
with respect thereto, and are incorporated by reference herein in reliance
upon the authority of said firm as experts in giving said reports.
Our consolidated financial statements and schedules for the year ended
December 31, 1996, incorporated by reference in this Prospectus and elsewhere
in the Registration Statement have been incorporated by reference herein in
reliance on the report of PricewaterhouseCoopers LLP, Chartered Accountants,
given on the authority of that firm as experts in accounting and auditing.
Future financial statements and schedules of the Company and the reports
thereon of the Company's independent chartered accountants also will be
incorporated by reference in this Prospectus in reliance upon the authority
of the firm as experts giving these reports to the extent said firm has
audited these financial statements and consented to the use of their reports
thereon.
MATERIAL CHANGES
On June 23, 1999, we entered into a Pre-Acquisition Agreement (the
"Acquisition Agreement") with UTC. The Acquisition Agreement provides that
UTC will make a tender offer ("Tender Offer") to purchase all of our
outstanding Shares. Shares validly tendered in the Tender Offer shall be
entitled to receive $11.75 (U.S.), net to the seller, in cash. Consummation
of the Tender Offer is subject to certain conditions as specified in the
Acquisition Agreement.
On June 25, 1999, Stanley Ginkowski and Jeff Grau filed a class action
lawsuit in the Chancery Court of Marshall County, Tennessee, naming as
defendants the Company and all of our directors. The plaintiffs seek to
enjoin any actions by us in furtherance of the Tender Offer or, alternatively,
to recover damages in the event the Tender Offer and any subsequent merger is
consummated. The plaintiffs claim that the consideration to be received by
our shareholders in the proposed transaction with UTC is unfair and inadequate,
that our directors breached certain alleged fiduciary duties to our
shareholders and that our directors will be unjustly enriched by the
transaction. On July 19, 1999, the Court issued a memorandum opinion
dismissing the litigation on a variety of grounds. Prior to the formal entry
of an order, however, the plaintiffs voluntarily dismissed their case in
Marshall County, Tennessee. On July 26, 1999, the Company received a demand
letter from an attorney in Canada representing Mr. Grau demanding certain
actions by the Board of Directors and generally making claims that certain
benefit packages improperly benefitted certain executives of the Company to
the detriment of the shareholders. We believe that the claims against us, our
directors and our officers are without merit and intend to vigorously defend
all claims made against us and them.
5
A copy of the Acquisition Agreement is filed as Exhibit 2 to the
Registration Statement and is incorporated herein by this reference. A copy
of the Schedule 14D-9 (Solicitation/Recommendation Statement) ("Schedule 14D-
9") and any amendments thereto that we filed in connection with the Tender
Offer also are filed as exhibits to the Registration Statement and are
incorporated herein by this reference. The Schedule 14D-9 and any amendments
thereto contain information about the Tender Offer. We encourage you to
obtain copies and read them thoroughly.
MISCELLANEOUS
No dealer, salesman or any other person has been authorized to give any
information or to make any representation not contained or incorporated by
reference in this Prospectus in connection with the offering herein
contained, and, if given or made, such information or representation must not
be relied upon as having been authorized by the Company or the Selling
Shareholders. This Prospectus does not constitute an offer to sell or a
solicitation of any offer to buy any of the Shares offered hereby in any
jurisdiction to any person to whom it is unlawful to make such an offer or
solicitation in such jurisdiction. Neither the delivery of this Prospectus
nor any sale hereunder shall under any circumstances create any implication
that there has been no change in the affairs of the Company since any of the
dates as of which information is furnished herein or since the date hereof.
6
THIS PAGE INTENTIONALLY LEFT BLANK
INTERNATIONAL
COMFORT
PRODUCTS [ICP LOGO]
CORPORATION
TABLE OF CONTENTS
Available Information .......... 2
Incorporation of Certain
Documents by Reference ....... 2
Risk Factors.................... 3
The Company..................... 3
Use of Proceeds................. 3
Selling Shareholders............ 3
Plan of Distribution............ 4
Legal Matters................... 5
Experts......................... 5
Material Changes................ 5
Miscellaneous................... 6
