As filed with the Securities and Exchange Commission on September 18, 1996
Registration No. 33-57243
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
AMENDMENT NO. 2
to
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
Ethyl Corporation
(Exact name of Registrant as Specified in Its Charter)
VIRGINIA 54-0118820
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
330 South Fourth Street
P. O. Box 2189
Richmond, Virginia 23218
(804) 788-5000
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of Registrant's Principal Executive Offices)
Bruce C. Gottwald
Chairman of the Board and Executive Committee
Charles B. Walker
Vice Chairman of the Board,
Chief Financial Officer and Treasurer
Ethyl Corporation
330 South Fourth Street
P. O. Box 2189
Richmond, Virginia 23218
(804) 788-5000
(Names, Address, Including Zip Code, and Telephone
Number, Including Area Code, of Agents for Service)
Copies to:
Steven M. Mayer, Esq. Allen C. Goolsby, Esq.
Vice President and General Counsel Hunton & Williams
Ethyl Corporation Riverfront Plaza, East Tower
330 South Fourth Street 951 East Byrd Street
P.O. Box 2189 Richmond, Virginia 23219
Richmond, Virginia 23218
Approximate date of commencement of proposed sale to the public: From
time to time after the effective date of this Registration Statement in light
of market conditions and other factors.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box.___
If any of the securities being registered on this form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box._X_
The registrant hereby amends this Registration Statement on such date or dates
as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section
8(a), may determine.
<PAGE>
Prospectus
$300,000,000
Ethyl Corporation
Debt Securities
Convertible Debt Securities
Preferred Stock
---------------
Ethyl Corporation ("Ethyl" or the "Company") intends to issue from
time to time its (i) unsecured senior debt securities (the "Debt Securities")
and (ii) shares of Preferred Stock (the "Preferred Stock"), which may be
issued in the form of depositary shares evidenced by depositary receipts
("Depositary Shares"), having an aggregate initial public offering price not
to exceed $300,000,000, on terms to be determined at the time of sale. The
Debt Securities, the Preferred Stock and the Depositary Shares offered hereby
(collectively, the "Offered Securities") may be offered, separately or as
units with other Offered Securities, in separate series in amounts, at prices
and on terms to be determined at the time of sale and to be set forth in a
supplement to this Prospectus (a "Prospectus Supplement").
The specific terms of the Offered Securities in respect of which this
Prospectus is being delivered, such as, where applicable, (i) in the case of
Debt Securities, the specific designation, aggregate principal amount,
currency, denomination, maturity, interest rate, time of payment of interest,
terms of redemption at the option of the Company or repayment at the option of
the holder or for sinking fund payments, the designation of the Trustee acting
under the Indenture, terms for conversion into or exchange for Preferred Stock
and the initial public offering price; (ii) in the case of Preferred Stock,
the designation, preferences and other rights, qualifications, limitations or
restrictions thereof, the initial public offering price and whether interests
in the Preferred Stock will be evidenced by Depositary Shares; and (iii) in
the case of all Offered Securities, whether such Offered Security will be
offered separately or as a unit with other Offered Securities, will be set
forth in the accompanying Prospectus Supplement.
The Prospectus Supplement will also contain information, where
applicable, about certain United States Federal income tax considerations
relating to, and any listing on a securities exchange of, the Offered
Securities covered by the Prospectus Supplement.
The Offered Securities may be sold directly by the Company, or through
agents designated from time to time, or through underwriters or dealers. If
any agent of the Company, or any underwriters are involved in the sale of
Offered Securities, the names of such agents or underwriters and any
applicable fees, commissions or discounts and the net proceeds to the Company
from such sale will be set forth in the applicable Prospectus Supplement. See
"Plan of Distribution."
This Prospectus may not be used to consummate sales of Offered
Securities unless accompanied by a Prospectus Supplement.
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 date of this Prospectus is ________, 1996
<PAGE>
IN CONNECTION WITH AN OFFERING, THE UNDERWRITERS, IF ANY, FOR SUCH
OFFERING MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE
MARKET PRICES OF THE OFFERED SECURITIES AT LEVELS ABOVE THOSE WHICH MIGHT
OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED IN
THE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY
TIME.
No person has been authorized to give any information or to make any
representation not contained in this Prospectus or the Prospectus Supplement
in connection with any offering made thereby, and, if given or made, such
information or representation must not be relied upon as having been authorized
by the Company or by any underwriter, dealer or agent. This Prospectus and
the Prospectus Supplement do not constitute an offer to sell or a solicitation
of an offer to buy any securities offered thereby in any jurisdiction to any
person to whom it is unlawful to make such offer in such jurisdiction.
TABLE OF CONTENTS
Page
AVAILABLE INFORMATION 1
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE 1
THE COMPANY 2
USE OF PROCEEDS 4
CONSOLIDATED FINANCIAL DATA 5
DESCRIPTION OF DEBT SECURITIES 11
General 11
Restrictive Covenants 11
Events of Default 13
Defeasance 14
Modification and Waiver 15
Global Securities 15
DESCRIPTION OF CAPITAL STOCK 17
General 17
Preferred Stock 17
Common Stock 19
Certain Provisions of the Restated Articles
and By-Laws 19
Purchase Rights 19
DESCRIPTION OF DEPOSITARY SHARES 20
PLAN OF DISTRIBUTION 20
VALIDITY OF SECURITIES 21
EXPERTS 21
<PAGE>
AVAILABLE INFORMATION
Ethyl is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by Ethyl with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and
at the Regional Offices of the Commission at Suite 1400, Northwestern Atrium
Center, 500 West Madison Street, Chicago, Illinois 60661 and Seven World Trade
Center, Suite 1300, New York, New York 10048. In addition, copies of such
material can be obtained from the Public Reference Section of the Commission
at 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Such
reports, proxy statements and other information concerning Ethyl can also be
inspected at the offices of The New York Stock Exchange, 20 Broad Street, New
York, New York 10005 and The Pacific Stock Exchange, 301 Pine Street, San
Francisco, California 94104.
Ethyl has filed with the Commission a Registration Statement on Form
S-3 under the Securities Act of 1933 (the "Securities Act") with respect to
the securities offered hereby. For further information with respect to Ethyl
and the Offered Securities, reference is made to such Registration Statement
and to the exhibits thereto. Statements contained herein concerning the
provisions of certain documents are not necessarily complete and, in each
instance, reference is made to the copy of such document filed as an exhibit
to the Registration Statement or otherwise filed with the Commission. Each
such statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Ethyl's Annual Report on Form 10-K for the fiscal year ended December
31, 1995 filed pursuant to Section 13 or 15(d) of the Exchange Act, Ethyl's
Current Report on Form 8-K filed March 15, 1996 as amended by Form 8-K/A filed
May 13, 1996, Ethyl's Quarterly Report on Form 10-Q as amended by Form 10-Q/A
for the first quarter ended March 31, 1996 and Ethyl's Quarterly Report on
Form 10-Q for the second quarter ended June 30, 1996 are hereby incorporated
by reference into this Prospectus. All documents filed by Ethyl with the
Commission 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 termination of the offering
made hereby shall be deemed to be incorporated by reference into this
Prospectus and to be a part hereof from the date of filing of such 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 or in any Prospectus Supplement
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
Ethyl will provide without charge to each person to whom a copy of
this Prospectus is delivered, on the written or oral request of such person, a
copy of any or all of the documents referred to above which have been or may
be incorporated by reference into this Prospectus, other than certain exhibits
to such documents. Copies of the Indenture summarized on the following pages
are also available upon request. Requests for such copies should be directed
to E. Whitehead Elmore, Secretary and Special Counsel to the Executive
Committee, Ethyl Corporation, 330 South Fourth Street, P.O. Box 2189,
Richmond, Virginia 23218 (Telephone: (804) 788-5000).
<PAGE>
<PAGE>
THE COMPANY
The Company is a major manufacturer and blender of petroleum
additives. Incorporated in Virginia in 1887, the Company has approximately
1,800 employees. Its principal executive office is located at 330 S. Fourth
Street, Richmond, Virginia 23218, and its telephone number is (804) 788-5000.
On February 29, 1996, the Company acquired the worldwide lubricant
additives business of Texaco Inc. On September 15, 1994, the Company sold
Whitby, Inc. ("Whitby"), which marketed and distributed finished
pharmaceuticals. On February 28, 1994, Ethyl distributed to its shareholders
all of the outstanding shares of Albemarle Corporation ("Albemarle"), which
owned the olefins and derivatives, bromine chemicals and specialty chemicals
businesses formerly owned, directly or indirectly, by Ethyl. On July 1, 1993,
Ethyl distributed to its shareholders the outstanding shares of First Colony
Corporation that it then owned (approximately 80% of the then outstanding
shares). First Colony Corporation owns First Colony Life Insurance Company,
which engages primarily in writing life insurance and annuities. See
"Consolidated Financial Data" regarding financial data for the lubricant
additives business acquired from Texaco Inc.
The Company's petroleum additives business includes lubricant
additives and fuel additives. Lubricant additives extend the useful life of
lubricants and assist them in preventing wear and corrosion of metallic parts,
protecting seals, allowing metallic parts to withstand extremely high
temperatures and pressures, and increasing the adhesion of oils to metallic
parts. Lubricant additives are used in oils, fluids and greases for
over-the-road and off-highway vehicles, aircraft, power tools, marine,
railroad and industrial equipment and machinery requiring lubrication, thereby
extending equipment life. Lubricant additives are used in meeting government
regulations and original equipment manufacturers' specifications and
standards, including improving fuel economy.
Lubricant additives include packages for (i) passenger car motor oils
for gasoline engines, heavy-duty diesel oils for diesel-powered vehicles,
diesel oils for locomotive, marine and stationary power engines and oils for
two-cycle engines, and (ii) automatic transmission fluids, automotive and
industrial gear oils, hydraulic fluids and industrial oils; as well as
components for engine oil and other additive packages such as (i) antioxidants
to resist high-temperature degradation, antiwear agents to protect metal
surfaces from abrasion, (ii) detergents to prevent carbon and varnish deposits
from forming on engine parts, (iii) dispersants to keep engine parts clean by
suspending insoluble products of fuel combustion and oil oxidation, (iv)
friction reducers to facilitate movement, (v) pour point depressants to enable
oils to flow at cold temperatures, (vi) corrosion inhibitors to protect metal
parts and (vii) viscosity index improvers to provide uniform flow properties
over a wide range of temperatures.
Fuel additives increase the quality of gasolines and diesel fuel by
raising the level of octane and cetane, respectively, retaining the quality of
fuel over time, maintaining engine cleanliness, protecting metals, reducing
friction and wear and lowering emissions. Fuel additives are used by refiners
to meet regulations and standards, including those reducing exhaust emissions.
Fuel additives also are used in fuels for over-the-road and off-highway
vehicles, piston and jet aircraft, railroad, marine and other gasoline, diesel
or synfuel powered engines as well as home heating oil.
Fuel additives include lead and manganese antiknock compounds to
increase octane and prevent power loss due to early or late combustion (engine
knock) in gasoline engines; cetane improvers to improve the combustion
properties and power delivery of diesel fuels; amine stabilizers and hindered
phenolic antioxidants to prevent thermal degradation during storage and
transport; corrosion inhibitors to prevent fuel storage and pumping system
failures; cold flow improvers to enhance diesel fuel pumping under cold
weather conditions; detergent packages to keep carbon deposits from forming on
fuel injectors, intake valves or carburetors and in combustion chambers; dyes
for fuel identification and leak detection; lubricity agents; and a
conductivity modifier to neutralize static charge build-up in fuel and
products for home heating oils. The Company also markets Greenburn (TM), an
environmentally friendly line of proprietary products designed for diesel
fuel, home heating oil and power generation fuel markets worldwide.
Greenburn (TM) products contain HITEC (R) 3000 performance additive ("MMT").
Lead antiknock compounds, which are sold worldwide to petroleum
refiners, remain one of the Company's largest product lines. The Company
estimates that it accounts for approximately one-third of the total worldwide
sales of lead antiknock compounds.
Lead antiknock compounds have been subject to regulations restricting
the amount that can be used in gasoline in the United States since the 1970s
and in Canada since 1990. The market for these products in motor vehicles in
the United States and Canada has been eliminated, but the market for their use
in certain other applications has remained at about the same level for years
and is expected to remain stable. As the Company has forecasted and planned,
the market for these products in other major markets continues to decline at
an annual rate of approximately 8% as the use of unleaded gasoline grows.
<PAGE>
On a consolidated basis, including prior-year operations of spun-off
businesses while they were part of the Company, the contribution of lead
antiknock compounds to the Company's net sales was about 26% in 1995, 22% in
1994 and 13% in 1993. The lead antiknock profit contribution to the Company's
consolidated operating profit, excluding allocation of corporate expenses, is
estimated to have been 74% in 1995, 56% in 1994 and 49% in 1993. On a PRO
FORMA basis, excluding prior year operations of the spun-off businesses, the
contribution of lead antiknock compounds to net sales would have been 25% in
1994 and 1993. On a PRO FORMA basis, the contribution to operating profit
would have been 60% in 1994 and 70% in 1993.
In recent years, the Company has been able to offset a continuing
decline in shipments of lead antiknock compounds with higher margins due
primarily to increases in selling prices. Any further decline in the use of
lead antiknock compounds would adversely affect sales and, unless the Company
can offset such volume declines with increased margins, also adversely affect
profits from lead antiknocks. The Company's current five-year plan
contemplates that growth in the remainder of its petroleum additives business
should be sufficient to offset any decline in the operating profit
contribution of lead antiknock compounds.
In December 1993, the Company entered into an agreement with The
Associated Octel Company Limited ("Octel") of London pursuant to which Octel
allocates a portion of its production capacity of lead antiknock compounds to
the Company for sale and distribution through the Company's worldwide network.
As a result, the Company has discontinued production of lead antiknock
compounds, while continuing to maintain the production equipment in its
subsidiary's Canadian plant, where the Company previously had produced some of
its lead antiknock compounds. The Octel agreement continues so long as the
Company determines that a market continues to exist for lead antiknock
compounds. Under the agreement, which is cancelable at the Company's option,
upon due notice, with no minimum purchase obligations, the Company has the
right to purchase from Octel antiknock compounds which the Company estimates
will be sufficient to cover the Company's needs in any contract year. Prices
are subject to periodic escalation and adjustment.
The Company believes the agreement with Octel will assure it of an
ongoing efficient source of supply for lead antiknock compounds as the
worldwide demand for these products continues to decline. It does not
anticipate that the Octel supply agreement and the Company's discontinuance of
lead antiknock manufacturing operations will adversely affect its relations
with its customers, or have a material effect on its future results of
operations. The Company and Octel continue to compete vigorously in sales and
marketing of lead antiknock compounds.
In addition to the supply agreement, Octel and the Company have agreed
that the Company's fleet of ships will distribute for Octel its lead antiknock
compounds that are shipped in bulk in ocean-going vessels.
The Company also sells a manganese-based antiknock compound, HITEC (R)
3000 performance additive, which is used in unleaded gasoline. The compounds
are manufactured by Albemarle under a long-term supply contract with the
Company. MMT has been used in Canadian unleaded gasoline for nearly 20 years.
The Company conducted extensive testing of MMT prior to filing a
request in 1990 for a fuel-additive waiver from the United States
Environmental Protection Agency (the "EPA") required to begin marketing the
additive for use in unleaded gasoline in the United States. After extended
litigation with the EPA, in April 1995, the United States Court of Appeals for
the District of Columbia Circuit ordered the EPA to grant a waiver for the use
of MMT in unleaded gasoline and the waiver was granted in July 1995. EPA
continued to bar the use of MMT in the United States in unleaded gasoline
unless the additive was "registered" under another section of the Clean Air
Act. In another suit in the United States Court of Appeals for the District
of Columbia Circuit, the Company challenged EPA's assertion that additional
manganese health testing must be conducted before MMT could be registered. In
October 1995, the appellate court in a unanimous decision ordered EPA to
register MMT for use in unleaded gasoline. EPA did not appeal that decision.
In February 1996, the Environmental Defense Fund ("EDF") initiated a campaign
to prevent refiners from using MMT in the U.S. The Company takes strong
exception to the EDF's position. The major automobile manufacturers have
indicated that they will recommend use of MMT-free gasoline until more testing
is done. The Company has met with the automobile companies to discuss their
concerns and is continuing its MMT test programs. Sales of MMT remain
approximately level with 1995, and it is not possible to determine if and
when, or the degree to which, sales will increase in the U.S., as well as in
other countries besides Canada.
<PAGE>
In Canada, in May 1995 legislation was introduced in the Canadian
Parliament to restrict the import of MMT into Canada. When Parliament
adjourned in mid-December 1995, the legislation had not passed the House of
Commons. In April 1996 the legislation was reintroduced, but no action has
been taken by Parliament. On September 10, 1996, the Company served notice on
the Canadian government that, if such legislation is enacted by Parliament,
the Company intends to file a claim against the Canadian government for
damages under an arbitration provision of the North American Free Trade
Agreement. The NAFTA provision allows a company to bring before an arbitration
panel claims against NAFTA governments for alleged violations of their
obligations toward investors. Before the claim is filed, there is a
90-day period for consultations between the Company and the Canadian
government. The Company's management contends the proposed legislation would
violate Canada's investment obligations by "expropriating" Ethyl's MMT
business in Canada, which would significantly impact the Toronto-based
subsidiary of Ethyl.
A majority of the Company's production of petroleum additives is in
the United States. The Company also has production facilities in Feluy and
Gent, Belgium, Sarnia, Ontario, Canada and Rio de Janeiro, Brazil.
Fuel additives for gasoline, diesel fuels and heating oils are sold
directly to petroleum refiners and marketers, terminals and blenders.
Lubricant additive packages are sold directly to companies producing finished
oils and fluids.
Major raw materials used by the petroleum additives business include
process oils, polybutenes, 2-ethyl-1-hexanol and other alcohols, antioxidants
and amines as well as electricity and natural gas as fuels, which are
purchased at prices the Company believes are competitive.
The Company's petroleum additives businesses operate in highly
competitive markets, most of which involve a limited number of competitors.
The competitors are both larger and smaller than the Company in terms of
resources and market share. Competition in connection with all of the
Company's petroleum additive products requires continuing investments in
research and development of new products or leading technologies, continuing
product and process improvements and providing specialized customer services.
USE OF PROCEEDS
Unless otherwise set forth in the applicable Prospectus Supplement,
the net proceeds from the sale of the Offered Securities will be used for
general corporate purposes, which may include additions to working capital,
capital expenditures, stock repurchases, repayment of indebtedness and
acquisitions.
<PAGE>
CONSOLIDATED FINANCIAL DATA
The following table sets forth certain condensed consolidated financial data
of the Company for the six-month periods ended June 30, 1996 and 1995. The
data are in summary form and are unaudited. On February 29, 1996, the Company
completed the acquisition of the worldwide lubricant additives business of
Texaco Inc., including manufacturing and blending facilities, identifiable
intangibles and working capital. The acquisition, accounted for under the
purchase method, included an adjusted cash payment of $134.2 million based on
final working capital determinations and a future contingent payment of up to
$60 million (the "Contingent Note"). The cash payment was financed primarily
under the Company's revolving credit agreement. The payment of up to $60
million will become due on February 26, 1999, with interest payable on the
entire Contingent Note until such date. The actual amount of the contingent
payment and total interest will be determined using an agreed upon formula
based on volumes of certain acquired product lines shipped during the calendar
years 1996 through 1998, as specified in the contingent note agreement.
Texaco Inc. retained substantially all non-current liabilities. PRO FORMA
financial information related to this acquisition is presented on pages 6-7.
(Amounts presented are unaudited and in thousands except per share amounts and
ratios.)
<TABLE>
Condensed Consolidated Results of Operations (1) Six Months Ended
June 30,
-------------------------
1996 1995
--------- ---------
<S> <C> <C>
Net sales $ 541,505 $ 458,821
Cost of goods sold 383,644 306,043
--------- ---------
Gross profit 157,861 152,778
Selling, research, development, testing and
general expenses 83,871 85,651
--------- ---------
Operating profit 73,990 67,127
Interest and financing expenses 12,198 14,017
Other (income), net (955) (248)
--------- ---------
Income before income taxes 62,747 53,358
Income taxes 23,605 18,859
--------- ---------
Net income $ 39,142 $ 34,499
========= =========
Earnings per share $0.33 $0.29
========= =========
Financial Position and Other Data (at end of period) June 30,
-------------------------
1996 1995
--------- ---------
Working capital $ 286,713 $ 261,731
Total assets $1,159,532 $1,024,806
Long-term debt $ 417,077 $ 332,869
Common and other shareholders' equity $ 416,127 $ 405,599
Ratio of earnings to fixed charges (2) 5.23 3.93
</TABLE>
Notes:
1. Four months' results of the worldwide lubricant additives business
acquired from Texaco Inc. on February 29, 1996 are included in the Company's
six months' 1996 results. The financial data at June 30, 1996 includes a
preliminary allocation of purchase price, as well as the borrowing used to
finance the acquisition.
2. For purposes of computing the ratios of earnings to fixed charges,
"earnings" have been determined by adding to income before income taxes, the
interest portion of rent expense, amortization of capitalized interest, and
interest and financing expenses (net of capitalized interest). "Fixed
charges" consist of interest and financing expenses (before deducting
capitalized interest) and the interest portion of rent expense.
<PAGE>
SUMMARY PRO FORMA INFORMATION
The following unaudited PRO FORMA information presents a summary of the
combined results of the Company and the worldwide lubricant additives business
of Texaco Inc. ("Texaco") as if the acquisition had occurred on January 1,
1995, giving effect to adjustments for interest expense that is assumed to
have been incurred to finance the purchase and other purchase accounting
adjustments. The PRO FORMA results are for informational purposes only and
may not necessarily reflect the results of operations of Ethyl had the
acquired business operated as part of the Company for the six months ended
June 30, 1996 and the year ended December 31, 1995. Amounts presented are in
thousands except per share amounts.
<TABLE>
Six Months Ended June 30, 1996
<CAPTION>
Texaco
Historical Additives(a) Adjustments(b) PRO FORMA
(unaudited) (unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C>
Net sales $ 541,505 $ 49,854 $ (679) (c) $ 590,680
Cost of goods sold 383,644 43,140 (831) (c),(d) 425,953
--------- -------- -------- --------
Gross profit 157,861 6,714 152 164,727
Selling, research, development,
testing, and general expenses 83,871 4,985 (2,835) (e) 86,021
--------- -------- -------- --------
Operating profit 73,990 1,729 2,987 78,706
Interest and financing expenses 12,198 582 446 (f) 13,226
Other (income), net (955) - - (955)
--------- -------- -------- --------
Income before income taxes 62,747 1,147 2,541 66,435
Income taxes 23,605 436 966 (g) 25,007
--------- -------- -------- --------
Net Income $ 39,142 $ 711 $ 1,575 $ 41,428
========= ======== ======== ========
Earnings per share $ 0.33 $ 0.35
========= ========
</TABLE>
<TABLE>
Year Ended December 31, 1995
<CAPTION>
Texaco
Historical Additives(a) Adjustments(b) PRO FORMA
(unaudited) (unaudited) (unaudited) (unaudited)
<S> <C> <C> <C> <C>
Net sales $ 960,450 $ 396,312 $ (52,750) (c) $1,304,012
Cost of goods sold 636,056 354,240 (57,681) (c),(d) 932,615
--------- --------- --------- --------
Gross profit 324,394 42,072 4,931 371,397
Selling, research, development,
testing, and general expenses 177,215 39,880 (22,756) (e) 194,339
Special charge 4,750 - - 4,750
--------- --------- --------- --------
Operating profit 142,429 2,192 27,687 172,308
Interest and financing expense 26,833 3,489 5,059 (f) 35,381
Other (income), net (580) (2,714) - (3,294)
--------- --------- --------- --------
Income before income taxes 116,176 1,417 22,628 140,221
Income taxes 42,213 914 8,599 (g) 51,726
--------- --------- --------- --------
Net income $ 73,963 $ 503 $ 14,029 $ 88,495
========= ========= ========= =========
Earnings per share $ 0.62 $ 0.75
========= =========
</TABLE>
<PAGE>
NOTES TO SUMMARY PRO FORMA INFORMATION
a. To reflect the historical results of operations of the acquired
worldwide lubricant additives business of Texaco for the two month
period ended February 29, 1996, and the year ended December 31, 1995.
b. To reflect the PRO FORMA adjustments resulting from the acquisition of
the worldwide lubricant additives business of Texaco for the two month
period ended February 29, 1996, and the year ended December 31, 1995.
c. To eliminate sales and cost of goods sold on transactions between the
Company and Texaco of $679 for the two month period ended February 29,
1996, and $4,072 for the year ended December 31, 1995, as well as to
adjust pre-acquisition revenues and cost of sales by $48,678 to
reflect certain of the acquired business' 1995 blending and packaging
operations pursuant to the Company's agreement to blend and/or package
certain products for Texaco under a tolling arrangement. Such
products processed under the tolling contract between the Company and
Texaco, are neither owned nor sold by the Company but rather are
processed for the benefit of Texaco under a fee arrangement.
d. Includes adjustments to record incremental depreciation and
amortization expense resulting from the preliminary allocation of
purchase price. Also included are expense adjustments related to
pension liabilities assumed. The current allocation, pending further
review of plant rationalization, of the adjusted purchase price of
$134.2 million to the categories of assets acquired and liabilities
assumed is reflected in the following table:
Amounts
Description (In Millions)
-----------
Current assets $ 74.1
Non-current assets 80.3 $ 154.4
-----
Current liabilities $ 18.3
Non-current liabilities 1.9 20.2
----- -----
Net payment to Texaco $ 134.2
======
The estimated useful lives used to depreciate and amortize
non-current assets, by category, are as follows:
Property, plant and equipment - primarily 2 to 12 years
Identifiable intangibles - 5 to 20 years
e. Includes adjustments to selling, general, and administrative
expenses ("SG&A"), as well as research, development and testing
expenses ("R&D"), to reflect the integration of the business and
related efficiencies. The SG&A and R&D expenses of the acquired
business reflect the staffing levels and the number of activities and
R&D tests and other procedures historically conducted by Texaco. The
PRO FORMA staffing and activity levels reflect reductions realized at
the date of acquisition because only a small portion of the SG&A and
the R&D staff employed by Texaco was hired by the Company.
f. To eliminate the historical interest expense of the acquired
lubricant additives business and to record the incremental interest
expense on additional revolving credit debt that would have been
incurred to finance the acquisition assuming that the acquisition
occurred on January 1, 1995. Interest on the PRO FORMA debt was
computed at the weighted average interest rates of 6.51% and 6.04% for
the 1995 and 1996 periods, respectively, based on the Company's
interest rates under its revolving credit agreement.
g. To reflect the estimated income-tax effect for the PRO FORMA
adjustments described in notes (b) through (f) at an assumed combined
state and federal income tax rate of 38%.
<PAGE>
CONSOLIDATED FINANCIAL DATA
The following table sets forth certain condensed consolidated financial data
of the Company for the years ended December 31, 1995 through 1991. The data
are in summary form and, except for the ratios of earnings to fixed charges,
have been derived from the Company's audited consolidated financial
statements. The condensed consolidated financial data have been derived from
and are qualified in their entirety by reference to the financial statements
and other information incorporated herein by reference as described above
under "Incorporation of Certain Documents by Reference." At the close of
business on February 28, 1994, Ethyl completed the spin-off of its
wholly-owned subsidiary, Albemarle, which included the operations of the
olefins and derivatives, bromine chemicals and specialty chemicals businesses.
The condensed consolidated financial data includes the operating results of
Albemarle through the first two months of 1994.
<TABLE>
Condensed Consolidated Results of Operations (1)
(In thousands except per share amounts and ratios)
<CAPTION>
Years Ended December 31,
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Net sales $960,450 $1,174,086 $1,938,390 $1,692,582 $1,534,571
Cost of goods sold 636,056 776,508 1,386,251 1,199,096 1,044,720
------- --------- --------- --------- ---------
Gross profit 324,394 397,578 552,139 493,486 489,851
Selling, research, development,
testing and general expenses 177,215 227,116 348,384 310,164 286,001
Special charges (2) 4,750 2,720 36,150 9,500 11,185
------- --------- --------- --------- ---------
Operating profit 142,429 167,742 167,605 173,822 192,665
Interest and financing expenses 26,833 25,378 44,085 62,279 59,097
(Gain) on sale of 20% of First
Colony Corporation (3) - - - (93,600) -
(Gain) on sale of subsidiary (4) - - (5,871) - -
Other (income) expense, net (580) 1,218 (4,116) (1,475) (1,652)
------- --------- --------- --------- ---------
Income before income taxes,
extraordinary charge, cumulative
effect of accounting changes,
and discontinued insurance
operations 116,176 141,146 133,507 206,618 135,220
Income taxes (5) 42,213 43,391 43,485 99,373 41,168
------- --------- --------- --------- ---------
Income before extraordinary
charge, cumulative effect
of accounting changes and
discontinued insurance
operations 73,963 97,755 90,022 107,245 94,052
Extraordinary after-tax charge
due to early extinguishment
of debt (6) - - (5,000) - -
Cumulative effect of accounting
changes for: (7)
Postretirement health benefits
(net of tax) - - - (34,348) -
Deferred income taxes - - - 19,616 -
------- --------- --------- --------- ---------
Income before discontinued
insurance operations 73,963 97,755 85,022 92,513 94,052
Income from discontinued
insurance operations - - 90,483 162,472 112,616
------- --------- --------- --------- ---------
Net income (8) $73,963 $97,755 $175,505 $254,985 $206,668
======= ========= ========= ========= =========
<PAGE>
Years Ended December 31,
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
Earnings per share:
Income before extraordinary
charge, cumulative effect
of accounting changes and
discontinued insurance
operations $ 0.62 $ 0.83 $ 0.76 $ 0.90 $ 0.80
Extraordinary after-tax charge
due to early extinguishment
of debt - - (0.04) - -
Cumulative effect of
accounting changes - - - (0.12) -
------- --------- --------- --------- ---------
Income before discontinued
insurance operations 0.62 0.83 0.72 0.78 0.80
Income from discontinued
insurance operations - - 0.76 1.37 0.95
------- --------- --------- --------- ---------
Net income $ 0.62 $ 0.83 $ 1.48 $ 2.15 $ 1.75
======= ========= ========= ========= =========
Financial Position and Other Data
(at end of period)
Working capital $242,742 $248,650 $407,182 $327,840 $318,716
======= ======= ======= ======= =======
Total assets:
Excluding discontinued
insurance operations $983,787 $1,030,415 $2,009,198 $1,878,898 $1,570,505
Net assets of discontinued
insurance operations - - - 658,550 909,876
------- --------- --------- --------- ---------
Total assets $983,787 $1,030,415 $2,009,198 $2,537,448 $2,480,381
======= ========= ========= ========= =========
Long-term debt $302,973 $ 349,766 $ 686,986 $ 711,736 $ 810,849
Common and other
shareholders' equity $410,128 $ 390,937 $ 752,581 $1,401,279 $1,219,313
Ratio of earnings to
fixed charges (9) 4.45 4.43 3.13 3.60 2.71
</TABLE>
<PAGE>
Notes To Condensed Consolidated Results of Operations
1. The data includes the operating results and accounts of
Albemarle through the spin-off date at the close of business on
February 28, 1994. The results and net assets of the Insurance
segment spun off in mid-1993 are reported as discontinued insurance
operations.
2. The special charge in 1995 consists of a provision for a
legal settlement (totalling $4,150 after income taxes). 1994 consists
of a $10,720 provision primarily for environmental remediation as well
as other costs, largely offset by the benefit of an $8,000 legal
settlement (totalling $1,690 after income taxes). 1993 includes the
write-down of the Canadian plant and other related costs of $14,200,
costs of work-force reductions in the U.S. and Europe amounting to
$7,635, and $14,315 for downsizing costs of Whitby Research, Inc., and
relocation of employees and other related costs (totalling $22,400
after income taxes). 1992 includes charges for the relocation of the
Petroleum Additives Division R&D personnel ($6,000 after income
taxes). 1991 includes expenses and write-offs of $6,350 resulting
from the discontinuance of certain developmental research programs as
well as expenses of $4,835 covering the relocation of the Petroleum
Additives Division headquarters (totalling $7,000 after income taxes).
3. Results from the December 1992 sale of approximately 20% of
the First Colony Corporation stock ($30,200 after income taxes).
4. The gain reflects the 1993 sale of The Barclay Group ($6,100
after income taxes).
5. 1993 includes a nonrecurring deferred income tax charge of
$2,300 and additional taxes of $1,500 on six months earnings of the
spun-off insurance business, both resulting from Federal income tax
legislation, which increased the corporate income tax rate retroactive
to January 1, 1993. 1993 also includes a $9,300 deferred tax benefit,
which was realized in 1994, attributable to the excess of the tax
basis over the book basis in the stock of Whitby Research, Inc. in
addition to other favorable tax credits.
6. Results from the early redemption of Ethyl's $116.25 million
9 3/8% sinking fund debentures, net of income tax benefit of $3,000.
7. Results from a change in accounting for post retirement
health care benefits ($54,460 before income taxes) and deferred income
taxes pursuant to Financial Accounting Standards Board Statements No.
106 and 109, respectively.
8. 1994 includes a gain on the sale of Ethyl's pharmaceutical subsidiary,
Whitby, Inc. ($4,200 after income taxes) due to an income tax credit
resulting from a higher tax basis than book basis.
9. For purposes of computing the ratios of earnings to fixed
charges, "earnings" have been determined by adding to income before
income taxes, extraordinary charge, cumulative effect of accounting
changes and discontinued insurance operations, the interest portion of
rent expense, amortization of capitalized interest, and interest and
financing expenses (net of capitalized interest). "Fixed charges"
consist of interest and financing expenses (before deducting
capitalized interest) and the interest portion of rent expense. Due
to the immaterial amount of preferred stock dividends in the periods
presented, the ratio of earnings to combined fixed charges and
preferred stock dividends is not presented as this ratio is the same
with or without their inclusion.
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The Debt Securities are to be issued under an Indenture, dated as of
June 15, 1985 (as amended by the First Supplemental Indenture, dated as of
June 15, 1986, and the Second Supplemental Indenture, dated as of December 15,
1994, the "Indenture"), between the Company and First Trust of New York, N.A.,
Trustee (the "Trustee"), a copy of which is filed as an exhibit to the
Registration Statement. The following summaries of certain provisions of the
Indenture do not purport to be complete and are subject to, and are qualified
in their entirety by reference to, all provisions of the Indenture, including
the definitions therein of certain terms. Wherever particular provisions or
defined terms of the Indenture are referred to, such provisions or defined
terms are incorporated herein by reference.
General
The Debt Securities to be offered by this Prospectus are limited to
$300,000,000 in aggregate principal amount (unless any of the Securities are
Original Issue Discount Securities, in which case the aggregate amount is
limited to $300,000,000 in net proceeds to the Company). However, the
Indenture does not limit the amount of Debt Securities which may be issued
thereunder and provides that Debt Securities may be issued from time to time
in one or more series. The Debt Securities will be unsecured obligations of
the Company and will rank on an equal and ratable basis with all other
unsecured and unsubordinated indebtedness of the Company.
The Prospectus Supplement relating to Debt Securities will describe
the following terms of the Debt Securities: (i) the title of the Debt
Securities; (ii) any limit on the aggregate principal amount of the Debt
Securities; (iii) the date or dates on which the Debt Securities will mature;
(iv) the rate or rates at which the Debt Securities will bear interest, if
any, and the date from which such interest will accrue; (v) the dates on which
such interest, if any, will be payable and the Regular Record Dates for such
Interest Payment Dates; (vi) any mandatory or optional sinking fund or
analogous provisions; (vii) any terms for mandatory redemption or for
redemption at the option of the Company or the Holder; (viii) any terms for
conversion into or exchange for Preferred Stock; and (ix) any other terms of
the Debt Securities. Unless otherwise indicated in the Prospectus Supplement,
principal of and any premium and interest on the Debt Securities will be
payable, and transfers of the Debt Securities will be registrable, at the
office of the Trustee at 100 Wall Street, Suite 1600, New York, New York
10005, provided that at the option of the Company payment of interest may be
made by check mailed to the address of the Person entitled thereto as it
appears in the Security Register. (Sections 301, 305 and 1002)
Unless otherwise indicated in the Prospectus Supplement, the Debt
Securities will be issued only in fully registered form without coupons in
denominations of $1,000 or any integral multiple thereof. (Section 302) No
service charge will be made for any registration of transfer or exchange of
Debt Securities, but the Company may require payment of a sum sufficient to
cover any tax or other governmental charge payable in connection therewith.
(Section 305)
Debt Securities may be issued under the Indenture as Original Issue
Discount Securities to be sold at a substantial discount below their principal
amount. Special Federal income tax and other considerations applicable
thereto will be described in the Prospectus Supplement relating thereto.
Restrictive Covenants
Limitations on Liens. Section 1005 of the Indenture provides that so
long as any Debt Securities of any series entitled by their terms to the
benefits of that Section are outstanding, the Company may not, nor may it
permit any Restricted Subsidiary to, incur, issue, assume or guarantee
indebtedness for money borrowed which is secured by any mortgage, security
interest, pledge or lien ("Mortgage") of or upon any Principal Domestic
Property owned by the Company or a Restricted Subsidiary or any shares of
stock or indebtedness for borrowed money of any Restricted Subsidiary without
effectively providing that the Debt Securities shall be secured by such
Mortgage equally and ratably with (or prior to) such indebtedness, unless
after giving effect thereto the aggregate amount of all such indebtedness so
secured after the date of the Indenture together with all Attributable Debt in
respect of Sale and Lease-Back Transactions after the date of the Indenture
involving Principal Domestic Properties owned by the Company or a Restricted
Subsidiary would not exceed 10% of Consolidated Net Tangible Assets. This
<PAGE>
restriction will not apply to: (i) Mortgages on any property, shares of stock
or indebtedness existing at the time of, or within 120 days after, acquisition
thereof (including acquisition through merger or consolidation), purchase
money Mortgages and construction cost Mortgages; (ii) Mortgages in connection
with the issuance of tax-exempt industrial development bonds; (iii) Mortgages
on property of, or on any shares of stock or indebtedness of, a corporation
existing at the time such corporation becomes a Subsidiary; (iv) Mortgages in
favor of the Company or a Restricted Subsidiary; (v) Mortgages for taxes,
assessments or other governmental charges or levies, in each case (x) not then
due or delinquent or (y) the validity of which is being contested in good
faith by appropriate proceedings; and materialmen's, mechanics' and other like
Mortgages, or deposits to obtain the release of such Mortgages; (vi) Mortgages
to secure public or statutory obligations or to secure payment of workers'
compensation claims or to secure performance in connection with tenders,
leases of real property, bids or contracts or to secure (or in lieu of) surety
or appeal bonds and Mortgages made in the ordinary course of business for
similar purposes; or (vii) any extension, renewal or replacement of any
Mortgage referred to in clauses (i) through (vi). (Section 1005)
Limitations on Sale and Lease-Back Transactions. Section 1006 of the
Indenture provides that so long as the Debt Securities of any series entitled
by their terms to the benefits of that Section are outstanding, neither the
Company nor any Restricted Subsidiary may enter into any Sale and Lease-Back
Transaction with respect to a Principal Domestic Property (except for
transactions involving leases for a term, including renewals, of not more than
three years and except for transactions between the Company and a Restricted
Subsidiary or between Restricted Subsidiaries), the acquisition of which, or
completion of construction and commencement of full operation of which, has
occurred more than 120 days prior to such Sale and Lease-Back Transaction,
unless (i) the Company or such Restricted Subsidiary could create indebtedness
secured by a Mortgage on such property pursuant to Section 1005 of the
Indenture (see "Limitations on Liens" above) in an amount equal to the
Attributable Debt with respect to the Sale and Lease-Back Transaction without
equally and ratably securing the Securities, or (ii) within 180 days of the
sale, the Company applies an amount equal to, in the case of a sale or
transfer for cash, the greater of the net proceeds from the sale or the fair
value of the property so sold (as determined by its Board of Directors) and,
in the case of a sale or transfer otherwise than for cash, an amount equal to
such fair value to the retirement of the Debt Securities or other Consolidated
Senior Funded Debt of the Company or a Restricted Subsidiary, subject to
reduction as set forth in the Indenture in respect of Debt Securities and
other Consolidated Senior Funded Debt retired during such 180-day period
otherwise than for mandatory sinking funds and payments at maturity. (Section
1006)
Consolidation, Merger or Sale of Assets of the Company. The Indenture
provides that the Company may consolidate with, sell or convey all or
substantially all of its assets to, or merge with or into any other
corporation, provided that either the Company shall be the continuing
corporation or the successor corporation shall be a corporation organized and
existing under the laws of the United States or a state thereof, and such
successor corporation shall expressly assume, by supplemental indenture
satisfactory to the Trustee, the due and punctual payment of the principal of
and any premium and interest on all the Debt Securities, according to their
tenor, and the due and punctual performance and observance of all the
covenants and conditions of the Indenture to be performed by the Company. The
Company or successor corporation, as the case may be, shall not, immediately
after such merger or consolidation, or such sale or conveyance, be in default
in the performance of any such covenant or condition. The Indenture provides
that if after giving effect to any such consolidation or merger of the Company
with or into any other corporation or to any such sale or conveyance of its
property as an entirety, or substantially as an entirety, any Principal
Domestic Property of the Company or a Restricted Subsidiary or any shares of
stock or indebtedness for borrowed money of any Restricted Subsidiary owned
immediately prior thereto would become subject to a Mortgage and such Mortgage
could not be created pursuant to Section 1005 of the Indenture (see
"Limitations on Liens" above) without equally and ratably securing the Debt
Securities, the Debt Securities shall be equally and ratably secured with (or
prior to) the indebtedness secured by such Mortgage. (Article Eight)
There is no established meaning under New York law, which governs the
Indenture, of the phrase "all or substantially all" as used in Article Eight
of the Indenture. As a result of the lack of precise definition, it is
impossible to predict if a particular transaction would constitute the sale or
conveyance of all or substantially all of the Company's assets.
<PAGE>
Definitions. "Principal Domestic Property" means all real and
tangible personal property owned by the Company or a Restricted Subsidiary
constituting a part of any manufacturing or processing plant or warehouse
located within the United States, exclusive of (i) motor vehicles, mobile
materials-handling equipment and other rolling stock, (ii) office furnishings
and equipment, and information and electronic data processing equipment, (iii)
any property financed through the issuance of tax-exempt industrial
development bonds, (iv) any real property held for development or sale or (v)
any property which in the opinion of the Board of Directors of the Company is
not of material importance to the total business conducted by the Company and
its Restricted Subsidiaries as an entirety. "Restricted Subsidiary" means any
Subsidiary (as defined) of the Company which the Company shall, by written
notice to the Trustee, have designated as a Restricted Subsidiary; the
Indenture provides that the Company shall not permit any Subsidiary to be
designated as a Restricted Subsidiary unless, immediately thereafter, the
Company and its Restricted Subsidiaries could incur, issue, assume or
guarantee additional indebtedness for money borrowed secured by a Mortgage and
no Event of Default, and no event which after notice or lapse of time or both
would become an Event of Default, shall exist. "Unrestricted Subsidiary" means
any Subsidiary not designated as a Restricted Subsidiary and any Restricted
Subsidiary subsequently designated as an Unrestricted Subsidiary; the
Indenture provides that the Company shall not permit any Restricted Subsidiary
to be designated as an Unrestricted Subsidiary unless, immediately thereafter,
the Company and its Restricted Subsidiaries could incur, issue, assume or
guarantee additional indebtedness for money borrowed secured by a Mortgage,
and no Event of Default, and no event which after notice or lapse of time or
both would become an Event of Default, shall exist. "Consolidated Net
Tangible Assets" means (i) the assets of the Company and all Restricted
Subsidiaries (less applicable reserves and other properly deductible items),
minus (ii) current liabilities, goodwill, trade names, trademarks, patents,
unamortized debt discount and expense and similar intangibles, investments in
and advances to Unrestricted Subsidiaries and any minority interest in the
equity of Restricted Subsidiaries, all as determined in accordance with
generally accepted accounting principles. "Attributable Debt" means the total
net amount of rent (discounted from the respective due dates thereof to the
determination date at the rate per annum equal to the interest rate borne by
the Debt Securities of the series in respect of which such determination is
being made) required to be paid during the remaining term of any lease subject
to the limitations on Sale and Lease-Back Transactions. (Sections 101 and
1007)
Events of Default
The following are Events of Default under the Indenture with respect
to Debt Securities of any series: (i) failure to pay principal of or premium,
if any, on any Debt Security of that series when due; (ii) failure to pay any
interest on any Debt Security of that series when due, continued for 30 days;
(iii) failure to deposit any sinking fund payment, when due, in respect of any
Debt Security of that series; (iv) failure to perform any other covenant of
the Company in the Indenture (other than a covenant included in the Indenture
solely for the benefit of a series of Debt Securities other than that series),
continued for 60 days after written notice as provided in the Indenture; (v)
default in payment of any portion of principal of any indebtedness for money
borrowed by the Company or acceleration of any such indebtedness under the
terms of the instrument under which such indebtedness is issued or secured if
such default is not cured or such acceleration is not annulled within 10 days
after written notice as provided in the Indenture; (vi) certain events in
bankruptcy, insolvency or reorganization; and (vii) any other Event of Default
with respect to Debt Securities of that series. (Section 501) If an Event of
Default with respect to Debt Securities of any series at the time Outstanding
occurs and is continuing, either the Trustee or the Holders of at least 25% in
principal amount of the Outstanding Debt Securities of that series may declare
the principal amount (or, if the Securities of that series are Original Issue
Discount Securities, such portion of the principal amount as may be specified
in the terms of that series) of all the Debt Securities of that series to be
due and payable immediately. At any time after a declaration of acceleration
with respect to Debt Securities of any series has been made, but before a
judgment or decree based on acceleration has been obtained, the Holders of a
majority in principal amount of the Outstanding Debt Securities of that series
may, under certain circumstances, rescind and annul such acceleration. (e
502)
The Indenture provides that the Trustee, within 90 days after the
occurrence of a default with respect to any series of the Debt Securities,
shall give to the Holders of the Debt Securities of that series notice of all
uncured defaults known to it; provided that, except in the case of default in
the payment of the principal of or any premium or interest on any Debt
Securities of such series, or in the payment of any sinking fund installment
with respect to 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 the Holders of Debt Securities of such
series. (Section 602)
<PAGE>
The Indenture provides that the Trustee will be under no obligation,
subject to the duty of the Trustee during default to act with the required
standard of care, to exercise any of its rights or powers under the Indenture
at the request or direction of any of the Holders, unless such Holders shall
have offered to the Trustee reasonable indemnity. (Section 603) Subject to
such provisions for indemnification of the Trustee, the Holders of a majority
in principal amount of the Outstanding Debt Securities of any series will have
the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred on the Trustee, with respect to the Debt Securities of that series.
(Section 512)
The Company will be required to furnish to the Trustee annually a
statement as to the performance by the Company of certain of its obligations
under the Indenture and as to any default in such performance. (Section 1008)
Defeasance
Defeasance and Discharge. The Indenture provides that, if so
specified with respect to the Debt Securities of any series, the Company will
be discharged from any and all obligations in respect of the Debt Securities
of such series (except for certain obligations to register the transfer or
exchange of Debt Securities of such series, to replace stolen, lost or
mutilated Debt Securities of such series, to maintain paying agencies and to
hold monies for payment in trust) upon the deposit with the Trustee, in trust,
of money and/or U.S. Government Obligations (as defined) 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
premium, if any), each installment of interest on and any sinking fund
payments on, the Debt Securities of such series on the Stated Maturity (as
defined) of such payments in accordance with the terms of the Indenture and
the Debt Securities of such series. Such a trust may only be established if,
among other things, the Company has delivered to the Trustee an Opinion of
Counsel (who may be an employee of or counsel for the Company) to the effect
that the Debt Securities of such series, if then listed on the New York Stock
Exchange, will not be delisted as a result of such deposit, defeasance and
discharge. (Section 402) In the event of any such defeasance and discharge of
Debt Securities of such series, Holders of Debt Securities of such series
would be able to look only to such trust fund for payment of principal (and
premium, if any), and interest, if any, on their Debt Securities until
maturity. Such defeasance and discharge may be treated as a taxable exchange
of the Debt Securities of such series for an issue of obligations of the trust
or a direct interest in the cash and securities held in the trust. In that
case Holders of the Debt Securities of such series would recognize gain or
loss as if the trust obligations or the cash or securities deposited, as the
case may be, had actually been received by them in exchange for their Debt
Securities. Such Holders thereafter might be required to include in income a
different amount than would be includable in the absence of defeasance and
discharge. Prospective investors are urged to consult their own tax advisors
as to the specific consequences of defeasance and discharge.
Defeasance of Certain Obligations. The Indenture provides that, if so
specified with respect to the Debt Securities of any series, the Company may
omit to comply with the restrictive covenants described under "Restrictive
Covenants$Limitations on Liens and Limitations on Sale and Leaseback
Transactions" if such restrictive covenants are applicable to the Debt
Securities of such series, and any such omission shall not be an Event of
Default with respect to the Debt Securities of such series, upon the deposit
with the Trustee, in trust, of money and/or U.S. Government Obligations (as
defined) 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 premium, if any), each installment of
interest on, and any sinking fund payments on the Debt Securities of such
series on the Stated Maturity (as defined) of such payments in accordance with
the terms of the Indenture and the Debt Securities of such series. The
obligations of the Company under the Indenture and the Debt Securities of such
series other than with respect to the covenants referred to above and the
Events of Default other than the Event of Default referred to above shall
remain in full force and effect. Such a trust may only be established if,
among other things, the Company has delivered to the Trustee an Opinion of
Counsel (who may be an employee of or counsel for the Company) to the effect
that (i) the Holders of the Debt Securities of such series will not recognize
income, gain or loss for federal income tax purposes as a result of such
deposit and defeasance of certain obligations and will be subject to federal
income tax on the same amounts and in the same manner and at the same times,
as would have been the case if such deposit and defeasance had not occurred,
and (ii) the Debt Securities of such series, if then listed on the New York
Stock Exchange, will not be delisted as a result of such deposit and
defeasance. (Section 1010)
<PAGE>
Defeasance and Certain Other Events of Default. In the event the
Company exercises its option to omit compliance 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 any Event of Default other than the Event of Default
described in clause (d) under "Events of Default" with respect to the
restrictive covenants described under "Restrictive CovenantsLimitations on
Liens and Limitations on Sale and Leasebacks," the amount of money and U.S.
Government Obligations (as defined) on deposit with the Trustee will be
sufficient to pay amounts due on the Debt Securities of such series at the
time of their Stated Maturity (as defined) 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 in any
event remain liable for such payments as provided in the Indenture.
Modification and Waiver
Modifications and amendments of the Indenture may be made by the
Company and the Trustee with the consent of the Holders of at least 66 2/3% in
principal amount of the Outstanding Securities of each series affected by such
modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each Outstanding Security
affected thereby, (a) change the stated maturity date of the principal of, or
any installment of principal of or any interest on, any Debt Security, (b)
reduce the principal amount of, or any premium or interest on, any Debt
Security (c) reduce the amount of principal of an Original Issue Discount
Security payable upon acceleration of the Maturity thereof, (d) change the
place or currency of payment of principal of, or any premium or interest on,
any Debt Security, (e) impair the right to institute suit for the enforcement
of any payment on or with respect to any Debt Security, or (f) reduce the
percentage in principal amount of Outstanding Securities of any series, the
consent of whose Holders is required for modification or amendment of the
Indenture or for waiver of compliance with certain provisions of the Indenture
or for waiver of certain defaults. (Section 902)
The Holders of at least 66 2/3% in principal amount of the Outstanding
Securities of any series may on behalf of the Holders of all Debt Securities
of that series waive, insofar as that series is concerned, compliance by the
Company with certain restrictive provisions of the Indenture. (Section 1009)
The Holders of a majority in principal amount of the Outstanding Securities of
any series may on behalf of the Holders of all Debt Securities of that series
waive any past default under the Indenture with respect to that series, except
a default in the payment of the principal of, or any premium or interest on,
any Debt Security of that series or in respect of a provision which under the
Indenture cannot be modified or amended without the consent of the Holder of
each Outstanding Security of that series affected. (Section 513)
Global Securities
The Debt Securities of a series issued under the Indenture may be
issued in whole or in part in the form of one or more global securities (the
"Global Securities") that will be deposited with, or on behalf of, a
depositary (the "Depositary") identified in the Prospectus Supplement relating
to such series. Global Securities may be issued only in fully registered
form and in either temporary or permanent form. Unless and until it is
exchanged in whole or in part for the individual Debt Securities represented
thereby, a Global Security may not be transferred except as a whole by the
Depositary for such Global Security to a nominee of such Depositary or by a
nominee of such Depositary to such Depositary or other nominee of such
Depositary or by the Depositary or any nominee to a successor Depositary or
any nominee of such successor.
The specific terms of the depositary arrangement with respect to a
series of Debt Securities will be described in the Prospectus Supplement
relating to such series. Ethyl anticipates that the following provisions will
generally apply to depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security or its nominee will credit, on its book-entry registration and
transfer system, the respective principal amounts of the individual Debt
<PAGE>
Securities represented by such Global Security to the accounts of persons that
have accounts with such Depositary. Such accounts shall be designated by the
dealers, underwriters or agents with respect to such Debt Securities or by
Ethyl if such Debt Securities are offered and sold directly by Ethyl.
Ownership of beneficial interests in a Global Security will be limited to
persons that have accounts with the applicable Depositary ("participants") or
persons that may hold interests through participants. Ownership of beneficial
interests in such Global Security will be shown on, and the transfer of that
ownership will be effected only through, records maintained by the applicable
Depositary or its nominee (with respect to interests of participants) and the
records of participants (with respect to interests of persons other than
participants). The laws of some states require that certain purchasers of
securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to transfer beneficial interests
in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is
the registered owner of such Global Security, such Depositary or such nominee,
as the case may be, will be considered the sole owner or holder of the Debt
Securities represented by such Global Security for all purposes under the
Indenture governing such Debt Securities. Except as provided below, owners of
beneficial interests in a Global Security will not be entitled to have any of
the individual Debt Securities of the series represented by such Global
Security registered in their names, will not receive or be entitled to receive
physical delivery of any such Debt Securities of such series in definitive
form and will not be considered the owners or holders thereof under the
Indenture governing such Debt Securities.
Payments of principal of, premium, if any, and interest, if any, on
individual Debt Securities represented by a Global Security registered in the
name of a Depositary or its nominee will be made to the Depositary or its
nominee, as the case may be, as the registered owner of the Global Security
representing such Debt Securities. Neither Ethyl, the Trustee for such Debt
Securities, any paying agent (a "Paying Agent"), nor the Registrar for such
Debt Securities will have any responsibility or liability for any aspect of
the records relating to or payments made by the Depositary or any participants
on account of beneficial ownership interests of the Global Security for such
Debt Securities or for maintaining, supervising or reviewing any records
relating to such beneficial ownership interests.
Ethyl expects that the Depositary for a series of Debt Securities or
its nominee, upon receipt of any payment of principal, premium or interest in
respect of a permanent Global Security representing any of such Debt
Securities, immediately will credit participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the
principal amount of such Global Security for such Debt Securities as shown on
the records of such Depositary or its nominee. Ethyl also expects that
payments by participants to owners of beneficial interests in such 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."
Such payments will be the responsibility of such participants.
If the Depositary for a series of Debt Securities is at any time
unwilling, unable or ineligible to continue as depositary and a successor
depositary is not appointed by Ethyl within 90 days, Ethyl will issue
individual Debt Securities of such series in exchange for the Global Security
or Securities representing such series of Debt Securities. In addition, Ethyl
may at any time and in its sole discretion, subject to any limitations
described in the Prospectus Supplement relating to such Debt Securities,
determine not to have any Debt Securities of a series represented by one or
more Global Securities and, in such event, will issue individual Debt
Securities of such series in exchange for the Global Security or Securities
representing such series of Debt Securities. Further, if Ethyl so specifies
with respect to the Debt Securities of a series, an owner of a beneficial
interest in a Global Security representing Debt Securities of such series may,
on terms acceptable to Ethyl, the Trustee, and the Depositary for such Global
Security, receive individual Debt Securities of such series in exchange for
such beneficial interests, subject to any limitations described in the
Prospectus Supplement relating to such Debt Securities. In any such instance,
an owner of a beneficial interest in a Global Security will be entitled to
physical delivery of individual Debt Securities of the series represented by
such Global Security equal in principal amount to such beneficial interest and
to have such Debt Securities registered in its name. Individual Debt
Securities of such series so issued will be issued in denominations, unless
otherwise specified by Ethyl, of $1,000 and integral multiples thereof.
<PAGE>
<PAGE>
DESCRIPTION OF CAPITAL STOCK
General
The authorized stock of the Company consists of 400,000,000 shares of
common stock, par value $1 per share (the "Common Stock") and 10,000,000
shares of Cumulative Preferred Stock, par value $10 per share, issuable in
series. On May 31, 1996, there were 118,443,835 shares of Common Stock
outstanding. No shares of Preferred Stock are currently outstanding.
The following statements with respect to the capital stock of the
Company are subject to the detailed provisions of the Company's Restated
Articles of Incorporation, as amended (the "Restated Articles"), and by-laws
(the "By-Laws") as currently in effect. These statements do not purport to be
complete, or to give full effect to the terms of the provisions of statutory
or common law, and are subject to, and are qualified in their entirety by
reference to, the terms of the Restated Articles, By-Laws and the Rights
Agreement, dated as of September 24, 1987 (the "Rights Agreement"), between
the Company and Sovran Bank N. A. (the current rights agent is Harris Trust
and Savings Bank), which are filed as Exhibits to the Registration Statement
of which this Prospectus is a part.
Preferred Stock
The following description of the terms of the Preferred Stock sets
forth certain general terms and provisions of the Preferred Stock to which a
Prospectus Supplement may relate. Specific terms of any series of the
Preferred Stock offered by a Prospectus Supplement will be described in the
Prospectus Supplement relating to such series of the Preferred Stock. The
description set forth below is subject to and qualified in its entirety by
reference to the Articles of Amendment to the Restated Articles establishing a
particular series of the Preferred Stock which will be filed with the Virginia
State Corporation Commission in connection with the offering of such series of
Preferred Stock.
General. Under the Restated Articles, the Board of Directors of the
Company is authorized, without further shareholder action, to provide for the
issuance of up to 10,000,000 shares of Preferred Stock, in one or more series,
with such voting powers and with such designations, preferences and relative,
participating, optional or other special rights, and qualifications,
limitations or restrictions, as shall be set forth in resolutions providing
for the issue thereof adopted by the Board of Directors. The Company may
amend from time to time its Restated Articles to increase the number of
authorized shares of Preferred Stock. Any such amendment would require the
approval of the holders of a majority of the outstanding shares of Common
Stock, and the approval of the holders of a majority of the outstanding shares
of all series of Preferred Stock voting together as a single class without
regard to series. As of the date of this Prospectus, the Company has no
Preferred Stock outstanding. The Company has designated 2,000,000 shares of
Cumulative Preferred Stock, Series B for possible future issuance pursuant to
the rights agreement described below under "Purchase Rights." Consequently,
the Company presently intends to designate no more than 8,000,000 shares of
any additional series of Preferred Stock.
The Preferred Stock will have the dividend, liquidation, redemption,
conversion and voting rights set forth below unless otherwise provided in the
Prospectus Supplement relating to a particular series of the Preferred Stock.
Reference is made to the Prospectus Supplement relating to the particular
series of the Preferred Stock offered thereby for specific terms, including:
(i) the title and liquidation preference per share of such Preferred Stock and
the number of shares offered; (ii) the price at which such Preferred Stock
will be issued; (iii) the dividend rate (or method of calculation), the dates
on which dividends shall be payable and the dates from which dividends shall
commence to accumulate; (iv) any redemption or sinking fund provisions of such
Preferred Stock; (v) any conversion provisions of such Preferred Stock; and
(vi) any additional dividend, liquidation, redemption, sinking fund and other
rights, preferences, privileges, limitations and restrictions of such
Preferred Stock.
The Preferred Stock will, when issued, be fully paid and nonassessable.
Unless otherwise specified in the Prospectus Supplement relating to a
particular series of the Preferred Stock, each series of the Preferred Stock
will rank on a parity as to dividends and distributions in the event of a
liquidation with the outstanding shares of Preferred Stock of the Company.
<PAGE>
Dividend Rights. Holders of the Preferred Stock of each series will
be entitled to receive, when, as and if declared by the Board of Directors,
out of assets of the Company legally available therefor, cash dividends at
such rates and on such dates as are set forth in the Prospectus Supplement
relating to such series of the Preferred Stock. Such rate may be fixed or
variable or both. Each such dividend will be payable to the holders of record
as they appear on the stock books of the Company on such record dates as will
be fixed by the Board of Directors or a duly authorized committee thereof.
Dividends on all series of the Preferred Stock will be cumulative.
If the Prospectus Supplement so provides, no dividends will be
declared or paid or set apart for payment on the Preferred Stock of any series
ranking, as to dividends, on a parity with or junior to any other series of
Preferred Stock for any period unless full dividends have been or
contemporaneously are declared and paid, or declared and a sum sufficient for
the payment thereof set apart for such payment, on such other series of
Preferred Stock for the then-current dividend payment period and, if such
other Preferred Stock is cumulative, all other dividend payment periods
terminating on or before the date of payment of such full dividends. When
dividends on all shares of Preferred Stock for any dividend period are not
paid in full, all such shares will participate ratably in any partial payment
for such period in proportion to the full amounts for such period. Except as
provided in the preceding sentence, unless full dividends, including
accumulations in respect of prior dividend payment periods, on all outstanding
shares of any series of the Preferred Stock have been paid, no dividends
(other than, if the Prospectus Supplement so provides, in shares of Common
Stock or another stock ranking junior to such series of the Preferred Stock)
will be declared or paid or set aside for payment or other distributions made
upon the Common Stock or any other stock of the Company ranking junior to such
series of Preferred Stock.
Each series of Preferred Stock will be entitled to dividends as
described in the Prospectus Supplement relating to such series, which may be
based upon one or more methods of determination. Different series of the
Preferred Stock may be entitled to dividends at different dividend rates or
based upon different methods of determination. Except as provided herein and
in the Prospectus Supplement, the Preferred Stock will not be entitled to
participate in the earnings and assets of the Company.
Rights Upon Liquidation. In the event of any voluntary or involuntary
liquidation, dissolution or winding up of the Company, the holders of each
series of Preferred Stock will be entitled to receive, out of the assets of
the Company available for distribution to shareholders, liquidating
distributions in the amount set forth in the Prospectus Supplement relating to
such series of the Preferred Stock. The holders of any series of the
Preferred Stock will not be entitled to receive any assets of the Company upon
any liquidation, dissolution or winding up of the Company unless and until the
liquidation preference is paid to the holders of any Preferred Stock ranking
senior to the series of Preferred Stock. If the Prospectus Supplement so
provides, if, upon any voluntary or involuntary liquidation, dissolution or
winding up of the Company, the amounts payable with respect to the Preferred
Stock of any series and any other shares of stock of the Company ranking as to
any such distribution on a parity with such series of the Preferred Stock are
not paid in full, the holders of the Preferred Stock of such series and of
such other shares will share ratably in any such distribution of assets of the
Company in proportion to the full respective preferential amounts to which
they are entitled. Upon any liquidation, dissolution or winding up, after the
holders of the Preferred Stock have been paid the specified liquidation
preference, such holders will have no right or claim to any of the remaining
assets of the Company.
Redemption. A series of the Preferred Stock may be redeemable, in
whole or in part, at the option of the Company, and may be subject to
mandatory redemption pursuant to a sinking fund, in each case upon terms, at
the times, the redemption prices and for the types of consideration set forth
in the Prospectus Supplement relating to such series.
The Prospectus Supplement relating to a series of Preferred Stock
which is subject to mandatory redemption shall specify the number of shares of
such series of Preferred Stock that shall be redeemed by the Company in each
year commencing after a date to be specified, at a redemption price per share
to be specified, together with an amount equal to any accrued and unpaid
dividends thereon to the date of redemption.
Except as indicated in the Prospectus Supplement relating to any
series of the Preferred Stock, the Preferred Stock is not subject to any
mandatory redemption at the option of the holder.
<PAGE>
Conversion Rights. The Prospectus Supplement for any series of the
Preferred Stock will state the terms, if any, on which shares of that series
are convertible into shares of Common Stock or another series of Preferred
Stock of the Company. The Preferred Stock will have no preemptive rights.
Voting Rights. Except as indicated below or in the Prospectus
Supplement relating to a particular series of Preferred Stock, or except as
expressly required by applicable law, a holder of the Preferred Stock will not
be entitled to vote. Except as indicated in the Prospectus Supplement
relating to a particular series of Preferred Stock, in the event the Company
issues full shares of any series of Preferred Stock, each such share will be
entitled to one vote on matters on which holders of such series of the
Preferred Stock are entitled to vote.
Unless otherwise provided in the Prospectus Supplement, the affirmative
vote of the holders of a majority of the outstanding shares of all series of
Preferred Stock, voting as a separate voting group, will be required for any
amendment of the Restated Articles (or any certificate amendatory thereof or
supplemental thereto relating to any series of the Preferred Stock) which
changes any rights or preferences of such series of Preferred Stock.
In addition to the foregoing voting rights, under Virginia law as now
in effect, the holders of the Preferred Stock will have the voting rights set
forth under "General" above with respect to amendments to the Restated
Articles which would increase the number of authorized shares of Preferred
Stock of the Company.
Transfer Agent and Registrar. The transfer agent, registrar and
dividend disbursement agent for a series of the Preferred Stock will be
selected by the Company and be described in the applicable Prospectus
Supplement. The registrar for shares of Preferred Stock will send notices to
shareholders of any meetings at which holders of the Preferred Stock have the
right to vote on any matter.
Common Stock
Subject to the rights of holders, if any, of Preferred Stock, holders
of Common Stock are entitled to dividends as declared by the Board of
Directors from time to time after payment of, or provision for, full
cumulative dividends on and any required redemptions of shares of Preferred
Stock then outstanding. Holders of Common Stock are entitled to one vote per
share and may not cumulate votes for the election of directors. Holders of
Common Stock have preemptive or subscription rights except they have no right
to purchase or subscribe to shares of the Preferred Stock and any shares that
may be issued upon conversion of the Preferred Stock. Holders of Common Stock
have no liability for further calls or assessments. In the event of the
liquidation, dissolution or winding up of the Company, holders of Common Stock
are entitled to receive pro rata all the remaining assets of the Company
available for distribution, after satisfaction of the prior preferential
rights of the Preferred Stock and the satisfaction of all debts and
liabilities of the Company.
The Transfer Agent and Registrar for the Common Stock is Harris Trust
and Savings Bank.
Certain Provisions of the Restated Articles and By-Laws
Special meetings of shareholders may be called only by a majority of
the Board of Directors or by designated officers. Directors may be removed
with or without cause, and vacancies on the Board of Directors, including any
vacancy created by an increase in the number of Directors, may be filled by
the Board of Directors unless the vacancy is to be filled at a meeting of
shareholders. The By-Laws require that advance notice of nominees for
election as Directors to be made by any shareholder be given to the Secretary
of the Company, together with certain specified information, no later than 60
days before an annual meeting of shareholders or seven days following notice
of a special meeting of shareholders for the election of Directors. The
provisions of the Restated Articles and By-Laws described above may, in
certain circumstances, make more difficult or discourage a takeover of the
Company.
<PAGE>
Purchase Rights
Pursuant to a rights agreement dated September 24, 1987, the Company
distributed one Preferred Stock, Series B purchase right ("Right") for each
outstanding share of Common Stock to the shareholders of record on October 5,
1987. Unless the Board of Directors directs otherwise, one Right will be
issued with respect to each share of Common Stock that becomes outstanding
prior to the occurrence of certain potential change-in-control events. The
Rights become exercisable upon certain potential change-in-control events.
When exercisable, the Rights entitle holders to purchase 2.522 one-thousandth
of a share (subject to adjustment) of Preferred Stock, Series B, and upon the
occurrence of certain events, the Rights entitle holders to purchase shares of
Common Stock at a substantial discount. Exercise of the Rights will cause
substantial dilution to a person or group attempting to acquire control of the
Company without the approval of the Board of Directors. Except under certain
circumstances, the Board of Directors may cause the Company to redeem the
Rights in whole, but not in part, at a price of $.01 per Right. The Rights
expire on September 24, 1997, if not redeemed earlier. The Rights have no
voting or dividend privileges. Until such time as the Rights become
exercisable, they are attached to and do not trade separately from the Common
Stock.
DESCRIPTION OF DEPOSITARY SHARES
Each Depositary Share will represent a fraction of a share of Preferred
Stock deposited under a Deposit Agreement (the "Deposit Agreement"), to be
entered into by the Company, a depositary and the holders from time to time of
Depositary Receipts (as defined) issued thereunder. Subject to the terms of
the Deposit Agreement, each owner of a Depositary Share will be entitled,
proportionately, to all the rights and preferences of the Preferred Stock
represented thereby contained in the Company's articles of incorporation.
The Depositary Shares will be evidenced by depositary receipts issued
pursuant to the Deposit Agreement ("Depositary Receipts"). The above
description of the Depositary Shares is not complete and is subject to, and
qualified in its entirety by, the description in the applicable Prospectus
Supplement and the provisions of the Deposit Agreement (which will contain the
form of the Depositary Receipt).
PLAN OF DISTRIBUTION
The Company may sell Offered Securities to one or more underwriters
for public offering and sale by them or may sell Offered Securities to
investors directly or through agents. Any such underwriter or agent involved
in the offer and sale of the Offered Securities will be named in the
Prospectus Supplement.
Underwriters may offer and sell the Offered Securities at a fixed
price or prices, which may be changed, or from time to time at market prices
prevailing at the time of sale, at prices related to such prevailing market
prices or at negotiated prices. The Company also may, from time to time,
authorize underwriters acting as agents to offer and sell the Offered
Securities upon the terms and conditions set forth in any Prospectus
Supplement. In connection with the sale of Offered Securities, underwriters
may be deemed to have received compensation from the Company in the form of
underwriting discounts or commissions and may also receive commissions from
purchasers of Offered Securities for whom they may act as agent. Underwriters
may sell Offered Securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions
(which may be changed from time to time) from the underwriters and/or from the
purchasers for whom they may act as agent.
Any underwriting compensation paid by the Company to underwriters or
agents in connection with the offering of Offered Securities and any
discounts, concessions or commissions allowed by underwriters to participating
dealers will be set forth in the Prospectus Supplement. Underwriters, dealers
and agents participating in the distribution of the Offered Securities may be
deemed to be underwriters, and any discounts and commissions received by them
and any profit realized by them on resale of the Offered Securities may be
deemed to be underwriting discounts and commissions under the Securities Act.
<PAGE>
Underwriters, dealers and agents may be entitled, under agreements entered
into with the Company, to indemnification against and contribution toward
certain civil liabilities, including liabilities under the Securities Act.
If so indicated in the Prospectus Supplement, the Company will
authorize dealers acting as the Company's agents to solicit offers by certain
institutions to purchase Offered Securities from the Company at the public
offering price set forth in the Prospectus Supplement pursuant to Delayed
Delivery Contracts ("Contracts") providing for payment and delivery on the
date or dates stated in the Prospectus Supplement. Each Contract will be for
an amount not less than, and the principal amount of Offered Securities sold
pursuant to Contracts shall not be less nor more than, the respective amounts
stated in the Prospectus Supplement. Institutions with which Contracts, when
authorized, may be made include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions and other institutions, but will in all cases be subject to the
approval of the Company. Contracts will not be subject to any conditions
except (i) the purchase by an institution of the Offered Securities covered by
its Contract shall not at the time of delivery be prohibited under the laws of
any jurisdiction in the United States to which such institution is subject and
(ii) the Company shall have sold to such underwriters the total principal
amount of the Offered Securities less the principal amount thereof covered by
Contracts. A commission indicated in the Prospectus Supplement will be
granted to agents and underwriters soliciting purchases of Offered Securities
pursuant to Contracts accepted by the Company. Agents and underwriters shall
have no responsibility in respect of the delivery or performance of Contracts.
Certain of the underwriters and their affiliates may be customers of,
engage in transactions with, and perform services for, the Company in the
ordinary course of business.
VALIDITY OF SECURITIES
The validity of the Securities will be passed upon for the Company by
Hunton & Williams, Richmond, Virginia, and for the Underwriters by counsel to
be selected by the Underwriters.
At September 1, 1996, partners and associates of Hunton & Williams who
participated in the preparation of this Prospectus owned, in the aggregate,
6,912 shares of the Common Stock of the Company.
EXPERTS
The consolidated balance sheets as of December 31, 1995 and 1994 and
the consolidated statements of income, stockholders' equity and cash flows for
each of the three years in the period ended December 31, 1995, included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1995 and
the historical combined financial statements of the Texaco Additive Group of
Companies for the year ended December 31, 1995, included in the Company's May
13, 1996 filing on Form 8-K/A, both incorporated by reference in this
prospectus, have been incorporated herein in reliance on the reports of
Coopers & Lybrand L.L.P., independent accountants, given on the authority of
that firm as experts in accounting and auditing.
<PAGE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 16. Exhibits
1 Form of Underwriting Agreement.*
4.1 Indenture, dated as of June 15, 1985, between Ethyl Corporation and
First Trust of New York, N.A. (formerly, Morgan Guaranty Trust Company
of New York), as Trustee (filed as Exhibit 4.1 to the registrant's
Registration Statement on Form S-3 (No. 33-19184), and incorporated
herein by reference).
4.2 First Supplemental Indenture, dated as of June 15, 1986, between Ethyl
Corporation and First Trust of New York, N.A. (formerly, Morgan
Guaranty Trust Company of New York), as Trustee (filed as Exhibit 4.2
to the registrant's Registration Statement on Form S-3 (No. 33-19184),
and incorporated herein by reference).**
4.3 Second Supplemental Indenture, dated as of December 15, 1994, between
Ethyl Corporation and First Trust of New York, N.A., as Trustee.**
5 Opinion of Hunton & Williams.**
12 Ethyl Corporation and Subsidiaries-Computation of Ratio of Earnings to
Fixed Charges for Each of the Five Years in the Period Ended December
31, 1995 and the Six Month Periods Ended June 30, 1996 and 1995.
23.1 Consent of Coopers & Lybrand L.L.P. (Ethyl Corporation 1995 Form
10-K).
23.2 Consent of Coopers & Lybrand L.L.P. (Texaco Additives Group of
Companies 1995 Financial Statements,included in Form 8-K/A filed May
13, 1996).
23.3 Consent of Hunton & Williams
24 Powers of attorney.**
25 Form T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of First Trust of New York, N.A., as Trustee. **
99 Exhibit 7 to Form T-1 Statement of Eligibility and Qualification under
the Trust Indenture Act of 1939 of First Trust of New York, N.A., as
Trustee.
_________________________
* To be filed by amendment.
**Previously filed.<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Ethyl Corporation
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Amendment No. 2
to the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Richmond, State of Virginia on the
18 day of September, 1996.
Ethyl Corporation,
(Registrant)
By /s/ Charles B. Walker
(Charles B. Walker,
Vice Chairman of the Board,
Chief Financial Officer and
Treasurer)<PAGE>
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this Amendment No.
2 to the Registration Statement has been signed below by the following persons
in the capacities indicated and on the 18 day of September, 1996.
Signature Title
/s/ Bruce C. Gottwald*
(Bruce C. Gottwald) Chairman of the Board and
Executive Committee and
Director (Principal
Executive Officer)
/s/ Charles B. Walker*
(Charles B. Walker) Vice Chairman of the Board,
Chief Financial Officer,
Treasurer and Director
(Principal Financial
Officer)
/s/ Wayne C. Drinkwater*
(Wayne C. Drinkwater) Controller (Principal
Accounting Officer)
/s/ William W. Berry*
(William W. Berry) Director
(Phyllis L. Cothran) Director
/s/ Thomas E. Gottwald*
(Thomas E. Gottwald) President and Director
(Principal Operating
Officer)
/s/ Gilbert M. Grosvenor*
(Gilbert M. Grosvenor) Director
/s/ Sidney Buford Scott*
(Sidney Buford Scott) Director
*By: /s/ Charles B. Walker
Charles B. Walker
Attorney-in-fact<PAGE>
<PAGE>
EXHIBIT INDEX
Exhibit
Number Exhibit
12 Ethyl Corporation and Subsidiaries-Computation of Ratio of Earnings
to Fixed Charges for Each of the Five Years in the Period Ended
December 31, 1995 and the Six Month Periods Ended June 30, 1996 and
1995.
23.1 Consent of Coopers & Lybrand L.L.P. (Ethyl Corporation 1995 Form
10-K).
23.2 Consent of Coopers & Lybrand L.L.P. (Texaco Additives Group of
Companies 1995 Financial Statements, included in Form 8-K/A, filed
May 13, 1996).
23.3 Consent of Hunton & Williams
99 Exhibit 7 to Form T-1 Statement of Eligibility and Qualification
under the Trust Indenture Act of 1939 of First Trust of New York,
N.A., as Trustee.
<PAGE>
<TABLE>
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Exhibit 12
(IN 000'S OF DOLLARS EXCEPT FOR RATIOS)
<CAPTION>
Six Months Ended
June 30, Years Ended December 31,
------------------ -------------------------------------------------------------
EARNINGS 1996 1995 1995 1994 1993 1992 1991
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME BEFORE INCOME TAXES,
EXTRAORDINARY CHARGE, CUMULATIVE
EFFECT OF ACCOUNTING CHANGES AND
DISCONTINUED INSURANCE OPERATIONS $62,747 $53,358 $116,176 $141,146 $133,507 $206,618 $135,220
INTEREST EXPENSE (NET) 12,198 14,017 26,833 25,378 44,085 62,279 59,097
PORTION OF RENTS REPRESENTATIVE OF
INTEREST FACTOR 2,460 2,298 4,511 5,706 9,896 9,021 7,067
AMORTIZATION OF CAPITALIZED INTEREST 920 888 1,878 1,294 3,246 2,807 2,266
------ ------ ------- ------- ------- ------- -------
TOTAL EARNINGS $78,325 $70,561 $149,398 $173,524 $190,734 $280,725 $203,650
====== ====== ======= ======= ======= ======= =======
FIXED CHARGES
INTEREST EXPENSE (BEFORE DEDUCTING
CAPITALIZED INTEREST) $12,516 $15,652 $29,056 $33,438 $50,949 $69,042 $68,061
PORTION OF RENTS REPRESENTATIVE OF
INTEREST FACTOR 2,460 2,298 4,511 5,706 9,896 9,021 7,067
------ ------ ------ ------ ------- ------ ------
TOTAL FIXED CHARGES $14,976 $17,950 $33,567 $39,144 $60,845 $78,063 $75,128
====== ====== ====== ====== ====== ====== ======
RATIO OF EARNINGS TO FIXED CHARGES 5.2300 3.9310 4.4507 4.4330 3.1348 3.5961 2.7107
====== ====== ====== ====== ====== ====== ======
</TABLE>
Exhibit 23.1
Consent of Independent Accountants
We consent to the incorporation by reference in this registration statement of
Ethyl Corporation on Amendment No. 2 to Form S-3 (File No. 33-57243) of our
report dated January 29, 1996, on our audits of the consolidated financial
statements of Ethyl Corporation and Subsidiaries as of December 31, 1995 and
1994, and for the years ended December 31, 1995, 1994 and 1993, appearing on
page 45 of the Ethyl Corporation 1995 Annual Report, which report is
incorporated by reference in the Annual Report on Form 10-K. We also consent
to the reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
Richmond, Virginia
September 16, 1996
<PAGE>
Exhibit 23.2
Consent of Independent Accountants
We consent to the incorporation by reference in this registration statement of
Ethyl Corporation on Amendment No. 2 to Form S-3 (File No. 33-57243) of our
report dated March 11, 1996, on our audit of the combined financial statements
of the Texaco Additive Group of Companies as of and for the year ended
December 31, 1995, which report is contained in the Ethyl Corporation Form
8-K/A dated February 29, 1996. We also consent to the reference to our firm
under the caption "Experts."
COOPERS & LYBRAND L.L.P.
Houston, Texas
September 16, 1996
Exhibit 23.3
HUNTON & WILLIAMS
Riverfront Plaza, East Tower
951 East Byrd Street
Richmond, Virginia 23219-4074
Telephone (804) 788-8200
Facsimile (804) 788-8218
September 18, 1996
Ethyl Corporation
330 South Fourth Street
P.O. Box 2189
Richmond, Virginia 23219
Ethyl Corporation --
Registration Statement on Form S-3
Dear Sirs:
We have acted as counsel to Ethyl Corporation, a Virginia corporation (the
"Company"), in connection with the registration by the Company of (a) an
aggregate of $300,000,000 of its (i) unsecured senior debt securities and (ii)
shares of its Cumulative Second Preferred Stock, par value $10 per share and
(b) an indeterminate number of preferred depositary shares of the Company to
be evidenced by depositary receipts, as set forth in Amendment No. 2 to the
Registration Statement on Form S-3 (the "Registration Statement") that is
being filed with the Securities and Exchange Commission (the "Commission") by
the Company pursuant to the Securities Act of 1933, as amended.
We hereby confirm our consent to the filing of the January 11, 1995
opinion of this firm with the Commission as an exhibit to the Registration
Statement and to the statement made in reference to this firm under the
caption "Validity of Securities" in the Registration Statement.
Very truly yours,
/s/ Hunton & Williams
<PAGE>
Exhibit 99
----------
Exhibit 7
---------
First Trust of New York, N.A.
Statement of Financial Condition
As of 03/31/96
($000's)
Assets 03/31/96
--------
Cash and Due From Depository Institutions $ 23,596
Federal Reserve Stock 3,600
Fixed Assets 764
Intangible Assets 84,233
Other Assets 9,068
--------
Total Assets $121,261
========
Liabilities
Other Liabilities 2,533
--------
Total Liabilities 2,553
Equity
Common and Preferred Stock 1,000
Surplus 120,932
Undivided Profile (3,224)
--------
Total Equity Capital 118,708
Total Liabilities and Equity Capital $121,261
========
===============================================================================
To the best of the undersigned's determination, as of this date the above
financial information is true and correct.
First Trust of New York, N.A.
By: /s/ Ward A Spooner
Ward A. Spooner
Vice President
Date: August 19, 1996
