GOODRICH B F CO, 424B2, 1999-05-03

GOODRICH B F CO
424B2, 1999-05-03
GUIDED MISSILES & SPACE VEHICLES & PARTS

Previous: GENUINE PARTS CO, 10-Q, 1999-05-03

Next: ENERGY WEST INC, SC 13G, 1999-05-03

<PAGE> 1

File Pursuant To Rule 424(b)(2)
Registration No. 333-77199
PROSPECTUS SUPPLEMENT
(To Prospectus dated April 30, 1999)

$200,000,000
The B.F.Goodrich Company
6.60% NOTES DUE 2009
------------------------

Interest payable on May 15 and November 15
------------------------

WE MAY REDEEM THE NOTES IN WHOLE OR IN PART, AT ANY TIME PRIOR TO MATURITY AT
THE REDEMPTION PRICES SET FORTH IN THIS PROSPECTUS SUPPLEMENT
------------------------

INVESTING IN THE NOTES INVOLVES RISKS. SEE "RISK FACTORS" BEGINNING ON PAGE 5 OF
THE ACCOMPANYING PROSPECTUS.
------------------------

PRICE 99.881% AND ACCRUED INTEREST, IF ANY
------------------------

<TABLE>
<CAPTION>
Underwriting
Price to Discounts Proceeds to
Public and Commissions Company
------------ --------------- ------------
<S> <C> <C> <C>
Per Note................... 99.881% .650% 99.231%
Total...................... $199,762,000 $1,300,000 $198,462,000
</TABLE>

The Securities and Exchange Commission and state securities regulators have not
approved or disapproved these securities, or determined if this prospectus
supplement or the accompanying prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.

The Underwriters expect to deliver the notes to purchasers on May 5, 1999.

------------------------

MORGAN STANLEY DEAN WITTER
GOLDMAN, SACHS & CO.
J.P. MORGAN & CO.
NATIONSBANC MONTGOMERY SECURITIES LLC
SALOMON SMITH BARNEY

April 30, 1999
<PAGE> 2

------------------------

TABLE OF CONTENTS

PROSPECTUS SUPPLEMENT

BFGoodrich.................................................. S-3

Corporate Developments...................................... S-3

Use of Proceeds............................................. S-3

Description of the Notes.................................... S-3

Underwriters................................................ S-6

Validity of the Notes....................................... S-7
</TABLE>

PROSPECTUS

About This Prospectus....................................... 3

Where You Can Find More Information......................... 3

Forward-Looking Statements.................................. 4

Recent Developments......................................... 4

Risk Factors................................................ 5

The Company................................................. 7

Use of Proceeds............................................. 8

Ratio of Earnings to Fixed Charges.......................... 8

Description of Debt Securities.............................. 8

Plan of Distribution........................................ 16

Legal Opinions.............................................. 18

Experts..................................................... 18

Unaudited Pro Forma Condensed Combined Financial
Statements................................................ F-1
</TABLE>

------------------------

You should rely only on the information contained or incorporated by
reference in the prospectus supplement and the accompanying prospectus. We have
not, and the Underwriters have not, authorized any other person to provide you
with different information. If anyone provides you with different or
inconsistent information, you should not rely on it. We are not, and the
Underwriters are not, making an offer to sell these securities in any
jurisdiction where the offer or sale is not permitted. The information in this
prospectus supplement and the accompanying prospectus is accurate only as of the
date of dates on the fronts of the documents, regardless of the time of delivery
of this prospectus or any sale of the Notes.

S-2
<PAGE> 3

BF GOODRICH

We manufacture and supply a wide variety of systems and component parts for
the aerospace industry and provide maintenance, repair and overhaul services on
commercial, regional, business and general aviation aircraft. We also
manufacture specialty plastics and specialty additives products for a variety of
end-user applications. In 1998, we had sales of $4.0 billion. We are organized
into two principal business segments: Aerospace and Performance Materials. We
maintain patent and technical assistance agreements, licenses and trademarks on
our products, process technologies and expertise in most of the countries in
which we operate.

Our principal executive offices are located at 4020 Kinross Lakes Parkway,
Richfield, Ohio 44286-9368 (telephone (330) 659-7600). We were incorporated
under the laws of the State of New York on May 2, 1912 as the successor to a
business founded in 1870.

CORPORATE DEVELOPMENTS

Our net income for the first quarter of 1999 was $65.8 million (excluding
special items), or 88 cents per diluted share, representing a 21% increase over
our first quarter 1998 net income of $54.2 million, or 77 cents per diluted
share. In addition, sales in the first quarter of 1999 increased to $1,035.6
million from $937.7 million in the first quarter of 1998.

On April 9, 1999, our shareholders and the shareholders of Coltec
Industries overwhelmingly approved the merger of the two companies.

You should see the discussions under "Recent Developments" and "Risk
Factors" in the accompanying prospectus, as well as the documents referred to in
"Where You Can Find More Information" in the accompanying prospectus for further
information regarding us and the merger.

USE OF PROCEEDS

We intend to use the net proceeds from the sale of the Notes (estimated to
be approximately $198,177,000 after deduction of the underwriting discounts and
commissions and expenses payable by us) primarily to retire short-term debt
which we borrow on an overnight revolving basis. The debt bears interest at a
floating rate, currently approximately 5.2%. The amount of these borrowings
fluctuates from day to day. As of April 28, 1999, these borrowings totalled
approximately $147,600,000. Any proceeds not used to retire this indebtedness
will be used for general corporate purposes.

DESCRIPTION OF THE NOTES

The 6.60% Notes due 2009 (the "Notes") are a series of the "Debt
Securities" described in the accompanying prospectus. The following is a
description of the particular terms of the Notes. It should be read together
with the description of the general terms and provisions of the Debt Securities
set forth in the prospectus. If the description in this prospectus supplement
differs from the description in the prospectus, the description in this
prospectus supplement will control.

The Notes will be issued under an Indenture, dated as of May 1, 1991, as
amended or supplemented, between BFGoodrich and Harris Trust and Savings Bank,
as Trustee.

PRINCIPAL

The Notes will have a total principal amount of $200,000,000.

S-3
<PAGE> 4

The maturity date for the Notes will be May 15, 2009.

INTEREST

The Notes will bear interest at 6.60% per year, initially accruing from May
5, 1999.

We will pay interest on the Notes every May 15 and November 15, beginning
November 15, 1999 to the persons in whose names the Notes are registered as of
the close of business on the preceding May 1 or November 1.

OPTIONAL REDEMPTION

We may redeem the Notes at our option at any time, as a whole or in part,
at a redemption price equal to the greater of (1) 100% of their principal amount
or (2) the sum of the present values of the remaining scheduled payments of
principal and interest thereon discounted to the date of redemption on a
semi-annual basis (assuming a 360-day year consisting of twelve 30-day months)
at the treasury rate plus 15 basis points, plus, in either case, accrued and
unpaid interest on the principal amount being redeemed to the redemption date.

The "treasury rate" means, with respect to any redemption date, (1) the
yield, under the heading which represents the average for the immediately
preceding week, appearing in the most recently published statistical release
designated "H.15(519)" or any successor publication which is published weekly by
the Board of Governors of the Federal Reserve System and which establishes
yields on actively traded United States Treasury securities adjusted to constant
maturity under the caption "Treasury Constant Maturities," for the maturity
corresponding to the comparable treasury issue (if no maturity is within three
months before or after the remaining life of the Notes, yields for the two
published maturities most closely corresponding to the comparable treasury issue
shall be determined and the treasury rate shall be interpolated or extrapolated
from such yields on a straight line basis, rounding to the nearest month) or (2)
if such release (or any successor release) is not published during the week
preceding the calculation date or does not contain such yields, the rate per
annum equal to the semi-annual equivalent yield to maturity of the comparable
treasury issue (expressed as a percentage of its principal amount) equal to the
comparable treasury price for the redemption date. The treasury rate shall be
calculated on the third business day preceding the redemption date.

The "comparable treasury issue" means the United States Treasury security
selected by an independent investment banker as having a maturity comparable to
the remaining life of the Notes to be redeemed that would be used, at the time
of selection and in accordance with customary financial practice, in pricing new
issues of corporate debt securities of comparable maturity to the remaining life
of the Notes.

The "independent investment banker" means Morgan Stanley & Co. Incorporated
or, if such firm is unwilling or unable to select the comparable treasury issue,
an independent investment banking institution of national standing appointed by
the Trustee.

The "comparable treasury price" means (1) the average of five reference
treasury dealer quotations for such redemption date, after excluding the highest
and lowest reference treasury dealer quotations, or (2) if the independent
investment banker obtains fewer than five such reference treasury dealer
quotations, the average of all such quotations.

The "reference treasury dealer" means (1) Morgan Stanley & Co.
Incorporated, Goldman, Sachs & Co., J.P. Morgan Securities Inc., NationsBanc
Montgomery Securities LLC and Salomon Smith Barney Inc. and their respective
successors, provided, however, that if any of the foregoing shall cease to be a
U.S. Government securities dealer in New York City (a "primary treasury
dealer"), we shall substitute another primary treasury dealer and (2) any

S-4
<PAGE> 5

other primary treasury dealer selected by the independent investment banker
after consultation with us.

The "reference treasury dealer quotation" means, with respect to each
reference treasury dealer and any redemption date, the average, as determined by
the independent investment banker, of the bid and asked prices for the
comparable treasury issue (expressed in each case as a percentage of its
principal amount) quoted in writing to the independent investment banker at 5:00
p.m., New York City time, on the third business day preceding such redemption
date.

ADDITIONAL TERMS

The Notes will be issued only in registered form in multiples of $1,000.

The Notes will not be subject to any sinking fund.

Any payment required to be made with respect to the Notes on a day that is
not a business day will be made on the next succeeding business day as if it had
been made on such day, and no interest shall accrue from and after that day to
the date of payment.

A "business day" means any day that is not a Saturday or Sunday and that is
not a day on which banking institutions are generally authorized or obligated by
law to close in The City of New York.

So long as the Notes are represented by one or more global certificates,
the interest payable on the Notes will be paid to Cede & Co., the nominee of The
Depository Trust Company, or DTC, as depositary, or its registered assigns.
These payments will be made by wire transfer of immediately available funds on
each of the applicable interest payment dates, before 2:30 p.m. (New York City
time). If the Notes are no longer represented by global certificates, payment of
interest may, at our option, be made by check mailed to the address of the
person entitled to payment. No service charge will be made for any transfer or
exchange of Notes, but we may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection with the a transfer or
exchange.

BOOK-ENTRY SYSTEM

The Notes will initially be issued in the form of one or more fully
registered global certificates, referred to as book-entry notes, that will be
deposited with DTC or its nominee. A book-entry note may not be transferred
except as a whole between DTC and its nominee or to one of their successors.

Upon the issuance of a book-entry note, DTC will credit, on its book-entry
registration and transfer system, the respective principal amounts of the Notes
represented by that book-entry note to the accounts of its participants, i.e.
persons that have accounts with DTC. The underwriters participating in the
distribution of the Notes will designate the accounts to be credited. Only
participants or persons that may hold interests through participants can own
beneficial interests in a book-entry note. Ownership of beneficial interests in
a book-entry note will be shown on, and the transfer of that ownership will be
effected only through, records maintained by DTC for the book-entry note (with
respect to interests of participants) or by participants or persons that hold
through participants (with respect to interests of persons other than
participants).

So long as DTC, or its nominee, is the registered owner of a book-entry
note, DTC or such nominee, as the case may be, will be considered the sole owner
or holder of the Notes represented by that book-entry note for all purposes
under the Indenture. Except as set forth below, owners of beneficial interests
in a book-entry note will not be entitled to have the Notes

S-5
<PAGE> 6

represented by that book-entry note registered in their names, will not receive
or be entitled to receive physical delivery of their Notes in definitive form
and will not be considered the owners or holders of the Notes under the
Indenture.

All payments on Notes represented by a book-entry note will be made to DTC
or its nominee, as the case may be, as the registered owner of that book-entry
note. BFGoodrich, the Trustee and any paying agent for such Notes will not have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in a book-entry note
or for maintaining, supervising or reviewing any records relating to those
beneficial ownership interests.

We expect that DTC will, upon receiving any payment relating to a
book-entry note, immediately credit its participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the principal
amount of that book-entry note as shown on DTC's records. We also expect that
payments by participants to owners of beneficial interests in a book-entry note
held through such participants will be governed by standing instructions and
customary practices, as is now the case with the securities held for the
accounts of customers registered in "street names" and will be the
responsibility of those participants.

If DTC is at any time unwilling or unable to continue as depositary and a
successor depositary is not appointed by us within 90 days, we will issue Notes
in definitive form in exchange for any book-entry notes. In addition, we may at
any time and in our sole discretion decide not to have any of the Notes
represented by book-entry notes. If this happens, we will issue Notes in
definitive form in exchange for all of the book-entry notes representing such
Notes.

GOVERNING LAW

The Indenture and the Notes will be governed by and construed in accordance
with the laws of the State of New York.

UNDERWRITERS

Subject to the terms of the Underwriting Agreement, dated April 30, 1999
(the "Underwriting Agreement") between the underwriters named below (the
"Underwriters") and us, we have agreed to sell to each of the several
Underwriters, and each Underwriter has severally agreed to purchase from us, the
principal amount of the Notes set forth opposite its name below:

<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
NAME OF NOTES
- ---- ----------------
<S> <C>
Morgan Stanley & Co. Incorporated.......................... $120,000,000
Goldman, Sachs & Co........................................ 20,000,000
J.P. Morgan Securities Inc. ............................... 20,000,000
NationsBanc Montgomery Securities LLC...................... 20,000,000
Salomon Smith Barney Inc. ................................. 20,000,000
------------
Total................................................. $200,000,000
</TABLE>

The Underwriting Agreement provides that the obligations of the several
Underwriters to pay for and accept delivery of the Notes are subject to, among
other things, the approval of certain legal matters by their counsel. The
Underwriters are obligated to take and pay for all of the Notes if any Notes are
taken.

The Underwriters propose to offer the Notes directly to the public at the
initial public offering price set forth on the cover page of this prospectus
supplement and in part to certain dealers at prices that represent a concession
not in excess of .40% of the principal amount of the Notes. Any Underwriter may
allow, and such dealers may reallow, a concession not in excess of .25% of the
principal amount of the Notes to certain other dealers. After the initial

S-6
<PAGE> 7

offering of the Notes, the offering price and other selling terms may from time
to time be varied by the Underwriters.

We do not intend to apply for listing of the Notes on a national securities
exchange, but we have been advised by the Underwriters that they presently
intend to make a market in the Notes, as permitted by applicable laws and
regulations. The Underwriters are not obligated, however, to make a market in
the Notes and any such market making may be discontinued at the sole discretion
of the Underwriters. Accordingly, no assurance can be given as to the liquidity
of, or trading markets for, the Notes.

In order to facilitate the offering of the Notes, the Underwriters may
engage in transactions that stabilize, maintain or otherwise affect the price of
the Notes. Specifically, the Underwriters may over-allot in connection with this
offering, creating short positions in the Notes for their own account. In
addition, to cover over-allotments or to stabilize the price of the Notes, the
Underwriters may bid for, and purchase, Notes in the open market. Finally, the
Underwriters may reclaim selling concessions allowed to an underwriter or dealer
for distributing Notes in this offering, if the Underwriters repurchase
previously distributed Notes in transactions that cover syndicate short
positions, in stabilization transactions or otherwise. Any of these activities
may stabilize or maintain the market price of the Notes above independent market
levels. The Underwriters are not required to engage in these activities, and may
end any of these activities at any time.

Settlement for the Notes will be made in immediately available funds and
all secondary trading in the Notes will settle in immediately available funds.

We have agreed to indemnify the several Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.

Each of the Underwriters has rendered financial advisory services to us
from time to time and has received customary fees for its services. From time to
time the Underwriters and certain of their affiliates have engaged, and may in
the future engage, in investment banking and/or commercial banking transactions
with, and perform services for, us and our affiliates in the ordinary course of
business.

VALIDITY OF THE NOTES

Nicholas J. Calise, Esq., who is our Vice President, Associate General
Counsel and Secretary, will issue an opinion about the validity of the Notes.
Sullivan & Cromwell, New York, New York, will issue an opinion about the
validity of the Notes to the Underwriters.

As of April 6, 1999, Mr. Calise owned 13,617 shares of our Common Stock;
has deferred receipt of 6,079 shares of our Common Stock under our Long Term
Incentive Plan; has contingently credited to his account 5,918 phantom shares
under the 1998-2000 and 1999-2001 Long Term Incentive Plan, all of which are
subject to forfeiture; held options to purchase 87,100 shares of our Common
Stock; and had credited to his account in our Retirement Plus Savings Plan
approximately 5,855 shares of our Common Stock. In addition, Mr. Calise's wife
owns 1,000 shares of our Common Stock, although Mr. Calise disclaims beneficial
ownership of these shares.

S-7
<PAGE> 8

PROSPECTUS

THE B.F.GOODRICH COMPANY
4020 Kinross Lakes Parkway
Richfield, Ohio 44286-9368
(330) 659-7600

$200,000,000

DEBT SECURITIES

- --------------------------------------------------------------------------------

WE WILL PROVIDE SPECIFIED TERMS OF THESE SECURITIES IN SUPPLEMENTS TO THIS
PROSPECTUS.
YOU SHOULD READ THIS PROSPECTUS AND ANY SUPPLEMENT CAREFULLY BEFORE YOU INVEST.
- --------------------------------------------------------------------------------

THE INFORMATION IN THIS PROSPECTUS IS NOT COMPLETE AND MAY BE CHANGED. WE MAY
NOT SELL THESE SECURITIES UNTIL THE REGISTRATION STATEMENT FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION IS EFFECTIVE. THIS PROSPECTUS IS NOT AN OFFER
TO SELL THESE SECURITIES AND IT IS NOT SOLICITING AN OFFER TO BUY THESE
SECURITIES IN ANY STATE WHERE THE OFFER OR SALE IS NOT PERMITTED.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS
PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

This prospectus is dated April 30, 1999
<PAGE> 9

TABLE OF CONTENTS

<TABLE>
<CAPTION>
PAGE
----
<S> <C>
About This Prospectus....................................... 3
Where You Can Find More Information......................... 3
Forward-Looking Statements.................................. 4
Recent Developments......................................... 4
Risk Factors................................................ 5
The Company................................................. 7
Use of Proceeds............................................. 8
Ratio of Earnings to Fixed Charges.......................... 8
Description of Debt Securities.............................. 8
Plan of Distribution........................................ 16
Legal Opinions.............................................. 18
Experts..................................................... 18
Unaudited Pro Forma Condensed Combined Financial
Statements................................................ F-1
</TABLE>

2
<PAGE> 10

ABOUT THIS PROSPECTUS

This prospectus is part of a registration statement that we filed with the
SEC using a "shelf" registration process. Under this shelf process, we may sell
the Debt Securities described in this prospectus in one or more offerings up to
a total dollar amount of $200,000,000.

This prospectus provides you with a general description of the securities
we may offer. Each time we sell securities, we will provide a prospectus
supplement that will contain specific information about the terms of the
securities offered. Each prospectus supplement may also add to or update or
change information contained in this prospectus. You should read both this
prospectus and any prospectus supplement together with additional information
described under the heading WHERE YOU CAN FIND MORE INFORMATION.

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and special reports, proxy statements and other
information with the SEC. Our SEC filings are available to the public over the
Internet at our website at http://www.bfgoodrich.com or from the SEC's web site
at http://www.sec.gov. You may also read and copy any document we file at the
SEC's public reference rooms in Washington, D.C., New York, New York and
Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further information
on the public reference rooms and their copy charges. Certain of our securities
are listed on the New York Stock Exchange. You can obtain information about us
from the Exchange at 20 Broad Street, New York, New York 10005.

The SEC allows us to "incorporate by reference" in this prospectus the
information in documents filed with it. This means that we can disclose
important information to you by referring you to those documents. The
information incorporated by reference is considered to be a part of this
prospectus, and information in documents that we file later with the SEC will
automatically update and supersede information contained in documents filed
earlier with the SEC or contained in this prospectus. We incorporate by
reference in this prospectus the documents listed below and any future filings
that we may make with the SEC under Sections 13(a), 13(c), 14, or 15(d) of the
Securities Exchange Act of 1934 until we, or our agents, sell all of the
securities that may be offered by this prospectus.

- BFGoodrich Annual Report on Form 10-K for the year ended December 31,
1998.

- BFGoodrich Current Reports on Form 8-K filed on February 19, 1999,
February 25, 1999, April 12, 1999 and April 20, 1999.

- Coltec Industries Annual Report on Form 10-K for the year ended December
31, 1998 (Item 8 on pages 26-60 and pages S-1 to S-3, only).

- Coltec Industries Current Report on Form 8-K filed on April 28, 1999.

You may request a copy of these documents at no cost to you, by writing or
telephoning us at the following address:

The B.F.Goodrich Company
4020 Kinross Lakes Parkway
Richfield, Ohio 44286-9368
Attention: Secretary
(330) 659-7600

3
<PAGE> 11

You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. We are not making an
offer of the securities described in this prospectus in any state where the
offer is not permitted. You should not assume that the information in this
prospectus or any prospectus supplement is accurate as of any date other than
the date on the front of those documents.

FORWARD-LOOKING STATEMENTS

We believe that some of the information presented in or incorporated by
reference in this prospectus constitutes "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933. These forward-looking
statements are based on management's assumptions, expectations and projections
about us and the industries in which we operate. Our Annual Report on Form 10-K
for the year ended December 31, 1998 explains the nature of a number of these
forward-looking statements as well as some of the things that could cause our
actual results to differ materially from what we are expecting. You should read
that explanation before investing in our debt securities. In addition, this
prospectus describes a number of factors, especially with regard to risks we
face with respect to our merger with Coltec Industries Inc, potential
environmental and asbestos-related litigation, our vulnerability to economic
downturns in the United States and abroad and the "year 2000" problem, which
could each cause our actual results to differ materially from our expectations.

RECENT DEVELOPMENTS

In November 1998, we executed an agreement to merge with Coltec Industries,
a producer of aerospace and industrial products, by exchanging each share of
common stock of Coltec for 0.56 shares of our common stock. When we complete the
merger, Coltec will be a direct wholly-owned subsidiary of BFGoodrich. We expect
the merger to be accounted for as a pooling of interests, which means that we
will treat BFGoodrich and Coltec as if they always had been one company for
accounting and financial reporting purposes.

We have received all regulatory approvals necessary to complete the merger
and the shareholders of each company have overwhelmingly approved the merger.
AlliedSignal Inc. and Crane Co. have filed lawsuits in the U.S. District Court
in South Bend, Indiana seeking to block the merger. We have agreed not to
consummate the merger until the court rules on certain pending motions. In any
event, this agreement to delay the merger expires May 1, 1999. AlliedSignal has
filed a motion for a temporary restraining order and preliminary injunction to
prevent the merger. We will oppose AlliedSignal's motion. A hearing on this
motion is scheduled for 4:00 p.m. on Friday, April 30, 1999. We cannot assure
you if or when the merger will be completed.

You should see the Unaudited Pro Forma Condensed Combined Financial
Statements beginning on page F-1 for certain financial information relating to
the merger.

4
<PAGE> 12

RISK FACTORS

You should carefully consider the following risks before deciding to invest
in our debt securities.

WE MAY NOT BE ABLE TO ACHIEVE THE EXPECTED INTEGRATION AND COST SAVINGS FROM THE
MERGER, AND THAT FAILURE COULD ADVERSELY AFFECT OUR EARNINGS AND FINANCIAL
CONDITION.

We expect to achieve cost savings from our merger with Coltec. By the year
2001, we believe the cost savings could be $60 million per year. Difficulties
may arise, however, in the integration of the business and operation of the
combined entity. As a result, we may not be able to achieve the cost savings and
synergies that we expect will result from the merger. Achieving cost savings
depends on consolidating our corporate and aerospace staffs with Coltec's
corporate staff in Charlotte, North Carolina and achieving other synergies in
combining our two organizations. Additional operational savings depend upon the
integration of our aerospace business and Coltec's aerospace business and the
elimination of duplicate facilities and excess capacity. Actual savings in 1999
may be materially less than expected if the merger is delayed beyond May 1,
1999, if the reorganization of both companies' staffs is delayed beyond what we
anticipate or if the reductions in personnel are less than we currently
envision. We expect material cost savings from the reduction in personnel.

WE MAY HAVE LIABILITIES RELATED TO ASBESTOS LITIGATION WHICH COULD ADVERSELY
AFFECT OUR EARNINGS AND FINANCIAL CONDITION.

The historical business operations of Coltec have resulted in a substantial
volume of asbestos litigation. Plaintiffs in these matters have alleged personal
injury or death as a result of exposure to asbestos contained in some products
that were manufactured or distributed by two of Coltec's subsidiaries. We
believe that the funding agreements with Coltec's insurance carriers will
provide resources sufficient to meet the vast majority of the currently
anticipated costs and expenses associated with known and pending litigation. It
is difficult to predict the number of asbestos lawsuits that Coltec's
subsidiaries will be party to in the future. These future claims and insurance
and other related costs may result in future liabilities that are significant
and may be material.

WE MAY HAVE LIABILITIES RELATING TO ENVIRONMENTAL LAWS AND REGULATIONS WHICH
COULD ADVERSELY AFFECT OUR EARNINGS AND FINANCIAL CONDITION.

We and Coltec generate both hazardous and non-hazardous wastes. The
treatment, storage, transportation and disposal of these hazardous and
non-hazardous wastes are governed by various environmental laws and regulations.
We have been notified that we and Coltec have been designated as potentially
responsible parties by the U.S. Environmental Protection Agency for the costs of
investigating and, in some cases, remediating contamination by hazardous
materials at several sites, most of which relate to businesses previously
discontinued. Liability for these costs may be imposed on present and former
owners or operators of the properties or on parties who generated the wastes
that contributed to the contamination.

THE CYCLICAL NATURE OF OUR BUSINESS COULD ADVERSELY AFFECT OUR EARNINGS AND
FINANCIAL CONDITION.

The business sectors to which we sell our product are, to varying degrees,
cyclical and have historically experienced periodic downturns. These downturns
have often had a negative effect on demand for our products resulting in lower
net sales, gross margin and net income. Any future material weakness in demand
in any of these business sectors could have a material

5
<PAGE> 13

adverse effect on our earnings and financial condition. In addition, some of our
competitors have greater financial resources than we do and may be better able
to withstand the effects of those periodic downturns.

THE DOWNTURN IN ASIA COULD CONTINUE TO ADVERSELY AFFECT OUR EARNINGS AND
FINANCIAL CONDITION.

The current economic downturn in some Asian countries has adversely
affected and could continue to aversely affect the worldwide aerospace industry.
According to industry analysts, as a result of the recession in Japan, as well
as currency fluctuations and other problems in other Asian countries, Asian
airlines have slowed purchases of new aircraft. The reduction in demand for new
aircraft has led and could continue to lead aircraft manufacturers to build
fewer aircraft than they might otherwise have built. As a result, we have
experienced and could continue to experience delays or cancellations of orders
for our products for aircraft. Those delays or cancellations could seriously
harm our earnings and financial condition.

OUR DEPENDENCE UPON CURRENT CONDITIONS IN THE AIRLINE INDUSTRY COULD ADVERSELY
AFFECT OUR EARNINGS AND FINANCIAL CONDITION.

The airline industry is undergoing a process of consolidation and
significantly increased competition. This consolidation could result in a
reduction of future aircraft orders as overlapping routes are eliminated and
airlines seek greater economies through higher aircraft utilization. Increased
airline competition may also result in airlines seeking to reduce costs by
promoting greater price competition from aerospace suppliers, which could
adversely affect our earnings and financial condition.

THE FINANCIAL RESULTS OF OUR PERFORMANCE MATERIALS SEGMENT COULD BE ADVERSELY
AFFECTED IF GROWTH IN DEMAND FOR PERFORMANCE MATERIALS DOES NOT OCCUR OR COST
REDUCTIONS ARE NOT ACHIEVED AS WE EXPECT.

Our financial results could be adversely affected if the expected growth in
volume demand for performance materials does not occur as we expect. Recent
turmoil in the financial markets in the Far East and Latin America could
adversely impact sales increases in those regions. Our financial results could
also be adversely affected if we do not achieve cost reduction benefits as we
integrate recent acquisitions and continue the realignment activities of
BFGoodrich and Coltec.

COMPUTER SYSTEM FAILURES OR MISCALCULATIONS RESULTING FROM AN INABILITY TO
INTERPRET DATES BEYOND 1999 COULD MATERIALLY AND ADVERSELY AFFECT OUR
OPERATIONS.

Any computer equipment that uses two digits instead of four to specify the
year will be unable to interpret dates beyond the year 1999. This "year 2000"
issue could result in system failures or miscalculations causing disruptions of
operations. The three major areas that could be affected critically are
financial and operating systems, manufacturing systems and equipment, and
third-party relationships with suppliers and customers. We have developed plans
to address this exposure. However, we cannot assure you that these plans are
adequate to prevent or minimize such system failures or miscalculations.

6
<PAGE> 14

THE COMPANY

AEROSPACE

Our Aerospace Segment is conducted through four major business groups.

- Our Aerostructures Group primarily designs, develops and integrates
aircraft engine nacelle and pylon systems and provides support services.

- Our Landing Systems Group manufactures aircraft landing gear; aircraft
wheels and brakes; high-temperature composites; aircraft evacuation
slides and rafts for commercial, military, regional and business aviation
customers, and space programs.

- Our Sensors and Integrated Systems Group manufactures sensors and
sensor-based systems; fuel measurement and management systems;
electromechanical actuators; aircraft windshield wiper systems; health
and usage management systems; electronic test equipment; ice protection
systems; specialty heated products; collision warning systems; weather
detection systems; standby altitude indicators; aircraft lighting
components; and polymer and composite products for commercial, military,
regional, business and general aviation customers, and for aircraft
engine and space programs.

- Our Maintenance, Repair and Overhaul Group provides maintenance, repair
and overhaul of commercial airframes, components, wheels and brakes,
landing gear, instruments and avionics for commercial, regional, business
and general aviation customers.

PERFORMANCE MATERIALS

Our Performance Materials Segment is conducted through three major business
groups.

- Our Textile and Industrial Coatings Group manufactures acrylic textile
coatings and industrial formulations of Carbopol(R) polymers for textile
printing. This group also manufactures durable press resins, dyes and
softeners, as well as paper saturants and coatings in wood, metal and
other surface finishing products and in graphic arts applications.

- Our Consumer Specialties Group manufactures thickening, suspension and
emulsion polymers for personal care products and for household and
pharmaceutical applications.

- Our Polymer Additives & Specialty Plastics Group manufactures
thermoplastic polyurethane and alloys, high-heat-resistant and
low-combustibility plastics, static-dissipating polymers,
reaction-injection molding resins, and antioxidants for rubber, plastic
and lubricants applications. We market and sell these products to
manufacturers for film and sheet applications, wire and cable jacketing,
and magnetic media. Specialty plastics are also used in the manufacture
of automotive products, recreational vehicles and products, agricultural
equipment, industrial equipment, tire and rubber goods, plumbing and
industrial pipe, fire sprinkler systems and building material components.

7
<PAGE> 15

USE OF PROCEEDS

Unless we state otherwise in a prospectus supplement, the net proceeds from
the sale of the securities that are offered for sale will be used for general
corporate purposes.

RATIO OF EARNINGS TO FIXED CHARGES

The ratio of earnings to fixed charges for each of the periods indicated is
as follows:

<TABLE>
<CAPTION>
TWELVE MONTHS ENDED DEC. 31,
- --------------------------------
1998 1997 1996 1995 1994
- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C>
4.33 2.98 2.39 2.16 1.87
</TABLE>

For these ratios, "earnings" consists of income from continuing operations
before income taxes, fixed charges (excluding capitalized interest and
distributions on quarterly income preferred securities), amortization of
previously capitalized interest and undistributed earnings (losses) of
affiliated companies which are accounted for on the equity method. For this
purpose, "fixed charges" consists of (1) interest on all indebtedness (including
capitalized interest and interest costs on company-owned life insurance
policies), (2) amortization of debt discount or premium, (3) an interest factor
attributable to rentals and (4) distributions on quarterly income preferred
securities.

DESCRIPTION OF DEBT SECURITIES

The Debt Securities will be issued under an Indenture between us and Harris
Trust and Savings Bank as Trustee dated as of May 1, 1991.

We have summarized below selected provisions of the Indenture and the Trust
Indenture Act of 1939, as amended. The summary is not complete. The Indenture
has been filed as an exhibit to our registration statement on Form S-3,
Registration No. 33-65658. The following summary is subject to the detailed
provisions of the Indenture and the Trust Indenture Act of 1939. In the summary
below, we have included references to section numbers of the Indenture so that
you can easily locate these provisions. The referenced sections of the Indenture
are incorporated in this prospectus by reference.

GENERAL

The Debt Securities offered by this prospectus are limited to $200,000,000
in aggregate principal amount. The Indenture does not limit the amount of Debt
Securities that we may issue. Unless we state otherwise in a prospectus
supplement, the Indenture does not limit the amount of other debt that we can
issue.

The Indenture allows us to issue Debt Securities in one or more series. The
prospectus supplement for a series of Debt Securities being offered will include
specific terms of the Debt Securities. These terms will include some or all of
the following:

- the title of the Debt Securities;

- the total principal amount and the permitted denominations of the Debt
Securities;

- the percentage of principal amount of the Debt Securities at which the
Debt Securities will be issued;

- the currency or currencies in which the principal of and interest, if
any, on the Debt Securities will be payable;

8
<PAGE> 16

- the date on which the Debt Securities will be payable;

- the interest rate, if any, for the Debt Securities or the method that
will be used to determine the interest rate;

- the dates on which and places at which interest, if any, will be payable;

- any mandatory or optional repayment or redemption provisions; and

- any other terms of the Debt Securities.

The Indenture allows us to issue Debt Securities of a single series at
various times, with different maturity dates and redemption and repayment
provisions, if any, and different interest rates. (Section 2.5) The prospectus
supplement will specify the persons to whom and the manner in which interest, if
any, will be payable.

The Debt Securities will be unsecured, unsubordinated indebtedness of BF
Goodrich. The Debt Securities will rank equally with all of our other unsecured
and unsubordinated indebtedness.

The Debt Securities will be issued in fully registered form and in the
denominations set forth in the applicable prospectus supplement. We will
maintain an office or agency where the Debt Securities may be presented for
payment and may be transferred or exchanged. (Section 3.2) There will be no
service charge for any transfer or exchange of the Debt Securities, but we may
require a payment sufficient to cover any tax or other governmental charge
payable on the Debt Securities. (Section 2.10)

Some of the Debt Securities may be sold at a substantial discount below
their stated principal amount and may provide for the payment of no interest or
interest at a rate which at the time of issuance is below market rates. We will
describe the U.S. federal income tax consequences and other special
considerations applicable to any discounted Debt Securities in the prospectus
supplement relating to the discounted Debt Securities.

BOOK-ENTRY PROCEDURES

The Debt Securities may be issued in the form of one or more global
certificates registered in the name of a depositary or a nominee of a
depositary. Unless otherwise specified in the applicable prospectus supplement,
the depositary will be The Depository Trust Company, or "DTC." DTC has informed
us that its nominee will be Cede & Co., who will therefore be the initial
registered holder of any series of Debt Securities that are issued in global
form.

If we use the book-entry only form, we will not issue certificates to
individual holders of the Debt Securities, except as set forth in the applicable
prospectus supplement. Beneficial interests in global securities will be shown
on, and transfers of global securities will be made only through, records
maintained by DTC, Cede and their participating organizations. In addition, all
actions by holders of Debt Securities issued in global form shall be actions
taken by DTC upon instructions from its participating organizations, and all
payments and notices to holders shall be to DTC or Cede, as the registered
holder of the Debt Securities.

DTC has provided us with the following information: DTC is a limited
purpose trust company organized under the New York Banking Law, a "banking
organization" within the meaning of the New York Banking Law, a member of the
United States Federal Reserve System, a "clearing corporation" within the
meaning of the New York Uniform Commercial Code and a "clearing agency"
registered under Section 17A of the Securities Exchange Act of 1934. DTC holds
securities that its participating organizations, or direct participants, deposit
with DTC. DTC also facilitates the clearance and settlement of securities
transactions among direct

9
<PAGE> 17

participants through electronic book-entry, thereby eliminating the need for
physical exchange of certificates. Direct participants include securities
brokers and dealers, banks, trust companies, clearing corporations and certain
other organizations. Other organizations such as banks, brokers, dealers and
trust companies that work with a direct participant also use DTC's book-entry
system, or indirect participants. The rules that apply to DTC and its direct
participants are on file with the SEC.

DTC management is aware that some computer applications and systems for
processing data that are dependent upon calendar dates, including dates before,
on or after January 1, 2000, may encounter "Year 2000 problems." DTC has
informed its direct participants and other members of the financial community
that it has developed and is implementing a program so that its computer
applications and systems, as the same relate to the timely payment of
distributions (including principal and interest payments) to security holders,
book-entry deliveries and settlement of trades within DTC, continue to function
appropriately. This program includes a technical assessment and remediation
plan, both of which are complete. Additionally, DTC's plan includes a testing
phase, which is expected to be completed within appropriate time frames.

However, DTC's ability to perform its services properly is also dependent
upon other parties, including but not limited to issuers and their agents, as
well as third-party vendors from whom DTC licenses software and hardware, and
third-party vendors on whom DTC relies for information or the provision of
services, including telecommunication and electric utility service providers,
among others. DTC has informed its direct participants and other members of the
financial community that it is contacting (and will continue to contact)
third-party vendors from whom DTC acquires services to: (1) impress upon them
the importance of such services being Year 2000 compliant and (2) determine the
extent of their efforts for Year 2000 remediation (and, as appropriate, testing)
of their services. In addition, DTC is in the process of developing contingency
plans that it deems appropriate.

Purchases, sales or other transfers of Debt Securities must be done through
a Direct or indirect participant. Under a book-entry format, holders of Debt
Securities may experience some delay in their receipt of payments. Holders will
not be recognized as registered holders of the Debt Securities and, thus, will
be permitted to exercise their rights only indirectly through and subject to the
procedures of direct participants and, if applicable, indirect participants.

The ability of a holder to pledge Debt Securities to persons or entities
that do not participate in the DTC system, or to otherwise act with respect to
the Debt Securities, may be limited due to the absence of physical certificates.

DTC has advised us that it will only take any action permitted to be taken
by a registered holder of any Debt Securities at the direction of a direct
participant.

Debt Securities represented by a global security will be exchangeable for
the Debt Securities in registered form with the same terms only if:

- DTC notifies us that it is unwilling or unable to continue as depositary
or DTC ceases to be a clearing agency registered under applicable law;

- we determine that the global security is now exchangeable; or

- an event of default has occurred and is continuing with respect to the
Debt Securities.

If any of these events occur, DTC will generally notify all direct
participants of the availability of definitive Debt Securities.

10
<PAGE> 18

Except as described in this section, a global security may not be
transferred except as a whole by DTC to its nominee or by its nominee to DTC or
another of its nominees or to a successor depositary appointed by us.

We have obtained the information regarding DTC and DTC's book-entry system
from sources that we believe to be reliable, but we take no responsibility for
the accuracy of that information.

CERTAIN COVENANTS

The Indenture requires us to comply with certain restrictive covenants.
Some of the provisions are described below.

Definitions

"Subsidiary" is defined as any company in which we, or one or more of our
subsidiaries, own directly or indirectly at least a majority of outstanding
voting stock. (Section 1.1)

"Restricted Subsidiary" is defined as any Subsidiary (1) with substantially
all of its property located, or carrying on substantially all of its business
within, the United States and (2) which owns a Principal Property. "Restricted
Subsidiary", however, does not include any Subsidiary whose primary business
consists of (1) financing operations in connection with leasing and conditional
sales transactions on behalf of us and our Subsidiaries, (2) purchasing accounts
receivable or making loans secured by accounts receivable or inventory, or (3)
whose primary business is that of a finance company. As of the date of this
prospectus, there are no Restricted Subsidiaries.

"Principal Property" is defined as any building, structure or other
facility, the land upon which it stands and the fixtures that are a part of it,
(1) which is used primarily for manufacturing and is located in the United
States, and (2) the net book value of which exceeds 3% of Consolidated Net
Tangible Assets. Principal Property does not include (1) any building, structure
or facility which is not of material importance to our total business or (2) any
portion of a particular building, structure or facility which is not of material
importance to the use or operation of the building, structure or facility.

"Consolidated Net Tangible Assets" is defined as the total amount of assets
(minus applicable reserves and deductibles) minus (1) all current liabilities
(excluding (a) those which are extendible or renewable to more than 12 months
after the time as of which the amount of the liability is being computed, (b)
current maturities of long-term indebtedness and (c) capital lease obligations)
and (2) all goodwill.

"Attributable Debt" with respect to any lease is defined as the lesser of
(1) the fair value of the property subject to such lease or (2) the present
value of the total net amount of rent we must pay under such lease until it
expires, compounded semiannually. The net amount of rent we must pay under any
lease for any period is the amount of rent payable for the period, excluding
payments for maintenance and repairs, insurance, taxes, assessments, water rates
and similar charges. For any lease which we may terminate by paying a penalty,
the net amount of rent includes the penalty, but no rent is included after the
first date upon which the lease may be terminated.

"Funded Debt" is defined as all debt (1) with a maturity of more than 12
months after the date on which the amount of indebtedness is determined or (2)
with a maturity that is less than 12 months but which is renewable or extendible
at the borrower's option.

11
<PAGE> 19

Limitation on Liens

The Indenture will prohibit us or our Restricted Subsidiaries from
incurring, issuing, assuming or guarantying any debt for money borrowed or any
debt evidenced by notes, bonds, debentures or other similar documents ("Debt")
(other than guarantees related to the sale, discount, guarantee or pledge of
notes, chattel mortgages, leases, accounts receivable, trade acceptances and
other paper arising in the ordinary course of business out of installment or
conditional sales) without securing all outstanding series of Debt Securities
(other than any series of Debt Securities that provide that the Debt Securities
of the series are not entitled to the benefit of this covenant) equally and
ratably with (or prior to) the secured Debt to be incurred, issued, assumed or
guaranteed, unless the aggregate principal amount of such secured Debt together
with all secured Debt which would otherwise be prohibited, plus all Attributable
Debt of the Company and its Restricted Subsidiaries in respect of sale and
leaseback transactions which would otherwise be prohibited by the covenant
limiting sale and leaseback transactions described below would not exceed the
sum of 10% of Consolidated Net Tangible Assets.

The restriction described above will not apply to debt for borrowed money
secured by the following:

- liens on property, stock or Debt of any corporation existing at the time
it becomes a Restricted Subsidiary;

- liens to secure indebtedness of a Restricted Subsidiary to us or to
another Restricted Subsidiary;

- liens for taxes, assessments or governmental charges or levies (a) that
are not yet due and delinquent or (b) the validity of which is being
contested, or deposits to obtain the release of these mortgages;

- liens of materialmen, mechanics, carriers, workmen, repairmen, landlords
or other similar mortgages, or deposits to obtain the release of these
mortgages;

- liens arising under legal process the execution or enforcement of which
is stayed and which are being contested in good faith;

- liens (a) to secure public or statutory obligations, (b) to secure
payment of workmen's compensation, (c) to secure performance in
connection with tenders, leases of real property, bids or contracts or
(d) to secure (or in lieu of) surety or appeal bonds, and mortgages made
in the ordinary course of business for similar purposes;

- liens in favor of the United States, any state in the United States, any
other country, or any governmental entity or any political subdivision
thereof, to secure payments pursuant to any contract or statute or to
secure any debt incurred to finance the purchase price or the cost of
construction of the property subject to the mortgage;

- liens on property, stock or Debt of a corporation (a) existing at the
time we acquired the corporation (including corporations with which we
merged or consolidated or purchased substantially all the properties of),
(b) that secure the payment of purchase price, construction cost or
improvement cost thereof or (c) that secure any Debt incurred prior to,
at the time of, or within one year after we acquired the property, shares
or Debt, completed the construction on or commenced commercial operation
of the property for the purpose of financing the purchase price or
construction cost;

- mortgages existing at the date of the Indenture; and

12
<PAGE> 20

- any extension, renewal or replacement of any of these mortgages that does
not increase the Debt and that is limited to all or a part of the same
property, stock or Debt that secured the original mortgage.

(Section 3.4)

Limitation on Sales and Leasebacks

The Indenture provides that neither we nor any Restricted Subsidiary may
enter into most sale and lease-back transactions involving any Principal
Property which has been or is to be sold or transferred by us or such Restricted
Subsidiary, unless either:

- we or any Restricted Subsidiary could create Debt secured by a mortgage
on the Principal Property to be leased back in an amount equal to the
Attributable Debt with respect to such sale and leaseback transaction
without equally and ratably securing the Debt Securities of all series
pursuant to the provisions of the covenant on limitation on liens
described above; or

- we apply within 270 days after the sale or transfer an amount equal to
the greater of (1) the net proceeds of the sale of the Principal Property
sold and leased back pursuant to the arrangement or (2) the fair market
value of the Principal Property so sold and leased back at the time of
entering into the arrangement to (a) the purchase of different property,
facilities or equipment which has a value at least equal to the net
proceeds of the sale or (b) the retirement of Funded Debt of the Company
(other than Debt Securities of any series); provided, however, that the
amount to be applied to the retirement of Funded Debt of the Company
shall be reduced by (1) the principal amount of any Debt Securities of
any series (or, if the Debt Securities of any series are original issue
discount Debt Securities, the portion of the principal amount that is due
and payable with respect to such series pursuant to a declaration in
accordance with Section 5.1 of the Indenture) delivered within 270 days
after such sale to the Trustee for retirement and cancellation and (2)
the principal amount of Funded Debt, other than the Debt Securities of
any series, voluntarily retired by the Company within 270 days after such
sale. No retirement referred to in this clause may be effected by payment
at maturity or pursuant to any mandatory sinking fund payment or any
mandatory prepayment provision.

(Section 3.5)

Absence of Other Restrictions

The Indenture does not contain (1) any restrictions on the declaration of
dividends; (2) any requirements concerning the maintenance of any asset ratio;
or (3) any requirement for the creation or maintenance of reserves.

13
<PAGE> 21

CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE

The Indenture permits us to consolidate or merge with or into another
entity, or to sell, convey or lease all or substantially all of our property to
another entity only if certain conditions in the Indenture are met including:

- the successor corporation or purchaser expressly assumes our obligations
on the Debt Securities and under the Indenture; and

- performance and observance of all covenants and conditions in the
Indenture.

(Article Eight)

EVENTS OF DEFAULT, WAIVER AND NOTICE

Unless we tell you otherwise in an accompanying prospectus supplement,
"Event of Default" when used in an Indenture will mean any of the following:

- failure to pay any installment of interest on the Debt Securities for a
period of 10 days;

- failure to pay the principal and premium, if any, on the Debt Securities;

- failure to deposit any sinking fund payment on the Debt Securities;

- failure to perform any other covenant or agreement in the Indenture that
continues for 90 days after we have been given written notice of such
failure;

- acceleration of a BFGoodrich debt with a principal amount of more than
$50,000,000 that is not rescinded or annulled within 10 days after
written notice of such acceleration;

- certain events of bankruptcy, insolvency and reorganization of
BFGoodrich; and

- any other Event of Default established with respect to Debt Securities of
that series.

(Sections 2.5 and 4.1)

Within 90 days after the occurrence of a default (without regard to any
grace periods) the Trustee will give all holders of Debt Securities of the
affected series notice of all uncured defaults known to it. Except in the case
of a default in the payment of principal (and premium, if any) or interest, if
any, or in the payment of any sinking fund installment, the Trustee may withhold
such notice if it in good faith determines that withholding such notice is in
the interest of the holders. (Trust Indenture Act)

If an Event of Default occurs and continues, either the Trustee or the
holders of at least 25% in aggregate principal amount of the Debt Securities of
the series may declare the principal (or, in the case of original issue discount
Debt Securities, the portion specified in the applicable prospectus supplement)
of the Debt Securities of the series and the accrued interest, if any, to be due
and payable immediately. If this happens, subject to certain conditions, the
holders of a majority of the aggregate principal amount of the Debt Securities
of the series can annul the declaration of acceleration and waive past defaults
(except for uncured defaults in the payment of principal (or premium, if any) or
interest, if any. (Sections 4.1 and 4.9)

We must file with the Trustee annually a written statement regarding the
presence or absence of certain defaults (Trust Indenture Act).

If a default or an Event of Default occurs and continues, the holders of at
least a majority in aggregate principal amount of the Debt Securities of the
series may direct the time, method and place of conducting any proceeding or
remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee by the Indenture. (Section 4.8)

14
<PAGE> 22

The Trustee does not have to exercise any of its rights or powers at the
direction of the holders of Debt Securities unless the holders offer the Trustee
reasonable security or indemnity against expenses and liabilities. (Section
5.1(d))

DEFEASANCE

DEFEASANCE AND DISCHARGE

The Indenture provides that we will be discharged from any and all
obligations in respect of the Debt Securities of any series (except for certain
transfer obligations), if we deposit with the Trustee, in trust, money and/or
U.S. government obligations which will provide enough money to pay the principal
of and each installment of interest on the Debt Securities of the series on the
stated maturity of such payments in accordance with the terms of the Indenture
and the Debt Securities of such series. (Section 12.2)

Such a trust may only be established if, among other things, we have
delivered to the Trustee an opinion of counsel stating that, due to an Internal
Revenue Service ruling or a change in Federal income tax law, 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, defeasance and
discharge and will be subject to Federal income tax on the same amount and in
the same manner and at the same times, as would have been the case if such
deposit, defeasance and discharge had not occurred. (Section 12.4)

DEFEASANCE OF CERTAIN COVENANTS AND CERTAIN EVENTS OF DEFAULT

The Indenture provides that we may omit to comply with certain restrictive
covenants in Sections 3.4 and 3.5, and Section 4.1(d) (described above in the
fourth bullet point under "Events of Default, Waiver and Notice") without
triggering an Event of Default under the Indenture and the Debt Securities of a
series, if we deposit with the Trustee, in trust, money and/or U.S. government
obligations which through the payment of interest and principal thereon will
provide enough money to pay the principal of and each installment of interest on
the Debt Securities of such series on the stated maturity of such payments in
accordance with the terms of the Indenture and the Debt Securities of such
series. Our other obligations under the Indenture and the Debt Securities of
such series and other Events of Default shall remain in full force and effect.
(Section 12.3)

Such a trust may only be established if, among other things, we have
delivered to the Trustee an opinion of counsel stating that 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 covenants and Events of Default 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. (Section
12.4)

If we exercise the option described in this section 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 above in the fourth
bullet point under "Events of Default, Waiver and Notice"), the amount of money
and U.S. government obligations on deposit with the Trustee will be sufficient
to pay amounts due on the Debt Securities of such series at the time of their
stated maturity but may not be sufficient to pay amounts due on the Debt
Securities of such series at the time of the acceleration resulting from such
Event of Default.

15
<PAGE> 23

CHANGES TO THE INDENTURE

Holders who own not less than 50% in principal amount of the outstanding
Debt Securities of each series affected can agree to change the Indenture or the
rights of the holders of the Debt Securities. However, no change without your
consent can affect:

- the fixed maturity;

- the principal or premium amount;

- the rate or the time of payment of interest;

- the currency;

- the portion of the principal amount of an original issue discount Debt
Security due and payable upon acceleration of the maturity thereof;

- the portion of the principal amount of a Debt Security provable in
bankruptcy;

- amounts payable upon redemption;

- the overdue rate;

- any right of repayment at the option of the holder of a Debt Security; or

- the percentage of principal amount of the outstanding Debt Securities of
each series affected the holders of which may change the terms discussed
above.

(Section 7.2)

We may amend the Indenture in certain circumstances without your consent to
evidence the merger of BFGoodrich or the replacement of the Trustee and for
certain other purposes. (Section 7.1)

CONCERNING THE TRUSTEE

We maintain deposit accounts and conduct other banking transactions with
the Trustee in the ordinary course of our business.

PLAN OF DISTRIBUTION

We may sell the Debt Securities (a) to or through underwriters or dealers;
(b) directly to one or more purchasers or (c) through agents.

BY UNDERWRITERS

If underwriters are used in the sale, the offered securities will be
acquired by the underwriters for their own account. The underwriters may resell
the securities in one or more transactions, including negotiated transactions,
at a fixed public offering price or at varying prices determined at the time of
sale. The obligations of the underwriters to purchase the securities will be
subject to certain conditions. The underwriters will be obligated to purchase
all the Debt Securities offered if any of the Debt Securities are purchased. Any
initial public offering price and any discounts or concessions allowed or
re-allowed or paid to dealers may be changed from time to time.

16
<PAGE> 24

DIRECT SALES

Debt Securities may also be sold directly by us. In this case, no
underwriters or agents would be involved.

BY AGENTS

Debt Securities may be sold through agents designated by us. The agents
agree to use their reasonable best efforts to solicit purchases for the period
of their appointment.

GENERAL INFORMATION

Underwriters, dealers and agents that participate in the distribution of
the offered securities may be underwriters as defined in the Securities Act of
1933, and any discounts, concessions or commissions that we pay them and any
profit on their resale of the offered securities may be treated as underwriting
discounts, concessions and commissions under the Securities Act. We will
identify any underwriters or agents and describe their compensation in a
prospectus supplement.

We may have agreements with the underwriters, dealers and agents who
participate in the sale of Debt Securities to indemnify them against certain
civil liabilities, including liabilities under the Securities Act, or to
contribute with respect to payments which the underwriters, dealers or agents
may be required to make.

Underwriters, dealers and agents may engage in transactions with, or
perform services for, us or our subsidiaries in the ordinary course of their
businesses.

The Debt Securities, when first issued, will have no established trading
market. Any underwriters or agents to or through whom Debt Securities are sold
by us for public offering and sale may make a market in the Debt Securities; but
such underwriters or agents will not be obligated to do so and may discontinue
any market making at any time without notice. No assurance can be given as to
the liquidity of the trading market for any Debt Securities.

In connection with an offering of Debt Securities, underwriters or agents
may purchase and sell the Debt Securities in the open market. These transactions
may include over-allotment and stabilizing transactions, purchases to cover
syndicate short positions created in connection with the offering and penalty
bids. Over-allotment involves sales in excess of the offering size, which
creates a short position. Stabilizing transactions consist of bids or purchases
for the purpose of preventing or retarding a decline in the market price of Debt
Securities and are permitted so long as the stabilizing bids do not exceed a
specified maximum. Syndicate short positions involve the sale by the
underwriters or agents of a greater number of Debt Securities than they are
required to purchase from us in the offering. The underwriters or agents also
may impose a penalty bid which permits them to reclaim selling concessions
allowed to syndicate members or certain dealers if they repurchase the Debt
Securities in stabilizing or covering transactions. These activities may
stabilize, maintain or otherwise affect the market price of the Debt Securities,
which may be higher than the price that might otherwise prevail in the open
market. These activities, if commenced, may be discontinued at any time. These
transactions may be effected on the exchange, if any, on which the Debt
Securities are traded, in the over-the-counter market or otherwise.

If we so indicate in a prospectus supplement we will authorize underwriters
or our agents to solicit offers by certain institutional investors to purchase
Debt Securities from us which will be paid for and delivered on a future date
specified in the applicable prospectus supplement. The obligations of any
purchasers under these delayed delivery and payment arrangements will not

17
<PAGE> 25

be subject to any conditions except that the purchase at delivery must not be
prohibited under the laws of any jurisdiction in the United States to which the
institution is subject.

LEGAL OPINIONS

Nicholas J. Calise, Esq., who is our Vice President, Associate General
Counsel and Secretary, or another of our lawyers, will issue an opinion about
the validity of the Debt Securities.

As of April 6, 1999, Mr. Calise owned 13,617 shares of our Common Stock;
has deferred receipt of 6,079 shares of our Common Stock under the Long Term
Incentive Plan; has contingently credited to his account 5,918 phantom shares
under the 1998-2000 and 1999-2001 Long Term Incentive Plan, all of which are
subject to forfeiture; held options to purchase 87,100 shares of our Common
Stock; and had credited to his account in our Retirement Plus Savings Plan
approximately 5,855 shares of our Common Stock. In addition, Mr. Calise's wife
owns 1,000 shares of our Common Stock, although Mr. Calise disclaims beneficial
ownership of these shares.

Any underwriters will be advised about the validity of the Debt Securities
by their own legal counsel.

EXPERTS

Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements included in our Annual Report on Form 10-K for the year
ended December 31, 1998 as set forth in their report, which as to 1996 is based
in part on the report of Deloitte & Touche LLP, independent auditors, and which
is incorporated by reference in this prospectus and elsewhere in the
registration statement. Our consolidated financial statements are incorporated
by reference in reliance on their reports, given on their authority as experts
in accounting and auditing.

Arthur Andersen LLP, independent auditors, have audited Coltec Industries'
consolidated financial statements and schedules included in its Annual Report on
Form 10-K, for the year ended December 31, 1998, as set forth in their report
which is incorporated in this prospectus by reference. Coltec Industries'
consolidated financial statements are incorporated by reference in reliance on
their report, given on their authority as experts in accounting and auditing.

18
<PAGE> 26

UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

The following unaudited pro forma condensed combined statements of income
for each of the three years ended December 31, 1996, 1997 and 1998 give effect
to the merger with Coltec Industries, accounted for as a "pooling of interests."
The unaudited pro forma condensed combined statements of income and the
unaudited pro forma condensed combined balance sheet at December 31, 1998 give
effect to the merger as though Coltec Industries had always been a part of
BFGoodrich.

The pro forma information is based on the historical consolidated financial
statements of BFGoodrich and of Coltec Industries, under the assumptions and
adjustments set forth in the accompanying notes to the unaudited pro forma
condensed combined financial statements.

You should read the information shown below in conjunction with the
consolidated historical financial statements of BFGoodrich and of Coltec
Industries, including the respective notes to those financial statements, which
are incorporated by reference in this prospectus. We have presented the pro
forma data for comparative purposes only. They are not necessarily indicative of
the results of operations or of the financial position that would have occurred
had the merger been completed during the periods or as of the date for which the
pro forma data are presented, and they are not necessarily indicative of
BFGoodrich's future results of operations or financial position.

Pro forma per share amounts for the combined BFGoodrich and Coltec
Industries entity are based on the exchange ratio of 0.56 of a share of
BFGoodrich common stock for each share of Coltec Industries common stock.

F-1
<PAGE> 27

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
DECEMBER 31, 1998
(DOLLARS IN MILLIONS)

The following unaudited pro forma condensed combined balance sheet as of
December 31, 1998 is presented to show the impact of the proposed merger on
BFGoodrich's historical financial condition. The merger has been reflected under
the "pooling of interests" method of accounting.

<TABLE>
<CAPTION>
COLTEC PRO FORMA PRO FORMA
BFGOODRICH INDUSTRIES ADJUSTMENTS COMBINED
---------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C>
ASSETS
Current Assets
Cash and cash equivalents... $ 31.7 $ 21.8 $ $ 53.5
Accounts and notes
receivable, net.......... 629.0 148.2 777.2
Inventories................. 772.5 236.0 1,008.5
Deferred income taxes....... 142.1 20.5 162.6
Prepaid expenses and other
assets................... 39.2 15.6 54.8
-------- -------- ------- --------
Total current
assets............ 1,614.5 442.1 -- 2,056.6
-------- -------- ------- --------
Property...................... 1,255.9 306.6 -- 1,562.5
Deferred income taxes......... 39.7 -- -- 39.7
Prepaid pensions.............. 148.0 -- 45.3 4(c) 193.3
Goodwill...................... 771.0 214.6 985.6
Identifiable intangible
assets...................... 112.4 -- 112.4
Other assets.................. 251.1 92.3 343.4
-------- -------- ------- --------
$4,192.6 $1,055.6 $ 45.3 $5,293.5
======== ======== ======= ========
</TABLE>

See notes to unaudited pro forma condensed combined financial statements
beginning on page F-7.

F-2
<PAGE> 28

UNAUDITED PRO FORMA CONDENSED COMBINED BALANCE SHEET
DECEMBER 31, 1998
(DOLLARS IN MILLIONS)
(CONTINUED)

<TABLE>
<CAPTION>
COLTEC PRO FORMA PRO FORMA
BFGOODRICH INDUSTRIES ADJUSTMENTS COMBINED
---------- ---------- ----------- ---------
<S> <C> <C> <C> <C> <C>
LIABILITIES AND SHAREHOLDERS'
EQUITY
Current Liabilities
Short-term bank debt........ $ 144.1 $ -- $ $ 144.1
Accounts payable............ 364.4 96.6 461.0
Accrued expenses............ 420.1 171.1 591.2
Income taxes payable........ 59.4 -- 59.4
Current maturities of
long-term debt and
capital lease
obligations.............. 2.8 5.1 7.9
-------- -------- --------
Total current
liabilities....... 990.8 272.8 -- 1,263.6
-------- -------- ------- --------
Long-term debt and capital
lease obligations........... 995.2 577.5 1,572.7
Pension obligations........... 43.6 -- 33.0 4(c) 76.6
Postretirement benefits other
than pensions............... 338.1 5.9 344.0
Other non-current
liabilities................. 101.7 214.5 12.3 4(c) 328.5
Deferred income taxes......... -- 139.9 139.9
Mandatorily redeemable
preferred securities of
trusts...................... 123.6 145.3 268.9
Shareholders' Equity
Common stock................ 381.1 0.7 175.9 4(a) 557.7
Additional capital.......... 543.7 643.6 (303.8) 4(a)(b) 883.5
Income retained in the
business................. 736.8 (795.3) (58.5)
Accumulated other
comprehensive income..... 3.6 (18.7) (15.1)
Common stock held in
treasury, at cost........ (65.6) (127.9) 127.9 4(b) (65.6)
Unearned compensation....... -- (2.7) (2.7)
-------- -------- ------- --------
Total Shareholders'
Equity............ 1,599.6 (300.3) -- 1,299.3
-------- -------- ------- --------
$4,192.6 $1,055.6 $ 45.3 $5,293.5
======== ======== ======= ========
</TABLE>

See notes to unaudited pro forma condensed combined financial statements
beginning on page F-7.

F-3
<PAGE> 29

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1998
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)

The following unaudited pro forma condensed combined statements of income
are presented to show the impact of the proposed merger on BFGoodrich's
historical results of operations. These statements assume that the companies had
been combined for each period presented.

<TABLE>
<CAPTION>
COLTEC PRO FORMA PRO FORMA
BFGOODRICH INDUSTRIES ADJUSTMENTS COMBINED
---------- ---------- ----------- ---------
<S> <C> <C> <C> <C>
Sales............................... $3,950.8 $1,504.1 $ -- $5,454.9
Operating costs and expenses:
Cost of sales..................... 2,853.1 1,080.8 3,933.9
Selling and administrative
costs.......................... 610.4 235.2 -- 845.6
Restructuring costs and asset
impairment..................... 10.5 -- -- 10.5
-------- -------- -------- --------
3,474.0 1,316.0 -- 4,790.0
-------- -------- -------- --------
Operating income.................... 476.8 188.1 -- 664.9
Interest expense.................... (79.0) (54.3) -- (133.3)
Interest income..................... 5.2 0.9 -- 6.1
Other income (expense) -- net....... (18.1) 56.2 -- 38.1
-------- -------- -------- --------
Income from continuing operations
before income taxes and trust
distributions..................... 384.9 190.9 -- 575.8
Income tax expense.................. (146.3) (64.9) -- (211.2)
Distributions on trust preferred
securities........................ (10.5) (3.7) -- (14.2)
-------- -------- -------- --------
Income from continuing operations... 228.1 122.3 -- 350.4
Income (loss) from discontinued
operations -- net of taxes........ (1.6) -- -- (1.6)
-------- -------- -------- --------
Income before extraordinary item.... 226.5 122.3 -- 348.8
Extraordinary item -- net of tax.... -- (4.3) -- (4.3)
-------- -------- -------- --------
Net income.......................... $ 226.5 $ 118.0 $ -- $ 344.5
======== ======== ======== ========
Basic earnings per share:
Continuing operations............. $ 3.09 $ 1.88 $ -- $ 3.18
Discontinued operations........... (0.02) -- -- (0.01)
Extraordinary item................ -- (0.07) -- (0.04)
-------- -------- -------- --------
Net income........................ $ 3.07 $ 1.81 $ -- $ 3.13
======== ======== ======== ========
Diluted earnings per share:
Continuing operations............. $ 3.04 $ 1.81 $ -- $ 3.08
Discontinued operations........... (0.02) -- -- (0.01)
Extraordinary item................ -- (0.06) -- (0.04)
-------- -------- -------- --------
Net income........................ $ 3.02 $ 1.75 $ -- $ 3.03
======== ======== ======== ========
Weighted average number of common
and common equivalent shares
outstanding -- in millions
Basic.......................... 73.7 65.1 -- 110.2
Diluted........................ 75.0 69.4 -- 113.9
</TABLE>

See notes to unaudited pro forma condensed combined financial statements
beginning on page F-7.

F-4
<PAGE> 30

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1997
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
COLTEC PRO FORMA PRO FORMA
BFGOODRICH INDUSTRIES ADJUSTMENTS COMBINED
---------- ---------- ----------- ---------
<S> <C> <C> <C> <C>
Sales............................... $3,373.0 $1,314.9 $ -- $4,687.9
Operating costs and expenses:
Cost of sales..................... 2,454.7 898.3 -- 3,353.0
Charge for MD-90 contract......... 35.2 -- -- 35.2
Selling and administrative
costs.......................... 556.0 218.8 -- 774.8
Merger-related costs.............. 77.0 -- -- 77.0
-------- -------- -------- --------
3,122.9 1,117.1 -- 4,240.0
-------- -------- -------- --------
Operating income.................... 250.1 197.8 -- 447.9
Interest expense.................... (73.0) (54.6) -- (127.6)
Interest income..................... 12.0 .6 -- 12.6
Gain on issuance of subsidiary
stock............................. 13.7 -- -- 13.7
Other income (expense) -- net....... 15.0 -- -- 15.0
-------- -------- -------- --------
Income from continuing operations
before income taxes and trust
distributions..................... 217.8 143.8 -- 361.6
Income tax expense.................. (94.1) (48.9) -- (143.0)
Distributions on trust preferred
securities........................ (10.5) -- -- (10.5)
-------- -------- -------- --------
Income from continuing operations... 113.2 94.9 -- 208.1
Income from discontinued
operations -- net of taxes........ 84.3 -- -- 84.3
-------- -------- -------- --------
Income before extraordinary item.... 197.5 94.9 -- 292.4
Extraordinary item -- net of tax.... (19.3) -- -- (19.3)
-------- -------- -------- --------
Net income.......................... $ 178.2 $ 94.9 $ -- $ 273.1
======== ======== ======== ========
Basic earnings per share:
Continuing operations............. $ 1.59 $ 1.44 $ -- $ 1.93
Discontinued operations........... 1.19 -- -- 0.78
Extraordinary item................ (0.27) -- -- (0.18)
-------- -------- -------- --------
Net income........................ $ 2.51 $ 1.44 $ -- $ 2.53
======== ======== ======== ========
Diluted earnings per share:
Continuing operations............. $ 1.53 $ 1.42 $ -- $ 1.86
Discontinued operations........... 1.13 -- -- 0.75
Extraordinary item................ (0.25) $ -- -- (0.17)
-------- -------- -------- --------
Net income........................ $ 2.41 $ 1.42 $ -- $ 2.44
======== ======== ======== ========
Weighted average number of common
and common equivalent shares
outstanding -- in millions
Basic.......................... 71.0 65.9 -- 107.9
Diluted........................ 74.6 66.9 -- 112.1
</TABLE>

See notes to unaudited pro forma condensed combined financial statements
beginning on page F-7.

F-5
<PAGE> 31

UNAUDITED PRO FORMA CONDENSED COMBINED STATEMENTS OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1996
(DOLLARS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
COLTEC PRO FORMA PRO FORMA
BFGOODRICH INDUSTRIES ADJUSTMENTS COMBINED
---------- ---------- ----------- ---------
<S> <C> <C> <C> <C>
Sales............................... $2,845.8 $1,159.7 $ -- $4,005.5
Operating costs and expenses:
Cost of sales..................... 2,042.5 811.1 -- 2,853.6
Selling and administrative
costs.......................... 481.8 191.0 -- 672.8
Restructuring costs and asset
impairment..................... 11.2 -- -- 11.2
-------- -------- -------- --------
2,535.5 1,002.1 -- 3,537.6
-------- -------- -------- --------
Operating income.................... 310.3 157.6 -- 467.9
Interest expense.................... (89.3) (76.2) -- (165.5)
Interest income..................... 4.2 1.3 -- 5.5
Other income (expense) -- net....... (30.8) -- -- (30.8)
-------- -------- -------- --------
Income from continuing operations
before income taxes and trust
distributions..................... 194.4 82.7 -- 277.1
Income tax expense.................. (68.4) (28.1) -- (96.5)
Distributions on trust preferred
securities........................ (10.5) -- -- (10.5)
-------- -------- -------- --------
Income from continuing operations... 115.5 54.6 -- 170.1
Income from discontinued
operations -- net of taxes........ 58.4 57.1 -- 115.5
-------- -------- -------- --------
Income before extraordinary item.... 173.9 111.7 -- 285.6
Extraordinary item -- net of tax.... -- (30.6) -- (30.6)
-------- -------- -------- --------
Net income.......................... $ 173.9 $ 81.1 $ -- $ 255.0
======== ======== ======== ========
Basic earnings per share:
Continuing operations............. $ 1.74 $ 0.79 $ -- $ 1.62
Discontinued operations........... 0.87 0.83 -- 1.09
Extraordinary item................ -- (0.44) -- (0.29)
-------- -------- -------- --------
Net income........................ $ 2.61 $ 1.18 $ -- $ 2.42
======== ======== ======== ========
Diluted earnings per share:
Continuing operations............. $ 1.65 $ 0.79 $ -- $ 1.57
Discontinued operations........... 0.83 0.82 -- 1.05
Extraordinary item................ -- (0.44) -- (0.28)
-------- -------- -------- --------
Net income........................ $ 2.48 $ 1.17 $ -- $ 2.34
======== ======== ======== ========
Weighted average number of common
and common equivalent shares
outstanding -- in millions
Basic.......................... 66.6 69.1 -- 105.3
Diluted........................ 70.9 69.4 -- 109.8
</TABLE>

See notes to unaudited pro forma condensed combined financial statements
beginning on page F-7.

F-6
<PAGE> 32

NOTES TO UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL STATEMENTS

1. BASIS OF PRESENTATION

The unaudited pro forma condensed combined statements of income for each of
the three years in the period ended December 31, 1998 and the unaudited pro
forma condensed combined balance sheet at December 31, 1998 give effect to the
merger as though Coltec Industries had always been a part of BFGoodrich.

We have presented the unaudited pro forma condensed combined financial
statements for comparative purposes only. They are not necessarily indicative of
the results of operations or of the financial position that would have occurred
had the merger been completed during the periods or as of the date for which the
pro forma data are presented. They are also not necessarily indicative of
BFGoodrich's future results of operations or financial position.

We have included certain reclassifications in the unaudited pro forma
condensed combined balance sheet and statements of income to conform statement
presentations to those expected to be used by BFGoodrich after the merger.

2. CONFORMITY OF ACCOUNTING POLICIES

We are still in the process of reviewing our respective accounting policies
to determine if they are consistent or if they need to be conformed. As a result
of this review, we might need to restate either Coltec Industries' or
BFGoodrich's financial statements to conform to those accounting policies that
are most appropriate. We have not included any restatements of prior periods in
the unaudited pro forma condensed combined financial statements. At this time,
we do not expect that conforming such accounting policies will have a material
impact on the unaudited pro forma condensed combined financial statements. We
will make any restatements, if appropriate, upon completion of this review
process.

3. MERGER-RELATED AND CONSOLIDATION EXPENSES

The unaudited pro forma condensed combined financial statements do not
include any merger-related and consolidation expenses which we expect to incur
in connection with completing the merger and integrating the operations of
BFGoodrich and Coltec Industries. It is not possible to determine the actual
amount of these costs and expenses until the related operational and
transitional plans are complete. These costs and expenses relate to professional
and registration fees; employee benefit-related costs such as severance,
relocation and retention incentives; facility consolidations; and satisfaction
of contractual obligations. Most of these costs and expenses will be incurred to
eliminate duplicate facilities and excess capacity in the combined BFGoodrich
operations. We cannot determine the exact timing of these charges at this time.
They are dependent on the completion of the necessary plans.

In connection with the merger, the managements of BFGoodrich and Coltec
Industries estimate that BFGoodrich will incur a one-time charge for
merger-related and consolidation expenses at the effective date of the merger
that is expected to be material. Other merger-related transaction costs include
investment banking fees, registration and listing fees, and various accounting,
legal and other related costs.

4. PRO FORMA ADJUSTMENTS

Pro forma adjustments to reflect the effect of the merger on the unaudited
pro forma condensed combined balance sheet at December 31, 1998 are as follows:

F-7
<PAGE> 33

a. Common stock increased by $175.9 million to record the BFGoodrich
common stock issued in the merger. That increase is calculated by
multiplying the 63.1 million shares of Coltec Industries common stock
outstanding by the exchange ratio of 0.56 and the par value of
BFGoodrich common stock of $5 per share, reduced by $0.7 million to
record the retirement of Coltec Industries common stock.

b. Combined additional capital is adjusted for the effects of pro forma
adjustment a. above, and for the retirement of Coltec Industries
treasury shares.

c. Coltec Industries' pension obligations are reclassified in accordance
with BFGoodrich's presentation.

d. For purposes of the pro forma information and references to the
shares to be issued by BFGoodrich in the merger, we have not included
the 14,000,000 shares of BFGoodrich common stock to be issued in the
merger in exchange for the 25,000,000 shares of Coltec Industries
common stock currently owned by a subsidiary of Coltec Industries.

F-8