<PAGE> 1
Filed Pursuant to Rule 424(b)(2)
Registration No. 333-67145
Prospectus Supplement to Prospectus dated March 7, 2000
(LOGO)
$600,000,000
THE GOODYEAR TIRE & RUBBER COMPANY
$300,000,000 8.125% Notes due 2003
$300,000,000 8.50% Notes due 2007
MATURITY
- - The 8.125% Notes due 2003 will mature on March 15, 2003.
- - The 8.50% Notes due 2007 will mature on March 15, 2007.
INTEREST
- - Interest on the Notes is payable on March 15 and September 15 of each year,
beginning September 15, 2000.
- - Interest on the Notes will accrue from March 17, 2000.
LISTING
- - The Notes will not be listed on any securities exchange.
REDEMPTION
- - We may redeem some or all of the Notes of each series at any time. The
redemption prices are described at page S-8.
- - There is no sinking fund for the Notes.
RANKING
- - The Notes are unsecured.
- - The Notes rank equally with all of our other unsecured and unsubordinated
debt.
THE COMPANY
- - Our principal office is located at 1144 East Market Street, Akron, Ohio
44316-0001. Our telephone number is 330-796-2121.
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NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE ATTACHED PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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<S> <C> <C> <C> <C>
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PER 8.125% NOTE TOTAL PER 8.50% NOTE TOTAL
- ----------------------------------------------------------------------------------------------------------------------
INITIAL PUBLIC OFFERING PRICE 99.865% $299,595,000 100.000% $300,000,000
UNDERWRITING DISCOUNT 0.450% $ 1,350,000 0.625% $ 1,875,000
PROCEEDS TO GOODYEAR, BEFORE 99.415% $298,245,000 99.375% $298,125,000
EXPENSES
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</TABLE>
Your purchase price will also include any interest that has accrued on the
Notes since March 17, 2000.
- --------------------------------------------------------------------------------
- - The Notes will be delivered to you in global form through the book-entry
delivery system of The Depository Trust Company on or about March 17, 2000.
- - The underwriters listed below will purchase the notes from us on a firm
commitment basis and offer them to you, subject to certain conditions.
CHASE SECURITIES INC.
BANC OF AMERICA SECURITIES LLC
BEAR, STEARNS & CO. INC.
DONALDSON, LUFKIN & JENRETTE
GOLDMAN, SACHS & CO.
MERRILL LYNCH & CO.
MORGAN STANLEY DEAN WITTER
The date of this Prospectus Supplement is March 14, 2000.
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ABOUT THIS PROSPECTUS
You should read this prospectus supplement along with the prospectus that
follows. In making your investment decision, you should rely only on the
information contained or incorporated by reference in this prospectus supplement
and the attached prospectus. We have not authorized anyone to provide you with
any other information. If you receive any unauthorized information, you must not
rely on it. We are offering to sell the notes only in places where offers and
sales are permitted.
You should not assume that the information contained or incorporated by
reference in this prospectus supplement or the attached prospectus is accurate
as of any date other than its respective date. Our business, financial
condition, and results of operations may have changed since the date of such
information.
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TABLE OF CONTENTS
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PROSPECTUS SUPPLEMENT
The Company......................... S-3
Use of Proceeds..................... S-6
Selected Financial Data............. S-7
Description of Notes................ S-8
Underwriting........................ S-11
Validity of the Notes............... S-12
</TABLE>
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PROSPECTUS
About this Prospectus............... 2
Where You Can Find More Information
about Goodyear................... 2
The Company......................... 3
Use of Proceeds..................... 3
Ratio of Earnings to Fixed
Charges.......................... 3
Description of Debt Securities...... 3
Plan of Distribution................ 12
Validity of Debt Securities......... 13
Experts............................. 13
</TABLE>
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THE COMPANY
The Goodyear Tire & Rubber Company ("Goodyear", or "we" or "us", and,
together with our domestic and foreign subsidiary companies, the "Goodyear
Group") is one of the world's leading manufacturers of tires and rubber
products. The Goodyear Group engages in operations in most regions of the world.
In 1999, our consolidated net sales were $12.88 billion and our net income was
$241.1 million, or $1.52 per share - diluted. Worldwide employment averaged
100,649 during 1999. Our operations involve seven business segments: North
American Tire, European Union Tire, Eastern Europe, Africa and Middle East Tire,
Latin American Tire, Asia Tire, Engineered Products and Chemical Products.
TIRES
Our principal business is the development, manufacture, distribution and
sale of tires and related products and services worldwide. The Goodyear Group
manufactures and markets in most regions of the world a broad line of rubber
tires for automobiles, trucks, buses, tractors, farm implements, earthmoving
equipment, aircraft, industrial equipment and various other applications, in
each case for sale to original equipment manufacturers and in the replacement
markets. We also:
- manufacture and sell inner tubes and flaps for truck tires and other
types of tires.
- retread truck, aircraft and heavy equipment tires.
- manufacture and sell tread rubber and other tire retreading materials.
- provide automotive repair services and miscellaneous other products and
services, primarily in the United States and Canada.
Our five tire segments accounted for approximately 87.1% of our
consolidated net sales and approximately 64.9% of our segment operating income
during 1999. During 1999, new tire sales accounted for approximately 79.5% of
our consolidated net sales.
On September 1, 1999, we completed a global alliance with Sumitomo Rubber
Industries ("Sumitomo") pursuant to which we acquired 75% of a joint venture
company in Europe that owns substantially all of Sumitomo's tire business in
Europe, including eight tire manufacturing plants and distribution operations in
18 European countries. We contributed the major portion of our tire businesses
in Europe to the joint venture company, including five tire plants. Similarly,
we acquired 75% of the capital of a company that purchased Sumitomo's
manufacturing operations in North America and certain related tire distribution
operations. We also acquired 100% of Sumitomo's other tire distribution
operations in North America. The businesses acquired in the alliance with
Sumitomo involve the manufacture, distribution and sale of Dunlop-brand and
other house brand passenger, truck and farm tires. The cost of acquiring these
businesses totaled approximately $1.24 billion, consisting of the approximately
$931.6 million of cash payments (financed by the issuance of additional debt) to
Sumitomo and approximately $307 million representing the fair value of the 25%
net interest of our businesses contributed to the joint venture company in
Europe. We recognized a gain on the assets contributed in the amount of $149.7
million ($143.7 million after tax, or $.90 per share - diluted) in the third
quarter of 1999. These businesses contributed $855.0 million of our net sales
and $60.7 million of our operating income in 1999.
We offer tires for most applications and to all classes of customers.
Worldwide, our sales of new tires to the numerous replacement markets we serve
substantially exceed our sales of new tires to original equipment manufacturers.
During 1999, we sold approximately 200.4 million tires worldwide, approximately
141.2 million of which were sold in the replacement markets and approximately
59.2 million of which were sold to original equipment customers. New tires are
sold under highly competitive conditions throughout the world. On a world-wide
basis, our major competitors are Bridgestone/Firestone and
Michelin/UniroyalGoodrich. Based on various industry and other sources, we
estimate that our share of the worldwide auto, truck and farm tire markets was
approximately 20.1% in 1999, 19.1% in 1998 and 19.0% in 1997.
In the United States and many other countries, we sell Goodyear-brand tires
to vehicle manufacturers for use as original equipment on vehicles they produce.
In most countries, we sell Goodyear-brand tires, and in certain countries we
sell other house brand and private brand tires, through various channels of
distribution for sale to vehicle owners for replacement purposes. We compete
with other tire manufacturers on the basis of price, warranty, service, consumer
convenience and product design, performance and reputation. We believe Goodyear-
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brand tires enjoy a high recognition factor throughout the world and have a
reputation for performance and high quality and value. Dunlop-brand tires enjoy
a high recognition factor in North America and Europe and have a reputation for
performance, quality and value. Kelly-brand, Fulda-brand, Debica-brand,
Sava-brand, and various other house-brand tire lines offered by us, and tires we
manufacture and sell to private-brand customers, compete primarily on the basis
of price.
NORTH AMERICAN TIRE
Our North American Tire segment manufactures and sells tires and related
products and services in the United States and Canada. In 1999, North American
Tire accounted for approximately 49.3% of our consolidated net sales and
approximately 3.5% of our segment operating income. During 1999, new tire sales
accounted for approximately 88.1% of the net sales of North American Tire.
TIRES. North American Tire manufactures and sells a broad line of tires in
the United States and Canada for automobiles, trucks, buses, tractors, farm
implements, earth moving equipment, aircraft, industrial equipment and various
other applications. North American Tire manufactures tires in 14 plants in the
United States and Canada.
Goodyear-brand radial passenger tire lines sold in North America include
the all season Regatta, the Eagle Gatorback and the Eagle Aquatred high
performance tire lines, and run-flat extended mobility technology tires,
including the new Aquasteel EMT. The major lines of Goodyear-brand radial light
truck tires offered are the Wrangler and Workhorse. A full line of all-steel
cord and belt construction radial medium truck tires, the Unisteel series, are
sold for various applications, including line-haul highway use and off-road
service. Also offered are several lines of radial and bias-ply tires for farm
machinery, heavy equipment and commercial and military aircraft.
We also offer various lines of Dunlop-brand, Kelly-brand, other house
brand, private brand and associate brand tires to the United States and Canadian
replacement markets.
RELATED PRODUCTS AND SERVICES. North American Tire also retreads truck,
aircraft and heavy equipment tires, primarily as a service to its commercial
customers, and manufactures and sells tread rubber and other tire retreading
materials for various applications. Additional products and services offered in
the United States and Canada include:
- automotive repair services provided through approximately 943 of our
retail outlets.
- the sale of automotive repair and maintenance items, automotive equipment
and accessories and other items to dealers and consumers.
EUROPEAN UNION TIRE
Our European Union Tire segment manufactures and sells a broad line of
tires for automobiles, trucks, farm implements and construction equipment
throughout the member states of the European Union and in Switzerland and
Norway, distributes and sells tires to various export markets in other regions,
and provides related products and services. European Union Tire manufactures
tires in 13 plants located in England, France, Germany and Luxembourg. In 1999,
European Union Tire accounted for approximately 19.9% of our consolidated net
sales and approximately 34.8% of our segment operating income. New tire sales
represented approximately 98.2% of the net sales of European Union Tire during
1999.
European Union Tire manufactures and sells several lines of radial
passenger tires and light truck tires, led by the Eagle and the Eagle Aquatred
passenger tire lines and the Wrangler light truck tire line, the Unisteel series
of radial medium truck tires, a line of bias-ply medium truck tires, and a broad
line of tires for farm implements and heavy equipment.
European Union Tire also:
- sells new, and manufactures and sells retreaded, aircraft tires in
Europe.
- provides various retreading and related services for truck and heavy
equipment tires, primarily for its commercial customers.
- offers automotive repair and related services through certain retail
outlets in which it owns a controlling interest.
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EASTERN EUROPE, AFRICA AND MIDDLE EAST TIRE
The Eastern Europe, Africa and Middle East Tire segment manufactures and
sells a broad line of passenger, truck, farm and construction equipment tires in
most countries in Eastern Europe, the Middle East and Africa, with tire
manufacturing plants located in Morocco, Poland, Slovenia, South Africa and
Turkey. In 1999, this segment accounted for approximately 6.2% of our
consolidated net sales and approximately 9.2% of our segment operating income.
New tire sales represented approximately 92.7% of the segment's net sales during
1999.
The Eastern Europe, Africa and Middle East Tire segment manufactures and
sells Goodyear-brand, Kelly-brand, Debica-brand and Sava-brand tires and sells
Dunlop-brand (since September 1, 1999) and Fulda-brand tires manufactured by
European Union Tire. Sales operations are maintained in most countries in
Eastern Europe and throughout Africa and the Middle East. Eastern Europe, Africa
and Middle East Tire also:
- sells new and retreaded aircraft tires.
- provides retreading and related services for truck and heavy equipment
tires.
- sells tires and automotive parts and accessories and provides automotive
repair services through retail outlets, primarily in South Africa.
LATIN AMERICAN TIRE
Our Latin American Tire segment manufactures and sells auto, truck and farm
tires in Mexico and throughout Central and South America and exports new tires
to various markets. Latin American Tire manufactures tires in plants located in
Brazil, Chile, Colombia, Guatemala, Mexico, Peru and Venezuela. In 1999, Latin
American Tire accounted for approximately 7.2% of our consolidated net sales and
approximately 12.5% of our segment operating income. New tire sales represented
approximately 89.0% of the net sales of Latin American Tire during 1999.
Latin American Tire manufactures and sells several lines of radial and
bias-ply passenger, light truck and medium truck tires and various radial and
bias-ply medium truck tires and sells new aircraft tires. Latin American Tire
also manufactures and sells retreaded tires for trucks and heavy equipment and
provides various materials and related services for truck, aircraft and heavy
equipment tires.
ASIA TIRE
Our Asia Tire segment engages in the manufacture and sale of tires
throughout east, southeast and south Asia and the western Pacific, including
China, India, Indonesia, Japan, Malaysia and Thailand. In 1999, Asia Tire
accounted for approximately 4.5% of our consolidated net sales and approximately
4.8% of our segment operating income. New tire sales represented approximately
96.7% of the 1999 net sales of Asia Tire.
Asia Tire manufactures several lines of tires for automobiles, light and
medium trucks, aircraft, farm implements and construction equipment for both the
original equipment and replacement markets at facilities located in China,
India, Indonesia, Japan, Malaysia, the Philippines, Taiwan and Thailand. Asia
Tire also retreads truck, heavy equipment and aircraft tires.
ENGINEERED PRODUCTS
Our Engineered Products segment develops, manufactures, distributes and
sells numerous rubber and thermoplastic products worldwide. Engineered Products
are manufactured in 26 plants located in the United States, Australia, Brazil,
Canada, Chile, China, France, Mexico, Slovenia, South Africa and Venezuela. In
1999, Engineered Products accounted for approximately 9.4% of our consolidated
net sales and approximately 13.1% of our segment operating income.
The products and services offered by Engineered Products include:
- belts and hose for motor vehicles.
- air springs, engine mounts and chassis parts for motor vehicles.
- conveyor and power transmission belts.
- air, water, steam, hydraulic, petroleum, fuel, chemical and materials
handling hose for industrial applications.
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- tank tracks.
- various other engineered rubber products and miscellaneous services.
CHEMICAL PRODUCTS
Our Chemical Products segment manufactures and sells synthetic rubber and
rubber latices, various resins and organic chemicals used in rubber and plastic
processing, and other chemical products for industrial customers worldwide.
Substantially all production is in the United States, except for certain
products manufactured in France. Our Chemical Products business also owns and
operates a natural rubber plantation and processing facility in Indonesia and
conducts natural rubber purchasing operations.
Chemical Products accounted for approximately 7.2% of our consolidated net
sales and approximately 22.0% of our segment operating income during 1999. The
major portion (52.0% in 1999) of the revenues of our Chemical Products segment
are from sales to our other segments, primarily synthetic rubber and rubber
processing chemicals to North American Tire, at the lower of a formula price or
market.
USE OF PROCEEDS
The net proceeds from the sale of the notes will be used to repay a portion
of the approximately $1.314 billion of our commercial paper outstanding at March
1, 2000, which commercial paper bears interest at a weighted average rate of
6.33% per annum.
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SELECTED FINANCIAL DATA
In the table below we provide you with selected consolidated financial
information prepared using our audited consolidated financial statements for
each of the fiscal years in the five-year period ended December 31, 1999.
You should read the information below with the financial statements and
accompanying notes included at Item 8 of our Annual Report on Form 10-K for the
year ended December 31, 1999, which are incorporated herein by reference.
<TABLE>
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YEAR ENDED DECEMBER 31,
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1999 1998 1997 1996 1995
(IN MILLIONS, EXCEPT PER SHARE AND RATIOS) --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
Net Sales.............................. $12,880.6 $12,626.3 $13,065.3 $12,985.7 $13,039.2
Income from Continuing Operations...... 241.1 717.0 522.4 558.5 575.2
Discontinued Operations................ -- (34.7) 36.3 (456.8) 35.8
--------- --------- --------- --------- ---------
Net Income............................. $ 241.1 $ 682.3 $ 558.7 $ 101.7 $ 611.0
========= ========= ========= ========= =========
Per Share of Common Stock:
Income (Loss) Per Share -- Basic:
Income from Continuing Operations...... $ 1.54 $ 4.58 $ 3.34 $ 3.60 $ 3.78
Discontinued Operations................ -- (.22) .24 (2.94) .24
--------- --------- --------- --------- ---------
Net Income -- Basic.................... $ 1.54 $ 4.36 $ 3.58 $ .66 $ 4.02
========= ========= ========= ========= =========
Income (Loss) Per Share -- Diluted:
Income from Continuing Operations...... $ 1.52 $ 4.53 $ 3.30 $ 3.56 $ 3.74
Discontinued Operations................ -- (.22) .23 (2.91) .23
--------- --------- --------- --------- ---------
Net Income -- Diluted.................. $ 1.52 $ 4.31 $ 3.53 $ .65 $ 3.97
========= ========= ========= ========= =========
Dividends Per Share.................... $ 1.20 $ 1.20 $ 1.14 $ 1.03 $ .95
Total Assets........................... $13,102.6 $10,589.3 $ 9,917.4 $ 9,671.8 $ 9,789.6
Long Term Debt......................... $ 2,347.9 $ 1,186.5 $ 844.5 $ 1,132.2 $ 1,320.0
Shareholders' Equity................... $ 3,617.1 $ 3,745.8 $ 3,395.5 $ 3,279.1 $ 3,281.7
Ratio of Earnings to Fixed Charges..... 2.31 5.78 5.08 5.18 5.10
</TABLE>
NOTES: (1) Net income in 1999 included net after-tax gains of $154.8 million, or
$.97 per share-diluted, from the change in control of businesses
contributed by Goodyear to the Goodyear Dunlop joint venture in
Europe and the sale of certain rubber chemical assets, and net
rationalization charges of $132.5 million after tax, or $.84 per
share-diluted.
(2) Net income in 1998 included a net after-tax gain of $61.3 million, or
$.38 per share-diluted, from the sale of the All American Pipeline
System and related assets, rationalizations and the sale of other
assets.
(3) Net Income in 1997 included net after-tax charges of $176.3 million,
or $1.12 per share-diluted, for rationalizations.
(4) Net Income in 1996 included net after-tax charges of $573.0 million,
or $3.65 per share-diluted, for the writedown of the All American
Pipeline System and related assets and certain rationalization
actions.
(5) For purposes of computing the ratios of earnings to fixed charges:
(a) earnings consist of income from continuing operations before
income taxes, plus amortization of capitalized interest, minority
interest in net income of subsidiaries, certain other adjustments,
and fixed charges; and (b) fixed charges include interest expense,
amortization of debt discount, premium or expense, the portion of
rents representative of an interest factor, capitalized interest and
our share of fixed charges of equity investees.
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DESCRIPTION OF NOTES
The following description sets forth the particular terms of the Notes and
supplements the description of the general terms of the Notes set forth under
the heading "Description of Debt Securities" in the attached prospectus.
Capitalized terms used in this prospectus supplement that are not otherwise
defined will have the meanings given to them in the accompanying prospectus. The
following statements with respect to the Notes are summaries and are subject to,
and are qualified by reference to, the provisions of the Notes and the
Indenture.
GENERAL TERMS
The Notes will be issued in two series under the Indenture, dated as of
March 1, 1999, between Goodyear and The Chase Manhattan Bank, as Trustee.
The 8.125% Notes due 2003 will constitute a series of debt securities under
the Indenture and will be limited in aggregate principal amount to $300,000,000.
The 8.125% Notes will mature on March 15, 2003 and will accrue interest at a
rate of 8.125% per annum.
The 8.50% Notes due 2007 will constitute a separate series of debt
securities under the Indenture and will be limited in aggregate principal amount
to $300,000,000. The 8.50% Notes will mature on March 15, 2007 and will accrue
interest at a rate of 8.50% per annum.
The Notes will bear interest from March 17, 2000, payable on March 15 and
September 15 of each year, commencing September 15, 2000. Interest will be
computed on the basis of a 360-day year of twelve 30-day months. Interest will
be payable generally to the person in whose name the Note is registered at the
close of business on the March 1 or September 1 next preceding the March 15 or
September 15 interest payment date.
The Notes will be issued only in denominations of $1,000 and integral
multiples of $1,000.
DEFEASANCE
The provisions of the Indenture relating to legal defeasance and covenant
defeasance (described under the caption "Description of Debt
Securities -- Defeasance" in the attached prospectus) will apply to the Notes.
OPTIONAL REDEMPTION
We may, at our option, redeem the Notes of each series in whole at any time
or in part from time to time, on at least 30 but not more than 60 days prior
notice mailed to the Depositary, at a redemption price equal to the greater of:
- 100% of their principal amount, and
- the present value of the Remaining Scheduled Payments (as defined
below) on the Notes to be redeemed, discounted to the date of
redemption, on a semiannual basis, at the Treasury Rate (as defined
below) plus fifteen basis points (.15%) in the case of the 8.125%
Notes due 2003 and twenty-five basis points (.25%) in the case of
the 8.50% Notes due 2007.
We will also accrue interest on the Notes to the date of redemption. In
determining the redemption price and accrued interest, interest shall be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
If money sufficient to pay the redemption price of and accrued interest on
the Notes to be redeemed is deposited with the Trustee on or before the
redemption date, on and after such date interest will cease to accrue on the
Notes (or such portions thereof) called for redemption.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable to
the remaining term of the Notes to be redeemed that would be utilized, 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 term of such Notes. "Independent Investment Banker" means one of the
Reference Treasury Dealers appointed by the Trustee after consultation with us.
"Comparable Treasury Price" means, with respect to any redemption date, (i)
the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
business day preceding such redemption date, as set forth in the daily
statistical release (or any
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successor release) published by the Federal Reserve Bank of New York and
designated "Composite 3:30 p.m. Quotations for U.S. Government Securities" or
(ii) if such release (or any successor release) is not published or does not
contain such prices on such business day, (A) the average of the Reference
Treasury Dealer Quotations for such redemption date, after excluding the highest
and lowest such Reference Treasury Dealer Quotations, or (B) if the Trustee
obtains fewer than four such Reference Treasury Dealer Quotations, the average
of all such Quotations. "Reference Treasury Dealer Quotations" means, with
respect to each Reference Treasury Dealer and any redemption date, the average,
as determined by the Trustee, 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 Trustee by such Reference Treasury Dealer at 5:00 p.m.
on the third business day preceding such redemption date.
"Reference Treasury Dealer" means Chase Securities Inc., and its
successors, and, at our option, other primary U.S. Government securities dealers
in New York City selected by us.
"Remaining Scheduled Payments" means, with respect to any note, the
remaining scheduled payments of the principal thereof to be redeemed and
interest thereon that would be due after the related redemption date but for
such redemption; provided, however, that, if such redemption date is not an
interest payment date with respect to such Note, the amount of the next
succeeding scheduled interest payment thereon will be reduced by the amount of
interest accrued thereon to such redemption date.
"Treasury Rate" means, with respect to any redemption date, the rate per
annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as
a percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date.
SINKING FUND
There will not be a sinking fund for the Notes.
FORM OF NOTES
Upon issuance, the Notes will be represented by one or more global
securities in registered form, without coupons (the "Global Securities"), which
will be issued in a denomination equal to the aggregate outstanding principal
amount of the Notes.
BOOK-ENTRY SYSTEM
The Notes will be represented by Global Securities registered in the name
of Cede & Co., as a nominee of DTC. The information set forth under "Description
of Debt Securities -- Permanent Global Debt Securities -- Book-Entry System" in
the attached prospectus will apply to the notes. Thus, beneficial interests in
the Notes will be shown on, and transfers thereof will be effected only through,
records maintained by DTC and its participants. Except under the circumstances
described at "Description of Debt Securities -- Permanent Global Debt
Securities -- Book-Entry System" in the attached prospectus, owners of
beneficial interests in the Global Securities will not be entitled to receive
Notes in definitive form and will not be considered holders of Notes.
DTC holds securities of institutions that have accounts with it or its
participants. DTC's records reflect only the identity of the participants to
whose accounts notes are credited, which may or may not be the Beneficial
Owners. The participants will remain responsible for keeping account of their
holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to participants, by
participants to their customers, and in turn to beneficial owners will be
governed by arrangements made among them, subject to any statutory or regulatory
requirements as may be in effect from time to time. Redemption notices will be
sent to Cede & Co.
Neither DTC nor Cede & Co. will consent or vote with respect to the Global
Securities. Under its usual procedures, DTC mails an omnibus proxy to us as soon
as possible after the applicable record date. The omnibus proxy assigns Cede &
Co.'s consenting or voting rights to the participants to whose accounts the
Notes are credited on the applicable record date.
Principal and interest payments on the Global Securities representing the
Notes will be made in immediately available funds to DTC. DTC's practice is to
credit participants' accounts on the applicable payment date in
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accordance with their respective holdings shown on DTC's records unless DTC has
reason to believe that it will not receive payment on such date. Payments by
participants to beneficial owners will be governed by standing instructions and
customary practices, as is the case with securities held for the accounts of
customers in bearer form or registered in "street name", and will be the
responsibility of such participant and not of DTC, the Trustee or us, subject to
any statutory or regulatory requirements as may be in effect from time to time.
We, or the Trustee, are responsible for the payment of principal, premium, if
any, and interest to DTC. Disbursement of such payments to participants shall be
the sole responsibility of DTC. Disbursement of such payments to the beneficial
owners of the Notes shall be the responsibility of the participants. Neither we
nor the Trustee will have any responsibility or liability for the disbursements
of payments in respect of ownership interests in the Notes by DTC or any
participants or for maintaining or reviewing any records of DTC or any
participants.
DTC may discontinue providing its services as securities depositary with
respect to the Notes at any time by giving reasonable notice to us or the
Trustee. Under such circumstances, and in the event that a successor securities
depositary is not obtained, notes in definitive form are required to be printed
and delivered to each holder. We may decide to discontinue use of the system of
book-entry transfers through DTC (or a successor securities depositary). In that
event, Notes in definitive form will be printed and delivered.
The information in this section concerning DTC and its system has been
obtained from sources that we believe are reliable, but we take no
responsibility for the accuracy of such information. The information is subject
to any changes to the arrangements between us and DTC and any changes to such
procedures that may be instituted unilaterally by DTC.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available funds. So long as DTC continues to make its "Same-Day Funds Settlement
System" available to us:
- we will make all payments of principal and interest on the Notes in
immediately available funds.
- The Notes will trade in DTC's Same-Day Funds Settlement System until
maturity.
See, "Description of Debt Securities -- Same-Day Settlement and Payment" in
the attached prospectus at page 11.
S-10
<PAGE> 11
UNDERWRITING
We and the underwriters have entered into an underwriting agreement
relating to the offering and sale of the Notes (the "Underwriting Agreement").
In the Underwriting Agreement, we have agreed to sell to each underwriter, and
each underwriter has agreed to purchase from us, the principal amount of the
Notes that appear opposite its name in the table below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT PRINCIPAL AMOUNT
OF THE 8.125% NOTES OF THE 8.50% NOTES
UNDERWRITERS DUE 2003 DUE 2007
------------ ------------------- -------------------
<S> <C> <C>
Chase Securities Inc............................. $180,000,000 $180,000,000
Banc of America Securities LLC................... 20,000,000 20,000,000
Bear, Stearns & Co. Inc.......................... 20,000,000 20,000,000
Donaldson, Lufkin & Jenrette Securities
Corporation.................................... 20,000,000 20,000,000
Goldman, Sachs & Co.............................. 20,000,000 20,000,000
Merrill Lynch, Pierce, Fenner & Smith
Incorporated......................... 20,000,000 20,000,000
Morgan Stanley & Co. Incorporated................ 20,000,000 20,000,000
------------ ------------
Total.................................. $300,000,000 $300,000,000
============ ============
</TABLE>
The obligations of the underwriters under the Underwriting Agreement,
including their agreement to purchase Notes from us, are several and not joint.
Those obligations are also subject to certain conditions in the Underwriting
Agreement being satisfied. The underwriters have agreed to purchase all of the
notes if any of them are purchased.
The underwriters have advised us that they propose to offer the Notes to
the public at the public offering prices that appear on the cover page of this
prospectus. The underwriters may offer the Notes to selected dealers at the
public offering price minus a selling concession of up to .30% of the principal
amount of the 8.125% Notes due 2003 and up to .375% of the principal amount of
the 8.50% Notes due 2007. In addition, the underwriters may allow, and those
selected dealers may reallow, a selling concession of up to .25% of the
principal amount of the Notes to certain other dealers. After the initial public
offering, the underwriters may change the public offering prices and any other
selling terms.
In the Underwriting Agreement, we have agreed that:
- we will pay our expenses related to the Offering, which we estimate will
approximately be $756,252;
- we will not offer or sell any of our debt securities (other than the
Notes, debt securities offered for sale outside the United States,
commercial paper or similar instruments, and notes and other similar
instruments evidencing loans from banks) for a period of three days after
the date of this prospectus without the prior consent of Chase Securities
Inc.; and
- we will indemnify the underwriters against certain liabilities, including
liabilities under the Securities Act.
There is currently no established trading market for the Notes. In
addition, we do not intend to apply for the Notes to be listed on any securities
exchange or to arrange for the Notes to be quoted on any quotation system. The
underwriters have advised us that they intend to make a market in the Notes, but
they are not obligated to do so. The underwriters may discontinue any market
making in the Notes at any time in their sole discretion. Accordingly, we cannot
assure you that a liquid trading market will develop for the Notes, that you
will be able to sell your Notes at a particular time or that the prices that you
receive when you sell will be favorable.
In connection with the offering of the Notes, the underwriters may engage
in overallotment, stabilizing transactions and syndicate covering transactions
in accordance with Regulation M under the Exchange Act. Overallotment involves
sales in excess of the offering size, which creates a short position for the
underwriters. Stabilizing transactions involve bids to purchase the notes in the
open market for the purpose of pegging, fixing or maintaining the price of the
Notes. Syndicate covering transactions involve purchases of the Notes in the
open market after the distribution has been completed in order to cover short
positions. Stabilizing transactions and syndicate covering transactions may
cause the price of the Notes to be higher than it would otherwise be in the
absence of those transactions. If the underwriters engage in stabilizing or
syndicate covering transactions, they may discontinue them at any time.
S-11
<PAGE> 12
Chase Securities Inc. is an affiliate of the Chase Manhattan Bank, the
Trustee. The Chase Manhattan Bank is the administrative agent and a lender under
two revolving credit facilities under which we may borrow up to an aggregate of
$2.0 billion from 27 banks, including an affiliate of Banc of America Securities
LLC. In addition, the banking affiliates of Chase Securities Inc. and Banc of
America Securities LLC participate on a regular basis in various other general
financing and banking transactions for us and our affiliates. Chase Securities
Inc., Banc of America Securities LLC, Bear, Stearns & Co. Inc., Donald, Lufkin &
Jenrette Securities Corporation and Goldman, Sachs & Co., or their respective
affiliates, are counterparties to various interest rate exchange and similar
contracts with the Company. Certain of the underwriters or their affiliates from
time to time have performed, and continue to perform, various investment banking
services for Goodyear. The underwriters and their associates or affiliates may
in the future engage in transactions with, or may in the future perform services
for, us and may in the future receive fees in connection therewith.
VALIDITY OF THE NOTES
The validity of the Notes will be passed upon for us by C. Thomas Harvie,
Esq., a Senior Vice President and the General Counsel of Goodyear, and for the
Underwriters by Cravath, Swaine & Moore, Worldwide Plaza, 825 Eighth Avenue, New
York, New York 10019. At March 1, 2000, Mr. Harvie directly or indirectly owned
approximately 6,947 shares, and holds options and contingent rights granted
pursuant to Goodyear sponsored compensation plans to acquire up to 116,370
additional shares, of Goodyear common stock.
S-12
<PAGE> 13
PROSPECTUS
$1,250,000,000
THE GOODYEAR TIRE & RUBBER COMPANY
DEBT SECURITIES
------------------------
The Goodyear Tire & Rubber Company may offer and sell from time to time
debt securities consisting of debentures, notes and/or other unsecured evidences
of indebtedness in one or more series at an aggregate initial offering price not
to exceed $1,250,000,000. The debt securities may be offered in separate series
in amounts, at prices and on terms determined at the time of offering.
------------------------
WE WILL PROVIDE SPECIFIC TERMS OF EACH SERIES OF THE DEBT SECURITIES IN
SUPPLEMENTS TO THIS PROSPECTUS. YOU SHOULD READ THIS PROSPECTUS AND ANY
ACCOMPANYING PROSPECTUS SUPPLEMENT CAREFULLY BEFORE YOU INVEST.
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
------------------------
The date of this Prospectus is March 7, 2000
<PAGE> 14
YOU SHOULD RELY ONLY ON THE INFORMATION PROVIDED OR INCORPORATED BY
REFERENCE IN THIS PROSPECTUS AND THE ACCOMPANYING PROSPECTUS SUPPLEMENT. NO
PERSON HAS BEEN AUTHORIZED BY US TO PROVIDE YOU WITH ANY OTHER INFORMATION. WE
ARE NOT MAKING AN OFFER OF ANY DEBT SECURITIES IN ANY STATE WHERE THE OFFER IS
UNLAWFUL. YOU SHOULD NOT ASSUME THAT THE INFORMATION IN THIS PROSPECTUS AND THE
ACCOMPANYING PROSPECTUS SUPPLEMENT IS CORRECT AS OF ANY DATE AFTER THE DATE OF
THIS PROSPECTUS AND THE PROSPECTUS SUPPLEMENT.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that The Goodyear Tire
& Rubber Company ("Goodyear", or "we" or "us") filed with the Securities and
Exchange Commission using the "shelf" registration process. Under this process,
we may sell debt securities in one or more offerings up to a total amount of
$1,250,000,000. This prospectus provides you with a general description of the
debt securities we may offer. Each time we offer to sell debt securities, we
will provide a supplement to this prospectus that will contain specific
information about the terms of that offering. The supplement may also add
information and/or update and/or change the information contained in this
prospectus. You should read this prospectus and any accompanying prospectus
supplement together with the additional information described under the heading
"Where You Can Find More Information About Goodyear." To find more detail about
certain documents, you should read the exhibits filed with the registration
statement.
WHERE YOU CAN FIND MORE INFORMATION ABOUT GOODYEAR
We file annual, quarterly and current reports, proxy statements and other
information with the SEC. You may read and copy any document we file with the
SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington,
D.C. 20549. You may call the SEC at 1-800-SEC-0330 (1-800-732-0330) for
information on the operation of the Public Reference Room. Our filings with the
SEC are also available to the public over the SEC's Internet web site at:
http://www.sec.gov.
This prospectus does not contain all of the information in or the exhibits
to the registration statement, which you may read at the SEC's Public Reference
Room or over its Internet web site.
The SEC allows us to "incorporate by reference" into this prospectus
information included in documents we file with it, which means we can disclose
important information to you by referring you to other documents we file with
the SEC. The information incorporated by reference is considered a part of this
prospectus. Information that we file with the SEC later will automatically
update and supercede the information in this prospectus.
We incorporate by reference into this prospectus:
- Our Annual Report on Form 10-K for the year ended December 31, 1999; and
- Any future filings made by us with the SEC (File No. 1-1927) under
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934,
as amended, until we have sold all of the debt securities offered by this
prospectus.
YOU MAY REQUEST A COPY OF THESE FILINGS, AT NO COST TO YOU, BY WRITING TO
US AT THE FOLLOWING ADDRESS OR CALLING US AT THE TELEPHONE NUMBER BELOW:
OFFICE OF THE SECRETARY
THE GOODYEAR TIRE & RUBBER COMPANY
1144 EAST MARKET STREET
AKRON, OHIO 44316-0001
TELEPHONE NUMBER: 330-796-2121
2
<PAGE> 15
THE COMPANY
Goodyear was organized as an Ohio corporation in 1898. Together with its
subsidiary companies, Goodyear is one of the world's leading producers of tires
and rubber products. Our principal business is developing, manufacturing,
distributing and selling new tires for most applications in most regions of the
world. We also manufacture and sell numerous rubber and other products for the
transportation industry and various industrial and consumer markets, manufacture
and sell rubber-related chemicals for various applications, provide automotive
repair and other services at retail and commercial outlets and sell various
other products.
We maintain our principal executive offices at 1144 East Market Street,
Akron, Ohio 44316-0001. Our telephone number is 330-796-2121.
USE OF PROCEEDS
Unless otherwise indicated in the applicable prospectus supplement, the net
proceeds we receive from the sale of the debt securities will be used for
general corporate purposes. General corporate purposes may include repaying
short-term bank borrowings and funding future acquisitions, capital expenditures
and working capital requirements.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's ratio of earnings to fixed
charges for the periods indicated:
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
--------------------------------
1999 1998 1997 1996 1995
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges..... 2.31 5.78 5.08 5.18 5.10
</TABLE>
For purposes of computing the above ratios: (1) earnings consist of income
from continuing operations before income taxes, plus amortization of capitalized
interest, minority interest in net income of subsidiaries, certain other
adjustments, and fixed charges; and (2) fixed charges include interest expense,
amortization of debt discount, premium or expense, the portion of rents
representative of an interest factor, capitalized interest and our share of
fixed charges of equity investees.
DESCRIPTION OF DEBT SECURITIES
THE FOLLOWING DESCRIPTION SETS FORTH CERTAIN GENERAL TERMS OF THE DEBT
SECURITIES. THE PARTICULAR TERMS OF THE SERIES OF DEBT SECURITIES OFFERED BY A
PROSPECTUS SUPPLEMENT WILL BE DESCRIBED IN THE PROSPECTUS SUPPLEMENT RELATING TO
SUCH SERIES OF DEBT SECURITIES.
The debt securities will be issued under an Indenture, dated as of March 1,
1999 (the "Indenture"), between Goodyear and The Chase Manhattan Bank, as
trustee (the "Trustee"). The following summary of certain provisions of the
Indenture is not complete. Section references below are to sections of the
Indenture. Capitalized terms have the meanings assigned to them in the
Indenture. The referenced sections of the Indenture and the definitions of the
capitalized terms are incorporated by reference. A copy of the Indenture is
filed as an exhibit to the registration statement.
GENERAL
The Indenture provides for the issuance of our debt securities in an
unlimited amount from time to time in one or more separate series. The debt
securities will be unsecured and will have the same rank as all of our other
unsecured and unsubordinated indebtedness.
The prospectus supplement relating to any particular series of debt
securities offered will describe (to the extent applicable) the following terms
with respect to the offered debt securities:
- the title of the debt securities;
3
<PAGE> 16
- the aggregate principal amount of the debt securities;
- the price at which the debt securities will be issued;
- the dates on which the principal of the debt securities will be due and
payable;
- the rate or rates (which may be fixed or variable) and/or any method for
determining the rate or rates at which the debt securities will bear
interest, if any;
- the date or dates from which any interest will accrue;
- the date on which payment of interest, if any, will commence, the
interest payment dates, and the regular record dates for determining the
holder to whom such interest will be payable;
- the person to whom any interest will be payable, if other than the person
in whose name the debt security is registered at the close of business on
the regular record date for such interest payment;
- the place or places where payments on the debt securities will be
payable;
- any mandatory or optional sinking fund provisions applicable to the debt
securities;
- any mandatory or optional redemption provisions applicable to the debt
securities;
- if other than U.S. Dollars, the currency or currencies, including
composite currencies, in which payments on the debt securities will be
payable;
- any index used to determine the amount of payments of principal of (and
premium, if any) or interest on the debt securities;
- the portion of the principal amount of the debt securities, if other than
the principal amount thereof, payable upon acceleration of maturity
thereof;
- any right we have to defease the debt securities under the Indenture;
- whether such debt securities will be issued in fully registered form
without coupons or will be issued in the form of one or more global
securities in temporary global form or definitive global form;
- any addition to or change in the covenants or events of default set forth
below which will apply to the debt securities; and
- any other terms of the debt securities, which terms must be consistent
with the Indenture. (Section 3.01)
Debt securities may be issued as original issue discount debt securities.
An original issue discount debt security bears no interest or bears interest at
a below-market rate, is sold at a discount to its stated principal amount and,
ordinarily, provides that less than the stated principal amount will be payable
upon any acceleration of its maturity. (Section 1.01) The applicable prospectus
supplement will describe any special tax, accounting or other information
relating to original issue discount debt securities or relating to certain other
kinds of debt securities then being offered, such as debt securities linked to
an index, payable in currencies other than U.S. dollars, or subject to special
repayment or other provisions.
Unless otherwise specified in the prospectus supplement relating to any
particular series of the debt securities:
- principal of (and premium, if any) and interest, if any, on the debt
securities will be payable at the office of the Trustee maintained for
such purpose, except that we have the option to pay interest by mailing a
check to the address of the person entitled thereto as indicated by the
security register;
- transfers and exchanges of the debt securities may be made at the office
of the Trustee maintained for such purpose;
- payment of any interest due on any debt security will be made to the
person in whose name such debt security is registered at the close of
business on the regular record date for such interest;
4
<PAGE> 17
- the debt securities will be issued only in fully registered form without
coupons and in denominations of $1,000 or any integral multiples thereof;
and
- no service charge will be made for any transfer or exchange of the debt
securities, but we may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection with a transfer or
exchange. (Sections 3.01, 3.02, 3.05, 3.07 and 10.02)
COVENANTS
LIMITATION ON SECURED INDEBTEDNESS. The Indenture contains a covenant by
us that, so long as any debt securities are outstanding, neither we nor any
Restricted Subsidiary (as defined below) will issue, assume or guarantee any
Secured Indebtedness (as defined below) secured by a Lien (as defined below) on
Restricted Property (as defined below) without securing the debt securities
equally and ratably with, or prior to, such Secured Indebtedness. The foregoing
limitation on Secured Indebtedness does not apply to:
- any Lien on Restricted Property of a Restricted Subsidiary that exists
when the corporation becomes a Restricted Subsidiary;
- any Lien on Restricted Property that exists when Goodyear or a Restricted
Subsidiary acquires such Restricted Property;
- any Lien on Restricted Property securing payment of all or part of the
purchase price of such Restricted Property;
- any Lien on Restricted Property to secure any indebtedness incurred to
finance all or part of the purchase price of such Restricted Property,
whether incurred before, at the time of, or within one year after, the
acquisition of such Restricted Property;
- any Lien on property of a corporation that exists when such corporation
is merged into or consolidated with Goodyear or a Restricted Subsidiary;
- any Lien on property of a corporation that exists prior to the sale,
lease or other disposition of all or substantially all of the properties
of such corporation to Goodyear or a Restricted Subsidiary;
- any Lien securing Secured Indebtedness owing by any Restricted Subsidiary
to Goodyear or another Restricted Subsidiary;
- any Lien on Restricted Property in favor of any country, any political
subdivision of any country, or any department, agency or instrumentality
of any country or any political subdivision of any country, to secure
progress or other payments to us, or the performance of our obligations,
pursuant to any contract or statute or to secure any indebtedness
incurred to finance all or part of the cost of such Restricted Property,
including Liens to secure pollution control or industrial revenue bonds
or other types of financings;
- any Lien on personal property, other than manufacturing equipment that is
Restricted Property;
- any extension, renewal or replacement of any Secured Indebtedness or any
Lien referred to above, provided that the principal amount of Secured
Indebtedness secured by the Lien shall not exceed the principal amount
secured at the time of such extension, renewal or replacement and that
such extension, renewal or replacement Lien shall be limited to all or a
part of the Restricted Property which secured such Lien (plus
improvements on such Restricted Property); or
- any Lien on Restricted Property that would not otherwise be permitted, if
the aggregate amount of all Secured Indebtedness secured by Liens not
otherwise permitted, determined immediately after the grant of the Lien,
does not exceed 15% of our consolidated stated capital, plus capital
surplus, plus retained earnings as reported on our then most recent
annual or quarterly consolidated balance sheet. (Section 10.05.)
Lien, Restricted Property, Restricted Subsidiary and Secured Indebtedness
are defined in Section 1.01 of the Indenture. For your reference:
- "Lien" means any mortgage, lien, pledge, security interest or title
retention agreement relating to any asset.
5
<PAGE> 18
- "Restricted Property" means any manufacturing plant or equipment owned by
us or a Restricted Subsidiary which is used primarily to manufacture
tires or other automotive products and is located within the United
States of America, excluding (i) retread plants, (ii) plants, facilities
and equipment used primarily for transportation, marketing or
warehousing, (iii) oil and gas pipeline and related assets, and (iv)
certain other plants and equipment that are not important to our
business.
- "Restricted Subsidiary" means a subsidiary of ours engaged primarily in
manufacturing tires or other automotive products, which (i) has
substantially all of its assets located in, and conducts substantially
all of its operations in, the United States of America and (ii) has
assets in excess of 5% of the total consolidated assets of us and our
consolidated subsidiaries (as shown on our then most recent annual or
quarterly consolidated balance sheet), other than a subsidiary primarily
engaged in financing accounts receivable, leasing or owning real estate
or transportation or distribution activities.
- "Secured Indebtedness" means indebtedness of us or any Restricted
Subsidiary for money borrowed (including capital lease obligations and
conditional sales contracts) that matures (or may be extended so as to
mature) more than one year after it was incurred, assumed or guaranteed
and is secured by a Lien on Restricted Property, other than indebtedness
secured by a Lien which is outstanding at March 1, 1999.
LIMITATION ON SALE AND LEASEBACK TRANSACTIONS. We also covenant that
neither we nor any Restricted Subsidiary will enter into any lease covering any
Restricted Property owned at March 1, 1999 that is sold to any other person in
connection with such lease unless we or such Restricted Subsidiary:
- would be entitled under the Indenture to incur Secured Indebtedness
secured by a Lien on the Restricted Property to be leased in an amount
equal to the Attributable Debt (as defined below) with respect to such
transaction without equally and ratably securing the debt securities; or
- use (within 120 days of the effective date of such transaction) an amount
equal to the proceeds from the sale of such Restricted Property to repay
any indebtedness of ours or such Restricted Subsidiary that matures (or
may be extended so as to mature) more than one year after it was incurred
or assumed.
This covenant does not prevent us or any Restricted Subsidiary from
entering into any sale and lease back transaction:
- involving a lease with a term of three years or less; or
- which is entered into within 180 days after the later of the acquisition,
the completion of construction, or the commencement of operation of such
Restricted Property. (Section 10.06)
"Attributable Debt" is the total net amount of rent required to be paid
during the term of the relevant lease, discounted at the rate per annum equal to
the lesser of (i) the prevailing market interest rate at the relevant date on
United States Treasury obligations having a maturity substantially equal to the
average term of the relevant lease, plus 3%, and (ii) the weighted average
interest rate borne by debt securities then outstanding.
CONSOLIDATION, MERGER AND SALE OF ASSETS. We also covenant that we will
not merge into or consolidate with, or sell all or substantially all of our
assets to, any Person, unless (a) the successor is a corporation organized under
the laws of the United States of America or any state thereof, and (b) the
successor corporation assumes all of our obligations under the debt securities
and the Indenture. (Section 8.01) Upon any such merger, consolidation or sale,
the successor corporation will succeed to, and be substituted for, us. (Section
8.02).
NO COVENANTS PROTECTING HOLDERS IN THE EVENT OF HIGHLY LEVERAGED
TRANSACTIONS. In the event of a recapitalization or highly leveraged
transaction involving Goodyear, the Indenture does not and, unless set forth in
the prospectus supplement relating to a particular series of debt securities,
will not:
- contain any covenant (other than those described above) designed to
protect holders of the debt securities;
- limit the total amount of indebtedness that we may incur;
- grant any right of redemption to holders of the debt securities; or
- provide for new covenants or any adjustments to terms and conditions of
the debt securities.
6
<PAGE> 19
NO REDEMPTION OR AMENDMENT UPON CHANGE IN CONTROL. The Indenture does not
and, unless set forth in the prospectus supplement relating to a particular
series of debt securities, will not require redemption, or any change in the
covenants or other adjustments to the terms and conditions, of the debt
securities in the event of any change in control of Goodyear.
EVENTS OF DEFAULT
An "Event of Default" under the Indenture (Section 5.01) with respect to
debt securities of any series is the occurrence of any one of the following
events:
- default for 30 days in payment of any interest on any debt security of
that series;
- default in payment of principal of (or premium, if any, on) any debt
security of that series when due;
- failure to deposit when due any sinking fund payment in respect of the
debt securities of that series;
- our failure for 60 days after appropriate notice to perform any of the
other covenants in the Indenture (except covenants not applicable to debt
securities of that series);
- certain events of bankruptcy, insolvency or reorganization of Goodyear;
or
- any other Event of Default provided with respect to debt securities of
that series.
If any Event of Default with respect to debt securities of any series
occurs and is continuing, either the Trustee or the holders of not less than 25%
in principal amount of the debt securities of that series then outstanding may
declare the principal amount (or, if applicable, a specified portion of the
principal amount of any original issue discount debt securities) of all debt
securities of that series to be due and payable immediately. Subject to certain
conditions, the declaration may be annulled and past defaults (except uncured
payment defaults and certain other specified defaults) may be waived by the
holders of a majority in principal amount of the debt securities of that series
then outstanding. (Sections 5.02 and 5.13)
The prospectus supplement relating to each series of debt securities that
consists in whole or in part of original issue discount debt securities will
describe any particular provisions relating to acceleration of the maturity of
such original issue discount debt securities when an Event of Default occurs,
including the portion of the stated amount that would be due.
The Trustee is required to give the holders of any series of debt
securities notice of a default known to it (if uncured or not waived) within 90
days after the default occurs. Except in the case of a payment default, the
Trustee may withhold this notice if it determines in good faith that withholding
it is in the interest of the holders of such series. The above notice shall not
be given until at least 60 days after a default occurs in the performance of a
covenant in the Indenture other than a payment default. The term "default" for
this purpose means any event which is, or after notice and/or lapse of time
would become, an Event of Default with respect to debt securities of that
series. (Section 6.02)
Other than the duty to act with the required standard of care, the Trustee
is not obligated to exercise any of its rights or powers under the Indenture at
the request or direction of the holders of debt securities unless the holders
indemnify the Trustee. (Section 6.03)
If the Trustee is indemnified, the holders of a majority in principal
amount of debt securities of any series may direct the time, method and place of
conducting any proceeding for any available remedy or for exercising any trust
or other power conferred on the Trustee. However, the Trustee may decline to act
if such direction is contrary to law or the Indenture. (Section 5.12)
No holder of any debt security of any series may start a lawsuit under the
Indenture, unless:
- the holder has given to the Trustee written notice of a continuing Event
of Default with respect to debt securities of that series;
- the holders of at least 25% in principal amount of the debt securities of
that series then outstanding make a written request to the Trustee to
seek a remedy and offer a reasonable indemnity;
7
<PAGE> 20
- the Trustee fails to start a lawsuit within 60 days; and
- the Trustee does not receive from the holders of a majority in principal
amount of the debt securities of that series then outstanding a direction
inconsistent with such request during such 60-day period. (Section 5.07)
However, the holder of any debt security will have an absolute right to receive
payment of the principal of (and premium, if any) and any interest on such debt
security when due and to institute suit for the enforcement of any such payment.
(Section 5.08)
The Indenture requires us to file annually with the Trustee a certificate
stating that no default exists under certain provisions of the Indenture or
specifying any default that exists. (Section 10.08)
DEFEASANCE
The prospectus supplement will state if any defeasance provision will apply
to the offered debt securities.
DEFEASANCE AND COVENANT DEFEASANCE. The Indenture provides that, if made
applicable to any series of debt securities, we may elect to:
- defease and be discharged from all of our obligations (subject to certain
limited exceptions) with respect to any series of debt securities then
outstanding ("Defeasance"); and/or
- be released from our obligations under certain covenants and from the
consequences of an Event of Default resulting from the breach of those
covenants ("Covenant Defeasance").
To elect Defeasance and/or Covenant Defeasance, we must deposit in trust
with the Trustee money and/or U.S. Government Obligations which through the
payment of interest and principal in accordance with their terms will provide
money in an amount sufficient to repay in full when due the debt securities of
such series. As a condition to Defeasance or Covenant Defeasance, we must
deliver to the Trustee an opinion of counsel that holders of the debt securities
of such series will not recognize income, gain or loss for federal income tax
purposes as a result of the Defeasance or Covenant Defeasance and that the debt
securities, if then listed on a national securities exchange under the Exchange
Act, would not be delisted as a result of the defeasance. (Sections 13.02, 13.03
and 13.04) In the case of Defeasance, we may deliver to the Trustee a ruling of
the Internal Revenue Service in lieu of the opinion of counsel.
COVENANT DEFEASANCE AND CERTAIN EVENTS OF DEFAULT. If we implement
Covenant Defeasance for a series of the debt securities and such series is
declared due and payable because of the occurrence of one of certain Events of
Default, the amount of money and U.S. Government Obligations on deposit with the
Trustee will be sufficient to pay amounts due on the Debt Securities of such
series at the time of their stated maturity, but may not be sufficient to pay
amounts due at the time of the acceleration resulting from such Event of
Default. However, we remain liable for such payments.
MODIFICATIONS AND WAIVERS OF THE INDENTURE
Goodyear and the Trustee may modify (by adding, changing or eliminating any
provision of) the Indenture (as provided at Section 9.02) with the consent of
the holders of not less than a majority in principal amount of outstanding debt
securities of each series affected. However, without the consent of each
affected holder, no modification may:
- change the dates fixed in any debt security for the payment of the
principal of and interest on such debt security.
- reduce the principal amount of (or premium, if any) or any interest on
any debt security.
- reduce the rate of interest on any debt security.
- reduce the amount of principal of an original issue discount debt
security payable upon acceleration.
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- change the place or currency of payment of principal of (or premium, if
any) or interest on any debt security.
- impair the right to institute suit for the enforcement of any payment on
any debt security on or after such payment is due and payable.
- reduce the percentage in principal amount of debt securities of any
series required to consent a modification of, or waiver under, the
Indenture.
- effect certain other changes.
The holders of a majority in principal amount of debt securities of any
series then outstanding may waive our compliance with certain restrictive
provisions of the Indenture with respect to that series. (Section 10.09) The
holders of a majority in principal amount of debt securities of any series then
outstanding may waive any past default under the Indenture with respect to that
series, except a default in the payment of the principal of or interest (or
premium, if any) on any debt security of that series or a default under a
covenant which cannot be modified or amended without the consent of all affected
holders of debt securities. (Section 5.13)
PERMANENT GLOBAL DEBT SECURITIES -- BOOK-ENTRY SYSTEM
The following will apply to the debt securities of any series, unless
otherwise indicated in the prospectus supplement relating to that series.
The debt securities of each series will be represented by one or more
permanent global securities (collectively, a "global security") to be deposited
with and registered in the name of a depositary or a nominee of the depositary
identified in the prospectus supplement relating to such series. Unless
otherwise indicated in the prospectus supplement relating to that series of debt
securities, The Depositary Trust Company will act as depositary and the global
security will be deposited with DTC, as depositary, or its nominee and
registered in the name of a nominee of DTC. Except under the limited
circumstances described below, global securities are not exchangeable for
definitive certificated debt securities.
Ownership of beneficial interests in a global security is limited to
institutions that have accounts with DTC or its nominee ("participants") or
persons that may hold interests through participants. Ownership of beneficial
interests by participants in a global security will be evidenced only by, and
the transfer of that ownership interest will be effected only through, records
maintained by DTC or its nominee for that global security. Ownership of
beneficial interests in a global security by a person that holds through a
participant will be evidenced only by, and the transfer of that beneficial
interest within that participant will be effected only through, records
maintained by that participant. DTC has no knowledge of the actual beneficial
owners of the debt securities. Beneficial owners will not receive written
confirmation from DTC of their purchase. Beneficial owners are expected to
receive written confirmations of the details of transactions and periodic
statements of their holdings from the participants through which the beneficial
owners entered into the transactions. The laws of certain jurisdictions require
that certain owners of securities obtain possession of such securities in
definitive form. Such laws may impair the ability to transfer beneficial
interests in a global security.
We have been advised by DTC that upon the issuance of a global security and
the deposit of that global security with DTC, DTC will immediately credit, on
its book-entry registration and transfer system, the respective principal
amounts of the debt securities represented by that global security to the
accounts of its participants.
So long as DTC, or its nominee, is the registered holder and owner of a
global security, it will be considered the sole owner and holder of the debt
securities for all purposes of such debt securities and under the Indenture.
Except as set forth below, owners of beneficial interests in a global security
will not be entitled to have debt securities represented by such global security
registered in their names, will not receive or be entitled to receive physical
delivery of debt securities in definitive form and will not be considered to be
the owners or holders of any debt securities under the Indenture or such global
security. Accordingly, each person owning a beneficial interest in a global
security must rely on the procedures of the DTC and, if such person is not a
participant, on the procedures of the participant through which such person owns
its interest, to exercise any rights of a holder of debt securities under the
Indenture or the global security. The Indenture permits the Depositary to
authorize
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participants, as its agents, to take any action which the Depositary, as the
holder of a global security, is entitled to take under the Indenture or such
global security.
Payment of principal of and premium, if any, and interest, if any, on debt
securities represented by a global security will be made to DTC or its nominee,
as the case may be, as the registered owner and holder of the global security
representing those debt securities.
We have been advised by DTC that upon receipt of any payment of principal
of, or premium, if any, or interest on, a global security, DTC will immediately
credit participants' accounts on its book-entry registration and transfer system
with payments in amounts proportionate to their respective beneficial interests
in the principal amount of that global security as shown on the records of DTC.
Payments by participants to owners of beneficial interests in a global security
held through those participants will be governed by standing instructions and
customary practices, as is the case with securities held for the accounts of
customers in bearer form or registered in "street name," and will be the sole
responsibility of such participants, subject to any statutory or regulatory
requirements that may be in effect from time to time.
Neither we nor the Trustee will be responsible for any aspect of the
records of DTC, any nominee or any participant relating to, or payments made on
account of, beneficial ownership interests in a global security for any debt
securities or for maintaining, supervising or reviewing any records of DTC, any
nominee or any participant relating to such beneficial ownership interests.
Further, neither we nor the Trustee will be responsible for any other aspect of
the relationship between the DTC and its participants or the relationship
between such participants and the owners of beneficial interests in such global
security owning through such participants.
A global security is exchangeable for definitive debt securities registered
in the name of, and a transfer of a global security may be registered to, any
person other than DTC or its nominee, only if:
(a) DTC notifies us that it is unwilling or unable to continue as
depositary for that global security or at any time DTC ceases to be a
clearing agency registered under the Exchange Act;
(b) we at any time determine in our discretion that all or a portion
of the global security shall be exchangeable for definitive debt securities
in registered form; or
(c) an Event of Default with respect to the debt securities shall have
occurred and be continuing.
Any global security that is exchangeable pursuant to the preceding sentence
will be exchangeable in whole for definitive debt securities in registered form,
of like tenor and of an equal aggregate principal amount as the global security,
in denominations specified in the applicable prospectus supplement (if other
than $1,000 and integral multiples of $1,000). The definitive debt securities
will be registered by the registrar in the name or names instructed by DTC. We
expect that these instructions may be based upon directions received by DTC from
its participants with respect to ownership of beneficial interests in the global
security. Any principal and interest will be payable, the transfer of the
definitive debt securities will be registerable, and the definitive debt
securities will be exchangeable at the corporate trust office of the Trustee in
the Borough of Manhattan, The City of New York, provided that payment of
interest may be made at our option by check mailed to the address of the person
entitled to that interest payment as of the record date and as shown on the
register for the debt securities.
Except as provided above, owners of the beneficial interests in a global
security will not be entitled to receive physical delivery of debt securities in
definitive form and will not be considered the holders of debt securities for
any purpose under the Indenture. No global security shall be exchangeable except
for another global security of like denomination and tenor to be registered in
the name of DTC or its nominee. Accordingly, each person owning a beneficial
interest in a global security must rely on the procedures of DTC and, if that
person is not a participant, on the procedures of the participant through which
that person owns its interest, to exercise any rights of a holder under the
global security or the Indenture.
We understand that, under existing industry practices, if we request any
action of holders, or an owner of a beneficial interest in a global security
desires to take any action that a holder is entitled to take under the debt
securities or the Indenture, then DTC would authorize the participants holding
the relevant beneficial interests to take that action and those participants
would authorize beneficial owners owning through those participants to take that
action or would otherwise act upon the instructions of beneficial owners owning
through them.
DTC has advised us that DTC is a limited purpose trust company organized
under the laws of the State of New York, a "banking organization" within the
meaning of the New York Banking Law, a member of the
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Federal Reserve System, a "clearing corporation" within the meaning of the New
York Uniform Commercial Code and a "clearing agency" registered under the
Exchange Act. DTC was created to hold securities of its participants and to
facilitate the clearance and settlement of securities transactions among its
participants in those securities through electronic book-entry changes in
accounts of the participants, thereby eliminating the need for physical movement
of securities certificates. DTC's participants include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations. DTC is owned by a number of its participants and by the New York
Stock Exchange, Inc., the American Stock Exchange, Inc. and the National
Association of Securities Dealers, Inc. Access to DTC's book-entry system is
also available to others, such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a participant,
either directly or indirectly. The rules applicable to DTC and its participants
are on file with the Commission.
DTC has informed its participants and others that its processing data
systems, as they relate to the timely payment of distributions to
securityholders, book-entry deliveries, and settlement of trades within DTC,
functioned properly on and after January 1, 2000. DTC has indicated that it has
completed a technical assessment and has determined that its systems are Year
2000 compliant and are fully operational following the Year 2000 rollover.
According to DTC, the foregoing information is not intended as a representation,
warranty, or contract modification of any kind.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement by the purchasers of the debt securities will be made in
immediately available funds. All payments of principal and interest by us to DTC
will be made in immediately available funds.
The debt securities will trade in DTC's Same-Day Funds Settlement System
until maturity. DTC will require secondary trading activity in the debt
securities to be settled in immediately available funds. The settlement of
trades in immediately available funds may affect trading activity in the debt
securities, since secondary trading in long-term notes and debentures of
corporate issuers is generally settled in clearing-house or next-day funds.
INFORMATION CONCERNING THE TRUSTEE
The Chase Manhattan Bank is the Trustee under the Indenture. The Chase
Manhattan Bank is also the Trustee under an indenture, dated as of March 15,
1996, between Goodyear and The Chase Manhattan Bank, as Trustee, which contains
substantially the same covenants and events of default as those set forth in the
Indenture. Under the indenture dated March 15, 1996, Goodyear issued $250
million principal amount of its 6 5/8% Notes due 2006, $150 million principal
amount of its 7% Notes due 2028 and $100 million principal amount of its 6 3/8%
Notes due 2008. We maintain various banking relationships with the Trustee. The
Bank is the agent and a lender under our Revolving Credit Facility Agreement, as
amended by a Second Replacement and Restatement Agreement, dated as of July 13,
1998. The Chase Manhattan Bank and 23 other domestic and international banks
have agreed to lend us up to $700 million at any one time outstanding from time
to time through July 13, 2003 under the Revolving Credit Facility Agreement. The
Chase Manhattan Bank is also the agent and the lender under our Credit Agreement
[364-Day Facility], dated as of August 20, 1999, whereunder The Chase Manhattan
Bank and 24 other domestic and international banks have agreed to lend us up to
$1.3 billion at any one time outstanding from time to time until August 18,
2000, when the commitment of each participating bank terminates unless extended
for 364 days on a bank by bank basis or, if not so extended, we elect to obtain
a two year loan from any non-extending bank. The Chase Manhattan Bank is from
time to time the counterparty to certain interest rate exchange transactions and
performs various other banking services for us in the ordinary course of
business. The Chase Manhattan Bank has received and will receive fees and other
compensation in connection with the aforesaid credit agreements and for other
transactions and services.
GOVERNING LAW
The Indenture and the debt securities will be governed by, and construed in
accordance with, the laws of the State of New York.
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PLAN OF DISTRIBUTION
We may offer and sell debt securities from time to time in and/or outside
the United States:
- through underwriters or dealers;
- directly to one or more purchasers;
- through agents; or
- through a combination of such methods.
The applicable prospectus supplement with respect to any particular series
of debt securities offered will set forth:
- the terms of the offering of that series of debt securities.
- the name of each underwriter, dealer or agent, if any.
- the initial public offering price of that series of debt securities.
- the proceeds to us from such sale.
- any delayed delivery arrangement.
- any underwriting discounts and other items constituting underwriters'
compensation.
- any discounts or concessions allowed or re-allowed or paid to dealers.
Any initial public offering price and any discount or concessions allowed or
reallowed or paid to dealers may be changed from time to time.
If underwriters are used in the sale, the debt securities will be acquired
by the underwriters for their own account and may be resold from time to time 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 debt
securities may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more
firms acting as underwriters. We will execute an underwriting agreement with
those underwriters which will provide, among other things, that the obligations
of the underwriters will be subject to certain conditions and that the
underwriters must purchase all debt securities then being offered if any are
purchased.
If dealers are used in the sale of debt securities, we will sell the debt
securities to the dealers as principals. The dealers may then resell the debt
securities to the public at varying prices to be determined by the dealers at
the time of resale.
The debt securities may be sold through agents we designate from time to
time. Any agent involved in the offer or sale of the debt securities will be
named, and any commissions payable by us to such agent will be set forth, in the
prospectus supplement relating thereto. Unless otherwise indicated in the
prospectus supplement, any such agent will be acting on a best efforts basis for
the period of its appointment.
We may sell the debt securities directly to institutional investors or
others, who may be deemed to be underwriters within the meaning of the
Securities Act of 1933, as amended, with respect to any resale thereof. The
terms of any such sales, including the terms of any bidding or auction process,
will be described in the prospectus supplement relating thereto.
Underwriters, dealers and agents may be entitled under agreements entered
into with us to indemnification by us against certain liabilities, including
liabilities under the Securities Act. Underwriters, dealers and agents and their
affiliates may have in the past engaged, and may in the future engage, in
transactions with, or perform services for, us and our affiliates in the
ordinary course of business and receive compensation for such transactions and
services.
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Each series of debt securities will be a new issue of securities with no
established trading market. Unless otherwise specified in a prospectus
supplement, the debt securities will not be listed on any securities exchange.
No assurance can be given as to the existence or liquidity of a trading market
for any series of debt securities.
In connection with an offering, certain persons participating in such
offering may engage in transactions that stabilize, maintain or otherwise affect
the price of the debt securities. Specifically, such persons may overallot such
offering, creating a syndicate short position. Such persons may bid for, and
purchase, the debt securities in the open market to cover syndicate shorts or to
stabilize the price of the debt securities. Such person may reclaim selling
concessions allowed for distributing the debt securities in an offering, if such
persons repurchase previously distributed debt securities in syndicate covering
transactions, in stabilization transactions or otherwise. Any of these
activities may stabilize or maintain the market price of the debt securities
above independent market levels. Such activities, if commenced, may be
discontinued at any time.
VALIDITY OF DEBT SECURITIES
Unless otherwise indicated in an accompanying prospectus supplement
relating to any particular series of the debt securities offered, the validity
of the debt securities will be passed upon for us by C. Thomas Harvie, Esq., a
Senior Vice President and the General Counsel of Goodyear, and for any
underwriters or agents by Cravath, Swaine & Moore, Worldwide Plaza, 825 Eighth
Avenue, New York, New York 10019.
EXPERTS
The consolidated financial statements of Goodyear incorporated in this
Prospectus by reference to Goodyear's Annual Report on Form 10-K for the year
ended December 31, 1999 have been so incorporated in reliance on the report of
PricewaterhouseCoopers LLP, independent accountants, given on the authority of
said firm as experts in auditing and accounting.
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