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FILED PURSUANT TO RULE 424(B)(3)
REGISTRATION NO. 333-61019
PROSPECTUS [LOGO OF ALUMINUM COMPANY OF AMERICA]
OFFER FOR ALL OUTSTANDING 6 1/8% BONDS DUE 2005 AND 6 1/2% BONDS DUE 2018
IN EXCHANGE FOR 6 1/8% SERIES B BONDS DUE 2005 AND 6 1/2% SERIES B BONDS DUE
2018, RESPECTIVELY,
WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OF
ALUMINUM COMPANY OF AMERICA
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, OCTOBER 2, 1998, UNLESS EXTENDED.
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Aluminum Company of America, a Pennsylvania corporation ("Alcoa" or the
"Company") hereby offers, upon the terms and subject to the conditions set
forth in this Prospectus and the accompanying Letter of Transmittal (which
together constitute the "Exchange Offer"), to exchange an aggregate principal
amount of up to $200,000,000 of 6 1/8% Series B Bonds due 2005 of the Company
(the "New 6 1/8% Bonds"), and an aggregate principal amount of up to
$250,000,000 of 6 1/2% Series B Bonds due 2018 of the Company (the "New 6 1/2%
Bonds" and, together with the New 6 1/8% Bonds, the "New Bonds"), which have
been registered under the Securities Act of 1933, as amended (the "Securities
Act"), for a like principal amount of the issued and outstanding (i) 6 1/8%
Bonds due 2005 of the Company (the "Old 6 1/8% Bonds") in the case of the New 6
1/8% Bonds, and (ii) 6 1/2% Bonds due 2018 of the Company (the "Old 6 1/2%
Bonds" and, together with the Old 6 1/8% Bonds, the "Old Bonds") in the case of
the New 6 1/8% Bonds from the holders (the "Holders") thereof. The terms of the
New Bonds are identical in all material respects to the Old Bonds except (i)
that the New Bonds have been registered under the Securities Act, (ii) for
certain transfer restrictions and registration rights relating to the Old Bonds
and (iii) that the New Bonds will not contain certain provisions relating to
additional interest to be paid to Holders of Old Bonds under certain
circumstances relating to the timing of the Exchange Offer. The Company issued
$200,000,000 aggregate principal amount of the Old 6 1/8% Bonds and
$250,000,000 aggregate principal amount of the Old 6 1/2% Bonds on June 16,
1998, pursuant to exemptions from, or transactions not subject to, the
registration requirements of the Securities Act and applicable state securities
laws. The Old Bonds and the New Bonds are sometimes referred to herein
collectively as the "Bonds."
Interest on the New 6 1/8% Bonds and the New 6 1/2% Bonds will be payable
semi-annually in arrears on June 15 and December 15 of each year, commencing
December 15, 1998. The New Bonds are redeemable, in whole or in part, at the
option of the Company at any time at a redemption price equal to the greater of
(i) 100% of the principal amount of such New Bonds, or (ii) as determined by
the Quotation Agent (as defined herein), the sum of the present values of the
remaining scheduled payments of principal and interest thereon (not including
any portion of such payments of interest accrued as of the date of redemption)
discounted to the date of redemption on a semi-annual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as
defined herein) plus 10 basis points in the case of the New 6 1/8% Bonds and
plus 15 basis points in the case of the New 6 1/2% Bonds, plus, in each case,
accrued interest thereon to the date of redemption. The New Bonds are not
convertible or exchangeable into any other security of the Company. The New
Bonds rank pari passu with other unsubordinated indebtedness of the Company.
(Continued on next page)
SEE "RISK FACTORS" BEGINNING ON PAGE 5 FOR A DISCUSSION OF FACTORS THAT
SHOULD BE CONSIDERED BY HOLDERS WHO TENDER THEIR OLD BONDS IN THE EXCHANGE
OFFER.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
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The date of this Prospectus is August 28, 1998.
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(Continued from previous page)
For each Old Bond accepted for exchange, the Holder of such Old Bond will
receive a New Bond having a principal amount equal to that of the surrendered
Old Bond. The New Bonds will bear interest from the most recent date to which
interest has been paid on the Old Bonds or, if no interest has been paid on
the Old Bonds, from June 16, 1998. Old Bonds accepted for exchange will cease
to accrue interest from and after the date of consummation of the Exchange
Offer. Holders of Old Bonds whose Old Bonds are accepted for exchange will not
receive any payment in respect of accrued interest on such Old Bonds.
The New Bonds are being offered hereunder in order to satisfy certain
obligations of the Company contained in the Registration Rights Agreement (as
defined herein). Based on interpretations by the staff of the Securities and
Exchange Commission (the "Commission"), as set forth in no-action letters
issued to third parties, the Company believes that the New Bonds issued
pursuant to the Exchange Offer in exchange for Old Bonds may be offered for
resale, resold and otherwise transferred by Holders thereof (other than any
Holder which is an "affiliate" of the Company within the meaning of Rule 405
under the Securities Act), without compliance with the registration and
prospectus delivery requirements of the Securities Act, provided that such New
Bonds are acquired in the ordinary course of such Holder's business and such
Holder has no arrangement with any person to engage in a distribution of such
New Bonds. However, the Commission has not considered the Exchange Offer in
the context of a no-action letter and there can be no assurance that the staff
of the Commission would make a similar determination with respect to the
Exchange Offer as in such other circumstances. Each Holder must acknowledge
that it is not engaged in, and does not intend to engage in, a distribution of
such New Bonds and has no arrangements or understanding to participate in a
distribution of New Bonds. If any Holder is an affiliate of the Company, is
engaged in or intends to engage in or has any arrangement with any person to
participate in the distribution of the New Bonds to be acquired pursuant to
the Exchange Offer, that Holder (i) could not rely on the applicable
interpretations of the staff of the Commission and (ii) must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any resale transaction. The prospectus that must be delivered
by that Holder must name each such Holder and include the other selling
security holder information required by Regulation S-K under the Securities
Act. Each broker-dealer that receives New Bonds for its own account pursuant
to the Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such New Bonds. The Letter of Transmittal states
that by so acknowledging and by delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an "underwriter" within the meaning of the
Securities Act. This Prospectus, as it may be amended or supplemented from
time to time, may be used by a broker-dealer in connection with resales of New
Bonds received in exchange for Old Bonds where such Old Bonds were acquired by
such broker-dealer as a result of market-making activities or other trading
activities. The Company has agreed that, for a period of 90 days after the
Expiration Date (as defined in "The Exchange Offer,Terms of the Exchange
Offer; Period for Tendering Old Bonds"), it will make this Prospectus
available to any broker-dealer for use in connection with any such resale. See
"Plan of Distribution."
The Company will not receive any proceeds from the Exchange Offer. The
Company will pay all the expenses incident to the Exchange Offer. Tenders of
Old Bonds pursuant to the Exchange Offer may be withdrawn at any time prior to
the Expiration Date. If the Company terminates the Exchange Offer and does not
accept for exchange any Old Bonds, the Company will promptly return the Old
Bonds to the Holders thereof. See "The Exchange Offer."
There is no existing market for the New Bonds, and there can be no assurance
regarding the future development of a market for the New Bonds. The Initial
Purchasers (as defined in "The Exchange Offer") have advised the Company that
they currently intend to make a market in the New Bonds. The Initial
Purchasers are not obligated to do so, however, and any market-making with
respect to the New Bonds may be discontinued at any time without notice. The
Company does not intend to apply for listing or quotation of the New Bonds on
any securities exchange or market or register or qualify the New Bonds for
offer and sale in any jurisdiction (other than the registration of the New
Bonds under the Securities Act).
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DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus, including without limitation, the "Company" section and
certain of the information incorporated by reference, contains "forward-
looking statements" within the meaning of the Private Securities Litigation
Reform Act of 1995, which can be identified by the use of forward-looking
terminology, such as "may," "intend," "will," "expect," "anticipate,"
"estimate," or "continue" or the negative thereof or other variations thereon
or comparable terminology. In particular, any statement, express or implied,
concerning future operating results or the ability to generate revenues,
income or cash flow to service the New Bonds are forward-looking statements.
Although the Company believes that the expectations reflected in such forward-
looking statements are reasonable, there can be no assurance that such
expectations will prove to be correct. All forward-looking statements are
expressly qualified by such cautionary statements.
AVAILABLE INFORMATION
The Company has filed with the Commission a registration statement on Form
S-4 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act with respect to the New
Bonds offered hereby. This Prospectus, which forms a part of the Registration
Statement, does not contain all of the information set forth in the
Registration Statement and the exhibits thereto, certain parts of which are
omitted in accordance with the rules and regulations of the Commission. For
further information with respect to the Company and the New Bonds offered
hereby, reference is made to the Registration Statement. Any statements made
in this Prospectus concerning the provisions of certain documents are not
necessarily complete and, in each instance, reference is made to the copy of
such document filed as an exhibit to the Registration Statement otherwise
filed with the Commission.
Alcoa is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). The Registration Statement, the exhibits
forming a part thereof and the reports and other information filed by the
Company with the Commission may be inspected and copies may be obtained at the
principal office of the Commission at 450 Fifth Street, N.W., Washington D.C.
20549, and at the following regional offices of the Commission: 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661, and 7 World Trade Center,
13th Floor, New York, New York 10048. Copies of such materials can be obtained
from the Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. Such information may also be
accessed electronically by means of the Commission's home page on the Internet
at (http://www.sec.gov.). Reports and other information concerning Alcoa can
also be inspected at the offices of the New York Stock Exchange, Inc., 20
Broad Street, New York, New York 10005.
The Company has agreed that if at any time while any of the New Bonds are
outstanding and the Company is not subject to the informational requirements
of the Exchange Act, the Company will continue to file with the Commission,
and to furnish the Holders of the New Bonds with, the information, documents
and other reports specified in Sections 13 and 15(d) of the Exchange Act.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Alcoa has filed with the Commission, pursuant to the Exchange Act, an Annual
Report on Form 10-K for the fiscal year ended December 31, 1997, filed March
11,1998, as amended by Amendment No.1 on Form 10-K/A, filed on June 26, 1998
(the "Alcoa 1997 Form 10-K"), Quarterly Reports on Form 10-Q for the quarters
ended March 31, 1998 and June 30, 1998, and a Current Report on Form 8-K,
dated June 10, 1998, each of which is hereby incorporated in and made a part
of this Prospectus. Statements contained in any such documents as to the
contents of any contract or other document referred to therein are not
necessarily complete and, in each instance, reference is made to the copy of
such contract or other document filed with the Commission, each such statement
being qualified in all respects by such reference.
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All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior
to the termination of the offering of the New Bonds will be deemed to be
incorporated by reference in this Prospectus and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated, or deemed to be incorporated, by reference herein or contained
in this Prospectus will be deemed to be modified or superseded for purposes of
this Prospectus to the extent any statement contained herein or in any
subsequently filed document which also is, or is deemed to be, incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded will not be deemed to constitute a part hereof except
as so modified or superseded. This Prospectus does not contain all the
information set forth in the Registration Statement of which this Prospectus
forms a part which the Company has filed with the Commission and to which
reference is hereby made.
THE COMPANY WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM A COPY OF
THIS PROSPECTUS HAS BEEN DELIVERED, UPON THE WRITTEN OR ORAL REQUEST OF SUCH
PERSON, A COPY OF ANY OR ALL OF THE DOCUMENTS WHICH ARE INCORPORATED HEREIN BY
REFERENCE, OTHER THAN EXHIBITS TO SUCH DOCUMENTS (UNLESS SUCH EXHIBITS ARE
SPECIFICALLY INCORPORATED BY REFERENCE INTO SUCH DOCUMENTS). REQUESTS FOR SUCH
COPIES SHOULD BE DIRECTED TO ALUMINUM COMPANY OF AMERICA, 201 ISABELLA STREET,
PITTSBURGH, PENNSYLVANIA 15212-5858, ATTENTION: TREASURER (TELEPHONE: (412)
553-4545).
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SUMMARY
The following summary is qualified in its entirety by, and should be read in
conjunction with the more detailed information and the financial statements and
notes thereto incorporated by reference herein. Unless the context otherwise
requires, the terms of the Old Bonds are identical in all material respects to
the New Bonds, except for certain transfer restrictions and certain rights
under the Registration Rights Agreement, including registration rights and the
right to receive the contingent increases in interest rates, which rights will
terminate upon consummation of the Exchange Offer, except under certain limited
circumstances. The description of the Bonds contained herein assumes that all
Old Bonds are exchanged for New Bonds in the Exchange Offer.
THE COMPANY
Alcoa is the world's leading producer of aluminum and alumina and a major
participant in all segments of the industry: mining, refining, smelting,
fabricating and recycling. Alcoa serves customers worldwide in the packaging,
automotive, aerospace, construction and other markets with a great variety of
fabricated and finished products. Its operations consist of the three segments
described below. The alumina and chemicals segment includes the production and
sale of bauxite, alumina chemicals and related transportation services. The
aluminum processing segment comprises the production and sale of molten metal,
ingot and aluminum products that are flat-rolled, engineered or finished. Also
included are power, transportation and other services. The non-aluminum
products segment includes the production and sale of electrical, plastic and
composite materials products, manufacturing equipment, gold, magnesium products
and steel and titanium forgings. Alcoa is organized into 21 independently-
managed business units and has over 180 operating locations in 28 countries,
serving a broad range of markets in developing and industrialized economies.
The principal executive offices of the Company are located at 201 Isabella
Street, Pittsburgh, Pennsylvania 15212-5858 (Telephone: (412) 553-4545).
RECENT DEVELOPMENTS,ALUMAX TRANSACTION
On July 31, 1998, Alcoa consummated its acquisition of all of the outstanding
shares of common stock (the "Alumax Transaction") of Alumax Inc., a Delaware
corporation ("Alumax"). On March 13, 1998, Alcoa commenced the Alumax
Transaction with a cash tender offer (the "Offer") for one-half of the
outstanding Alumax shares at $50.00 per share. The Offer expired on June 16,
1998, at which time Alcoa accepted for payment 27,540,000 shares of Alumax
common stock, representing approximately 51% of the outstanding Alumax common
stock. The Offer was followed by a merger in which each remaining outstanding
share of Alumax common stock was converted into 0.6975 of a share of Alcoa
common stock.
THE EXCHANGE OFFER
On June 16, 1998, the Company issued and sold $200,000,000 aggregate
principal amount of Old 6 1/8% Bonds and $250,000,000 aggregate principal
amount of 6 1/2% Old Bonds. The Old Bonds were sold pursuant to exemptions
from, or in transactions not subject to, the registration requirements of the
Securities Act and applicable state securities laws, in order to enable the
Company to raise funds on a more expeditious basis than necessarily would have
been possible had the initial sale been pursuant to an offering registered
under the Securities Act. As a condition to their purchase of the Old Bonds,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, ABN AMRO Incorporated,
BancAmerica Robertson Stephens, Chase Securities Inc., Citicorp Securities,
Inc. and Deutsche Bank Securities Inc. (collectively, the "Initial
Purchasers"), requested that the Company agree to commence the Exchange Offer
following the offering of the Old Bonds.
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Securities.................. Up to $200,000,000 aggregate principal amount of
6 1/8% Series B Bonds due 2005 and up to
$250,000,000 principal amount of 6 1/2% Series B
Bonds due 2018, which have been registered under
the Securities Act. The terms of the New Bonds
and the Old Bonds are identical in all material
respects, except that (i) interest on the New
Bonds will accrue from the last day on which
interest was paid on the Old Bonds exchanged
therefor or, if no such interest has been paid,
from June 16, 1998 and (ii) the transfer
restrictions on the Old Bonds will not apply to
the New Bonds. At such time as provided in the
Exchange Offer Registration Statement, the
Company will offer to the Holders of Old Bonds
who are able to make certain representations the
opportunity to exchange their Old Bonds for New
Bonds.
The Exchange Offer.......... The New Bonds are being offered in exchange for a
like principal amount of the Old Bonds. The
issuance of the New Bonds is intended to satisfy
obligations of the Company contained in the
Registration Rights Agreement, dated as of June
16, 1998, among the Company and the Initial
Purchasers (the "Registration Rights Agreement").
For procedures for tendering, see "The Exchange
Offer."
Tenders, Expiration Date;
Withdrawal................. The Exchange Offer will expire at 5:00 p.m., New
York City time, on October 2, 1998, or such later
date and time to which it is extended. Each
Holder tendering Old Bonds must acknowledge that
such Holder is not engaging in, nor intends to
engage in, a distribution of the New Bonds. The
tender of Old Bonds pursuant to the Exchange
Offer may be withdrawn at any time prior to the
Expiration Date (as defined herein). Any Old Bond
not accepted for exchange for any reason will be
returned without expense to the tendering Holder
thereof as promptly as practicable after the
expiration or termination of the Exchange Offer.
Federal Income Tax
Considerations............. The exchange pursuant to the Exchange Offer
should not result in any income, gain or loss to
the Holders or the Issuers for federal income tax
purposes. See "Certain United States Federal
Income Tax Considerations."
Use of Proceeds............. There will be no proceeds to the Company from the
exchange pursuant to the Exchange Offer. See "Use
of Proceeds."
Exchange Agent.............. PNC Bank, National Association, is serving as
Exchange Agent in connection with the Exchange
Offer.
Shelf Registration
Statement.................. Under certain circumstances, certain Holders of
Old Bonds (including Holders who are not
permitted to participate in the Exchange Offer or
who may not freely resell New Bonds received in
the Exchange Offer) may, by giving the Company
written notice on or before October 2, 1998,
require the Company to file, and cause to become
effective, a shelf registration statement under
the Securities Act, which would cover resales of
Old Bonds by such Holders. See "Exchange Offer;
Registration Rights."
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SUMMARY OF TERMS OF NEW BONDS
Interest Payment Dates:
The New 6 1/8% Bonds.... June 15 and December 15 of each year, commencing
December 15, 1998.
The New 6 1/2% Bonds.... June 15 and December 15 of each year, commencing
December 15, 1998.
Redemption.................. The New Bonds will be redeemable at the option of
the Company, in whole or in part, at any time at
the redemption prices set forth herein, plus
accrued and unpaid interest thereon to the date
of redemption. See "Description of the Bonds--
Optional Redemption."
Ranking..................... The New Bonds rank pari passu with other
unsubordinated indebtedness of the Company.
Certain Covenants........... The Indenture pursuant to which the Old Bonds
were issued and the New Bonds will be issued
contain certain covenants, including (i)
limitations on liens, and (ii) limitations on
certain sale and leaseback transactions by
Restricted Subsidiaries (as defined herein). In
addition, the Indenture limits the ability of the
Company to consolidate, merge or sell all or
substantially all of its assets. These covenants
are subject to important exceptions and
qualifications. See "Description of the Bonds--
Certain Limitations."
Absence of Public Market
for New Bonds.............. The New Bonds will constitute new issues of
securities for which there is no established
public trading market. There has been no public
market for the Old Bonds, and it is not currently
anticipated that an active public market for the
New Bonds will develop. The Company currently
does not intend to apply for the listing of the
Bonds on any securities exchange or to seek
approval for quotation through any automated
quotation system. Although the Initial Purchasers
have informed the Company that they currently
intend to make a market in the New Bonds, they
are not obligated to do so and any such market
making may be discontinued at any time without
notice. Accordingly, there can be no assurance as
to the development or liquidity of any market for
the New Bonds. See "Risk Factors--Absence of
Public Market" and "Plan of Distribution."
For additional information regarding the New Bonds, see "Description of the
Bonds" and "Certain United States Federal Income Tax Considerations."
USE OF PROCEEDS
The Company will not receive any proceeds from the issuance of the New Bonds
pursuant to this Prospectus. See "Use of Proceeds."
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RISK FACTORS
See "Risk Factors" beginning on page 5 for a discussion of factors that
should be considered by Holders of Old Bonds before tendering their Old Bonds
in the Exchange Offer. Most of these factors apply to the New Bonds as well as
the Old Bonds.
CONSEQUENCES OF EXCHANGING OLD BONDS
Holders of Old Bonds who do not exchange their Old Bonds for New Bonds
pursuant to the Exchange Offer will continue to be subject to the restrictions
on transfer of such Old Bonds as set forth in the legend thereon as a
consequence of the issuance of the Old Bonds pursuant to exemptions from, or in
transactions not subject to, the registration requirements of the Securities
Act and applicable state securities laws. In general, the Old Bonds may not be
offered or sold, unless registered under the Securities Act, except pursuant to
an exemption from, or in a transaction not subject to, the Securities Act and
applicable state securities laws. The Company does not currently anticipate
that it will register the Old Bonds under the Securities Act. See "Exchange
Offer; Registration Rights." Based on interpretations by the staff of the
Commission, as set forth in no-action letters issued to third parties, the
Company believes that New Bonds issued pursuant to the Exchange Offer in
exchange for Old Bonds may be offered for resale, resold or otherwise
transferred by Holders thereof (other than any Holder which is an "affiliate"
of the Company within the meaning of Rule 405 under the Securities Act) without
compliance with the registration and prospectus delivery requirements of the
Securities Act, provided that such New Bonds are acquired in the ordinary
course of such Holder's business and such Holder, other than broker-dealers,
has no arrangement with any person to participate in the distribution of such
New Bonds. However, the Commission has not considered the Exchange Offer in the
context of a no-action letter and there can be no assurance that the staff of
the Commission would make a similar determination with respect to the Exchange
Offer as in such other circumstances. Each Holder, other than a broker-dealer,
must acknowledge that it is not engaged in, and does not intend to engage in, a
distribution of such New Bonds and has no arrangement or understanding to
participate in a distribution of New Bonds. Each broker-dealer that receives
New Bonds for its own account in exchange for Old Bonds must acknowledge that
such Old Bonds were acquired by such broker-dealer as a result of market-making
activities or other trading activities and that it will deliver a prospectus in
connection with any resale of such New Bonds. See "Plan of Distribution." In
addition, to comply with the securities laws of certain jurisdictions, it may
be necessary to qualify for sale or register thereunder the New Bonds prior to
offering or selling such New Bonds. The Company has agreed, pursuant to the
Registration Rights Agreement, subject to certain limitations specified
therein, to register or qualify the New Bonds for offer or sale under the
applicable state securities laws of such United States jurisdictions as any
Holders of the Old Bonds reasonably request before the time the Registration
Statement (of which this Prospectus forms a part) is declared effective by the
Commission. The Company does not intend to register or qualify the sale of the
New Bonds in any such United States jurisdiction (unless the Company receives
such a request) or any other jurisdiction. See "The Exchange Offer--
Consequences of Exchanging Old Bonds."
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RISK FACTORS
Holders of Old Bonds should carefully consider the following matters, as
well as the other information contained in this Prospectus, before tendering
their Old Bonds in the Exchange Offer. The risk factors set forth below (other
than"--Consequences of Failure to Exchange Old Bonds") are applicable to the
Old Bonds as well as the New Bonds.
CONSEQUENCES OF FAILURE TO EXCHANGE OLD BONDS
The Old Bonds have not been registered under the Securities Act or any other
securities laws of any jurisdiction and, therefore, may not be offered, sold
or otherwise transferred except in compliance with the registration
requirements of the Securities Act and any other applicable securities laws or
pursuant to exemptions from, or in transactions not subject to, those
requirements and, in each case, in compliance with certain other conditions
and restrictions. Holders of Old Bonds who do not exchange their Old Bonds for
New Bonds pursuant to the Exchange Offer will continue to be subject to such
restrictions on transfer of such Old Bonds as set forth in the legend thereon.
In addition, upon consummation of the Exchange Offer, Holders of Old Bonds
which remain outstanding will not be entitled to any rights to have such Old
Bonds registered under the Securities Act or to any similar rights under the
Registration Rights Agreement (subject to certain limited exceptions). The
Company does not currently anticipate that it will register or qualify any Old
Bonds which remain outstanding after consummation of the Exchange Offer for
offer or sale in any jurisdiction (subject to such limited exceptions, if
applicable). To the extent that Old Bonds are tendered and accepted in the
Exchange Offer, a Holder's ability to sell untendered Old Bonds could be
adversely affected.
The New Bonds and any Old Bonds which remain outstanding after consummation
of the Exchange Offer will vote together as a single class for purposes of
determining whether Holders of the requisite percentage thereof have taken
certain actions or exercised certain rights under the Indenture. Upon
consummation of the Exchange Offer, Holders of Old Bonds will not be entitled
to any increase in the interest rate thereon or any further registration
rights under the Registration Rights Agreement, except under limited
circumstances. See "Exchange Offer; Registration Rights."
ABSENCE OF PUBLIC MARKET
The Old Bonds were issued to, and the Company believes such securities are
currently owned by, a relatively small number of beneficial owners. The Old
Bonds have not been registered under the Securities Act and will be subject to
restrictions on transferability if they are not exchanged for the New Bonds.
Although the New Bonds may be resold or otherwise transferred by the Holders
(who are not affiliates of the Company) without compliance with the
registration requirements under the Securities Act, they will constitute a new
issue of securities with no established trading market. There can be no
assurance that such a market will develop. In addition, the New Bonds will not
be listed on any national securities exchange. The New Bonds may trade at a
discount from the initial offering price of the Old Bonds, depending upon
prevailing interest rates, the market for similar securities, the Company's
operating results and other factors. The Company has been advised by the
Initial Purchasers that they currently intend to make a market in the New
Bonds, as permitted by applicable laws and regulations; however, the Initial
Purchasers are not obligated to do so, and any such market-making activities
may be discontinued at any time without notice. In addition, such market-
making activity may be limited during the Exchange Offer and the pendency of a
shelf registration. Therefore, there can be no assurance that an active market
for any of the New Bonds will develop, either prior to or after the Company's
performance of its obligations under the Registration Rights Agreement. If an
active public market does not develop, the market price and liquidity of the
New Bonds may be adversely affected.
If a public trading market develops for the New Bonds, future trading prices
will depend on many factors, including, among other things, prevailing
interest rates, the financial condition of the Company, and the market for
similar securities. Depending on these and other factors, the New Bonds may
trade at a discount.
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Notwithstanding the registration of the New Bonds in the Exchange Offer,
holders who are "affiliates" (as defined under Rule 405 of the Securities Act)
of the Company may publicly offer for sale or resale the New Bonds only in
compliance with the provisions of Rule 144 under the Securities Act.
Each broker-dealer that receives New Bonds for its own account in exchange
for Old Bonds, where such Old Bonds were acquired by such broker-dealer as a
result of market-making activities or other trading activities, must
acknowledge that it will deliver a prospectus in connection with any resale of
such New Bonds. See "Plan of Distribution."
EXCHANGE OFFER PROCEDURES
Subject to the conditions set forth under "The Exchange Offer--Conditions to
the Exchange Offer," delivery of New Bonds in exchange for Old Bonds tendered
and accepted for exchange pursuant to the Exchange Offer will be made only
after timely receipt by the Exchange Agent of (i) certificates for Old Bonds
or a book-entry confirmation of a book-entry transfer of Old Bonds into the
Exchange Agent's account at DTC, including an Agent's Message (as defined
under "The Exchange Offer--Acceptance for Exchange") if the tendering holder
does not deliver a Letter of Transmittal, (ii) a completed and signed Letter
of Transmittal (or facsimile thereof), with any required signature guarantees,
or, in the case of a book-entry transfer an Agent's Message in lieu of the
Letter of Transmittal, and (iii) any other documents required by the Letter of
Transmittal. Therefore, Holders of Old Bonds desiring to tender such Old Bonds
in exchange for New Bonds should allow sufficient time to ensure timely
delivery. The Company is under no duty to give notification of defects or
irregularities with respect to the tenders of Old Bonds for exchange.
Each broker-dealer that receives New Bonds for its own account in exchange
for Old Bonds, where such Old Bonds were acquired by such broker-dealer as a
result of market-making activities or other trading activities, must
acknowledge that it will deliver a prospectus in connection with any resale of
such New Bonds. See "Plan of Distribution."
6
<PAGE>
THE COMPANY
Alcoa is the world's leading producer of aluminum and alumina and a major
participant in all segments of the industry: mining, refining, smelting,
fabricating and recycling. Alcoa serves customers worldwide in the packaging,
automotive, aerospace, construction and other markets with a great variety of
fabricated and finished products. Its operations consist of the three segments
described below.
The alumina and chemicals segment includes the production and sale of
bauxite, alumina chemicals and related transportation services. The aluminum
processing segment comprises the production and sale of molten metal, ingot
and aluminum products that are flat-rolled, engineered or finished. Also
included are power, transportation and other services. The non-aluminum
products segment includes the production and sale of electrical, plastic and
composite materials products, manufacturing equipment, gold, magnesium
products and steel and titanium forgings.
Alcoa is organized into 21 independently-managed business units and has over
180 operating locations in 28 countries, serving a broad range of markets in
developing and industrialized economies.
RECENT DEVELOPMENTS--ALUMAX TRANSACTION
On July 31, 1998, Alcoa consummated its acquisition of all of the
outstanding shares of common stock (the "Alumax Transaction") of Alumax Inc.,
a Delaware corporation ("Alumax"). On March 13, 1998, Alcoa commenced the
Alumax Transaction with a cash tender offer (the "Offer") for one-half of the
outstanding Alumax shares at $50.00 per share. The Offer expired on June 16,
1998, at which time Alcoa accepted for payment 27,540,000 shares of Alumax
common stock, representing approximately 51% of the outstanding Alumax common
stock. The Offer was followed by a merger in which each remaining outstanding
share of Alumax common stock was converted into 0.6975 of a share of Alcoa
common stock. The Alumax Transaction is valued at approximately $3.8 billion,
including the assumption of debt.
Alumax is an integrated producer of aluminum products, operating in a single
segment: aluminum processing. Using alumina purchased primarily from an
affiliate of Alcoa, Alumax produces primary aluminum employing an electrolytic
process at five reduction plants in the United States and Canada. Primary
products are sold externally or further processed by Alumax into a broad range
of semi-fabricated and fabricated products. Alumax's products are sold to a
wide variety of markets, including transportation, distributors, building and
construction, consumer durables and packaging.
For the six months ended June 30, 1998 and for the year ended December 31,
1997, Alumax had net sales and operating revenues of $1.56 billion and $2.93
billion, respectively, and net income of $47 million and $34 million for the
same periods. On a combined pro forma basis, for the six months ended June 30,
1998 and for the year ended December 31, 1997, the Company and Alumax would
have had sales and operating revenues of $8.48 billion and $15.99 billion,
respectively, and net income of $428 million and $761 million for the same
periods.
The Alumax Transaction involves the integration of two companies that have
previously operated independently of each other. No assurance can be given
that following the Alumax Transaction Alcoa will be able to integrate the
operations of Alcoa and Alumax without encountering difficulties. Further, no
assurance can be given that any synergies that are expected to result from
such integration will in fact be realized by the combined company following
the Alumax Transaction.
RATIOS OF EARNINGS TO FIXED CHARGES
The ratios of the Company's earnings to fixed charges for the years ended
December 31, 1993 through 1997 are 2.22, 6.47, 10.45, 7.25 and 9.44. The ratio
of the Company's earnings to fixed charges for the six month period ended June
30, 1998 is 8.7. The ratios include all earnings, before extraordinary items
and the cumulative
7
<PAGE>
effects of accounting changes, and fixed charges of the Company and its
majority owned subsidiaries plus the Company's proportionate share of earnings
of 50% owned entities. Earnings have been calculated by adding to net income
the provision for taxes on income, amortization of capitalized interest,
interest expense and an amount representative of the interest factor in
rentals, and have been decreased by the undistributed earnings of entities
less than 50% owned, preferred stock dividend requirements of majority owned
subsidiaries and the minority interest share in the losses of majority owned
subsidiaries without fixed charges of the Company. Fixed charges consist of
total interest expense, amortization of debt expense, an amount representative
of the interest factor in rentals, interest capitalized and preferred stock
dividend requirements of majority owned subsidiaries.
USE OF PROCEEDS
The Company will not receive any proceeds from the Exchange Offer. The net
proceeds received by the Company from the issuance of the Old Bonds of
approximately $443 million were used by the Company to pay a portion of the
cash consideration for the exchange of tendered shares of Alumax common stock
in connection with the Alumax Transaction. See "Recent Developments--Alumax
Transaction."
8
<PAGE>
CAPITALIZATION
The following table sets forth (i) the consolidated capitalization of the
Company at June 30, 1998 and (ii) as adjusted to give effect to the issuance
of the Old Bonds, the Alumax Transaction and related transactions as if they
each occurred on such date. The table should be read in conjunction with the
Company's historical consolidated and pro forma condensed consolidated
financial statements and the notes thereto incorporated by reference in this
Prospectus.
<TABLE>
<CAPTION>
AS OF JUNE 30,
1998
----------------------
(IN MILLIONS)
PRO FORMA
ACTUAL AS ADJUSTED
--------- -----------
<S> <C> <C>
Cash, cash equivalents and short-term investments....... $ 909.0 $ 725.1
========= =========
Long-term debt:
Current portion of long-term debt..................... 162.8 162.8
Long-term debt........................................ 3,703.4 3,703.4
--------- ---------
Total long-term debt................................ $ 3,866.2 $ 3,866.2
--------- ---------
Shareholders' equity:
Preferred stock, $100 par value 557,740 shares
authorized; 557,649 shares issued.................... $ 55.8 $ 55.8
Common stock, $1.00 par value 600 million shares
authorized; 178,922,583 shares issued................ 178.9 197.3
Additional capital.................................... 573.1 1,875.5
Retained earnings..................................... 4,965.2 4,965.2
Treasury stock, at cost............................... (1,022.7) (1,022.7)
Accumulated other comprehensive income................ $ (399.3) $ (399.3)
--------- ---------
Total shareholders' equity.......................... $ 4,351.0 $ 5,671.8
========= =========
Total capitalization.................................... $ 8,217.2 $ 9,538.0
========= =========
</TABLE>
9
<PAGE>
THE EXCHANGE OFFER
TERMS OF THE EXCHANGE OFFER; PERIOD FOR TENDERING OLD BONDS
Upon the terms and conditions set forth in this Prospectus and in the
accompanying Letter of Transmittal (which together constitute the Exchange
Offer), the Company will accept for exchange Old Bonds which are properly
tendered on or prior to the Expiration Date and not withdrawn as permitted
below. As used herein, the term "Expiration Date" means 5:00 p.m., New York
City time, on October 2, 1998; provided, however, that if the Company, in its
sole discretion, has extended the period of time for which the Exchange Offer
is open, the term "Expiration Date" means the latest time and date to which
the Exchange Offer is extended.
As of the date of this Prospectus, $200,000,000 aggregate principal amount
of Old 6 1/8% Bonds and $250,000,000 aggregate principal amount of Old 6 1/2%
Bonds are outstanding. This Prospectus, together with the Letter of
Transmittal, is first being sent on or about the date hereof, to all Holders
of Old Bonds known to the Company. The Company's obligation to accept Old
Bonds for exchange pursuant to the Exchange Offer is subject to certain
conditions as set forth under "--Certain Conditions to the Exchange Offer"
below.
The Company expressly reserves the right, at any time or from time to time,
to extend the period of time during which the Exchange Offer is open, and
thereby delay acceptance for exchange of any Old Bonds, by giving oral or
written notice of such extension to the Holders thereof as described below.
During any such extension, all Old Bonds previously tendered will remain
subject to the Exchange Offer and may be accepted for exchange by the Company.
Any Old Bonds not accepted for exchange for any reason will be returned
without expense to the tendering Holder thereof as promptly as practicable
after the expiration or termination of the Exchange Offer.
Old Bonds tendered in the Exchange Offer must be in denominations of
principal amount of $1,000 and any integral multiple thereof.
The Company expressly reserves the right to amend or terminate the Exchange
Offer, and not to accept for exchange any Old Bonds not theretofore accepted
for exchange, upon the occurrence of any of the conditions of the Exchange
Offer specified below under "--Certain Conditions to the Exchange Offer." The
Company will give oral or written notice of any extension, amendment, non-
acceptance or termination to the Holders of the Old Bonds as promptly as
practicable, such notice in the case of any extension to be issued by means of
a press release or other public announcement no later than 9:00 a.m., New York
City time, on the next business day after the previously scheduled Expiration
Date.
PROCEDURES FOR TENDERING OLD BONDS
The tender to the Company of Old Bonds by a Holder thereof as set forth
below and the acceptance thereof by the Company will constitute a binding
agreement between the tendering Holder and the Company upon the terms and
subject to the conditions as set forth in this Prospectus and in the
accompanying Letter of Transmittal. Except as set forth below, a Holder who
wishes to tender Old Bonds for exchange pursuant to the Exchange Offer must
transmit a properly completed and duly executed Letter of Transmittal,
including all other documents required by such Letter of Transmittal or (in
the case of a book-entry transfer) an Agent's Message (as defined below) in
lieu of such Letter of Transmittal, to PNC Bank, National Association (the
"Exchange Agent") at the address set forth below under "Exchange Agent" on or
prior to the Expiration Date. In addition, either (i) certificates for such
Old Bonds must be received by the Exchange Agent along with the Letter of
Transmittal, or (ii) a timely confirmation of a book-entry transfer (a "Book-
Entry Confirmation") of such Old Bonds, if such procedure is available, into
the Exchange Agent's account at The Depository Trust Company (the "Book-Entry
Transfer Facility") pursuant to the procedure for book-entry transfer
described below, must be received by the Exchange Agent prior to the
Expiration Date with the Letter of Transmittal or an Agent's Message in lieu
of such Letter of Transmittal, or (iii) the Holder must comply with the
guaranteed delivery procedures described below. The term "Agent's Message"
means a message, transmitted by the Book-Entry Transfer Facility to and
received by the Exchange Agent and forming a part of a Book-Entry
Confirmation, which states that the Book-
10
<PAGE>
Entry Transfer Facility has received an express acknowledgment from the
tendering participant, which acknowledgment states that such participant has
received and agrees to be bound by the Letter of Transmittal and that the
Company may enforce such Letter of Transmittal against such participant. THE
METHOD OF DELIVERY OF OLD BONDS, LETTERS OF TRANSMITTAL AND ALL OTHER REQUIRED
DOCUMENTS IS AT THE ELECTION AND RISK OF THE HOLDERS. IF SUCH DELIVERY IS BY
MAIL, IT IS RECOMMENDED THAT REGISTERED MAIL, PROPERLY INSURED, WITH RETURN
RECEIPT REQUESTED, BE USED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ASSURE TIMELY DELIVERY. NO LETTERS OF TRANSMITTAL OR OLD BONDS SHOULD BE SENT
TO THE COMPANY.
Signatures on a Letter of Transmittal or a notice of withdrawal, as the case
may be, must be guaranteed unless the Bonds surrendered for exchange pursuant
thereto are tendered (i) by a Holder of the Old Bonds who has not completed
the box entitled "Special Issuance Instructions" or "Special Delivery
Instructions" on the Letter of Transmittal or (ii) for the account of an
Eligible Institution (as defined below). In the event that signatures on a
Letter of Transmittal or a notice of withdrawal, as the case may be, are
required to be guaranteed, such guarantees must be by a firm which is a member
of a registered national securities exchange or a member of the National
Association of Securities Dealers, Inc. or by a commercial bank or trust
company having an office or correspondent in the United States (collectively,
"Eligible Institutions"). If Old Bonds are registered in the name of a person
other than a signer of the Letter of Transmittal, the Old Bonds surrendered
for exchange must be endorsed by, or be accompanied by a written instrument or
instruments of transfer or exchange, in satisfactory form as determined by the
Company in its sole discretion, duly executed by the registered national
securities exchange with the signature thereon guaranteed by an Eligible
Institution.
All questions as to the validity, form, eligibility (including time of
receipt) and acceptance of Old Bonds tendered for exchange will be determined
by the Company in its sole discretion, which determination will be final and
binding. The Company reserves the absolute right to reject any and all tenders
of any particular Old Bonds not properly tendered or to not accept any
particular Old Bonds which acceptance might, in the judgment of the Company or
its counsel, be unlawful. The Company also reserves the absolute right to
waive any defects or irregularities or conditions of the Exchange Offer as to
any particular Old Bond either before or after the Expiration Date (including
the right to waive the ineligibility of any Holder who seeks to tender Old
Bonds in the Exchange Offer). The interpretation of the terms and conditions
of the Exchange Offer as to any particular Old Bonds either before or after
the Expiration Date (including the Letter of Transmittal and the instruction
thereto) by the Company will be final and binding on all parties. Unless
waived, any defects or irregularities in connection with tenders of Old Bonds
for exchange must be cured within such reasonable period of time as the
Company will determine. Neither the Company, the Exchange Agent nor any other
person will be under any duty to give notification of any defect or
irregularity with respect to any tender of Old Bonds for exchange, nor will
any of them incur any liability for failure to give such notification.
If the Letter of Transmittal is signed by a person or persons other than the
registered Holder or Holders of Old Bonds, such Old Bonds must be endorsed or
accompanied by powers of attorney, in either case signed exactly as the name
or names of the registered Holder or Holders that appear on the Old Bonds.
If the Letter of Transmittal or any Old Bonds or powers of attorneys are
signed by trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing, and, unless waived by
the Company, proper evidence satisfactory to the Company of its authority to
so act must be submitted with the Letter of Transmittal.
By tendering, each Holder will represent to the Company that, among other
things, the New Bonds acquired pursuant to the Exchange Offer are being
obtained in the ordinary course of business of the person receiving such New
Bonds, whether or not such person is the Holder and that neither the Holder
nor such other person has any arrangement or understanding with any person to
participate in the distribution of the New Bonds. If any Holder or any such
other person is an "affiliate," as defined under Rule 405 of the Securities
Act, of the
11
<PAGE>
Company, is engaged in or intends to engage in or has an arrangement or
understanding with any person to participate in a distribution of such New
Bonds to be acquired pursuant to the Exchange Offer, such Holder or any such
other person (i) could not rely on the applicable interpretations of the staff
of the Commission and (ii) must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any resale
transaction. Each broker-dealer that receives New Bonds for its own account in
exchange for Old Bonds, where such Old Bonds were acquired by such broker-
dealer as a result of market-making activities or other trading activities,
must acknowledge that it will deliver a prospectus (which may be this
Prospectus) in connection with any resale of such New Bonds and must represent
that they were acquired as a result of market-making activities or other
trading activities. See "Plan of Distribution." The Letter of Transmittal
states that by so acknowledging and by delivering a prospectus, a broker-
dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
ACCEPTANCE OF BONDS FOR EXCHANGE; DELIVERY OF NEW BONDS
Upon satisfaction or waiver of all of the conditions to the Exchange Offer,
the Company will accept, promptly after the Expiration Date, all Old Bonds
properly tendered and will issue the New Bonds promptly after acceptance of
the Old Bonds. See "--Certain Conditions to the Exchange Offer" below. For
purposes of the Exchange Offer, the Company will be deemed to have accepted
properly tendered Old Bonds for exchange when, as and if the Company has given
oral (promptly confirmed in writing) or written notice thereof to the Exchange
Agent.
For each Old Bond accepted for exchange, the Holder of such Old Bond will
receive an New Bond having a principal amount equal to that of the surrendered
Old Bond. Accordingly, registered Holders of New Bonds on the relevant record
date for the first interest payment date following the consummation of the
Exchange Offer will receive interest accruing from the most recent date to
which interest has been paid or, if no interest has been paid, from June 16,
1998. Old Bonds accepted for exchange will cease to accrue interest from and
after the date of consummation of the Exchange Offer. Pursuant to the
Registration Rights Agreement, certain additional payments are required to be
made to Holders of Old Bonds under certain circumstances relating to the
timing of the Exchange Offer.
In all cases, issuance of New Bonds for Old Bonds that are accepted for
exchange pursuant to the Exchange Offer will be made only after timely receipt
by the Exchange Agent of (i) certificates for such Old Bonds or a timely Book-
Entry Confirmation of such Bonds into the Exchange Agent's account at the
Book-Entry Transfer Facility, (ii) a properly completed and duly executed
Letter of Transmittal or an Agent's Message in lieu thereof and (iii) all
other required documents. If any tendered Old Bonds are not accepted for any
reason set forth in the terms and conditions of the Exchange Offer or if Old
Bonds are submitted for a greater principal amount than the Holder desires to
exchange, such unaccepted or non-exchanged Old Bonds will be returned without
expense to the tendering Holder thereof (or, in the case of Old Bonds tendered
by book-entry transfer into the Exchange Agent's account at the Book-Entry
Transfer Facility pursuant to the book-entry procedures described below, such
non-exchanged Old Bonds will be credited to an account maintained with such
Book-Entry Transfer Facility) as promptly as practicable after the expiration
or termination of the Exchange Offer.
BOOK-ENTRY TRANSFERS
The Exchange Agent will make a request to establish an account with respect
to the Old Bonds at the Book-Entry Transfer Facility for purposes of the
Exchange Offer within two business days after the date of this Prospectus. Any
financial institution that is a participant in the Book-Entry Transfer
Facility systems must make book-entry delivery of Old Bonds by causing the
Book-Entry Transfer Facility to transfer such Old Bonds into the Exchange
Agent's account at the Book-Entry Transfer Facility in accordance with such
Book-Entry Transfer Facility's Automated Tender Offer Program ("ATOP")
procedures for transfer. Such participant using ATOP should transmit its
acceptance to the Book-Entry Transfer Facility on or prior to the Expiration
Date or comply with the guaranteed delivery procedures described below. The
Book-Entry Transfer Facility will verify such acceptance, execute a book-entry
transfer of the tendered Old Bonds into the Exchange Agent's account at the
12
<PAGE>
Book-Entry Transfer Facility and then send to the Exchange Agent confirmation
of such book-entry transfer, including an Agent's Message confirming that the
Book-Entry Transfer Facility has received an express acknowledgment from such
participant that such participant has received and agrees to be bound by the
Letter of Transmittal and that the Company may enforce the Letter of
Transmittal against such participant. However, although delivery of Old Bonds
may be effected through book-entry transfer at the Book-Entry Transfer
Facility, an Agent's Message and any other required documents, must, in any
case, be transmitted to and received by the Exchange Agent at the address set
forth below under "--Exchange Agent" on or prior to the Expiration Date or the
guaranteed delivery procedures described below must be complied with.
GUARANTEED DELIVERY PROCEDURES
If a Holder of the Old Bonds desires to tender such Old Bonds and the Old
Bonds are not immediately available, or time will not permit such Holder's Old
Bonds or other required documents to reach the Exchange Agent before the
Expiration Date, or the procedure for book-entry transfer cannot be completed
on a timely basis, a tender may be effected if (i) the tender is made through
an Eligible Institution, (ii) prior to the Expiration Date, the Exchange Agent
received from such Eligible Institution a Notice of Guaranteed Delivery,
substantially in the form provided by the Company (by telegram, telex,
facsimile transmission, mail or hand delivery), setting forth the name and
address of the Holder of the Old Bonds and the amount of Old Bonds tendered,
stating that the tender is being made thereby and guaranteeing that within
five New York Stock Exchange ("NYSE") trading days after the date of execution
of the Notice of Guaranteed Delivery, the certificates for all physically
tendered Old Bonds, in proper form for transfer, or a Book-Entry Confirmation,
as the case may be, together with a properly completed and duly executed
appropriate Letter of Transmittal (or facsimile thereof or Agent's message in
lieu thereof) with any required signature guarantees and any other documents
required by the Letter of Transmittal will be deposited by the Eligible
Institution with the Exchange Agent, and (iii) the certificates for all
physically tendered Old Bonds, in proper form for transfer, or a Book-Entry
Confirmation, as the case may be, together with a properly completed and duly
executed appropriate Letter of Transmittal (or facsimile thereof or Agent's
Message in lieu thereof) with any required signature guarantees and all other
documents required by the Letter of Transmittal, are received by the Exchange
Agent within five NYSE trading days after the date of execution of the Notice
of Guaranteed Delivery.
WITHDRAWAL RIGHTS
Tenders of Old Bonds may be withdrawn at any time prior to 5:00 p.m., New
York City time, on the Expiration Date. For a withdrawal to be effective, a
written notice of withdrawal must be received by the Exchange Agent at one of
the addresses set forth below under "--Exchange Agent." Any such notice of
withdrawal must (i) specify the name of the person having tendered the Old
Bonds to be withdrawn, (ii) identify the Old Bonds to be withdrawn (including
the principal amount of such Old Bonds), and (iii) (where certificates for Old
Bonds have been transmitted) specify the name in which such Old Bonds are
registered, if different from that of the withdrawing Holder. If certificates
for Old Bonds have been delivered or otherwise identified to the Exchange
Agent, then, prior to the release of such certificates the withdrawing Holder
must also submit the serial numbers of the particular certificates to be
withdrawn and a signed notice of withdrawal with signatures guaranteed by an
Eligible Institution unless such Holder is an Eligible Institution. If Old
Bonds have been tendered pursuant to the procedure for book-entry transfer
described above, any notice of withdrawal must specify the name and number of
the account at the Book-Entry Transfer Facility to be credited with the
withdrawn Old Bonds and otherwise comply with the procedures of such facility.
All questions as to the validity, form and eligibility (including time of
receipt) of such notices will be determined by the Company, whose
determination will be final and binding on all parties. Any Old Bonds so
withdrawn will be deemed not to have been validly tendered for exchange for
purposes of the Exchange Offer. Any Old Bonds which have been tendered for
exchange but which are not exchanged for any reason will be returned to the
Holder thereof without cost to such Holder (or, in the case of Old Bonds
tendered by book-entry transfer into the Exchange Agent's account at the Book-
Entry Transfer Facility pursuant to the book-entry transfer procedures
described above, such Old Bonds will be credited to an account maintained with
such Book-Entry Transfer Facility for the Old Bonds)
13
<PAGE>
as soon as practicable after withdrawal, rejection of tender or termination of
the Exchange Offer. Properly withdrawn Old Bonds may be retendered by
following one of the procedures described under "--Procedures for Tendering
Old Bonds" above at any time on or prior to 5:00 p.m., New York City time, on
the Expiration Date.
CERTAIN CONDITIONS TO THE EXCHANGE OFFER
Notwithstanding any other provision of the Exchange Offer, the Company will
not be required to accept for exchange, or to issue New Bonds in exchange for,
any Old Bonds and may terminate or amend the Exchange Offer, if at any time
before the acceptance of such Old Bonds, any of the following events will
occur:
(a) there will be threatened, instituted or pending any action or
proceeding before, or any injunction, order or decree will have been issued
by, any court or governmental agency or other governmental regulatory or
administrative agency or commission, (i) seeking to restrain or prohibit
the making or consummation of the Exchange Offer or any other transaction
contemplated by the Exchange Offer, or assessing or seeking any damages as
a result thereof, or (ii) resulting in a material delay in the ability of
the Company to accept for exchange or exchange some or all of the Old Bonds
pursuant to the Exchange Offer; or any statute, rule, regulation, order or
injunction will be sought, proposed, introduced, enacted, promulgated or
deemed applicable to the Exchange Offer or any of the transactions
contemplated by the Exchange Offer by any government or governmental
authority, domestic or foreign, or any action will have been taken,
proposed or threatened, by any government, governmental authority, agency
or court, domestic or foreign, that in the sole judgment of the Company
might directly or indirectly result in any of the consequences referred to
in clauses (i) or (ii) above or, in the sole judgment of the Company, might
result in the holders of New Bonds having obligations with respect to
resales and transfers of New Bonds which are greater than those described
in the interpretation of the Commission referred to on the cover page of
this Prospectus, or would otherwise make it inadvisable to proceed with the
Exchange Offer; or
(b) there will have occurred (i) any general suspension of or general
limitation on prices for, or trading in, securities on any national
securities exchange or in the over-the-counter market, (ii) any limitation
by a governmental agency or authority which may adversely affect the
ability of the Company to complete the transactions contemplated by the
Exchange Offer, (iii) a declaration of a banking moratorium or any
suspension of payments in respect of banks in the United States or any
limitation by any governmental agency or authority which adversely affects
the extension of credit or (iv) a commencement of a war, armed hostilities
or other similar international calamity directly or indirectly involving
the United States, or, in the case of any of the foregoing existing at the
time of the commencement of the Exchange Offer, a material acceleration or
worsening thereof; or
(c) any change (or any development involving a prospective change) will
have occurred or be threatened in the business, properties, assets,
liabilities, financial condition, operations, results of operations or
prospects of the Company that, in the sole judgment of the Company, is or
may be adverse to the Company, or the Company will have become aware of
facts that, in the sole judgment of the Company, have or may have adverse
significance with respect to the value of the Old Bonds or the New Bonds;
which in the sole judgment of the Company in any case, and regardless of the
circumstances (including any action by the Company) giving rise to any such
condition, makes it inadvisable to proceed with the Exchange Offer and/or with
such acceptance for exchange or with such exchange.
The foregoing conditions are for the sole benefit of the Company and may be
asserted by the Company regardless of the circumstances giving rise to any
such condition or may be waived by the Company in whole or in part at any time
and from time to time in its sole discretion. The failure by the Company at
any time to exercise any of the foregoing rights will not be deemed a waiver
of any such right and each such right will be deemed an ongoing right which
may be asserted at any time and from time to time.
In addition, the Company will not accept for exchange any Old Bonds
tendered, and no New Bonds will be issued in exchange for any such Old Bonds,
if at such time any stop order will be threatened or in effect with
14
<PAGE>
respect to the Registration Statement of which this Prospectus constitutes a
part or the qualification of the Indenture (as defined herein) under the Trust
Indenture Act of 1939, as amended.
EXCHANGE AGENT
PNC Bank, National Association has been appointed as the Exchange Agent for
the Exchange Offer. All executed Letters of Transmittal should be directed to
the Exchange Agent at the address set forth below. Questions and requests for
assistance, requests for additional copies of this Prospectus or of the Letter
of Transmittal and requests for Notices of Guaranteed Delivery should be
directed to the Exchange Agent addressed as follows:
Delivery to: PNC Bank, National Association
As Exchange Agent
By Mail:
By Hand: PNC Bank, National Association
PNC Bank, National Association Two PNC Plaza
Two PNC Plaza 4th Floor
4th Floor 620 Liberty Ave.
620 Liberty Ave. Pittsburgh, PA 15222-2719
Pittsburgh, PA 15222-2719 Attn: Mark A. Rullo
Attn: Mark A. Rullo
By Facsimile:
By Overnight Courier: PNC Bank, National Association
PNC Bank, National Association Attn: Mark A. Rullo
Two PNC Plaza Telephone: (412) 762-2673
4th Floor Facsimile: (412) 762-8226
620 Liberty Ave.
Pittsburgh, PA 15222-2719
Attn: Mark A. Rullo
DELIVERY OF THE LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF SUCH LETTER OF TRANSMITTAL VIA FACSIMILE OTHER THAN
AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY OF SUCH LETTER OF
TRANSMITTAL.
FEES AND EXPENSES
The Company will not make any payment to brokers, dealers, or others
soliciting acceptances of the Exchange Offer except for reimbursement of
mailing expenses.
The estimated cash expenses to be incurred in connection with the Exchange
Offer will be paid by the Company and are estimated in the aggregate to be
$100,000.
TRANSFER TAXES
Holders who tender their Old Bonds for exchange will be obligated to pay any
transfer taxes in connection with that exchange, as well as any other sale or
disposition of the Old Bonds. Holders who instruct the Company to register New
Bonds in the name of, or request that Old Bonds not tendered or not accepted
in the Exchange Offer be returned to, a person other than the registered
tendering Holder will be responsible for the payment of any applicable
transfer tax thereon.
CONSEQUENCES OF NOT EXCHANGING BONDS
Holders of Old Bonds who do not exchange their Old Bonds for New Bonds
pursuant to the Exchange Offer will continue to be subject to the provisions
in the Indenture regarding transfer and exchange of the Old Bonds
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and the restrictions on transfer of such Old Bonds as set forth in the legend
thereon as a consequence of the issuance of the Old Bonds pursuant to
exemptions from, or in transactions not subject to, the registration
requirements of the Securities Act and applicable state securities laws. In
general, the Old Bonds may not be offered or sold, unless registered under the
Securities Act, except pursuant to an exemption from, or in a transaction not
subject to, the Securities Act and applicable state securities laws. The
Company does not currently anticipate that it will register under the
Securities Act any Old Bonds which remain outstanding after consummation of
the Exchange Offer (subject to limited exceptions, if applicable). To the
extent that Old Bonds are tendered and accepted in the Exchange Offer, a
Holder's ability to sell untendered Old Bonds could be adversely affected.
Holders of the New Bonds and any Old Bonds which remain outstanding after
consummation of the Exchange Offer will vote together as a single class for
purposes of determining whether Holders of the requisite percentage thereof
have taken certain actions or exercised certain rights under the Indenture.
Upon consummation of the Exchange Offer, Holders of Old Bonds will not be
entitled to any increase in the interest rate thereon or any further
registration rights under the Registration Rights Agreement, except under
limited circumstances. See "Exchange Offer; Registration Rights."
CONSEQUENCES OF EXCHANGING BONDS
Based on interpretations by the staff of the Commission, as set forth in no-
action letters issued to third parties, the Company believes that New Bonds
issued pursuant to the Exchange Offer in exchange for Old Bonds may be offered
for resale, resold or otherwise transferred by Holders thereof (other than any
such Holder which is an "affiliate" of the Company within the meaning of Rule
405 under the Securities Act) without compliance with the registration and
prospectus delivery requirements of the Securities Act, provided that such New
Bonds are acquired in the ordinary course of such Holder's business and such
Holder has no arrangement or understanding with any person to participate in
the distribution of such New Bonds. However, the Commission has not considered
the Exchange Offer in the context of a no-action letter and there can be no
assurance that the staff of the Commission would make a similar determination
with respect to the Exchange Offer as in such other circumstances. Each Holder
must acknowledge that it is not engaged in, and does not intend to engage in,
a distribution of such New Bonds and has no arrangement or understanding to
participate in a distribution of New Bonds. If any Holder is an affiliate of
the Company, is engaged in or intends to engage in or has any arrangement or
understanding with respect to the distribution of the New Bonds to be acquired
pursuant to the Exchange Offer, such Holder (i) could not rely on the
applicable interpretations of the staff of the Commission and (ii) must comply
with the registration and prospectus delivery requirements of the Securities
Act in connection with any resale transaction. Each broker-dealer that
receives New Bonds for its own account in exchange for Old Bonds must
acknowledge that such Old Bonds were acquired by such broker-dealer as a
result of market-making activities or other trading activities and that it
will deliver a prospectus (which may be this Prospectus) in connection with
any resale of such New Bonds. See "Plan of Distribution." In addition, to
comply with the securities laws of certain jurisdictions (including any
jurisdiction outside the United States), the New Bonds may not be offered or
sold unless they have been registered or qualified for sale in such
jurisdiction or an exemption from registration or qualification is available
and is complied with. The Company has agreed, pursuant to the Registration
Rights Agreement, subject to certain limitations specified therein, to
register or qualify the New Bonds for offer or sale under the applicable state
securities laws of such United States jurisdictions as any Holders of the Old
Bonds reasonably request by the time the Registration Statement (of which this
Prospectus forms a part) is declared effective by the Commission. The Company
does not intend to register or qualify the sale of the New Bonds in any such
United States jurisdictions (unless they receive such a request) or any other
jurisdiction.
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DESCRIPTION OF THE BONDS
The New Bonds offered hereby will be issued under an indenture (the
"Indenture"), dated as of September 30, 1993, between the Company and PNC
Bank, National Association, as Trustee (the "Trustee"). The statements under
this caption are brief summaries of certain provisions of the Indenture, do
not purport to be complete and are subject to, and are qualified in their
entirety by reference to, all of the provisions of the Indenture, including
the definitions therein of certain terms. Wherever particular Sections of the
Indenture are referred to herein, it is intended that such Sections will be
incorporated by reference.
The term "Securities," as used under this caption, refers to all Securities
issued under the Indenture and includes the New Bonds.
The Indenture does not limit the aggregate amount of securities which may be
issued thereunder and Securities other than the New Bonds have been and may be
issued thereunder from time to time in separate series up to the aggregate
amount from time to time authorized by the Company for each series. The New
Bonds will be unsecured obligations of the Company and will rank on a parity
with all other unsecured and unsubordinated indebtedness of the Company. New
Bonds may be issued in minimum denominations of $1,000 and integral multiples
thereof.
Registered Holders of New Bonds on the relevant record date for the first
interest payment date following the consummation of the Exchange Offer will
receive interest accruing from the most recent date to which interest has been
paid or, if no interest has been paid, from June 16, 1998. Old Bonds accepted
for exchange will cease to accrue interest from and after the date of
consummation of the Exchange Offer. Holders whose Old Bonds are accepted for
exchange will not receive any payment in respect of interest on such Old Bonds
otherwise payable on any interest payment date, the record date for which
occurs on or after the consummation of the Exchange Offer.
For each Old Bond accepted for exchange, the Holder of such Old Bond will
receive a New Bond having a principal amount equal to that of the surrendered
Old Bond.
The interest rate on the Old Bonds is subject to increase in certain
circumstances if the Exchange Offer Registration Statement is not declared
effective on a timely basis or if certain other conditions are not satisfied,
all as further described under "Exchange Offer; Registration Rights."
6 1/8% NEW BONDS
The 6 1/8% New Bonds will be limited to $200,000,000 aggregate principal
amount, will bear interest from June 16, 1998, at the rate of 6 1/8% per annum
and will mature on June 15, 2005. Interest will be payable semiannually on
June 15 and December 15 to the persons in whose names the 6 1/8% New Bonds are
registered at the close of business on the June 1 or December 1, as the case
may be, next preceding such interest payment date.
The 6 1/8% New Bonds are not subject to the provisions of any optional or
mandatory sinking fund. The 6 1/8% New Bonds are not convertible or
exchangeable into any other security of the Company.
6 1/2% NEW BONDS
The 6 1/2% New Bonds will be limited to $250,000,000 aggregate principal
amount, will bear interest from June 16, 1998, at the rate of 6 1/2% per annum
and will mature on June 15, 2018. Interest will be payable semiannually on
June 15 and December 15 to the persons in whose names the 6 1/2% New Bonds are
registered at the close of business on the June 1 or December 1, as the case
may be, next preceding such interest payment date.
The 6 1/2% New Bonds are not subject to the provisions of any optional or
mandatory sinking fund. The 6 1/2% New Bonds are not convertible or
exchangeable into any other security of the Company.
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OPTIONAL REDEMPTION
The Bonds will be redeemable, in whole or in part, at the option of the
Company at any time at a redemption price equal to the greater of (i) 100% of
the principal amount of such Bonds or (ii) as determined by the Quotation
Agent (as defined below), the sum of the present values of the remaining
scheduled payments of principal and interest thereon (not including any
portion of such payments of interest accrued as of the date of redemption)
discounted to the date of redemption on a semiannual basis (assuming a 360-day
year consisting of twelve 30-day months) at the Adjusted Treasury Rate (as
defined below) plus 10 basis points in the case of the 6 1/8% New Bonds and
plus 15 basis points in the case of the 6 1/2% New Bonds, plus, in each case,
accrued interest thereon to the date of redemption.
"Adjusted 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.
"Comparable Treasury Issue" means the United States Treasury security
selected by the Quotation Agent as having a maturity comparable to the
remaining term of the Bonds 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 Bonds.
"Comparable Treasury Price" means, with respect to any redemption date, (i)
the average of the Reference Treasury Dealer Quotations for such redemption
date, after excluding the highest and lowest such Reference Treasury Dealer
Quotations, or (ii) if the Trustee obtains fewer than three such Reference
Treasury Dealer Quotations, the average of all such Quotations.
"Quotation Agent" means the Reference Treasury Dealer appointed by the
Company.
"Reference Treasury Dealer" means (i) Merrill Lynch, Pierce, Fenner & Smith
Incorporated and its respective successors; provided, however, that if the
foregoing will cease to be a primary U.S. Government securities dealer in New
York city (a "Primary Treasury Dealer"), the Company will substitute therefor
another Primary Treasury Dealer; and (ii) any other Primary Treasury Dealer,
if any, selected by the Company.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by the
Company, 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 Dealer at 5:00 p.m. on the third
Business Day preceding such redemption date.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of the Bonds to be redeemed.
Unless the Company defaults in payment of the redemption price, on and after
the redemption date, interest will cease to accrue on the Bonds or portions
thereof called for redemption.
STATUS
The New Bonds will rank pari passu with other unsubordinated indebtedness of
the Company.
FORM, EXCHANGE, REGISTRATION AND TRANSFER
New Bonds other than Global Bonds (as defined herein), if any, will be
exchangeable for other New Bonds of a like aggregate principal amount and
tenor of different authorized denominations.
New Bonds (other than Global Bonds) may be presented for exchange as
provided above and may be presented for registration of transfer (with the
form of transfer endorsed thereon duly executed, if so required by the Company
or the Trustee or any transfer agent), at the office of the Security Registrar
or at the office of any
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transfer agent designated by the Company for such purpose, without service
charge and upon payment of any taxes and other governmental charges as
described in the Indenture. Such transfer or exchange will be effected upon
the Security Registrar or such transfer agent, as the case may be, being
satisfied with the documents of title and identity of the person making the
request. (Section 305) The Company may at any time designate additional
transfer agents with respect to the New Bonds. (Section 1002)
In the event of any redemption in part, the Company will not be required to
(i) issue, register the transfer of or exchange of New Bonds during a period
beginning at the opening of business 15 days before any selection of New Bonds
to be redeemed and ending at the close of business on the day of mailing of
the relevant notice of redemption; or (ii) register the transfer of or
exchange any New Bond, or portion thereof, called for redemption, except the
unredeemed portion of any New Bond being redeemed in part. (Section 305)
PAYMENT AND PAYING AGENTS
Payment of principal of and any premium and interest on the Bonds will be
made at the office of such Paying Agent or Paying Agents as the Company may
designate from time to time, except that at the option of the Company, payment
of any interest may be made by check mailed to the address of the Person
entitled thereto as such address will appear in the Security Register. Payment
of any installment of interest on the Bonds will be made to the Person in
whose name such Registered Security is registered at the close of business on
the Regular Record Date for such interest. (Section 307)
The Corporate Trust Office of the Trustee in Pittsburgh, Pennsylvania will
be designated as a Paying Agent for the Company for payments with respect to
the Bonds. The Company may at any time designate additional Paying Agents or
rescind the designation of any Paying Agent or approve a change in the office
through which any Paying Agent acts, except that the Company will be required
to maintain a Paying Agent in each Place of Payment for such series. (Section
1002)
All moneys paid by the Company to a Paying Agent for the payment of
principal of and any premium or interest on any Security which remain
unclaimed at the end of two years after such principal, premium or interest
will have become due and payable will be repaid to the Company and the Holder
of such Security or any coupon will thereafter look only to the Company for
payment thereof. (Section 1003)
CERTAIN LIMITATIONS
Liens. The Company covenants in the Indenture that it will not create,
incur, assume or guarantee, and will not permit any Restricted Subsidiary to
create, incur, assume or guarantee, any indebtedness for borrowed money
("Debt") secured by a mortgage, security interest, pledge, charge or similar
encumbrance ("mortgages") upon any Principal Property of the Company or any
Restricted Subsidiary or upon any shares of stock or indebtedness of any
Restricted Subsidiary without equally and ratably securing the Bonds. The
foregoing restriction, however, will not apply to (a) mortgages on property,
shares of stock or indebtedness of any corporation existing at the time such
corporation becomes a Restricted Subsidiary; (b) mortgages on property
existing at the time of acquisition of such property by the Company or a
Restricted Subsidiary or mortgages to secure the payment of all or any part of
the purchase price of such property upon the acquisition or to secure any Debt
incurred prior to, at the time of, or within 180 days after, the acquisition
of such property for the purpose of financing all or any part of the purchase
price thereof, or mortgages to secure the cost of improvements to such
acquired property; (c) mortgages to secure Debt of a Restricted Subsidiary to
the Company or another Restricted Subsidiary; (d) mortgages existing at the
date of the Indenture; (e) mortgages on property of a corporation existing at
the time such corporation is merged into or consolidated with the Company or a
Restricted Subsidiary or at the time of a sale, lease, or other disposition of
the properties of a corporation as an entirety or substantially as an entirety
to the Company or a Restricted Subsidiary; (f) certain mortgages in favor of
governmental entities; or (g) extensions, renewals or replacements of any
mortgage referred to in the foregoing clauses (a) through (f). (Section 1009)
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Notwithstanding the restrictions outlined in the preceding paragraph, the
Company or any Restricted Subsidiary will be permitted to create, incur,
assume or guarantee any Debt secured by a mortgage without equally and ratably
securing the New Bonds, provided that after giving effect thereto, the
aggregate amount of all debt so secured by mortgages (not including mortgages
permitted under clauses (a) through (g) above) does not exceed 10% of
Consolidated Net Tangible Assets. (Section 1009)
Sale and Leaseback Arrangements. The Company covenants that it will not, nor
will it permit any Restricted Subsidiary to, enter into any arrangement with
any person that provides for the leasing to the Company or any Restricted
Subsidiary of Principal Property (other than any such transaction involving a
lease for a term of not more than three years or any such transaction between
the Company and a Restricted Subsidiary or between Restricted Subsidiaries)
which has been or is to be sold or transferred by the Company or such
Restricted Subsidiary to such person, unless either (a) the Company or such
Restricted Subsidiary would be entitled to issue, assume or guarantee Debt
secured by a mortgage on such Principal Property at least equal in amount to
the Attributable Debt with respect to such arrangement, without equally and
ratably securing the Bonds, pursuant to the limitation in the Indenture on
liens, or (b) the Company will apply an amount equal to the greater of the net
proceeds of such sale or the Attributable Debt with respect to such
arrangements to the retirement of Debt that matures more than twelve months
after the creation of such Debt. (Section 1010)
Highly leveraged transactions. The Indenture does not contain provisions
which would afford protection to the Holders of the Bonds in the event of a
highly leveraged transaction involving the Company.
CERTAIN DEFINITIONS
The term "Affiliate" of any specified Person will mean any other Person
directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified Person. For the purposes of this
definition, "control," when used with respect to any specified Person, means
the power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
The term "Attributable Debt," when used in connection with a sale and
leaseback transaction referred to above will mean, at the time of
determination, the lesser of (a) the fair value of such property (as
determined by the Board of Directors of the Company) or (b) the present value
(discounted at the annual rate of 9%, compounded semi-annually) of the
obligation of the lessee for net rental payments during the remaining term of
the lease (including any period for which such lease has been extended).
The term "Board of Directors" means either the board of directors of the
Company or any duly authorized committee of that board.
The term "Corporate Trust Office" means the principal office of the Trustee
in Pittsburgh, Pennsylvania at which at any particular time its corporate
trust business will be administered.
The term "Consolidated Net Tangible Assets" will mean, as of any particular
time, the aggregate amount of assets (less applicable reserves and other
properly deductible items) adjusted for inventories on the basis of cost
(before application of the "last-in first-out" method of determining cost) or
current market value, whichever is lower, and deducting therefrom (a) all
current liabilities except for (1) notes and loans payable, (2) current
maturities of long-term debt and (3) current maturities of obligations under
capital leases and (b) all goodwill, tradenames, trademarks, patents,
unamortized debt discount and expenses (to the extent included in said
aggregate amount of assets) and other like intangibles, all as set forth on
the most recent consolidated balance sheet of the Company and its consolidated
Subsidiaries and computed in accordance with generally accepted accounting
principles.
The term "Defaulted Interest" will mean any interest on any Registered
Security of any series which is payable but is not punctually paid or duly
provided for on any Interest Payment Date.
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The term "Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any statute successor thereto.
The term "Holder", when used with respect to any Security, means in the case
of a Registered Security the Person in whose name the Security is registered
in the Security Register and in the case of a Bearer Security the bearer
thereof and, when used with respect to any coupon, means the bearer thereof.
The term "Indenture" means the indenture as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental thereto entered into pursuant to the applicable provisions
hereof, including, for all purposes of the Indenture and any supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern the Indenture, and any such supplemental indenture,
respectively. The term "Indenture" will also include the terms of particular
series of Securities established as contemplated by Section 301 therein.
The term "Opinion of Counsel" means a written opinion of counsel, who may be
counsel for the Company and will be acceptable to the Trustee.
The term "Outstanding," when used with respect to Securities, means, as of
the date of determination, all Securities theretofore authenticated and
delivered under the Indenture, except:
(1) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(2) Securities for whose payment or redemption money in the necessary
amount has been theretofore deposited with the Trustee or any Paying Agent
in trust or set aside and segregated in trust by the Company (if the
Company will act as its own Paying Agent) for the Holders of such
Securities and any coupons appertaining thereto; provided that, if such
Securities are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture or provision therefor satisfactory to the
Trustee has been made:
(3) Securities as to which Defeasance has been effected pursuant to
Section 1302 of the Indenture (see also "Defeasance and Covenant
Defeasance" section herein); and
(4) Securities which have been paid pursuant to Section 306 of the
Indenture or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to the Indenture, other than any such
Securities in respect of which there will have been presented to the
Trustee proof satisfactory to it that such Securities are held by a bona
fide purchaser in whose hands such Securities are valid obligations of the
Company; provided, however, that in determining whether the Holders of the
requisite principal amount of the Outstanding Securities have given any
request, demand, authorization, direction, notice, consent or waiver
hereunder or whether a quorum is present at a meeting of Holders of
Securities (A) the principal amount of an Original Issue Discount Security
that will be deemed to be Outstanding will be the amount of the principal
thereof that would be due and payable as of the date of such determination
upon acceleration of the Maturity thereof to such date pursuant to Section
502 of the Indenture, (B) the principal amount of a Security denominated in
one or more foreign currencies or currency units will be the Dollar
equivalent, determined in the manner provided as contemplated by Section
301 of the Indenture on the date of original issuance of such Security, of
the principal amount (or in the case of an Original Issue Discount
Security, the Dollar equivalent on the date of original issuance of such
Security of the amount determined as provided in Clause (A) above), of such
Security, and (C) Securities owned by the Company or any other obligor upon
the Securities or any Affiliate of the Company or of such other obligor
will be disregarded and deemed not to be Outstanding except that, in
determining whether the Trustee will be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, or
upon any such determination as to the presence of a quorum, only Securities
which the Trustee knows to be so owned will be so disregarded. Securities
so owned which have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Trustee
the pledgee's right so to act with respect to such Securities and that the
pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor.
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The term "Paying Agent" means any Person authorized by the Company to pay
the principal of or any premium or interest on any Securities on behalf of the
Company.
The term "Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
The term "Principal Property" will mean any manufacturing plant or
manufacturing facility which is (i) owned by the Company or any Restricted
Subsidiary and (ii) located within the continental United States of America,
except any such plant which, in the opinion of the Board of Directors, is not
of material importance to the total business conducted by the Company and the
Restricted Subsidiaries taken as a whole.
The term "Redemption Date," when used with respect to any Security to be
redeemed, means the date fixed for such redemption by or pursuant to the
Indenture.
The term "Registered Security" means any Security established pursuant to
the Indenture which is registered in the Security Register.
The term "Regular Record Date" for the interest payable on any Interest
Payment Date on the Registered Securities of any series means the date
specified for that purpose as contemplated by Section 301 of the Indenture.
The term "Restricted Subsidiary" will mean any Subsidiary substantially all
the property of which is located within the continental United States;
provided, however, that the term "Restricted Subsidiary" will not include any
Subsidiary which is principally engaged in leasing or in financing
receivables, or which is principally engaged in financing the Company's
operations outside the continental United States, or which principally serves
as a partner in a partnership.
The term "Security Register" means the register kept at an office or agency
of the Company pursuant to Section 305 of the Indenture.
The term "Security Registrar" will mean PNC Bank, National Association.
The term "Special Record Date" for the payment of any Defaulted Interest on
the Registered Securities of any series means a date fixed by the Trustee
pursuant to Section 307 of the Indenture.
The term "Stated Maturity," when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security or a coupon representing such installment of interest as the
fixed date on which the principal of such Security or such installment of
principal or interest is due and payable.
The term "Subsidiary" will mean any corporation of which at least a majority
of the outstanding stock having the voting power to elect a majority of the
board of directors of such corporation at such time is owned, directly or
indirectly, by the Company or by one or more Subsidiaries, or by the Company
and one or more Subsidiaries.
The term "Trust Indenture Act" means the Trust Indenture Act of 1939 as in
force at the date as of which the Indenture was executed, provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
The term "U.S. Government Obligations" will mean (x) any security that is
(i) a direct obligation of the United States of America for the payment of
which the full faith and credit of the United States of America is pledged or
(ii) an obligation of a Person controlled or supervised by or acting as an
agent or instrumentality of the United States of America the payment of which
is unconditionally guaranteed as a full faith and credit
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obligation by the United States of America, which, in either case (i) or (ii),
is not callable or redeemable at the option of the issuer thereof, and (y) any
depositary receipt issued by a bank (as defined in Section 3(a)(2) of the
Securities Act of 1933, as amended) as custodian with respect to any U.S.
Government Obligation specified in clause (x) and held by such custodian for
the account of the holder of such depositary receipt, or with respect to any
specific payment of principal of or interest on any such U.S. Government
Obligation, provided that (except as required by law) such custodian is not
authorized to make any deduction from the amount payable to the holder of such
depositary receipt from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of principal or interest
evidenced by such depositary receipt.
EVENTS OF DEFAULT
Any one of the following events will constitute an Event of Default under
the Indenture with respect to Securities of any series: (a) failure to pay any
interest on any Security of that series when due, continued for 30 days; (b)
failure to pay principal of or any premium on a Security of that series when
due; (c) failure to deposit any sinking fund payment when due in respect of
any Security of that series, continued for 30 days; (d) failure to perform any
other covenant of the Company in the Indenture (other than a covenant included
in the Indenture solely for the benefit of a series of Securities other than
that series), continued for 90 days after written notice as provided in the
Indenture; (e) default resulting in acceleration of any indebtedness for money
borrowed by the Company under the terms of the instrument or instruments under
which such indebtedness is issued or secured if such acceleration is not
rescinded or annulled within 10 days after written notice as provided in the
Indenture (provided that, the resulting Event of Default under the Indenture
will be cured or waived if such other default is cured or waived); (f) certain
events in bankruptcy, insolvency or reorganization involving the Company; and
(g) any other Event of Default provided with respect to Securities of that
series. (Security 501)
If an Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing, either the Trustee or the Holders of at
least 25% in aggregate principal amount of the Outstanding Securities of that
series by notice as provided in the Indenture may declare the principal amount
(or, if the Securities of that series are Original Issue Discount Securities,
such portion of the principal amount as may be specified in the terms of that
series) of all the Securities of that series to be due and payable
immediately. At any time after a declaration of acceleration with respect to
Securities of any series has been made, but before a judgment or decree for
payment of money has been obtained by the Trustee, the Holders of a majority
in aggregate principal amount of the Outstanding Securities of that series
may, under certain circumstances, rescind and annul such acceleration.
(Section 502)
The Indenture provides that, subject to the duty of the Trustee during
default to act with the required standard of care, the Trustee will be under
no obligation to exercise any of its rights or powers under the Indenture at
the request or direction of any of the Holders, unless such Holders will have
offered to the Trustee reasonable indemnity. (Sections 601 and 603) The
Holders of a majority in aggregate principal amount of the Outstanding
Securities of any series will have the right to direct the time, method and
place of conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred on the Trustee, with respect to the
Securities of that series. (Section 512)
DEFEASANCE AND COVENANT DEFEASANCE
The Company, at its option, (i) will be discharged from any and all
obligations in respect of the Bonds (except for certain obligations to issue
temporary Securities pending preparation of definitive Bonds, to register the
transfer or exchange of Bonds of such series, to replace stolen, lost or
mutilated Bonds of such series, and to maintain paying agents and hold moneys
for payment in trust) or (ii) need not comply with the covenants that are set
forth under "Certain Limitations" and "Consolidations, Mergers and Sale of
Assets," and the occurrence of an event described under clause (d) of the
"Events of Default" with respect to any defeased covenant and clauses (e) and
(g) of the "Events of Default" will no longer be an Event of Default if, in
each case, the Company irrevocably deposits with the Trustee, in trust, money
and/or U.S. Government Obligations that through the scheduled payment of
interest thereon and principal thereof in accordance with their terms will
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provide money in an amount sufficient to pay all the principal of (and
premium, if any) and any interest on the Bonds on the dates such payments are
due (which may include one or more redemption dates designated by the Company)
in accordance with the terms of the Indenture and the Bonds. Such a trust may
only be established if, among other things, (a) no Event of Default or event
which with the giving of notice or lapse of time, or both, would become an
Event of Default under the Indenture will have occurred and be continuing on
the date of such deposit, or with regard to any Event of Default or any such
event described under clause (f) of "Events of Default" will have occurred and
be continuing at any time during the period ending on the 91st day following
such date of deposit, and (b) in the case of a defeasance of the type
described in clause (i) above, the Company will have delivered to the Trustee
an opinion of counsel stating that (A) the Company has received from, or there
has been published by, the Internal Revenue Service a ruling or (B) since the
date of the Indenture, there has been a change in the applicable Federal
income tax law, in either case to the effect that, and based thereon such
opinion of counsel will confirm that, the holders of the Bonds will not
recognize income, gain or loss for Federal income tax purposes as a result of
such defeasance of the type described in clause (i) above and will be subject
to Federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such defeasance of the type described in
clause (i) above had not occurred; (c) in the case of a defeasance of the type
described in clause (ii) above, the Company will have delivered to the Trustee
an opinion of counsel stating that the holders of the Bonds will not recognize
income, gain or loss for Federal income tax purposes as a result of such
defeasance of the type described in clause (ii) above and will be subject to
Federal tax on the same amounts, in the same manner and at the same times as
would have been the case if such defeasance of the type described in clause
(ii) above had not occurred. In the event the Company omits to comply with its
remaining obligations under the Indenture after a defeasance of the Indenture
with respect to the Bonds as described under clause (ii) above and the Bonds
are declared due and payable because of the occurrence of any undefeased Event
of Default, the amount of money and/or U.S. Government Obligations on deposit
with the Trustee may be insufficient to pay amounts due on the Bonds at the
time on the acceleration resulting from such Event of Default. However, the
Company will remain liable in respect of such payments. (Article Thirteen)
MEETINGS, MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the Company and
the Trustee with the consent of the Holders of not less than 66 2/3% in
aggregate principal amount of the Outstanding Securities of each series
affected by such modification or amendment; provided, however, that no such
modification or amendment may, without the consent of the Holder of each
Outstanding Security affected thereby, (a) change the Stated Maturity of the
principal of, or any installment of principal of or interest on any Security,
(b) reduce the principal amount of, or premium or interest on, any Security,
(c) change any obligation of the Company to pay additional amounts, (d) reduce
the amount of principal of an Original Issue Discount Security payable upon
acceleration of the Maturity thereof, (e) change the coin or currency in which
any Security or any premium or interest thereon is payable, (f) impair the
right to institute suit for the enforcement of any payment on or with respect
to any Security, (g) reduce the percentage in principal amount of Outstanding
Securities of any series, the consent of whose Holders is required for
modification or amendment of the Indenture or for waiver of compliance with
certain provisions of the Indenture or for waiver of certain defaults, (h)
reduce the requirements contained in the Indenture for quorum or voting, (i)
change any obligation of the Company to maintain an office or agency in the
places and for the purposes required by the Indenture, or (j) modify any of
the above provisions. (Section 902)
The Holders of at least 66 2/3% of the outstanding Securities of a series
may waive compliance by the Company with certain restrictive provisions of the
Indenture. (Section 1012) The Holders of not less than a majority in aggregate
principal amount of the Outstanding Securities of each series may, on behalf
of all Holders of Securities of that series and any coupons appertaining
thereto, waive any past default under the Indenture with respect to Securities
of that series, except a default (a) in the payment of principal of (or
premium if any) or any interest on any Security of such series, and (b) in
respect of a covenant or provision of the Indenture which cannot be modified
or amended without the consent of the Holder of each Outstanding Security of
such series affected. (Section 513)
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The Indenture provides that in determining whether the Holders of the
requisite principal amount of the Outstanding Securities have given any
request, demand, authorization, direction, notice, consent or waiver
thereunder or are present at a meeting of Holders of Securities for quorum
purposes, (i) the principal amount of an Original Issue Discount Security that
will be deemed to be Outstanding will be the amount of the principal thereof
that would be due and payable as of the date of such determination upon
acceleration of the Maturity thereof, (ii) the principal amount of a Security
denominated in a foreign currency or currencies will be the U.S. dollar
equivalent, determined on the date of original issuance of such Security, of
the principal amount of such Security (or, in the case of an Original Issue
Discount Security, the U.S. dollar equivalent, determined on the date of
original issuance of such Security, of the amount determined as provided in
(i) above), and (iii) Securities owned by the Company or an Affiliate thereof
will not be deemed Outstanding. (Section 101)
A meeting may be called at any time by the Trustee, and also, upon request,
by the Company or the Holders of at least 10% in principal amount of the
Outstanding Securities of such series, in any such case upon notice given in
accordance with "Notices" below. (Section 1402) To be entitled to vote at any
meeting of Holders of Securities of any series, a Person will be (1) a Holder
of one or more Outstanding Securities of such series, or (2) a person
appointed by an instrument in writing as proxy of a Holder or Holders,
including proxies given to beneficial owners of Book-Entry Securities by the
Depository, or its nominee. (Section 1403) Except for any consent which must
be given by the Holder of each Outstanding Security affected thereby, as
described above, any resolution presented at a meeting or adjourned meeting at
which a quorum is present may be adopted by the affirmative vote of the
Holders of a majority in principal amount of the Outstanding Securities of
that series; provided, however, that, except for any consent which must be
given by the Holder of each Outstanding Security affected thereby, as
described above, any resolution with respect to any consent or waiver which
may be given by the Holders of not less than 66 2/3% in principal amount of
the Outstanding Securities of a series may be adopted at a meeting or an
adjourned meeting at which a quorum is present only by the affirmative vote of
66 2/3% in principal amount of the Outstanding Securities of that series; and
provided, further, that, except for any consent which must be given by the
Holder of each Outstanding Security affected thereby, as described above, any
resolution with respect to any request, demand, authorization, direction,
notice, consent, waiver or other action which may be made, given or taken by
the Holders of a specified percentage, which is less than a majority, in
principal amount of the Outstanding Securities of a series may be adopted at a
meeting or adjourned meeting duly reconvened at which a quorum is present by
the affirmative vote of the Holders of such specified percentage in principal
amount of the Outstanding Securities of that series. Any resolution passed or
decision taken at any meeting of Holders of Securities of any series duly held
in accordance with the Indenture will be binding on all Holders of Securities
of that series and the related coupons. The quorum at any meeting called to
adopt a resolution, and at any reconvened meeting, will be persons holding or
representing a majority in principal amount of the Outstanding Securities of a
series; provided, however, that if any action is to be taken at such meeting
with respect to a consent or waiver which may be given by the Holders of not
less than 66 2/3% in principal amount of the Outstanding Securities of a
series, the persons holding or representing 66 2/3% in principal amount of the
Outstanding Securities of such series will constitute a quorum. (Section 1404)
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Company, without the consent of the Holders of any of the Outstanding
Securities under the Indenture, may consolidate or merger with or into, or
transfer or lease its assets substantially as an entirety to, any Person which
is a corporation, partnership or trust organized and validly existing under
the laws of any domestic jurisdiction, or may permit any such Person to
consolidate with or merge into the Company or convey, transfer or lease its
properties and assets substantially as an entirety to the Company, provided
that any successor Person assumes the Company's obligations on the Securities
and under the Indenture, that after giving effect to the transaction no Event
of Default, and no event which, after notice or lapse of time, would become an
Event of Default, will have occurred and be continuing, and that certain other
conditions are met. (Section 801)
NOTICES
Notices to Holders of Bonds will be given by mail to the addresses of such
Holders as they appear in the Security Register. (Sections 101 and 106)
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REPLACEMENT OF SECURITIES
Any mutilated Bond will be replaced by the Company at the expense of the
Holder upon surrender of such Bond to the Security Registrar. Bonds that are
destroyed, stolen or lost will be replaced by the Company at the expense of
the Holder upon delivery to the Trustee of the Bond or evidence of the
destruction, loss or theft thereof satisfactory to the Company and the
Trustee. In the case of a destroyed, lost or stolen Bond, an indemnity
satisfactory to the Trustee and the Company may be required at the expense of
the Holder of such Bond before a replacement Bond will be issued. (Section
306)
GOVERNING LAW
The Indenture and the Bonds will be governed by, and construed in accordance
with, the laws of the Commonwealth of Pennsylvania. (Section 113)
REGARDING THE TRUSTEE
PNC Bank, National Association, trustee under the Indenture. The Company and
certain of its Subsidiaries maintain deposit accounts and conduct other
banking transactions, including borrowings in the ordinary course of business,
with PNC Bank, National Association.
EXCHANGE OFFER; REGISTRATION RIGHTS
The following description of certain provisions of the Registration Rights
Agreement is a summary and is subject to, and is qualified in its entirety by
reference to, all the provisions of the Registration Rights Agreement, a copy
of which is filed as an exhibit to the Registration Statement of which this
Prospectus forms a part.
Pursuant to a Registration Rights Agreement (the "Registration Rights
Agreement") the Company agreed, for the benefit of the Holders of Old Bonds,
at the Company's cost, to file with the Commission, subject to the following
discussion, an Exchange Offer Registration Statement on an appropriate form
under the Securities Act, with respect to the Exchange Offer for the New
Bonds, which will have terms identical to the Old Bonds being exchanged,
except that (i) interest on the New Bonds will accrue from the last day on
which interest was paid on the Old Bonds exchanged therefor or, if no such
interest has been paid, from June 16, 1998 and (ii) the transfer restrictions
on the Old Bonds will not apply to the New Bonds. At such time as provided in
the Exchange Offer Registration Statement, the Company will offer to the
holders of Old Bonds who are able to make certain representations the
opportunity to exchange their Old Bonds for New Bonds. If (i) the Company is
not permitted to consummate the Exchange Offer because the Exchange Offer is
not permitted by applicable law or Commission policy, (ii) the Exchange Offer
Registration Statement is not declared effective by the Commission on or prior
to November 13, 1998, (iii) any holder of Old Bonds notifies the Company
within a specified time period that (a) due to a change in law or policy it is
not entitled to participate in the Exchange Offer, (b) due to a change in law
or policy it may not resell the New Bonds acquired by it in the Exchange Offer
to the public without delivering a prospectus and the prospectus contained in
the Exchange Offer Registration Statement is not appropriate or available for
such resales by such holder or (c) it is a broker-dealer and owns Old Bonds
acquired directly from the Company or an affiliate of the Company or (iv) the
holders of a majority in aggregate principal amount of the Old Bonds may not
resell the New Bonds acquired by them in the Exchange Offer to the public
without restriction under the Securities Act and without restriction under
applicable blue sky or state securities laws, the Company will file with the
Commission a Registration Statement pursuant to Rule 415 under the Securities
Act (the "Shelf Registration Statement") to cover resales of the Transfer
Restricted Bonds (as defined herein) by the holders thereof. The Company will
use its best efforts to cause the applicable registration statement to be
declared effective as promptly as possible by the Commission.
For purposes of the foregoing, "Transfer Restricted Bonds" means each Old
Bond until (i) the date on which such Old Bonds have been exchanged by a
person other than a broker-dealer referred to in (ii) below for a New Bond in
the Exchange Offer, (ii) following the exchange by a broker-dealer in the
Exchange Offer of an
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Old Bond for a New Bond, the date on which such New Bond is sold to a
purchaser who receives from such broker-dealer on or prior to the date of such
sale a copy of the prospectus contained in the Exchange Offer Registration
Statement, as amended or supplemented, (iii) the date on which such Old Bonds
have been effectively registered under the Securities Act and disposed of in
accordance with the Shelf Registration Statement, (iv) the date on which such
Old Bond is eligible for distribution to the public pursuant to Rule 144(k)
under the Securities Act (or any similar provision then in force, but not Rule
144A under the Securities Act), (v) the date on which such Old Bond will have
been otherwise transferred by the holder thereof and a new Bond not bearing a
legend restricting further transfer will have been delivered by the Company
and subsequent disposition of such New Bonds will not require registration or
qualification under the Securities Act or any similar state law then in force
or (vi) such Old Bonds cease to be outstanding.
Under existing Commission interpretations, the New Bonds would, in general,
be freely transferable after the Exchange Offer without further registration
under the Securities Act; provided, however, that in the case of broker-
dealers participating in the Exchange Offer, a prospectus meeting the
requirements of the Securities Act must be delivered by such broker-dealers in
connection with resales of the New Bonds. The Company has agreed, for a period
of 90 days after consummation of the Exchange Offer, to make available a
prospectus meeting the requirements of the Securities Act to any such broker-
dealer for use in connection with any resale of any New Bonds acquired in the
Exchange Offer. A broker-dealer which delivers such a prospectus to purchasers
in connection with such resales will be subject to certain of the civil
liability provisions under the Securities Act and will be bound by the
provisions of the Registration Rights Agreement (including certain
indemnification rights and obligations).
Each Holder of Old Bonds that wishes to exchange such Old Bonds for New
Bonds in the Exchange Offer will be required to make certain representations,
including representations that (i) any New Bonds to be received by it will be
acquired in the ordinary course of its business, (ii) it has no arrangement
with any person to participate in the distribution (within the meaning of the
Securities Act) of the New Bonds and (iii) it is not an "affiliate," as
defined in Rule 405 under the Securities Act, of the Company, or if it is an
affiliate, it will comply with the registration and prospectus delivery
requirements of the Securities Act to the extent applicable.
If the Holder is not a broker-dealer, it will be required to represent that
it is not engaged in, and does not intend to engage in, the distribution of
the New Bonds. If the Holder is a broker-dealer that will receive New Bonds
for its own account in exchange for Old Bonds that were acquired as a result
of market-making activities or other trading activities, it will be required
to acknowledge that it will deliver a prospectus in connection with any resale
of such New Bonds.
The Registration Rights Agreement provides that (i) unless the Exchange
Offer would not be permitted by applicable law or Commission policy, the
Company will file the Exchange Offer Registration Statement with the
Commission on or prior to August 15, 1998, (ii) unless the Exchange Offer
would not be permitted by applicable law or Commission policy, the Company
will use its best efforts to have the Exchange Offer Registration Statement
declared effective by the Commission on or prior to November 13, 1998, (iii)
unless the Exchange Offer would not be permitted by applicable law or
Commission policy, the Company will commence the Exchange Offer and use its
best efforts to issue, on or prior to 30 days after the date on which the
Exchange Offer Registration Statement was declared effective by the
Commission, New Bonds, in exchange for all Old Bonds tendered prior thereto in
the Exchange Offer and (iv) if obligated to file the Shelf Registration
Statement, the Company will use its best efforts to file prior to the later of
(a) August 15, 1998 or (b) 30 days after such filing obligation arises and use
its best efforts to cause the Shelf Registration Statement to be declared
effective by the Commission on or prior to 90 days after such obligation
arises; provided, however, that if the Exchange Offer Registration Statement
is not declared effective by the Commission on or prior to November 13, 1998,
then the Company will file the Shelf Registration Statement with the
Commission on or prior to December 13, 1998. The Company will use its best
efforts to keep such Shelf Registration Statement continuously effective,
supplemented and amended until the second anniversary of the effective date of
the Shelf Registration Statement or such shorter period that will terminate
when all the Transfer Restricted Bonds covered by the Shelf Registration
Statement have been sold pursuant thereto. A holder of Old Bonds that sells
its Old Bonds pursuant
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to the Shelf Registration Statement generally will be required to be named as
a selling security holder in the related prospectus and to deliver a
prospectus to purchasers, will be subject to certain of the civil liability
provisions under the Securities Act in connection with such sales and will be
bound by the provisions of the Registration Rights Agreement that are
applicable to such holder (including certain indemnification and contribution
obligations).
If (i) the Company fails to file any of the registration statements required
by the Registration Rights Agreement on or before the date specified for such
filing, (ii) any of such registration statements is not declared effective by
the Commission on or prior to the date specified for such effectiveness (the
"Effectiveness Target Date"), (iii) the Exchange Offer is required to be
consummated under the Registration Rights Agreement and the Company fails to
issue New Bonds in exchange for all Old Bonds properly tendered and not
withdrawn in the Exchange Offer within 45 days of the Effectiveness Target
Date with respect to the Exchange Offer Registration Statement, or (iv) the
Shelf Registration Statement or the Exchange Offer Registration Statement is
declared effective but thereafter ceases to be effective or usable in
connection with the Exchange Offer or resales of Transfer Restricted Bonds, as
the case may be, during the periods specified in the Registration Rights
Agreement (each such event referred to in clauses (i) through (iv) above, a
"Registration Default"), then the Company will pay as liquidated damages
additional interest ("Additional Interest") on the Old Bonds as to which the
Registration Default exists as set forth herein. If a Registration Default
exists with respect to the Old 6 1/8% Bonds or the Old 6 1/2% Bonds, the
interest rate on such Transfer Restricted Bonds will increase, with respect to
the first 90-day period (or portion thereof) while a Registration Default is
continuing immediately following the occurrence of such Registration Default,
.25% per annum, such interest rate increasing by an additional .25% per annum
at the beginning of each subsequent 90-day period (or portion thereof) while a
Registration Default is continuing until all Registration Defaults have been
cured, up to a maximum rate of Additional Interest of 1.00% per annum. Upon
(w) the filing of the applicable registration statement (in the case of clause
(i) of the preceding sentence), (x) the effectiveness of the applicable
registration statement (in the case of clause (ii) of the preceding sentence),
(y) the issuance of New Bonds in exchange for all Old Bonds properly tendered
and not withdrawn in the Exchange Offer (in the case of clause (iii) of the
preceding sentence) or (z) the effectiveness of the Exchange Offer
Registration Statement or the Shelf Registration Statement, as the case may
be, which had ceased to be effective (in the case of clause (iv) of the
preceding sentence), Additional Interest as a result of the Registration
Default described in such clause will cease to accrue (but any accrued amount
will be payable) and the interest rate on the applicable Old Bonds will revert
to the original rate if no other Registration Default has occurred and is
continuing.
BOOK-ENTRY; DELIVERY AND FORM
The certificates representing the New Bonds will be issued in fully
registered form. Except as described in the next paragraph, the New Bonds will
initially be represented by a single, permanent global Bond in definitive,
fully registered book-entry form without interest coupons (each, a "Global
Bond" and together, the "Global Bonds"), which will be registered in the name
of Cede & Co., as nominee of DTC.
New Bonds held by Holders who elect to take physical delivery of their
certificates instead of holding their interest through the Global Bond (and
which are then unable to trade through DTC) (each, a "Non-Global Holder"),
will be in registered form without interest coupons ("Certificated
Securities"). Upon the transfer of Certificated Securities initially issued to
a Non-Global Holder, such Certificated Securities will, unless the transferee
requests otherwise or the Global Bonds have previously been exchanged in whole
for Certificated Securities, be exchanged for an interest in the Global Bond.
The Global Bonds. The Company expects that pursuant to procedures
established by DTC (a) upon deposit of the Global Bonds, DTC or its custodian
will credit on its internal system portions of the Global Bonds which will be
comprised of the corresponding respective amounts of the Global Bonds to the
respective accounts of persons who have accounts with such depositary and (b)
ownership of the New Bonds will be shown on, and the transfer of ownership
thereof will be effected only through, records maintained by DTC or its
nominee (with
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respect to interests of Participants (as defined below) and the records of
Participants (with respect to interests of persons other than Participants).
Ownership of beneficial interests in the Global Bonds will be limited to
persons who have accounts with DTC ("Participants") or persons who hold
interests through Participants.
So long as DTC or its nominee is the registered owner or holder of any of
the Global Bonds, DTC or such nominee will be considered the sole record owner
or holder of such New Bonds represented by the Global Bonds for all purposes
under the Indenture and under the New Bonds represented thereby. No beneficial
owner of an interest in the Global Bonds will be able to transfer such
interest except in accordance with the applicable procedures of DTC, in
addition to those provided for under the Indenture.
Payments of the principal of, premium, if any, and interest on the New Bonds
represented by the Global Bonds will be made to DTC or its nominee, as the
case may be, as the registered owner thereof. None of the Company, the Trustee
or any paying agent under the Indenture will have any responsibility or
liability for any aspect of the records relating to or payments made on
account of beneficial ownership interests in the Global Bonds or for
maintaining, supervising or reviewing any records relating to such beneficial
ownership interest.
The Company expects that DTC or its nominee, upon receipt of any payment of
the principal of, premium, if any, and interest on the New Bonds represented
by the Global Bonds, will credit Participants' accounts with payments in
amounts proportionate to their respective beneficial interests in the Global
Bonds as shown in the records of DTC or its nominee. The Company also expects
that payments by Participants to owners of beneficial interests in the Global
Bonds held through such Participants will be governed by standing instructions
and customary practice as is now the case with securities held for the
accounts of customers registered in the names of nominees for such customers.
Such payment will be the responsibility of such Participants.
Transfers between Participants in DTC will be effected in accordance with
DTC rules and will be settled in immediately available funds. If a holder
requires physical delivery of a Certificated Bond for any reason, including to
sell New Bonds to persons in states which require physical delivery of such
securities or to pledge such securities, such holder must transfer its
interest in the Global Bonds in accordance with the normal procedures of DTC
and in accordance with the procedures set forth in the Indenture.
DTC has advised the Company that DTC will take any action permitted to be
taken by a holder of New Bonds (including the presentation of New Bonds for
exchange as described below) only at the direction of one or more Participants
to whose account the DTC interests in the Global Bonds are credited and only
in respect of the aggregate principal amount as to which such Participant or
Participants has or have given such direction. However, if there is an Event
of Default under the Indenture, DTC will exchange the Global Bonds for
Certificated Securities, which it will distribute to its Participants and
which will be legended as set forth under the heading "Notice to Investors."
DTC has advised the Company as follows: DTC is a limited purpose trust
company organized under the laws of the State of New York, a member of the
Federal Reserve System, a "clearing corporation" within the meaning of the
Uniform Commercial Code and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Exchange Act. DTC was created to hold
securities for its Participants and facilitate the clearance and settlement of
securities transactions between Participants through electronic book-entry
changes in accounts of its Participants, thereby eliminating the need for
physical movement of certificates. Participants include securities brokers and
dealers, banks, trust companies and clearing corporations and certain other
organizations. Indirect access to the DTC system is available to others such
as banks, brokers, dealers and trust companies that clear through or maintain
a custodial relationship with a Participant, either directly or indirectly
("Indirect Participants").
Although DTC is expected to follow the foregoing procedures in order to
facilitate transfers of interests in the Global Bonds among Participants, it
is under no obligation to perform such procedures, and such procedures may be
discontinued at any time. Neither the Company nor the Trustee will have any
responsibility for the performance by DTC or its direct or indirect
participants of its obligations under the rules and procedures governing its
operations.
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Certificated Securities. Interests in the Global Bonds will be exchanged for
Certificated Securities if (i) DTC notifies the Company that it is unwilling
or unable to continue as depositary for the Global Bonds, or DTC ceases to be
a "Clearing Agency" registered under the Exchange Act, and a successor
depositary is not appointed by the Company within 40 days, or (ii) an Event of
Default has occurred and is continuing with respect to the New Bonds. Upon the
occurrence of any of the events described in the preceding sentence, the
Company will cause the appropriate Certificated Securities to be delivered.
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following is a general discussion of certain United States federal
income tax consequences for holders of the Old Bonds who exchange their Old
Bonds for New Bonds in the Exchange Offer and who hold New Bonds subsequent to
the Exchange Offer. This discussion is based on provisions of the Internal
Revenue Code of 1986, as amended (the "Code"), Treasury regulations
promulgated thereunder, and administrative and judicial interpretations
thereof, all as in effect on the date hereof and all of which are subject to
change, possibly with retroactive effect. This discussion does not address the
tax consequences to subsequent purchasers of New Bonds and is limited to
investors who hold the New Bonds as capital assets. Furthermore, this
discussion does not address all aspects of United States federal income
taxation that may be applicable to investors in light of their particular
circumstances, or to investors subject to special treatment under United
States federal income tax law (including, without limitation, certain
financial institutions, insurance companies, tax-exempt entities, dealers in
securities, persons who have acquired New Bonds as part of a straddle, hedge,
conversion transaction or other integrated investment or persons whose
functional currency is not the United States dollar).
EACH PROSPECTIVE INVESTOR SHOULD CONSULT HIS OR HER OWN TAX ADVISOR AS TO
THE PARTICULAR TAX CONSEQUENCES TO SUCH PURCHASER OF THE EXCHANGE, OWNERSHIP
AND DISPOSITION OF THE NEW BONDS, INCLUDING THE APPLICABILITY OF ANY FEDERAL
ESTATE OR GIFT TAX LAWS OR ANY STATE, LOCAL OR FOREIGN TAX LAWS, ANY CHANGES
IN APPLICABLE TAX LAWS AND ANY PENDING OR PROPOSED LEGISLATION OR REGULATIONS.
UNITED STATES TAXATION OF UNITED STATES HOLDERS
As used herein, (A) the term "United States Holder" means a beneficial owner
of an New Bond that is, for United States federal income tax purposes, (i) a
citizen or resident of the United States, (ii) a corporation or partnership
created or organized in or under the laws of the United States or of any
political subdivision thereof, (iii) an estate the income of which is subject
to United States federal income taxation regardless of its source and (iv) a
trust if a United States court is able to exercise primary supervision over
the administration of such trust and one or more United States fiduciaries
have the authority to control all substantial decisions of such trust and (B)
the term "Non-U.S. Holder" means a beneficial owner of an New Bond that is not
a United States Holder.
Exchange Offer
The exchange of an Old Bond for a New Bond pursuant to the Exchange Offer
will not constitute a "significant modification" of the Old Bond for United
States federal income tax purposes and, accordingly, the New Bond received
will be treated as a continuation of the Old Bond in the hands of such holder.
As a result, there will be no United States federal income tax consequences to
a United States Holder who exchanges an Old Bond for an New Bond pursuant to
the Exchange Offer and any such Holder will have the same adjusted tax basis
and holding period in the New Bond as he or she had in the Old Bond
immediately before the exchange.
Payments of Interest
Stated interest payable on the New Bonds generally will be included in the
gross income of a United States Holder as ordinary interest income at the time
accrued or received, in accordance with such United States Holder's method of
accounting for United States federal income tax purposes.
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Disposition of the New Bonds
Upon the sale, exchange, retirement at maturity or other disposition of a
New Bond (collectively, a "disposition"), a United States Holder generally
will recognize capital gain or loss equal to the difference between the amount
realized by such holder (except to the extent such amount is attributable to
accrued interest, which will be treated as ordinary interest income) and such
holder's adjusted tax basis in the New Bond. Such capital gain or loss will be
long-term capital gain or loss if the holding period for the New Bonds exceeds
one year at the time of the disposition. Under recently adopted amendments to
the Internal Revenue Code, net capital gain recognized by an individual
investor upon a disposition of property that has been held for more than 12
months will generally be subject to a maximum tax rate of 20% or, in the case
of property that has been held for 12 months or less, will generally be
subject to tax at ordinary income tax rates. Prospective investors should
consult their tax advisors about the new capital gain and loss provisions that
may be relevant to their particular circumstances.
UNITED STATES TAXATION OF NON-U.S. HOLDERS
Payments of Interest
In general, payments of interest received by a Non-U.S. Holder will not be
subject to United States federal income or withholding tax, provided that
(i)(a) the Non-U.S. Holder does not actually or constructively own 10% or more
of the total combined voting power of all classes of stock of the Company
entitled to vote, (b) the Non-U.S. Holder is not a controlled foreign
corporation that is related to the Company actually or constructively through
stock ownership, and (c) the beneficial owner of the New Bonds, under
penalties of perjury, either directly or through a financial institution which
holds the New Bonds on behalf of the Non-U.S. Holder and holds customers'
securities in the ordinary course of its trade or business, provides the
Company or its agent with the beneficial owner's name and address and
certifies, under penalties of perjury, that it is not a United States Holder
and (ii) the interest received on the New Bond is not effectively connected
with the conduct by the Non-U.S. Holder of a trade or business within the
United States (or, alternatively, if a tax treaty applies, is not attributable
to a permanent establishment maintained by the Non-U.S. Holder) and the Non-
U.S. Holder complies with certain reporting requirements. A Non-U.S. Holder
may be entitled to the benefits of an income tax treaty under which the
interest is exempt from United States withholding tax if the Non-U.S. Holder
complies with certain reporting requirements. Payments of interest not exempt
from United States federal withholding tax as described above will be subject
to such withholding tax at the rate of 30% (subject to possible reduction, if
applicable, under an income tax treaty).
Disposition of the New Bonds
A Non-U.S. Holder generally will not be subject to United States federal
income tax (and generally no tax will be withheld) with respect to gain
realized on the disposition of a New Bond, unless (i) the gain is effectively
connected with a United States trade or business conducted by the Non-U.S.
Holder (or, alternatively, if a tax treaty applies, is attributable to a
permanent establishment maintained by the Non-U.S. Holder) or (ii) the Non-
U.S. Holder is an individual who is present in the United States for 183 or
more days during the taxable year of the disposition and certain other
requirements are satisfied. In addition, an exchange of an Old Bond for a New
Bond pursuant to the Exchange Offer will not constitute a taxable exchange of
the Old Bond for Non-U.S. Holders. See "United States Taxation of United
States Holders--Disposition of the Bonds."
Effectively Connected Income
If interest and other payments received by a Non-U.S. Holder with respect to
the New Bonds (including proceeds from the disposition of the New Bonds) are
effectively connected with the conduct by the Non-U.S. Holder of a trade or
business within the United States (or the Non-U.S. Holder is otherwise subject
to United States federal income taxation on a net basis with respect to such
holder's ownership of the New Bonds), such Non-U.S. Holder will generally be
subject to the rules described above under "United States Taxation of United
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States Holders" (subject to any modification provided under an applicable tax
treaty). Such Non-U.S. Holder may also be subject to the "branch profits tax"
at a 30% rate (subject to possible reduction, if applicable, under an income
tax treaty) if such holder is a corporation.
BACKUP WITHHOLDING AND INFORMATION REPORTING
Certain non-corporate United States Holders may be subject to backup
withholding at a rate of 31% on payments of principal, premium and interest
on, and the proceeds of the disposition of, the New Bonds. In general, backup
withholding will be imposed only if the United States Holder (i) fails to
furnish its taxpayer identification number ("TIN"), which, for an individual,
would be his or her Social Security number, (ii) furnishes an incorrect TIN,
(iii) is notified by the IRS that it has failed to report payments of interest
or dividends or (iv) under certain circumstances, fails to certify, under
penalty of perjury, that it has furnished a correct TIN and has not been
notified by the IRS that it is subject to backup withholding tax for failure
to report interest or dividend payments. In addition, such payments of
principal and interest to United States Holders will generally be subject to
information reporting. United States Holders should consult their tax advisors
regarding their qualifications for exemption from backup withholding and the
procedure for obtaining such an exemption, if applicable.
Backup withholding generally will not apply to payments made to a Non-U.S.
Holder of a New Bond who provides the certification described under "United
States Taxation of Non-U.S. Holders--Payments of Interest" or otherwise
establishes an exemption from backup withholding. Payments by a United States
office of a broker of the proceeds of a disposition of the New Bonds generally
will be subject to backup withholding at a rate of 31% unless the Non-U.S.
Holder certifies it is a Non-U.S. Holder under penalties of perjury or
otherwise establishes an exemption. Payments by the foreign office of a broker
of the proceeds of a disposition of the New Bonds generally will not be
subject to backup withholding. However, information reporting requirements
will apply to a payment of proceeds of a disposition of the New Bonds through
a foreign office of a broker that is a U.S. person or a "U.S. related person",
unless the broker has documentary evidence in its files that the owner is a
Non-U.S. Holder and the broker has no actual knowledge to the contrary. For
this purpose, a "U.S. related person" is (i) a controlled foreign corporation
for United States federal income tax purposes or (ii) a foreign person 50% or
more of whose gross income from all sources for certain periods is effectively
connected with the conduct of a United States trade or business.
The amount of any backup withholding imposed on a payment to a holder of a
New Bond will be allowed as a credit against such holder's United States
federal income tax liability and may entitle such holder to a refund, provided
that the required information is furnished to the IRS.
RECENTLY ISSUED TREASURY REGULATIONS
On October 6, 1997, the U.S. Treasury Department issued final Treasury
regulations governing information reporting and the certification procedures
regarding withholding and backup withholding on certain amounts paid to Non-
U.S. Holders after December 31, 1999. The new Treasury regulations generally
would not alter the treatment of Non-U.S. Holders described above. The new
Treasury regulations would alter the procedures for claiming the benefits of
an income tax treaty and may change the certification procedures relating to
the receipt by intermediaries of payments on behalf of a beneficial owner of a
New Bond. Prospective investors should consult their tax advisors concerning
the effect, if any, of such new Treasury regulations on an investment in the
New Bonds.
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<PAGE>
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Bonds for its own account pursuant to
the Exchange Offer must acknowledge that it will deliver a prospectus (which
may be this Prospectus) in connection with any resale of such New Bonds. This
Prospectus, as it may be amended or supplemented from time to time, may be
used by a broker-dealer in connection with resales of New Bonds received in
exchange for Old Bonds where such Old Bonds were acquired as a result of
market-making activities or other trading activities. The Company has agreed
that, for a period of 90 days after the Expiration Date, it will make this
Prospectus, as amended or supplemented, available to any broker-dealer for use
in connection with any such resale. In addition, until November 26, 1998 (90
days from the date of this Prospectus), all dealers effecting transactions in
the New Bonds may be required to deliver a prospectus.
The Company will not receive any proceeds from any sale of New Bonds by
broker-dealers. New Bonds received by broker-dealers for their own account
pursuant to the Exchange Offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions,
through the writing of options on the New Bonds or a combination of such
methods of resale, at market prices prevailing at the time of resale, at
prices related to such prevailing market prices or negotiated prices. Any such
resale may be made directly to purchasers or to or through brokers or dealers
who may receive compensation in the form of commissions or concessions from
any such broker-dealer or the purchasers of any such New Bonds. Any broker-
dealer that resells New Bonds that were received by it for its own account
pursuant to the Exchange Offer and any broker or dealer that participates in a
distribution of such New Bonds may be deemed to be an "underwriter" within the
meaning of the Securities Act and any profit on any such resale of New Bonds
and any commission or concessions received by any such persons may be deemed
to be underwriting compensation under the Securities Act. The Letter of
Transmittal states that, by acknowledging that it will deliver and by
delivering a prospectus, a broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act.
For a period of 90 days after the Expiration Date, the Company will promptly
send additional copies of this Prospectus and any amendment or supplement to
this Prospectus to any broker-dealer that requests such documents in the
Letter of Transmittal. The Company has agreed to pay all expenses in
connection with the Exchange Offer and reimburse the Initial Purchasers for
the reasonable fees and expenses of one counsel for the Holders of the Old
Bonds (who will be reasonably acceptable to the Company). Each Holder will pay
all expenses of its counsel other than as described in the preceding sentence,
transfer taxes, if any, and any commissions or concessions of any brokers or
dealers. The Company has agreed to indemnify the Holders of the Old Bonds
(including any broker-dealer) against certain liabilities, including
liabilities under the Securities Act.
In addition, to comply with the securities laws of certain jurisdictions,
the New Bonds may not be offered or sold unless they have been registered or
qualified for offer and sale in such jurisdiction or an exemption from
registration or qualification is available and is complied with. The Company
has agreed, pursuant to the Registration Rights Agreement, subject to certain
limitations specified therein, to register or qualify the New Bonds for offer
or sale under the applicable state securities laws of such United States
jurisdictions as any Holders of the Old Bonds reasonably request by the time
the Registration Statement (of which this Prospectus forms a part) is declared
effective by the Commission. The Company does not intend to register or
qualify the offer or sale of the New Bonds in any United States jurisdiction
(unless they receive such a request) or any other jurisdiction.
LEGAL MATTERS
The validity of the New Bonds will be passed upon for the Company by Denis
A. Demblowski, Esq., Secretary and Senior Counsel of the Company. Mr.
Demblowski is a participant in the stock option plan and various other
employee benefit plans offered to employees of the Company.
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<PAGE>
EXPERTS
The consolidated financial statements incorporated in this Prospectus by
reference from the Alcoa 1997 Form 10-K have been incorporated by reference
herein in reliance on the report of PricewaterhouseCoopers LLP, independent
public accountants, given on the authority of that firm as experts in
accounting and auditing.
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NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFOR-
MATION OR TO MAKE ANY REPRESENTATIONS NOT CONTAINED IN THIS PROSPECTUS IN CON-
NECTION WITH THE OFFER MADE BY THIS PROSPECTUS AND, GIVEN OR MADE, SUCH INFOR-
MATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY
THE COMPANY. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUN-
DER WILL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN
NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE AS OF WHICH INFORMATION
IS GIVEN IN THIS PROSPECTUS. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OR
SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION
IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS
NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH SO-
LICITATION.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Disclosure Regarding Forward-Looking Statements............................ ii
Available Information...................................................... ii
Incorporation of Certain Documents by Reference............................ ii
Summary.................................................................... 1
Risk Factors............................................................... 4
The Company................................................................ 7
Use of Proceeds............................................................ 8
Capitalization............................................................. 9
The Exchange Offer......................................................... 10
Description of the Bonds................................................... 17
Exchange Offer; Registration Rights........................................ 26
Book-Entry; Delivery and Form.............................................. 28
Certain United States Federal Income Tax Considerations.................... 30
Plan of Distribution....................................................... 33
Legal Matters.............................................................. 33
Experts.................................................................... 34
</TABLE>
UNTIL NOVEMBER 26, 1998 (90 DAYS AFTER THE DATE OF THIS PROSPECTUS) DEALERS
AFFECTING TRANSACTIONS IN THE NEW BONDS, WHETHER OR NOT PARTICIPATING IN THE
EXCHANGE OFFER, MAY BE REQUIRED TO DELIVER A PROSPECTUS. THIS OBLIGATION IS IN
ADDITION TO THE OBLIGATION OF DEALERS TO DELIVER A PROSPECTUS WHEN ACTING AS
UNDERWRITERS AND WITH RESPECT TO THEIR UNSOLD ALLOTMENTS OR SUBSCRIPTIONS.
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$450,000,000
[LOGO ALUMINUM COMPANY OF AMERICA]
ALUMINUM COMPANY OF
AMERICA
$200,000,000 6 1/8%
SERIES B BONDS DUE 2005
$250,000,000 6 1/2%
SERIES B BONDS DUE 2018
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PROSPECTUS
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AUGUST 28, 1998
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