<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 24, 1997
REGISTRATION NO. 333-
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
HELLER FINANCIAL, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
----------------
DELAWARE 610 36-1208070
(STATE OR OTHER (PRIMARY STANDARD (I.R.S. EMPLOYER
JURISDICTION OF INDUSTRIAL CODE NUMBER) IDENTIFICATION NO.)
INCORPORATION OR
ORGANIZATION)
500 WEST MONROE STREET, CHICAGO, ILLINOIS 60661, (312) 441-7000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
----------------
DEBRA H. SNIDER, ESQ.
EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
HELLER FINANCIAL, INC.
500 WEST MONROE STREET, CHICAGO, ILLINOIS 60661, (312) 441-7000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
COPIES TO:
LAWRENCE D. LEVIN, ESQ.
MARK D. WOOD, ESQ.
KATTEN MUCHIN & ZAVIS
525 WEST MONROE STREET, SUITE 1600
CHICAGO, ILLINOIS 60661
(312) 902-5200
----------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance
with General Instruction G, please check the following box: [_]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering: [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(d)
under the Securities Act of 1933, check the following box and list the
Securities Act registration statement number of the earlier effective date
registration statement for the same offering: [_]
CALCULATION OF REGISTRATION FEE
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- -------------------------------------------------------------------------------
<TABLE>
<S> <C> <C> <C> <C>
PROPOSED
PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT MAXIMUM AGGREGATE AMOUNT OF
SECURITIES TO BE TO BE OFFERING PRICE OFFERING REGISTRATION
REGISTERED REGISTERED PER UNIT PRICE(2) FEE
- ------------------------------------------------------------------------------------
Fixed Rate Noncumulative
Perpetual Senior
Preferred Stock, Series 1,500,000
C...................... shares (1) $150,000,000 $45,455
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</TABLE>
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(1) Not applicable.
(2) Estimated solely for purposes of calculating the registration fee pursuant
to Rule 457 of Regulation C under the Securities Act of 1933, as amended.
----------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS
REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO
SECTION 8(A), MAY DETERMINE.
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR +
+THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED OCTOBER 24, 1997
PROSPECTUS
LOGO HELLER FINANCIAL, INC.
OFFER TO EXCHANGE
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES C
FOR ALL OUTSTANDING FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK,
SERIES B
-----------
Heller Financial, Inc., a Delaware corporation (the "Company"), hereby
offers, upon the terms and subject to conditions set forth in this Prospectus
(the "Prospectus") and the accompanying Letter of Transmittal (the "Letter of
Transmittal" and together with the Prospectus, the "Exchange Offer"), to
exchange up to 1,500,000 shares of its Fixed Rate Noncumulative Perpetual
Senior Preferred Stock, Series C, liquidation preference $100.00 per share (the
"Exchange Preferred Stock"), for up to 1,500,000 shares of its outstanding
Fixed Rate Noncumulative Perpetual Senior Preferred Stock, Series B,
liquidation preference $100.00 per share (the "Original Preferred Stock"). The
terms of the Exchange Preferred Stock are substantially the same in all
material respects as those of the Original Preferred Stock, except that the
Exchange Preferred Stock will be registered under the Securities Act of 1933,
as amended (the "Securities Act"), and, therefore, will not bear legends
restricting their transfer under the Securities Act and will not contain
provisions regarding minimum unit size, the payment of Additional Dividends (as
defined herein) or registration rights. The Exchange Preferred Stock will be
issued pursuant to, and entitled to the benefits of, a Certificate of
Designation, Preferences and Rights (the "New Certificate of Designation")
which shall be substantially similar in all material respects to the
Certificate of Designation, Preferences and Rights governing the Original
Preferred Stock (the "Original Certificate of Designation"). See "The Exchange
Offer" and "Description of the Exchange Preferred Stock."
Dividends on the Exchange Preferred Stock will be noncumulative and, if
declared, will be payable quarterly on February 15, May 15, August 15 and
November 15 of each year, commencing February 15, 1998. If dividends are
declared for the period from and including November 15, 1997 through and
including February 14, 1998, holders of the Exchange Preferred Stock will
receive dividends on February 15, 1998 from the date of initial issuance of the
Exchange Preferred Stock, plus an amount equal to the declared and accrued, but
unpaid, dividends on the Original Preferred Stock to the date of exchange
thereof. Dividends on the Exchange Preferred Stock will be payable at a rate of
6.687% of the liquidation preference thereof, or $6.687 per share, per annum.
The amount of dividends payable in respect of the Exchange Preferred Stock will
be adjusted in the event of certain amendments to the Internal Revenue Code of
1986, as amended (the "Code"), in respect of the dividends received deduction.
See "Description of the Exchange Preferred Stock--Dividends." Dividends
declared on the Original Preferred Stock accepted for exchange will cease to
accrue upon issuance of the Exchange Preferred Stock in exchange therefor.
The Exchange Preferred Stock is not redeemable prior to August 15, 2007,
except as stated herein. After such date, the Exchange Preferred Stock is
redeemable, in whole or in part, at the option of the Company, at $100.00 per
share, plus an amount equal to the sum of all accrued and unpaid dividends
thereon for the then-current dividend period to the redemption date (without
accumulation of accrued and unpaid dividends for prior dividend periods unless
previously declared). The Exchange Preferred Stock will not be entitled to the
benefit of any sinking fund. See "Description of the Exchange Preferred Stock--
Redemption."
The Exchange Preferred Stock will initially only be represented by global
securities in fully registered form, deposited with a custodian for, and
registered in the name of a nominee of, The Depository Trust Company ("DTC").
Beneficial interests in the Exchange Preferred Stock will be shown on and
transfers thereof will be effected through records maintained by DTC and its
participants. Beneficial interests in the Exchange Preferred Stock will trade
in DTC's Same-Day Funds Settlement System, and secondary market trading
activity in such interests will therefore settle in immediately available
funds. See "Book-Entry Issuance."
The Company will accept for exchange any and all shares of Original Preferred
Stock which are properly tendered in the Exchange Offer prior to 5:00 p.m., New
York City time, on , 1997, unless extended by the Company in its sole
discretion (the "Expiration Date"). The Expiration Date will not in any event
be extended to a date later than , 1998 (150 days after the initial
Expiration Date). Tenders of Original Preferred Stock may be withdrawn at any
time prior to 5:00 p.m., New York City time, on the Expiration Date. In the
event the Company terminates the Exchange Offer and does not accept for
exchange any Original Preferred Stock with respect to the Exchange Offer, the
Company will promptly return the Original Preferred Stock to the holders
thereof. The Exchange Offer is not conditioned upon any minimum aggregate
number of shares of Original Preferred Stock being tendered for exchange, but
is otherwise subject to certain customary conditions.
(Continued on following page)
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is , 1997
<PAGE>
(Continued from previous page)
----------------
The Exchange Preferred Stock is being offered hereunder in order to satisfy
certain obligations of the Company contained in the Registration Rights
Agreement dated as of June 11, 1997 (the "Registration Rights Agreement") by
and among the Company and Lehman Brothers, Inc., Chase Securities Inc. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated, as the initial purchasers
(the "Initial Purchasers") with respect to the initial sale of the Original
Preferred Stock. Based on existing interpretations of the Securities Act by
the staff of the Securities and Exchange Commission (the "Commission"), the
Company believes that the Exchange Preferred Stock issued pursuant to the
Exchange Offer in exchange for the Original Preferred Stock may be offered for
resale, resold and otherwise transferred by respective holders thereof (other
than any such holder which is an "affiliate" of the Company within the meaning
of Rule 405 of the Securities Act) without compliance with the registration
and prospectus delivery requirements of the Securities Act, provided that the
Exchange Preferred Stock is acquired in the ordinary course of such holder's
business and such holder is not engaged, does not intend to engage in, and has
no arrangement or understanding with any person to participate in, the
distribution of such Exchange Preferred Stock. Notwithstanding the foregoing,
each broker-dealer that receives Exchange Preferred Stock in exchange for
Original Preferred Stock acquired for its own account as a result of market-
making activities or other trading activities must acknowledge that it will
deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Preferred Stock. The Letter of
Transmittal states that a broker-dealer will not, by so acknowledging and by
delivering a prospectus, 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 to satisfy such
prospectus delivery requirements in connection with resales of Exchange
Preferred Stock. The Company has agreed that, for a period of 180 days after
the Registration Statement of which this Prospectus is a part is declared
effective by the Commission, it will make this Prospectus available to any
broker-dealer for use in connection with any such resale. See "Original
Preferred Stock Registration Rights" and "Plan of Distribution."
Prior to the Exchange Offer, there has been no public market for the
Exchange Preferred Stock. The Company does not currently intend to list the
Exchange Preferred Stock on any securities exchange or to seek approval for
quotation through any automated quotation system. Although the Initial
Purchasers have advised the Company that they intend to make a market in the
Exchange Preferred Stock, they are not obligated to do so, such market making
may be interrupted or discontinued without notice, and there can be no
assurance as to the development or liquidity of any public market for the
Exchange Preferred Stock, the ability of holders to sell the Exchange
Preferred Stock, or the price at which holders will be able to sell the
Exchange Preferred Stock. Future trading prices of the Exchange Preferred
Stock will depend on many factors, including among other things, prevailing
dividend rates, the Company's operating results and the market for similar
securities.
The Company will not receive any proceeds from the Exchange Offer. The
Company has agreed to pay the expenses incurred by it incident to the Exchange
Offer. No underwriter is being used in connection with the Exchange Offer.
Holders of Original Preferred Stock not tendered and accepted in the
Exchange Offer will continue to hold such Original Preferred Stock and will be
entitled to all the rights and benefits and will be subject to the limitations
applicable thereto under the Original Certificate of Designation. Original
Preferred Stock not tendered and accepted in the Exchange Offer will continue
to bear legends restricting their transfer under the Securities Act and their
holders will not retain any rights under the Registration Rights Agreement.
THE EXCHANGE OFFER IS NOT BEING MADE TO, NOR WILL THE COMPANY ACCEPT
SURRENDERS FOR EXCHANGE FROM, HOLDERS OF ORIGINAL PREFERRED STOCK IN ANY
JURISDICTION IN WHICH THE EXCHANGE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT
BE IN COMPLIANCE WITH THE SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTION.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE UPON REQUEST FROM
HELLER FINANCIAL, INC., 500 WEST MONROE STREET, CHICAGO, ILLINOIS 60661,
ATTENTION: TREASURER (312/441-7000). IN ORDER TO ENSURE TIMELY DELIVERY OF THE
DOCUMENTS, ANY REQUEST SHOULD BE MADE BY 5 BUSINESS DAYS PRIOR TO THE
EXPIRATION DATE.
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-4 (herein, together with all
amendments and exhibits thereto, referred to herein as the "Registration
Statement") pursuant to the Securities Act, and the rules and regulations
promulgated thereunder, covering the Exchange Preferred Stock being offered
hereby. This Prospectus, which constitutes a part of the Registration
Statement, does not contain all the information set forth in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the Commission. For further information, reference is hereby
made to the Registration Statement. Statements made in this Prospectus as to
the contents of any contract, agreement or other document referred to in the
Registration Statement are not necessarily complete. With respect to each such
contract, agreement or other document filed as an exhibit to the Registration
Statement or otherwise filed with the Commission, reference is made to each
copy so filed, and each such statement shall be deemed qualified in its
entirety by such reference.
The Company 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 Commission. Such
reports and other information can be inspected and copied at the public
reference facilities of the Commission at the Commission's Public Reference
Room, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the Commission's
regional offices at 7 World Trade Center, Suite 1300, New York, New York 10048
and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661. Copies of such material can be obtained at prescribed rates from the
Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549. Such reports and other information concerning the
Company can also be inspected at the offices of the New York Stock Exchange,
Inc., 20 Broad Street, New York, New York 10005, on which existing securities
of the Company are listed. Copies of reports, proxy and information statements
and other information regarding registrants that file electronically
(including the Company) are available on the Commission's Web Site at
http://www.sec.gov.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents heretofore filed by the Company with the Commission
pursuant to the Exchange Act are incorporated herein by reference and made a
part of this Prospectus.
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996;
(2) The Company's Quarterly Reports on Form 10-Q for the periods ended
March 31, 1997 and June 30, 1997; and
(3) The Company's Current Reports on Form 8-K dated January 27, 1997,
April 3, 1997, April 22, 1997, July 24, 1997 and October 22, 1997.
All documents filed by the Company pursuant to sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
date on which the Exchange Offer is consummated shall be deemed to be
incorporated in this Prospectus by reference and to be a part hereof from the
date of filing of each such document. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Prospectus to the extent
that a statement contained herein or in any other subsequently filed document
which also is, or is deemed to be, incorporated by reference herein modifies
or supersedes such statement. Any such statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
The Company will provide, without charge, to each person to whom a copy of
this Prospectus has been delivered, on the written or oral request of such
person, a copy of any or all of the documents incorporated herein by reference
(other than exhibits to such documents, unless such exhibits are specifically
incorporated by reference into the information that this Prospectus
incorporates). Requests for such copies should be directed to: Treasurer,
Heller Financial, Inc., 500 West Monroe Street, Chicago, Illinois 60661
(telephone (312) 441-7000).
1
<PAGE>
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by, and should be read in
conjunction with, the more detailed information included elsewhere in this
Prospectus or incorporated herein by reference. Unless the context indicates
otherwise, references to the Company in this Prospectus include Heller
Financial, Inc. and its consolidated subsidiaries.
THE COMPANY
GENERAL
The Company is a diversified financial services company which provides a
broad array of commercial financial products and services primarily to middle-
market companies in the United States and internationally. The Company provides
its products and services through five product categories: (i) asset based
finance, (ii) cash flow lending, (iii) real estate finance, (iv) international
asset based finance and factoring and (v) specialized finance. The middle-
market segment served includes entities primarily in the manufacturing and
service sectors with annual sales in the range of $15 million to $200 million
and in the real estate sector with property values generally in the range of $5
million to $40 million.
The Company's emphasis has been to grow the lower risk asset based finance
businesses, maintain significant franchises in corporate finance and real
estate finance and continue to grow its international asset based lending
businesses. The asset based businesses have developed to become the largest
product category in assets and revenues. Earnings quality has been strengthened
through the growth in the asset based businesses which provide more consistent
revenue streams and produce lower and less volatile credit quality costs. The
Company manages asset quality through the use of disciplined underwriting
standards and aggressive account management techniques. The underwriting
standards and credit disciplines employed on the post-1990 corporate finance
and real estate finance portfolios have resulted in strong credit quality for
these portfolios. In addition, the Company continues to significantly reduce
its pre-1990 corporate finance and real estate finance portfolios. The Company
has maintained a conservative capital structure with substantial equity, low
leverage and moderate reliance for funding on the commercial paper market.
OWNERSHIP
All of the outstanding Common Stock of the Company is owned by Heller
International Corporation (the "Parent"), a wholly-owned subsidiary of The Fuji
Bank, Limited ("Fuji Bank"), headquartered in Tokyo, Japan. Fuji Bank also
directly owns 21% of the outstanding shares of Heller International Group, Inc.
("Heller International"), a consolidated subsidiary of the Company engaged in
international factoring and asset based financing activities. Fuji Bank is one
of the largest banks in the world, with total deposits of approximately $340
billion at September 30, 1996.
KEEP WELL AGREEMENT
The Company entered into a Keep Well Agreement (as amended from time to time,
the "Keep Well Agreement") with Fuji Bank on April 23, 1983 in order to assist
the Company in maintaining its credit rating. The Keep Well Agreement was
amended and supplemented on January 26, 1984, in connection with the
consummation of the purchase of the Company by Fuji Bank, and has been amended
since that date from time to time. Most recently, on June 17, 1997, the Keep
Well Agreement was amended in connection with the Company's offering of
Original Preferred Stock. The Keep Well Agreement shall not be terminated prior
to the date (the "Termination Date") which is the earlier of (i) December 31,
2007 and (ii) the date on which the Company has received written certifications
from Moody's Investor Service, Inc. ("Moody's") and Standard & Poor's
Corporation ("S&P") that, upon termination of the Keep Well Agreement, the
ratings on the Company's
2
<PAGE>
senior unsecured indebtedness without the support provided by the Keep Well
Agreement will be no lower than such ratings with the support of the Keep Well
Agreement, but in no event shall the Termination Date be earlier than December
31, 2002. After the Termination Date, either Fuji Bank or the Company may
terminate the Keep Well Agreement upon 30 business days' prior written notice,
except as set forth below. So long as the 8 1/8% Cumulative Perpetual Senior
Preferred Stock, Series A, $.01 par value ("Series A Preferred Stock"), is
outstanding and held by third parties other than Fuji Bank, the Keep Well
Agreement may not be terminated by either party unless the Company has received
written certifications from Moody's and S&P that upon termination the Series A
Preferred Stock will be rated by them no lower than "a3" and "A-,"
respectively. In addition, so long as the Original Preferred Stock or Exchange
Preferred Stock is outstanding and held by third parties other than Fuji Bank,
the Keep Well Agreement may not be terminated by either party unless the
Company has received written certifications from Moody's and S&P that upon
termination the Original Preferred Stock or Exchange Preferred Stock, as the
case may be (or both the Original Preferred Stock and Exchange Preferred Stock
if shares of both are then outstanding), will be rated no lower than "baa1" and
"BBB" by Moody's and S&P, respectively. The Keep Well Agreement provides that
Fuji Bank will maintain the Company's net worth at $500 million through the
purchase of sufficient shares of a new series of Junior Preferred Stock (as
defined herein) of the Company and, if necessary, will provide loans of up to
$500 million to maintain the Company's liquidity. No purchases of Junior
Preferred Stock or loans have been made by Fuji Bank under the Keep Well
Agreement. For further discussion of the Keep Well Agreement, see "The
Company--Keep Well Agreement with Fuji Bank."
SUMMARY FINANCIAL DATA
<TABLE>
<CAPTION>
FOR THE SIX MONTHS FOR THE YEAR ENDED
ENDED JUNE 30, DECEMBER 31,
------------------- ------------------------
1997 1996 1996 1995 1994 1993 1992
--------- --------- ---- ---- ---- ---- ----
(UNAUDITED) (DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
Income Statement Data:
Net interest income.............. $ 199 $ 177 $355 $387 $366 $356 $339
Operating revenues............... 340 260 533 620 557 517 466
Operating expenses............... 152 119 247 216 195 174 169
Provision for losses............. 56 49 103 223 188 210 252
Income before income taxes,
minority interest and change in
accounting principle............ 132 92 183 181 174 133 45
Net income....................... 83 69 133 125 118 117 88
Common dividends paid............ 28 24 56 52 20 -- --
</TABLE>
<TABLE>
<CAPTION>
DECEMBER 31,
JUNE 30, ----------------------------------
1997 1996 1995 1994 1993 1992
----------- ------ ------ ------ ------ ------
(UNAUDITED) (DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C>
Balance Sheet Data:
Receivables.................... $10,109 $8,529 $8,085 $7,616 $7,062 $7,465
Allowance for losses of
receivables................... 250 225 229 231 221 224
Total assets................... 11,608 9,926 9,638 8,476 7,913 7,952
Total debt..................... 8,426 7,506 7,368 6,381 5,949 6,168
Total liabilities.............. 9,907 8,402 8,208 7,107 6,625 6,777
Total stockholders' equity..... 1,643 1,467 1,384 1,330 1,253 1,144
Ratio of earnings to combined
fixed
charges and preferred stock
dividends(1).................. 1.48x 1.35x 1.34x 1.44x 1.43x 1.14x
</TABLE>
- --------
(1) The ratio of earnings to combined fixed charges and preferred stock
dividends is calculated by dividing (i) income before income taxes, the
minority interest in Heller International income and fixed charges by (ii)
fixed charges plus preferred stock dividends.
3
<PAGE>
THE EXCHANGE OFFER
The Original Preferred The Original Preferred Stock was sold by the
Stock.................... Company on June 17, 1997 to Lehman Brothers Inc.,
Chase Securities Inc. and Merrill Lynch, Pierce,
Fenner & Smith Incorporated (the "Initial
Purchasers") pursuant to a Purchase Agreement,
dated as of June 11, 1997 (the "Purchase
Agreement"). The Initial Purchasers subsequently
resold the Original Preferred Stock to qualified
institutional buyers pursuant to Rule 144A under
the Securities Act.
Registration Rights Pursuant to the Purchase Agreement, the Company and
Agreement................ the Initial Purchasers entered into a Registration
Rights Agreement, dated as of June 11, 1997 (the
"Registration Rights Agreement"), which grants the
holders of the Original Preferred Stock certain
exchange and registration rights. The Exchange
Offer is being made pursuant to the Registration
Rights Agreement, and such exchange rights
terminate upon the consummation of the Exchange
Offer. The Company has agreed to use its reasonable
best efforts to cause the Registration Statement of
which this Prospectus is a part to become effective
under the Securities Act by December 14, 1997. See
"Original Preferred Stock Registration Rights."
The Exchange Offer........ The Company is offering to exchange one share of
Exchange Preferred Stock for each share of its
Original Preferred Stock that is validly tendered
and accepted. The Company will issue the Exchange
Preferred Stock on or promptly following the
Expiration Date (as defined below). There are
currently outstanding 1,500,000 shares of Original
Preferred Stock. See "The Exchange Offer."
Expiration Date........... The Exchange Offer will expire at 5:00 p.m., New
York City time, on , 1997 (the
"Expiration Date"), unless the Exchange Offer is
extended by the Company in its sole discretion, in
which case the term "Expiration Date" means the
latest date and time to which the Exchange Offer is
extended by the Company. See "The Exchange Offer--
Expiration Date; Extensions; Amendments."
Conditions to the The Exchange Offer is subject to certain customary
Exchange Offer........... conditions, which may be waived by the Company. See
"The Exchange Offer , Conditions to the
Exchange Offer." The Exchange Offer is not
conditioned upon any minimum aggregate number of
shares of Original Preferred Stock being tendered
or accepted for exchange. No vote of the Company's
security holders is required to effect the Exchange
Offer and no such vote (or proxy therefor) is being
sought hereby. See "The Exchange Offer--Conditions
to the Exchange Offer."
Procedures for Tendering
Original Preferred
Stock....................
Each holder of Original Preferred Stock wishing to
accept the Exchange Offer must complete, sign and
date the accompanying Letter of Transmittal, or a
facsimile thereof, in accordance with the
instructions contained herein and therein, and mail
or otherwise deliver such Letter of Transmittal, or
such facsimile, together with such Original
Preferred Stock and any other required
documentation to the
4
<PAGE>
Exchange Agent (as defined) at the address set
forth herein. By executing the Letter of
Transmittal, each holder will represent to the
Company that, among other things, (i) any Exchange
Preferred Stock acquired by it pursuant to the
Exchange Offer will be obtained in the ordinary
course of its business, (ii) it is not engaged in,
does not intend to engage in, and has no
arrangement or understanding with any person to
participate in, the distribution of such Exchange
Preferred Stock and (iii) it is not an "affiliate"
of the Company within the meaning of Rule 405 of
the Securities Act. Each broker-dealer that
receives Exchange Preferred Stock for its own
account in exchange for Original Preferred Stock,
where such Original Preferred Stock was acquired by
such broker-dealer as a result of market-making
activities or other trading activities (other than
Original Preferred Stock acquired directly from the
Company), may participate in the Exchange Offer,
but may be deemed an "underwriter" under the
Securities Act and, therefore, must acknowledge in
the Letter of Transmittal that it will deliver a
prospectus meeting the requirements of the
Securities Act in connection with any resale of
such Exchange Preferred Stock. Any holder who is an
affiliate of the Company or who tenders in the
Exchange Offer with the intention or for the
purpose of participating in a distribution of the
Exchange Preferred Stock or who is a broker-dealer
who purchased Original Preferred Stock from the
Company to resell pursuant to Rule 144A under the
Securities Act (i) cannot rely on the
interpretation of the staff of the Commission set
forth in the above-mentioned no-action letters,
(ii) will not be entitled to tender Original
Preferred Stock and (iii) must comply with the
registration and prospectus delivery requirements
of the Securities Act in connection with any sale
or transfer of the Original Preferred Stock, unless
such sale or transfer is made pursuant to an
exemption from such requirements. The Letter of
Transmittal states that a broker-dealer will not,
by so acknowledging and by delivering a prospectus,
be deemed to admit that it is an "underwriter"
within the meaning of the Securities Act. See "The
Exchange Offer--Procedures for Tendering" and "Plan
of Distribution."
Special Procedures for
Beneficial Owners .......
Any beneficial owner whose Original Preferred Stock
is registered in the name of a broker, dealer,
commercial bank, trust company or other nominee and
who wishes to tender such Original Preferred Stock
in the Exchange Offer should contact such
registered holder promptly and instruct such
registered holder to tender on such beneficial
owner's behalf. If such beneficial owner wishes to
tender on its own behalf, such beneficial owner
must, prior to completing and executing the Letter
of Transmittal and delivering its Original
Preferred Stock, either make appropriate
arrangements to register ownership of the Original
Preferred Stock in such beneficial owner's name or
obtain a properly completed stock power from the
registered holder. Any such transfer of registered
ownership may take considerable time and may not be
completed prior to the Expiration Date. See "The
Exchange Offer--Procedures for Tendering."
5
<PAGE>
Guaranteed Delivery Holders of Preferred Stock who wish to tender their
Procedures .............. Original Preferred Stock and whose Original
Preferred Stock is not immediately available or who
cannot deliver their Original Preferred Stock, the
Letter of Transmittal or any other documents
required by the Letter of Transmittal to the
Exchange Agent prior to the Expiration Date must
tender their Original Preferred Stock according to
the guaranteed delivery procedures set forth in
"The Exchange Offer--Guaranteed Delivery
Procedures."
Withdrawal Rights......... The tender of Original Preferred Stock pursuant to
the Exchange Offer may be withdrawn at any time
prior to the Expiration Date.
Acceptance of Original
Preferred Stock and
Delivery of Exchange
Preferred Stock..........
The Company will accept for exchange any and all
Original Preferred Stock which is properly tendered
in the Exchange Offer and not validly withdrawn
prior to 5:00 p.m., New York City time, on the
Expiration Date. The Exchange Preferred Stock
issued pursuant to the Exchange Offer will be
delivered promptly on or following the Expiration
Date. See "Exchange Offer--Terms of the Exchange
Offer." Any Original Preferred Stock 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.
Consequences of Failure
to Exchange..............
The Original Preferred Stock that is not exchanged
pursuant to the Exchange Offer will remain
outstanding and continue to accrue dividends (if
declared) and will also continue to bear legends
restricting their transfer under the Securities
Act. Accordingly, such Original Preferred Stock may
be resold only (i) to the Company, (ii) to
"qualified institutional buyers" within the meaning
of Rule 144A of the Securities Act pursuant to Rule
144A, (iii) to institutional "accredited investors"
as defined in Rule 501(a)(1), (2), (3) or (7) of
the Securities Act, (iv) outside the United States
to a non-U.S. person pursuant to the requirements
of Regulation S under the Securities Act, (v)
pursuant to an effective registration statement
under the Securities Act, or (vi) pursuant to any
other available exemption from the registration
requirements under the Securities Act. Upon the
Company's acceptance of all validly tendered
Original Preferred Stock pursuant to the Exchange
Offer, any remaining holders of the Original
Preferred Stock will be entitled to all the rights,
and subject to all the limitations, applicable
thereto under the Original Certificate of
Designation, but will have no right to receive
Additional Dividends thereunder nor any further
registration rights under the Registration Rights
Agreement. The liquidity of the market for such
Original Preferred Stock could be adversely
affected. See "Exchange Offer--Consequences of
Failure to Exchange."
Certain Federal Income
Tax Considerations.......
For a discussion of certain federal income tax
considerations relating to the exchange of the
Exchange Preferred Stock for the Original Preferred
Stock, see "Certain Federal Income Tax
Considerations Relating to the Exchange Offer."
6
<PAGE>
Use of Proceeds........... There will be no cash proceeds to the Company from
the exchange of Original Preferred Stock pursuant
to the Exchange Offer.
Exchange Agent............ BankBoston, N.A. is serving as the Exchange Agent
in connection with the Exchange Offer. The address
and telephone number of the Exchange Agent are set
forth in "The Exchange Offer--Exchange Agent."
THE EXCHANGE PREFERRED STOCK
Exchange Preferred Stock.. Up to 1,500,000 shares of Fixed Rate Noncumulative
Perpetual Senior Preferred Stock, Series C, are
being offered pursuant to the Exchange Offer. The
form and terms of the Exchange Preferred Stock are
substantially the same in all material respects as
the form and terms of the Original Preferred Stock
for which they may be exchanged pursuant to the
Exchange Offer, except that the Exchange Preferred
Stock will be registered under the Securities Act
and, therefore, will not bear legends restricting
their transfer under the Securities Act and will
not contain provisions regarding minimum unit size,
the payment of Additional Dividends or registration
rights.
Dividends on the Exchange
Preferred Stock..........
Cash dividends on the Exchange Preferred Stock will
be noncumulative and, if declared, will be payable
quarterly on February 15, May 15, August 15 and
November 15 of each year at a rate of 6.687% of the
liquidation preference thereof, or $6.687 per
share, per annum. If dividends are declared for the
period from and including November 15, 1997 through
and including February 14, 1998, holders of the
Exchange Preferred Stock will receive dividends on
February 15, 1998 from the date of initial issuance
of the Exchange Preferred Stock, plus an amount
equal to the declared and accrued, but unpaid,
dividends on the Original Preferred Stock to the
date of exchange thereof. Dividends declared on the
Original Preferred Stock accepted for exchange will
cease to accrue upon issuance of the Exchange
Preferred Stock in exchange therefor. The amount of
dividends payable in respect of the Exchange
Preferred Stock will be adjusted in the event of
certain amendments to the Code in respect of the
dividends received deduction. See "Description of
the Exchange Preferred Stock--Dividends."
Ranking................... The Exchange Preferred Stock will constitute a
separate series, consisting of 1,500,000 shares, of
the Company's senior preferred stock $.01 par value
per share ("Senior Preferred Stock"). The Exchange
Preferred Stock will, on the date of original
issue, rank on a parity in all respects with each
other outstanding series of Senior Preferred Stock
and will rank senior in all respects to the
Company's common stock, $0.25 par value per share
("Common Stock"). No shares of the Company's
preferred stock, no par value per share ("Junior
Preferred Stock"), are currently outstanding nor
are expected to be outstanding upon consummation of
this offering. See "Description of the Exchange
Preferred Stock--General."
7
<PAGE>
Liquidation Preference.... The Exchange Preferred Stock will be entitled to a
liquidation preference of $100.00 per share, plus
an amount equal to the sum of all accrued and
unpaid dividends (whether or not earned or
declared) for the then-current dividend period to
the date of final distribution (without
accumulation of accrued and unpaid dividends for
prior dividend periods unless previously declared),
that is senior to payments to holders of the Common
Stock, the Junior Preferred Stock or any other
class or series of stock of the Company ranking
junior to the Exchange Preferred Stock and pari
passu with payments to holders of each other series
of Senior Preferred Stock outstanding on the date
of original issue of the Exchange Preferred Stock.
See "Description of the Exchange Preferred Stock--
Liquidation Rights."
Voting Rights............. Except as indicated in "Description of the Exchange
Preferred Stock--Voting Rights" or expressly
required by applicable law, the holders of the
Exchange Preferred Stock will not be entitled to
vote.
Redemption................ The Exchange Preferred Stock is not redeemable
prior to August 15, 2007, except as stated herein.
On and after such date, the Exchange Preferred
Stock is redeemable, in whole or in part, at the
option of the Company, at $100.00 per share, plus
an amount equal to the sum of all accrued and
unpaid dividends (whether or not declared) for the
then-current dividend period to the redemption date
(without accumulation of accrued and unpaid
dividends for prior dividend periods unless
previously declared). The Exchange Preferred Stock
will not be entitled to the benefit of any sinking
fund. See "Description of the New Securities--
Redemption."
Absence of Market for the
Exchange Preferred
Stock....................
The Exchange Preferred Stock will be a new issue of
securities for which, prior to the Exchange Offer,
there has been no public market. The Company does
not currently intend to list the Exchange Preferred
Stock 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 each currently
intend to make a market in the Exchange Preferred
Stock, the Initial Purchasers 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 public market for
the Exchange Preferred Stock. If an active market
does not develop, the market price and liquidity of
the Exchange Preferred Stock may be adversely
affected.
8
<PAGE>
SAFE HARBOR FOR FORWARD-LOOKING STATEMENTS
This Prospectus contains and the documents incorporated by reference herein
contain or will contain certain "forward-looking statements" (as defined in
Section 27A of the Securities Act) that are based on the beliefs of the
Company's management, as well as assumptions made by, and information
currently available to, the Company's management. Wherever possible, the
Company has identified these forward-looking statements by using words such as
"anticipates," "believes," "estimates," "expects" and similar expressions.
These forward-looking statements are subject to risks and uncertainties which
could cause the Company's actual results, performance or achievements to
differ materially from those expressed in, or implied by, these statements.
These risks and uncertainties include, but are not limited to, the following:
(1) the results of the Company's efforts to implement its business strategy;
(2) the effect of economic conditions and the performance of borrowers; (3)
actions of the Company's competitors and the Company's ability to respond to
such actions; (4) the cost of the Company's capital, which depends in part on
the Company's portfolio quality, ratings, prospects and outlook; and (5)
changes in governmental regulations, tax rates and similar matters. The
Company assumes no obligation to update publicly any forward-looking
statements, whether as a result of new information, future events or
otherwise.
THE COMPANY
GENERAL
Heller Financial, Inc. (the "Company") was incorporated in 1919 under the
laws of the State of Delaware and is engaged in various aspects of the
commercial finance business. The Company and its consolidated subsidiaries
employ approximately 2,300 people. The Company's executive offices are located
at 500 West Monroe Street, Chicago, Illinois 60661 (telephone: (312) 441-
7000). Unless the context indicates otherwise, references to the Company
include Heller Financial, Inc. and its consolidated subsidiaries.
The Company is a diversified financial services company which provides a
broad array of commercial financial products and services primarily to middle-
market companies in the United States and internationally. The Company
provides its products and services through five product categories: (i) asset
based finance, (ii) cash flow lending, (iii) real estate finance, (iv)
international asset based finance and factoring and (v) specialized finance.
The middle-market segment served includes entities primarily in the
manufacturing and service sectors with annual sales in the range of $15
million to $200 million and in the real estate sector with property values
generally in the range of $5 million to $40 million.
The Company's emphasis has been to grow the lower risk asset based finance
businesses, maintain significant franchises in corporate finance and real
estate finance and continue to grow its international asset based lending
businesses. The asset based businesses have developed to become the largest
product category in assets and revenues. Earnings quality has been
strengthened through the growth in the asset based businesses, which provide
more consistent revenue streams and produce lower and less volatile credit
quality costs. The Company manages asset quality through the use of
disciplined underwriting standards and aggressive account management
techniques. The underwriting standards and credit disciplines employed on the
post-1990 corporate finance and real estate finance portfolios have resulted
in strong credit quality for these portfolios. In addition, the Company
continues to significantly reduce its pre-1990 corporate finance and real
estate finance portfolios. The Company has maintained a conservative capital
structure with substantial equity, low leverage and moderate reliance for
funding on the commercial paper market.
PRODUCT CATEGORIES
The Company offers a wide range of financial products and services to its
customers through five product categories.
9
<PAGE>
Asset Based Finance
Asset based financing is offered by six distinct product groups: Heller
Current Asset Management ("Current Asset Management"), Heller Business Credit
("Business Credit"), Heller Equipment Finance and Leasing ("Equipment Finance
and Leasing"), Heller Vendor Finance ("Vendor Finance"), Heller First Capital
("First Capital") and Heller Sales Finance ("Sales Finance").
Current Asset Management provides working capital financing, receivables
management and credit protection to companies in a broad range of industries.
Current Asset Management is the fourth largest domestic factor in the United
States and is the Company's oldest business with over 50 years of operations.
The group offers factoring services to over 600 clients and 80,000 customers
primarily in the apparel, textile, houseware, transportation, and home
furnishings industries. In return for a commission, the group purchases the
client's accounts receivables and provides collection, credit protection and
management information services. Working capital is provided by advancing on a
formula basis a percentage of the purchase price of the client's factored
accounts receivables. Current Asset Management also provides advances against
inventory on a formula basis.
Business Credit provides asset based working capital and term financing to
middle market companies for refinancings, recapitalizations, acquisitions,
seasonal borrowing, debtor-in-possession (DIP) and post-DIP transactions
through senior loans secured primarily by accounts receivables and inventory.
The group provides financing to manufacturers, retailers, wholesalers,
distributors, exporters and service firms. The group also serves as co-lender
or participant in transactions agented by other asset based lenders. Revolving
credit facilities and term loans are generally cross-collateralized. The
Company protects its position against deterioration of a borrower's
performance by using established advance rates against eligible collateral.
Transaction sizes range from $5 million to $75 million, and the group utilizes
syndication capabilities to lower the average retained transaction size to
approximately $20 million in commitments and $10 million in fundings.
Equipment Finance and Leasing is comprised of four direct origination
finance divisions: Heller Commercial Equipment Finance ("Commercial Equipment
Finance"), Heller Aircraft Finance ("Aircraft Finance"), Heller Public Finance
("Public Finance") and Heller Industrial Equipment Finance ("Industrial
Equipment Finance"). Commercial Equipment Finance provides leasing and
financing programs to a diverse group of middle market companies
collateralized by equipment for expansion, replacement or modernization or to
refinance existing equipment obligations. Typically, the equipment is
essential to the operations of the borrower, and the amount financed is
generally not a substantial part of the borrower's capital structure.
Commercial Equipment Finance serves various markets including transportation,
supermarket, manufacturing, energy, restaurant and food processing.
Transaction sizes generally range from $500,000 to $15 million with terms
ranging from three to ten years and an average transaction size in 1996 of
approximately $4 million. Aircraft Finance offers financing for commercial
aircraft and aircraft engines through operating leases and senior and junior
secured loans. Transaction sizes range from $5 million to $40 million, with
terms ranging from five to 15 years and an average transaction size in 1996 of
approximately $13 million. During 1996, the Company formed Public Finance to
provide equipment and project/facility financing to state and local
governments and Industrial Equipment Finance to provide collateral based
equipment financing to smaller middle market companies in the machine tool,
construction, printing and trucking industries. The targeted average
transaction size is approximately $2 million for Public Finance and less than
$1 million for Industrial Equipment Finance.
Vendor Finance provides customized equipment leasing and financing programs
to manufacturers and distributors of a wide variety of commercial, industrial
and technology based products. These services, offered through approximately
75 programs with manufacturers and vendors, are established to finance sales
to end users. Transactions under these programs generally have partial or in
some cases full recourse to the vendor. The group serves the financing needs
of the machining, graphic arts, information technology, energy management,
healthcare, communication, and food processing markets. Transaction sizes
range from $50,000 to approximately $3 million with an average transaction
size in 1996 of approximately $150,000. The group also provides capital to
independent finance and leasing companies.
10
<PAGE>
First Capital provides long-term financing to independent small businesses
and franchises under the United States Small Business Administration ("SBA")
loan programs. First Capital is one of the largest participants in the SBA's
7(A) loan program under which up to 80% of each loan is guaranteed by the SBA.
The Company also makes loans under the SBA's 504 program. These loans are
senior to an accompanying SBA loan and have an average loan to collateral
value of 50%. First Capital's SBA 7(A) and 504 loans include financing for
real estate acquisition, refinancing or construction financing, equipment or
business acquisition, permanent working capital for expansion efforts and debt
consolidation. The guaranteed portions of the SBA 7(A) loans are sometimes
sold in the secondary market, with servicing rights retained by First Capital.
Transaction sizes generally range from $50,000 to $2 million, with an average
transaction size in 1996 of approximately $400,000.
Sales Finance provides financing primarily through senior lines and, to a
lesser extent, subordinated debt to originators of consumer receivables.
Financing is primarily provided for vacation ownership, home equity and
improvement, non-prime auto, security alarm monitoring contracts and municipal
tax liens. Sales Finance is a major capital source in the United States in the
vacation ownership industry. Transaction sizes generally range from $3 million
to $25 million, with an average transaction size in 1996 of approximately $7
million.
Cash Flow Lending
Heller Corporate Finance ("Corporate Finance") is a leading provider of
middle market financing based on the cash flows underlying a client's
business. This lending is generally provided through coordination with private
equity sponsors and includes the financing of corporate recapitalizations,
refinancings, expansions, acquisitions and buy-outs of publicly and privately
held entities in a wide variety of industries. Loans are provided on both a
term and revolving basis for periods of up to ten years and are typically
collateralized by senior liens on the borrower's stock or assets or both.
Transactions may also include some unsecured or subordinated financings or
modest non-voting equity investments. The group also serves as co-lender or
participant in transactions agented by other asset based lenders. Transaction
sizes range from $5 million to $50 million, and the group utilizes syndication
capabilities to lower the average retained transaction size to approximately
$16 million in commitments and $9 million in fundings for 1996. Corporate
Finance also invests in equity funds generally originated by equity sponsors.
Real Estate Finance
Heller Real Estate Financial Services ("Real Estate Finance") specializes in
providing financing products to real estate owners, investors and developers
primarily for the acquisition, refinancing and renovation of commercial
income-producing properties in a wide range of property types and geographic
areas. The group is one of the nation's largest providers of loans secured by
manufactured housing communities and self storage facility property types to
be sold in the capital markets through a commercial mortgage securitization.
The group also offers financing for discounted loan portfolio acquisitions,
single family housing developments, credit sale-leasebacks and to be built
properties with credit tenants. The group also holds investments in
acquisition, development and construction transactions, as well as certain
available for sale debt securities. Loans generally have terms ranging from
one to five years and are principally collateralized by first mortgages.
Transaction sizes generally range from $1 million to $15 million, with an
average transaction size in 1996 of approximately $3 million.
International Asset Based Finance and Factoring
Heller International Group, Inc. ("Heller International") offers financial
products through commercial finance subsidiaries and joint ventures in 18
countries in Europe, Asia/Pacific and Latin America. The joint ventures and
subsidiaries primarily provide factoring, asset based financing and
receivables management services, and also make loans for acquisition
financing, leasing, vendor finance and/or trade finance programs, primarily to
small and mid-sized businesses outside the United States. Heller International
also makes modest investments in international equity funds.
11
<PAGE>
On April 2, 1997, Heller International purchased the interest of its joint
venture partner in Factofrance Heller S.A. ("Factofrance") for $174 million.
As a result, Heller International increased its ownership interest in
Factofrance from 48.8% to 97.6%. Heller International has held an interest in
Factofrance for over 30 years, using the equity method of accounting for its
previous ownership position. Factofrance, founded in 1965, is the leading
factoring company in the French marketplace. Factofrance is headquartered in
Paris and has seven regional sales offices covering local markets.
Specialized Finance
Heller Project Finance, formerly known as Project Investment and Advisory
Division, consists of transactions in project finance offering financing to
independent power producers and industrial projects in the oil and gas, coal,
mining, paper and environmental industries. Financing is provided in the form
of senior and junior secured loans and equity investments. Transaction sizes
generally range from $5 million to $25 million, and terms range from seven to
15 years.
SYNDICATION, SECURITIZATION AND LOAN SALE ACTIVITIES
A key element of the Company maintaining strong asset quality is its focus
on managing exposure to individual credits and industry concentrations. A
major part of the effort is syndicating loans or selling participations to
control the concentration of credit risk. The Company has established
syndication programs in most of its businesses, with receivable syndications
and participations totaling $453 million during 1996. In addition, Real Estate
Finance originates loans to manufactured housing communities, self storage
facilities and multi-tenant industrial property types, which may be sold as
whole loans or in the capital markets through a commercial mortgage
securitization. Other business groups also originate receivables which may be
sold as whole loans or through a securitization to take advantage of market
pricing and to reduce concentrations of credit risk. During 1996, the Company
had loan sales totaling $304 million. Through September 30, 1997, the Company
sold through securitization $268 million of loans and leases originated in its
Equipment Finance and Leasing and Vendor Finance businesses and $505 million
of mortgage loans originated in its Real Estate Finance Business.
OWNERSHIP
All of the outstanding Common Stock of the Company is owned by Heller
International Corporation (the "Parent"), a wholly-owned subsidiary of The
Fuji Bank, Limited ("Fuji Bank"), headquartered in Tokyo, Japan. Fuji Bank
also directly owns 21% of the outstanding shares of Heller International, a
consolidated subsidiary of the Company engaged in international factoring and
asset based financing activities. Fuji Bank is one of the largest banks in the
world, with total deposits of approximately $311.4 billion at March 31, 1997.
For a discussion of the Keep Well Agreement between Fuji Bank and the Company,
see "Keep Well Agreement with Fuji Bank" below.
12
<PAGE>
The following table summarizes selected financial data obtained from Fuji
Bank's most recent available financial statements, as prepared in accordance
with accounting principles generally accepted in Japan, which differ from
generally accepted accounting principles in the United States.
THE FUJI BANK, LIMITED
(CONSOLIDATED FINANCIAL STATEMENTS)
<TABLE>
<CAPTION>
YEAR ENDED MARCH 31,
--------------------------------------------------
1997 1996
------------------------ -------------------------
YEN DOLLARS* YEN DOLLARS*
(BILLIONS) (MILLIONS) (BILLIONS) (MILLIONS)
------------- ---------- ------------- ----------
<S> <C> <C> <C> <C>
Total Assets............ (Yen)56,211.2 $452,950.5 (Yen)54,401.4 $511,531.8
Total Deposits.......... 38,649.5 311,438.2 37,280.4 350,544.2
Total Liabilities....... 54,276.8 437,363.5 52,764.8 496,142.9
Total Stockholders'
Equity................. 1,934.3 15,587.0 1,636.1 15,388.9
Net Income.............. 109.0 878.7 (325.4) (3,059.9)
</TABLE>
- --------
*Rates of Exchange: 3/31/97 (Yen) 124.10 = U.S. $1.00
3/31/96 (Yen) 106.35 = U.S. $1.00
If the financial statements from which the numbers in the foregoing table
were taken had been prepared in accordance with accounting principles
generally accepted in the United States, some of the amounts shown might have
been materially different. The Company currently understands that accounting
principles generally accepted in Japan differ from generally accepted
accounting principles in the United States in various areas, including the
following: valuation of securities; accounting treatment of guarantees,
commitments, unearned income, deferred taxes, leases, depreciation, foreign
currency transactions and investments in subsidiaries, and creation and
maintenance of optional and required reserves.
KEEP WELL AGREEMENT WITH FUJI BANK
The Company entered into a Keep Well Agreement (as amended from time to
time, the "Keep Well Agreement") with Fuji Bank on April 23, 1983 in order to
assist the Company in maintaining its credit rating. The Keep Well Agreement
was amended and supplemented on January 26, 1984, in connection with the
consummation of the purchase of the Company by Fuji Bank and has been amended
since that date from time to time. Most recently, on June 17, 1997, the Keep
Well Agreement was amended in connection with the Company's offering of its
Original Preferred Stock. The Keep Well Agreement shall not be terminated
prior to the date (the "Termination Date") which is the earlier of (i)
December 31, 2007 and (ii) the date on which the Company has received written
certifications from Moody's and S&P that, upon termination of the Keep Well
Agreement, the ratings on the Company's senior unsecured indebtedness without
the support provided by the Keep Well Agreement will be no lower than such
ratings with the support of the Keep Well Agreement, but in no event shall the
Termination Date be earlier than December 31, 2002. In addition, the Keep Well
Agreement includes certain restrictions on termination relating to the
Company's 8 1/8% Cumulative Perpetual Senior Preferred Stock, Series A, $.01
par value ("Series A Preferred Stock"), the Exchange Preferred Stock and the
Original Preferred Stock, which restrictions are discussed below.
The Keep Well Agreement provides that Fuji Bank will maintain the Company's
net worth in an amount equal to $500 million. Accordingly, if the Company
should determine, at the close of any month, that its net worth is less than
$500 million, then Fuji Bank will purchase, or cause one of its subsidiaries
to purchase, shares of the Company's NW Preferred Stock, Class B, no par value
("NW Preferred Stock"), in an amount necessary to increase the Company's net
worth to $500 million. The NW Preferred Stock is a series of Junior Preferred
Stock and, accordingly, if and when issued will rank junior to the Exchange
Preferred Stock as to payment of dividends, and in all other respects. If and
when the NW Preferred Stock is issued, dividends thereon will be noncumulative
and will be payable (if declared) quarterly at a rate per annum equal to 1%
over the three-month
13
<PAGE>
London Inter-bank Offered Rate. Such dividends will not be paid during a
default in the payment of principal or interest on any of the outstanding
indebtedness for money borrowed by the Company. Subject to certain conditions,
the NW Preferred Stock will be redeemable, at the option of the holder, within
a specified period of time after the end of a calendar quarter in an aggregate
amount not greater than the excess of the net worth of the Company as of the
end of such calendar quarter over $500 million. See "Description of Existing
Preferred Stock--NW Preferred Stock."
The Keep Well Agreement further provides that if the Company should lack
sufficient cash, other liquid assets or credit facilities to meet its payment
obligations on its commercial paper, then Fuji Bank will lend the Company up
to $500 million (the "Liquidity Commitment"), payable on demand, which the
Company may use only for the purpose of meeting such payment obligations. Any
such loan by Fuji Bank to the Company (a "Liquidity Advance") will bear
interest at a fluctuating interest rate per annum equal to the announced prime
commercial lending rate of Morgan Guaranty Trust Company of New York plus
0.25% per annum. Each Liquidity Advance will be repayable on demand at any
time after the business day following the 29th day after such Liquidity
Advance was made. No repayment of the Liquidity Advance will be made during a
period of default in the payment of the Company's senior indebtedness for
borrowed money.
No Liquidity Advances or purchases of NW Preferred Stock have been made by
Fuji Bank under the Keep Well Agreement; other infusions of capital in the
Company have been made by the Parent, the last one of which occurred in 1992.
Under the Keep Well Agreement, the Company has covenanted to maintain, and
Fuji Bank has undertaken to assure that the Company will maintain, unused
short-term lines of credit, asset sales facilities and committed credit
facilities in an amount approximately equal to 75% of the amount of its
commercial paper obligations from time to time outstanding. In addition, under
the Keep Well Agreement, neither Fuji Bank nor any of its subsidiaries can
sell, pledge or otherwise dispose of shares of Common Stock of the Company, or
permit the Company to issue shares of its Common Stock, except to Fuji Bank or
a Fuji Bank affiliate.
Neither Fuji Bank nor the Company is permitted to terminate the Keep Well
Agreement for any reason prior to the Termination Date. After the Termination
Date, either Fuji Bank or the Company may terminate the Keep Well Agreement
upon 30 business days' prior written notice, except as set forth below. So
long as the Series A Preferred Stock is outstanding and held by third parties
other than Fuji Bank, the Keep Well Agreement may not be terminated by either
party unless the Company has received written certifications from Moody's and
S&P that upon such termination the Series A Preferred Stock will be rated by
them no lower than "a3" and "A-1," respectively. Additionally, so long as the
Exchange Preferred Stock or Original Preferred Stock is outstanding and held
by third parties other than Fuji Bank, the Keep Well Agreement may not be
terminated by either party unless the Company has received written
certifications from Moody's and S&P that upon such termination the Exchange
Preferred Stock or Original Preferred Stock, as the case may be (or both the
Exchange Preferred Stock and Original Preferred Stock if shares of both are
then outstanding), will be rated no lower than "baa1" and "BBB" by Moody's and
S&P, respectively. For these purposes, the Series A Preferred Stock, Exchange
Preferred Stock or Original Preferred Stock will no longer be deemed
outstanding at such time as an effective notice of redemption of all of the
Series A Preferred Stock, Exchange Preferred Stock or Original Preferred
Stock, as the case may be, shall have been given by the Company and funds
sufficient to effectuate such redemption shall have been deposited with the
party designated for such purpose in the notice. So long as the Series A
Preferred Stock is outstanding, if both Moody's and S&P shall discontinue
rating the Series A Preferred Stock, then Goldman, Sachs & Co., or its
successor, shall, within 30 days, select a nationally recognized substitute
rating agency and identify the comparable ratings from such agency. So long as
the Series A Preferred Stock is no longer outstanding but the Exchange
Preferred Stock or Original Preferred Stock is outstanding, if both Moody's
and S&P shall discontinue rating the Exchange Preferred Stock or Original
Preferred Stock, as the case may be, then Lehman Brothers Inc., or its
successor, shall, within 30 days, select a nationally recognized substitute
rating agency and identify the comparable ratings from such agency. Any
termination of the Keep Well Agreement by the Company must be consented to by
Fuji Bank. Any such termination will not relieve the Company of its
obligations in respect of any NW Preferred Stock outstanding on the date of
termination or the
14
<PAGE>
dividends thereon, any amounts owed in respect of Liquidity Advances on the
date of termination or the unpaid principal or interest on those Liquidity
Advances or Fuji Bank's fee relating to the Liquidity Commitment. Any such
termination will not adversely affect the Company's commercial paper
obligations outstanding on the date of termination. The Keep Well Agreement
can be modified or amended by a written agreement of Fuji Bank and the
Company. However, no such modification or amendment may change the prohibition
against termination before the Termination Date or the other restrictions on
termination or adversely affect the Company's then-outstanding commercial
paper obligations.
Under the Keep Well Agreement, the Company's commercial paper obligations
and any other debt instruments are solely the obligations of the Company. The
Keep Well Agreement is not a guarantee by Fuji Bank of the payment of the
Company's commercial paper obligations, indebtedness, liabilities or
obligations of any kind.
15
<PAGE>
CAPITALIZATION
The following table sets forth, as of June 30, 1997, (i) the capitalization
of the Company and (ii) such capitalization as adjusted to give effect to the
issuance of 1,500,000 shares of Exchange Preferred Stock pursuant to the
Exchange Offer (assuming all 1,500,000 shares of Original Preferred Stock are
validly tendered and accepted by the Company pursuant to the Exchange Offer
and subsequently retired by the Company). This table is qualified by, and
should be read in conjunction with, the consolidated financial statements of
the Company and its subsidiaries, including the related notes thereto, which
are included in the documents incorporated by reference into this Prospectus.
<TABLE>
<CAPTION>
JUNE 30, 1997
-------------------
ACTUAL AS ADJUSTED
------- -----------
(DOLLARS IN
MILLIONS)
<S> <C> <C>
Senior Debt:
Commercial paper and short-term borrowings............... $ 3,826 $ 3,826
Notes and debentures..................................... 4,600 4,600
------- -------
Total debt............................................. 8,426 8,426
Minority interest in equity of Heller International Group,
Inc....................................................... 58 58
Stockholders' equity:
Cumulative Perpetual Senior Preferred Stock, Series A,
$.01 par value, 5,000,000 shares authorized, issued and
outstanding, actual and as adjusted..................... 125 125
Fixed Rate Noncumulative Perpetual Senior Preferred
Stock, Series C, $.01 par value, no shares authorized,
issued and outstanding, actual; 1,500,000 shares
authorized, issued and outstanding, as adjusted......... -- 150
Fixed Rate Noncumulative Perpetual Senior Preferred
Stock, Series B, $.01 par value, 1,500,000 shares
authorized, issued and outstanding, actual; no shares
authorized, issued and outstanding, as adjusted......... 150 --
Common Stock, $0.25 par value, 1,000 shares authorized,
105 shares issued and outstanding, actual and as
adjusted, and additional paid-in capital................ 685 685
Retained earnings........................................ 683 683
------- -------
Total stockholders' equity............................. $ 1,643 $ 1,643
------- -------
Total capitalization................................. $10,127 $10,127
======= =======
</TABLE>
16
<PAGE>
SELECTED FINANCIAL DATA
The following selected financial data of the Company and its consolidated
subsidiaries have been derived from information contained in, and should be
read in conjunction with, the Company's Annual Report on Form 10-K for the
fiscal year ended December 31, 1996 and the Company's Quarterly Report on Form
10-Q for the six months ended June 30, 1997. The data presented below for, and
as of the end of, each of the years in the five-year period ended December 31,
1996 are derived from the audited consolidated financial statements of the
Company and its subsidiaries. The data presented below for, and as of the end
of, the six months ended June 30, 1997 and 1996 are derived from unaudited
financial statements and include, in the opinion of management, all
adjustments (consisting only of normal recurring adjustments) necessary to
present fairly the data for such periods.
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS
ENDED JUNE 30, FOR THE YEAR ENDED DECEMBER 31,
--------------- --------------------------------------
1997 1996 1996 1995 1994 1993 1992
------- ------ ------ ------ ------ ------ ------
(UNAUDITED)
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
Income Statement Data:
Interest income........ $ 446 $ 400 $ 807 $ 851 $ 702 $ 620 $ 634
Interest expense....... 247 223 452 464 336 264 295
------- ------ ------ ------ ------ ------ ------
Net interest income.. 199 177 355 387 366 356 339
Fees and other income.. 79 37 79 148 117 88 52
Factoring commissions.. 43 26 55 50 55 50 49
Income of
international joint
ventures.............. 19 20 44 35 21 23 26
------- ------ ------ ------ ------ ------ ------
Operating revenues... 340 260 533 620 557 517 466
Operating expenses..... 152 119 247 216 195 174 169
Provision for losses... 56 49 103 223 188 210 252
------- ------ ------ ------ ------ ------ ------
Income before income
taxes, minority
interest
and change in
accounting
principle........... 132 92 183 181 174 133 45
Income tax
provision/(benefit)... 45 21 43 49 51 11 (5)
Minority interest in
income of Heller
International Group,
Inc................... 4 2 7 7 5 5 3
------- ------ ------ ------ ------ ------ ------
Income before change
in accounting
principle........... 83 69 133 125 118 117 47
Cumulative effect of a
change in accounting
principle for income
taxes................. -- -- -- -- -- -- 41
------- ------ ------ ------ ------ ------ ------
Net income........... $ 83 $ 69 $ 133 $ 125 $ 118 $ 117 $ 88
======= ====== ====== ====== ====== ====== ======
Common dividends
paid................ $ 28 $ 24 $ 56 $ 52 $ 20 $ -- $ --
======= ====== ====== ====== ====== ====== ======
<CAPTION>
JUNE 30, DECEMBER 31,
--------------- --------------------------------------
1997 1996 1996 1995 1994 1993 1992
------- ------ ------ ------ ------ ------ ------
(UNAUDITED)
(DOLLARS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
Balance Sheet Data:
Receivables............ $10,109 $8,167 $8,529 $8,085 $7,616 $7,062 $7,465
Allowance for losses
of receivables........ 250 230 225 229 231 221 224
Investments............ 881 771 805 693 634 370 280
Investment in
international joint
ventures.............. 193 235 272 233 174 144 140
------- ------ ------ ------ ------ ------ ------
Total assets......... $11,608 $9,475 $9,926 $9,638 $8,476 $7,913 $7,952
======= ====== ====== ====== ====== ====== ======
Senior debt:
Commercial paper and
short-term
borrowings.......... $ 3,826 $2,440 $2,745 $2,223 $2,451 $1,981 $2,422
Notes and debentures. 4,600 4,768 4,761 5,145 3,930 3,893 3,521
Junior subordinated
debt.................. -- -- -- -- -- 75 225
------- ------ ------ ------ ------ ------ ------
Total debt........... $ 8,426 $7,208 $7,506 $7,368 $6,381 $5,949 $6,168
======= ====== ====== ====== ====== ====== ======
Total liabilities...... $ 9,907 $7,997 $8,402 $8,208 $7,107 $6,625 $6,777
Preferred stock........ 275 150 150 150 150 150 150
Common equity.......... 1,368 1,276 1,317 1,234 1,180 1,103 994
------- ------ ------ ------ ------ ------ ------
Total stockholders'
equity.............. $ 1,643 $1,426 $1,467 $1,384 $1,330 $1,253 $1,144
======= ====== ====== ====== ====== ====== ======
Ratio of commercial
paper and short-term
borrowings to total
debt.................. 45% 34% 37% 30% 38% 33% 39%
======= ====== ====== ====== ====== ====== ======
Ratio of debt (net of
short-term
investments)
to total
stockholders' equity.. 5.0x 4.8x 5.0x 5.0x 4.7x 4.7x 5.4x
======= ====== ====== ====== ====== ====== ======
</TABLE>
17
<PAGE>
During 1996, the Company continued to make significant progress in
strengthening earnings, diversifying assets, strengthening asset quality and
maintaining a conservative capital structure. Due to significantly lower
credit costs in 1996, the Company achieved a fifth consecutive year of
increased net income. The lower risk asset based businesses grew to become the
largest product category and source of revenue. The asset based businesses
provide the Company with a more balanced portfolio, more consistent revenue
streams and reduced volatility of credit quality costs. Asset quality is
demonstrated by the strong credit performance of the post-1990 portfolio and
the significant reduction in the pre-1990 portfolio. The Company's capital
structure remained conservative as evidenced by a debt to equity ratio (net of
short-term investments) of five to one. Commercial paper and short-term
borrowing as a percentage of total debt remained conservative at 37%.
During the six-month period ended June 30, 1997, the Company continued to
reduce the pre-1990 portfolio, which decreased by $189 million, or 19%, due to
the resolution or run-off of credits. On July 2, 1997, the Company received
$78 million, representing a full payoff on its largest pre-1990 account,
further reducing the size of the pre-1990 portfolio to approximately 6% of
total lending assets and investments. Net income for the six-month period
ended June 30, 1997 increased $14 million, or 20%, from the prior year's
comparable period, due to increases in all operating revenue components,
modest growth in operating expenses and continued strong credit performance in
the ongoing portfolio. As of June 30, 1997, the Company's debt to equity ratio
(net of short-term investments) remained unchanged, at five to one, from
December 31, 1996. Commercial paper and short-term borrowing represented 45%
of total debt as of June 30, 1997, remaining within the range targeted by the
Company to maintain its strong financial position. Of the increase in this
percentage from December 31, 1996, 5% was due to the consolidation of
Factofrance in the second quarter of 1997.
RATIOS OF EARNINGS TO FIXED CHARGES AND EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following table sets forth the ratios of earnings to fixed charges and
earnings to combined fixed charges and preferred stock dividends for the
Company and its consolidated subsidiaries for the periods indicated.
<TABLE>
<CAPTION>
FOR THE SIX MONTHS FOR THE YEAR ENDED DECEMBER
ENDED JUNE 30, 31,
------------------- -----------------------------
1997 1996 1996 1995 1994 1993 1992
--------- --------- ----- ----- ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed
charges(1).................. 1.53x 1.41x 1.40x 1.38x 1.51x 1.49x 1.15x
Ratio of earnings to combined
fixed charges and preferred
stock dividends(2).......... 1.48x 1.36x 1.35x 1.34x 1.44x 1.43x 1.14x
</TABLE>
- --------
(1) The ratio of earnings to fixed charges is calculated by dividing (i)
income before income taxes, the minority interest in Heller International
income and fixed charges by (ii) fixed charges. Fixed charges consist of
interest on all indebtedness and one-third of annual rentals (approximate
portion representing interest).
(2) The ratio of earnings to combined fixed charges and preferred stock
dividends is calculated by dividing (i) income before income taxes, the
minority interest in Heller International income and fixed charges by (ii)
fixed charges plus preferred stock dividends.
USE OF PROCEEDS
This Exchange Offer is intended to satisfy certain obligations of the
Company under the Registration Rights Agreement. The Company will not receive
any cash proceeds from the issuance of the Exchange Preferred Stock pursuant
to the Exchange Offer. In consideration for issuing the Exchange Preferred
Stock as contemplated in this Prospectus, the Company will receive, in
exchange, Original Preferred Stock in like amount. The form and terms of the
Exchange Preferred Stock are substantially the same in all material respects
as the form and terms of the Original Preferred Stock, except as otherwise
described herein under "The Exchange Offer--Terms of the Exchange Offer." The
Original Preferred Stock surrendered in exchange for the Exchange Preferred
Stock will be retired and cancelled and cannot be reissued. Accordingly,
issuance of the Exchange Preferred Stock will not result in any increase in
the outstanding capital stock of the Company.
18
<PAGE>
THE EXCHANGE OFFER
PURPOSE AND EFFECT OF THE EXCHANGE OFFER
The Original Preferred Stock was sold by the Company on June 17, 1997 to the
Initial Purchasers pursuant to the Purchase Agreement. The Initial Purchasers
subsequently resold the Original Preferred Stock to "qualified institutional
buyers" within the meaning of Rule 144A under the Securities Act in reliance
on Rule 144A. Pursuant to the Purchase Agreement, the Company and the Initial
Purchasers entered into the Registration Rights Agreement, pursuant to which
the Company agreed, for the benefit of the holders of the Original Preferred
Stock, (i) to use its reasonable best efforts to file a registration statement
(the "Exchange Offer Registration Statement," of which this Prospectus is a
part) with respect to an offer to exchange the Original Preferred Stock for
fixed rate noncumulative senior perpetual preferred stock of the Company, with
terms substantially the same as those of the Original Preferred Stock, within
150 days after the date of original issuance of the Original Preferred Stock
and (ii) to use its reasonable best efforts to cause the Exchange Offer
Registration Statement to become effective under the Securities Act within 180
days after such issue date. Promptly after the Exchange Offer Registration
Statement has been declared effective under the Securities Act, the Company
agreed to offer the Exchange Preferred Stock for the Original Preferred Stock.
The Company will keep the Exchange Offer open until the Expiration Date. For
each share of Original Preferred Stock validly tendered to the Company
pursuant to the Exchange Offer and not withdrawn by the holder thereof, such
holder will receive a share of Exchange Preferred Stock having a liquidation
preference equal to the liquidation preference of the tendered Exchange
Preferred Stock.
RESALE OF EXCHANGE PREFERRED STOCK
Based on existing interpretations of the Securities Act by the staff of the
Commission set forth in several no-action letters issued to third-parties, the
Company believes that, except as described below, any Exchange Preferred Stock
issued pursuant to the Exchange Offer in exchange for Original Preferred Stock
may be offered for resale, resold and otherwise transferred by any holder
thereof (other than a holder which is an "affiliate" of the Company within the
meaning of Rule 405 of the Securities Act) without further compliance with the
registration and prospectus delivery provisions of the Securities Act,
provided that such Exchange Preferred Stock has been acquired in the ordinary
course of such holder's business and such holder is not engaged in, does not
intend to engage in, and has no arrangement or understanding with any person
to participate in, the distribution of such Exchange Preferred Stock. Any
holder who is an affiliate of the Company or who tenders in the Exchange Offer
with the intention or for the purpose of participating in a distribution of
the Exchange Preferred Stock or who is a broker-dealer who purchased Original
Preferred Stock from the Company to resell pursuant to Rule 144A under the
Securities Act (i) cannot rely on the interpretation of the staff of the
Commission set forth in the above-mentioned no-action letters, (ii) will not
be entitled to tender Original Preferred Stock and (iii) must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any sale or transfer of the Original Preferred Stock, unless
such sale or transfer is made pursuant to an exemption from such requirements.
Each broker-dealer that receives Exchange Preferred Stock in exchange for
Original Preferred Stock acquired for its own account as a result of market-
making activities or other trading activities (other than Original Preferred
Stock acquired directly from the Company) (a "Participating Broker-Dealer")
must acknowledge that it will deliver a prospectus meeting the requirements of
the Securities Act in connection with any resale of such Exchange Preferred
Stock. The Letter of Transmittal states that a broker-dealer will not, by so
acknowledging and by delivering a prospectus, 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
Participating Broker-Dealer in connection with resales of Exchange Preferred
Stock. The Company has agreed that, for a period of 180 days after the
Exchange Offer Registration Statement is declared effective by the Commission,
it will make this Prospectus available to any Participating Broker-Dealer for
use in connection with any such resale. See "Plan of Distribution."
19
<PAGE>
Each holder of the Original Preferred Stock who wishes to exchange such
Original Preferred Stock for Exchange Preferred Stock in the Exchange Offer
will be required to make certain representations, including representations
that (i) any Exchange Preferred Stock acquired by it will be obtained in the
ordinary course of its business, (ii) it is not engaged in, and does not
intend to engage in, and has no arrangement or understanding with any person
to participate in, the distribution of the Exchange Preferred Stock, and (iii)
it is not an "affiliate" of the Company within the meaning of Rule 405 of the
Securities Act. In addition, in connection with any resales of Exchange
Preferred Stock, any Participating Broker-Dealer who acquired the Original
Preferred Stock for its own account as a result of market-making activities or
other trading activities must deliver a prospectus meeting the requirements of
the Securities Act. The Commission has taken the position that Participating
Broker-Dealers may fulfill their prospectus delivery requirements with respect
to the Exchange Preferred Stock (other than a resale of an unsold allotment
from the original sale of the Original Preferred Stock) with this Prospectus.
Under the Registration Rights Agreement, the Company is required to allow
Participating Broker-Dealers and other persons, if any, subject to similar
prospectus delivery requirements to use this Prospectus in connection with the
resale of Exchange Preferred Stock for a period not exceeding 180 days after
the Exchange Offer Registration Statement is declared effective by the
Commission.
TERMS OF THE EXCHANGE OFFER
Upon the terms and subject to the conditions set forth in this Prospectus
and in the Letter of Transmittal, the Company will accept for exchange any and
all Original Preferred Stock validly tendered and not withdrawn prior to 5:00
p.m., New York City time, on the Expiration Date. The Company will issue a
share of Exchange Preferred Stock in exchange for each share of outstanding
Original Preferred Stock surrendered pursuant to the Exchange Offer. Holders
may tender all or some of their Original Preferred Stock pursuant to the
Exchange Offer. The Exchange Offer is not conditioned upon any minimum
aggregate number of shares of Original Preferred Stock being tendered for
exchange.
The form and terms of the Exchange Preferred Stock will be substantially the
same as the form and terms of the Original Preferred Stock, except the
Exchange Preferred Stock will be registered under the Securities Act and,
therefore, will not bear legends restricting their transfer and will not
contain provisions regarding minimum unit size, the payment of Additional
Dividends or registration rights. The registration rights under the
Registration Rights Agreement will terminate when the Exchange Offer is
consummated. The Exchange Preferred Stock will be issued under, and entitled
to the benefits of, the New Certificate of Designation.
This Prospectus, together with the Letter of Transmittal, will only be sent
to registered holders of the Original Preferred Stock. As of the date of this
Prospectus, 1,500,000 shares of the Original Preferred Stock are outstanding
and registered in the name of Cede & Co., as nominee for DTC. There will be no
fixed record date for determining registered holders of Original Preferred
Stock entitled to participate in the Exchange Offer.
Holders of the Original Preferred Stock do not have appraisal or dissenters'
rights under the General Corporation Law of Delaware or the Original
Certificate of Designation in connection with the Exchange Offer. The Company
intends to conduct the Exchange Offer in accordance with the provisions of the
Registration Rights Agreement and the applicable requirements of the Exchange
Act, and the rules and regulations of the Commission thereunder. Original
Preferred Stock which is not tendered for exchange in the Exchange Offer will
remain outstanding and continue to accrue dividends, if declared, and will be
entitled to the rights and benefits such holders have under the Original
Certificate of Designation and the Registration Rights Agreement.
The Company shall be deemed to have accepted for exchange validly tendered
Preferred Stock when, as and if the Company shall have given oral or written
notice thereof to the Exchange Agent. The Exchange Agent will act as agent for
the tendering holders for the purpose of receiving the Exchange Preferred
Stock from the Company. The Company expressly reserves the right to amend or
terminate the Exchange Offer, and not to accept for exchange any Original
Preferred Stock not theretofore accepted for exchange, upon the occurrence of
any of the conditions specified below under "--Certain Conditions to the
Exchange Offer."
20
<PAGE>
In all cases, issuance of Exchange Preferred Stock for Original Preferred
Stock that is accepted for exchange pursuant to the Exchange Offer will be
made only after timely receipt by the Exchange Agent of (i) certificates
representing Original Preferred Stock or a timely Book-Entry Confirmation (as
defined herein) of such Original Preferred Stock into the Exchange Agent's
account at DTC, as the case may be, (ii) a properly completed and duly
executed Letter of Transmittal, and (iii) all other required documents. If any
tendered Original Preferred Stock is not accepted for exchange for any reason
set forth in the terms and conditions of the Exchange Offer or if Original
Preferred Stock is submitted for a greater number of shares than the holder
desires to exchange, such unaccepted or non-exchanged Original Preferred Stock
will be returned without expense to the tendering holder thereof (or, in the
case of Original Preferred Stock tendered by book-entry transfer into the
Exchange Agent's account at DTC, pursuant to the book-entry transfer
procedures described below under "--Book-Entry Transfer", such non-exchanged
Original Preferred Stock will be credited to an account maintained with DTC)
as promptly as practicable after the expiration or termination of the Exchange
Offer.
Holders who tender Original Preferred Stock in the Exchange Offer will not
be required to pay brokerage commissions or fees or, subject to the
instructions in the Letter of Transmittal, transfer taxes with respect to the
exchange of Original Preferred Stock pursuant to the Exchange Offer. The
Company will pay all charges and expenses, other than certain applicable taxes
described below, in connection with the Exchange Offer. See
"--Fees and Expenses."
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The term "Expiration Date," shall mean 5:00 p.m., New York City time on
, 1997, unless the Company, in its sole discretion, extends the Exchange
Offer, in which case the term "Expiration Date" shall mean the latest date and
time to which the Exchange Offer is extended. The Expiration Date shall not in
any event be extended to a date later than , 1998 (150 days after the
initial Expiration Date).
In order to extend the Exchange Offer, the Company will notify the Exchange
Agent of any extension by oral or written notice and will mail to the
registered holders of Original Preferred Stock an announcement thereof, each
prior to 9:00 a.m., New York City time, on the next business day after the
previously scheduled expiration date.
The Company reserves the right, in its sole discretion, (i) to delay
accepting for exchange any Original Preferred Stock, to extend the Exchange
Offer or to terminate the Exchange Offer if any of the conditions set forth
below under "--Certain Conditions to the Exchange Offer" shall not have been
satisfied, by giving oral or written notice of such delay, extension or
termination to the Exchange Agent or (ii) to amend the terms of the Exchange
Offer in any manner. Any such delay in acceptance, extension, termination or
amendment will be followed as promptly as practicable by oral or written
notice thereof to the registered holders of Original Preferred Stock. If the
Exchange Offer is amended in a manner determined by the Company to constitute
a material change, the Company will promptly disclose such amendment by means
of a prospectus supplement that will be distributed to the registered holders,
and the Company will extend the Exchange Offer for a period of five to 10
business days, depending upon the significance of the amendment and the manner
of disclosure to the registered holders, if the Exchange Offer would otherwise
expire during such five to 10 business day period.
DIVIDENDS ON THE EXCHANGE PREFERRED STOCK
Cash dividends on the Exchange Preferred Stock will be noncumulative and, if
declared, will be payable quarterly on February 15, May 15, August 15 and
November 15 of each year at a rate of 6.687% of the liquidation preference
thereof, or $6.687 per share, per annum. If dividends are declared for the
period from and including November 15, 1997 through and including February 14,
1998, holders of the Exchange Preferred Stock will receive dividends on
February 15, 1998 from the date of initial issuance of the Exchange Preferred
Stock, plus an amount equal to the declared and accrued, but unpaid, dividends
on the Original Preferred Stock to the date of exchange thereof. Dividends
declared on the Original Preferred Stock accepted for exchange will cease
21
<PAGE>
to accrue upon issuance of the Exchange Preferred Stock in exchange therefor.
The amount of dividends payable in respect of the Exchange Preferred Stock
will be adjusted in the event of certain amendments to the Code in respect of
the dividends received deduction. See "Description of the Exchange Preferred
Stock--Dividends."
PROCEDURES FOR TENDERING
Only a registered holder of Original Preferred Stock may tender such
Original Preferred Stock in the Exchange Offer. To tender in the Exchange
Offer, a holder must complete, sign and date the Letter of Transmittal, or
facsimile thereof, have the signature thereon guaranteed if required by the
Letter of Transmittal, and mail or otherwise deliver such Letter of
Transmittal or such facsimile, and any other required documents, to the
Exchange Agent. In addition, either (i) certificates for Original Preferred
Stock must be received by the Exchange Agent along with the Letter of
Transmittal, or (ii) a timely confirmation of book-entry transfer (a "Book-
Entry Confirmation") of such Original Preferred Stock, if such procedure is
available, into the Exchange Agent's account at DTC pursuant to the procedure
for book-entry transfer described below under "--Book-Entry Transfer" must be
received by the Exchange Agent, or (iii) the holder must comply with the
guaranteed delivery procedures described below. See "--Guaranteed Delivery
Procedures." To be tendered effectively, the Letter of Transmittal and all
other required documents must be received by the Exchange Agent at the address
set forth below under "--Exchange Agent" prior to 5:00 p.m., New York City
time, on the Expiration Date.
A tender by a holder which is not withdrawn prior to the Expiration Date
will constitute an agreement between such holder and the Company in accordance
with the terms and subject to the conditions set forth herein and in the
Letter of Transmittal.
THE METHOD OF DELIVERY OF ORIGINAL PREFERRED STOCK, THE LETTER OF
TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS TO THE EXCHANGE AGENT SHALL BE AT
THE ELECTION AND RISK OF THE HOLDER. INSTEAD OF DELIVERY BY MAIL, IT IS
RECOMMENDED THAT HOLDERS USE AN OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL
CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE
AGENT BEFORE THE EXPIRATION DATE. NO LETTER OF TRANSMITTAL OR ORIGINAL
PREFERRED STOCK SHOULD BE SENT TO THE COMPANY. HOLDERS MAY REQUEST THEIR
RESPECTIVE BROKERS, DEALERS, COMMERCIAL BANKS, TRUST COMPANIES OR OTHER
NOMINEES TO EFFECT THE ABOVE TRANSACTIONS FOR SUCH HOLDERS.
Any beneficial owner whose Original Preferred Stock is registered in the
name of a broker, dealer, commercial bank, trust company or other nominee and
who wishes to tender should contact the registered holder promptly and
instruct such registered holder of Original Preferred Stock to tender on such
beneficial owner's behalf. If such beneficial owner wishes to tender on such
its own behalf, such beneficial owner must, prior to completing and executing
the Letter of Transmittal and delivering such beneficial owner's Original
Preferred Stock, either make appropriate arrangements to register ownership of
the Original Preferred Stock in such beneficial owner's name or obtain a
properly completed stock power from the registered holder of Original
Preferred Stock. Any such transfer of registered ownership may take
considerable time and may not be completed prior to the Expiration Date.
Signatures on a Letter of Transmittal or a notice of withdrawal described
below, as the case be, must be guaranteed by an Eligible Institution (as
defined below) unless the Original Preferred Stock tendered pursuant thereto
is tendered (i) by a registered holder 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. In
the event that signatures on a Letter Transmittal or a notice of withdrawal,
as the case may be, are required to be guaranteed, such guarantor must be (a)
a member firm of a registered national securities exchange or of the National
Association of Securities Dealers, Inc., (b) a commercial bank or trust
company having an office or correspondent in the United States or (c) an
"eligible guarantor institution" within the meaning of Rule 17Ad-15 under the
Exchange Act which is a member of one of the recognized signature guarantee
programs identified in the Letter of Transmittal (each, an "Eligible
Institution").
22
<PAGE>
If the Letter of Transmittal is signed by a person other than the registered
holder of any Original Preferred Stock listed therein, such Original Preferred
Stock must be endorsed or accompanied by a properly completed stock power,
signed by such registered holder as such registered holder's name appears on
such Original Preferred Stock with the signature thereon guaranteed by an
Eligible Institution.
If the Letter of Transmittal or any Original Preferred Stock or stock powers
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, evidence satisfactory to the Company of their
authority to so act must be submitted with the Letter of Transmittal.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance of tendered Original Preferred Stock and withdrawal of
tendered Original Preferred Stock 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 Original Preferred Stock not
validly tendered or any Original Preferred Stock the Company's acceptance of
which would, in the opinion of counsel for the Company, be unlawful. The
Company also reserves the right to waive any defects, irregularities or
conditions of tender as to particular Original Preferred Stock. The Company's
interpretation of the terms and conditions of the Exchange Offer (including
the instructions in the Letter of Transmittal) will be final and binding on
all parties. Unless waived, any defects or irregularities in connection with
tenders of Original Preferred Stock must be cured within such time as the
Company shall determine. Although the Company intends to notify holders of
defects or irregularities with respect to tenders of Original Preferred Stock,
neither the Company, the Exchange Agent nor any other person shall incur any
liability for failure to give such notification. Tenders of Original Preferred
Stock will not be deemed to have been made until such defects or
irregularities have been cured or waived. Any Original Preferred Stock
received by the Exchange Agent that is not properly tendered and as to which
the defects or irregularities have not been cured or waived will be returned
by the Exchange Act to the tendering holders, unless otherwise provided in the
Letter of Transmittal, as soon as practicable following the Expiration Date.
By tendering, each holder will represent to the Company, among other things,
that (i) the Exchange Preferred Stock to be acquired by the holder pursuant to
the Exchange Offer is being obtained in the ordinary course of its business,
(ii) the holder is not engaged in, does not intend to engage in, and has no
arrangement or understanding with any person to participate in, any
distribution of such Exchange Preferred Stock and (iii) the holder is not an
"affiliate" of the Company within the meaning of Rule 405 of the Securities
Act. Each Participating Broker-Dealer must acknowledge that it will deliver a
prospectus meeting the requirements of the Securities Act in connection with
any resale of such Exchange Preferred Stock. See "Plan of Distribution."
BOOK-ENTRY TRANSFER
The Exchange Agent will make a request to establish an account with respect
to the Original Preferred Stock at The Depository Trust Company ("DTC") for
purposes of the Exchange Offer within two business days after the date of this
Prospectus, and any financial institution that is a participant in DTC's
system may make book-entry delivery of Original Preferred Stock by causing DTC
to transfer such Original Preferred Stock into the Exchange Agent's account at
DTC in accordance with DTC's procedures for transfer. However, although
delivery of Original Preferred Stock may be effected through book-entry
transfer at DTC, the Letter of Transmittal or facsimile thereof, with any
required signature guarantees 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, if the guaranteed
delivery procedures described below are to be complied with, within the time
period provided under such procedures. Delivery of documents to DTC does not
constitute delivery to the Exchange Agent.
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GUARANTEED DELIVERY PROCEDURES
Holders who wish to tender their Original Preferred Stock and (i) whose
certificates representing Original Preferred Stock are not immediately
available, (ii) who are unable to complete the procedure for book-entry
transfer on a timely basis, or (iii) who are unable to deliver their
certificates representing Original Preferred Stock, the Letter of Transmittal
or any other required documents to the Exchange Agent prior to the Expiration
Date, may effect a tender if:
(a) the tender is made through an Eligible Institution;
(b) prior to the Expiration Date, the Exchange Agent receives from such
Eligible Institution a properly completed and duly executed Notice of
Guaranteed Delivery (by facsimile transmission, mail or hand delivery)
setting forth the name and address of the holder, the certificate number(s)
of such Original Preferred Stock or the name and number of the holder's
account at DTC, as the case may be, and the number of shares of Original
Preferred Stock tendered, stating that the tender is being made thereby and
guaranteeing that, within three New York Stock Exchange trading days after
the Expiration Date, the Letter of Transmittal (or facsimile thereof)
together with certificate(s) representing the Original Preferred Stock in
proper form for transfer or a Book-Entry Confirmation, as the case may be,
and any other documents required by the Letter of Transmittal will be
deposited by the Eligible Institution with the Exchange Agent; and
(c) such properly completed and executed Letter of Transmittal (or
facsimile thereof), as well as the certificate(s) representing all tendered
Original Preferred Stock in proper form for transfer or a Book-Entry
Confirmation, as the case may be, and all other documents required by the
Letter of Transmittal, are received by the Exchange Agent within three New
York Stock Exchange trading days after the Expiration Date.
Upon request to the Exchange Agent, a Notice of Guaranteed Delivery will be
sent to holders who wish to tender their Original Preferred Stock according to
the guaranteed delivery procedures set forth above.
WITHDRAWAL OF TENDERS
Except as otherwise provided herein, tenders of Original Preferred Stock 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 or facsimile transmission notice
of withdrawal must be received by the Exchange Agent at its address set forth
below under "--Exchange Agent" prior to 5:00 p.m., New York City time, on the
Expiration Date. Any such notice of withdrawal must (i) specify the name of
the person having tendered the Original Preferred Stock to be withdrawn, (ii)
identify the Original Preferred Stock to be withdrawn (including the number of
shares of such Original Preferred Stock and certificate number(s) or, in the
case of Original Preferred Stock transferred by book-entry transfer, the name
and number of the account at DTC to be credited, (iii) specify the name in
which such Original Preferred Stock is to be registered, if different from
that of the withdrawing holder, and (iv) be signed by the holder in the same
manner as the original signature on the Letter of Transmittal by which such
Old Preferred was tendered (including any signature guarantees) or be
accompanied by documents of transfer sufficient to have the transfer of such
Original Preferred Stock into the name of the person withdrawing the tender.
If certificates for Original Preferred Stock 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 Original Preferred Stock has 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 DTC to be
credited with the withdrawn Original Preferred Stock and otherwise comply with
the procedures of DTC. All questions as to the validity, form and eligibility
(including time of receipt) of such notices will be determined by the Company,
whose determination shall be final and binding on all parties. Any Original
Preferred Stock so withdrawn will be deemed not to have been validly tendered
for exchange for purposes of the Exchange Offer. Any Original
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Preferred Stock which has been tendered for exchange but which is not
exchanged for any reason will be returned to the holder thereof without cost
to such holder (or, in the case of Original Preferred Stock tendered by book-
entry transfer into the Exchange Agent's account at DTC pursuant to the book-
entry transfer procedures described above under "--Book-Entry Transfer", such
Original Preferred Stock will be credited to an account maintained with DTC
for the Original Preferred Stock) as soon as practicable after withdrawal,
rejection of tender or termination of the Exchange Offer. Properly withdrawn
Original Preferred Stock may be retendered by following one of the procedures
described under "--Procedures for Tendering Original Preferred Stock" above at
any time on or prior to the Expiration Date.
CONDITIONS TO THE EXCHANGE OFFER
Notwithstanding any other term of the Exchange Offer, the Company will not
be required to accept for exchange, or exchange any Exchange Preferred Stock
for, any Original Preferred Stock, and may terminate the Exchange Offer as
provided herein before the acceptance of any Original Preferred Stock for
exchange, if:
(a) any action or proceeding is instituted or threatened in any court or
by or before any governmental agency with respect to the Exchange Offer
which, in the Company's sole judgment, might materially impair the ability
of the Company to proceed with the Exchange Offer, or any material adverse
development has occurred in any existing action or proceeding with respect
to the Company, which development might, in the Company's sole judgment,
materially impair the ability of the Company to proceed with the Exchange
Offer;
(b) any law, statute, rule or regulation is proposed, adopted or enacted,
or any existing law, statute, rule or regulation is interpreted by the
Staff of the Commission, which, in the Company's sole judgment, might
materially impair the ability of the Company to proceed with the Exchange
Offer;
(c) any governmental approval has not been obtained, which approval the
Company shall, in its sole discretion, deem necessary for the consummation
of the Exchange Offer as contemplated hereby; or
(d) any change, or development involving a prospective change, in the
business or financial affairs of the Company has occurred which, in the
Company's sole judgment, might materially impair the ability of the Company
to proceed with the Exchange Offer.
If the Company determines, in its sole discretion, that any of these
conditions are not satisfied, the Company may (i) refuse to accept any
Original Preferred Stock and return all tendered Original Preferred Stock to
the tendering holders, (ii) extend the Exchange Offer and retain all Original
Preferred Stock tendered prior to the expiration of the Exchange Offer,
subject, however, to the rights of holders to withdraw such Original Preferred
Stock (see "--Withdrawal of Tenders"), or (iii) waive such unsatisfied
conditions with respect to the Exchange Offer and accept all properly tendered
Original Preferred Stock which has not been withdrawn. If such waiver
constitutes a material change to the Exchange Offer, the Company will promptly
disclosure such waiver by means of a prospectus supplemental that will be
distributed to the registered holders, and the Company will extend the
Exchange Offer for a period of five to ten business days, depending upon the
significance of the waiver and the manner of disclosure to the registered
holders, if the Exchange Offer would expire during such five to 10 business
day period.
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 shall not be deemed a
waiver of any such right and each such right shall 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 Original Preferred
Stock tendered, and no Exchange Preferred Stock will be issued in exchange for
any such Original Preferred Stock, if at such time any stop order shall be
threatened or in effect with respect to the Registration Statement.
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EXCHANGE AGENT
BankBoston, N.A. has been appointed as Exchange Agent of the Exchange Offer.
Questions and requests for assistance, requests for additional copies of this
Prospectus or of the Letter of Transmittal and requests for the Notice of
Guaranteed Delivery should be directed to the Exchange Agent addressed as
follows:
By Overnight Courier, Hand Delivery or Registered or Certified Mail:
BankBoston, N.A.
c/o Boston EquiServe L.P.
Attn: Corporate Reorganization
150 Royall Street
Canton, Massachusetts 02021
By Facsimile:
(617) 575-2233
Confirm by Telephone:
(617) 575-3400
FEES AND EXPENSES
The expenses of soliciting tenders will be borne by the Company. The
principal solicitation is being made by mail; however, additional solicitation
may be made by telephone or in person by officers and employees of the Company
and its affiliates.
The Company has not retained any dealer-manager in connection with the
Exchange Offer and will not make any payments to broker-dealers or others
soliciting acceptances of the Exchange Offer. The Company will, however, pay
the Exchange Agent reasonable and customary fees for its services and will
reimburse it for its reasonable out-of-pocket expenses in connection
therewith.
The 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 approximately
$100,000. Such expenses include registration fees, fees and expenses of the
Exchange Agent, accounting and legal fees and printing costs, among others.
The Company will pay all transfer taxes, if any, applicable to the exchange
of Original Preferred Stock pursuant to the Exchange Offer. If, however,
certificates representing Original Preferred Stock for shares not tendered or
accepted for exchange are to be delivered to, or are to be issued in the name
of, any person other than the registered holder of Original Preferred Stock
tendered, or if tendered Original Preferred Stock is registered in the name of
any person other than the person signing the Letter of Transmittal, or if a
transfer tax is imposed for any reason other than the exchange of Original
Preferred Stock pursuant to the Exchange Offer, then the amount of any such
transfer taxes (whether imposed on the registered holder or any other persons)
will be payable by the tendering holder. If satisfactory evidence of payment
of such taxes or exemption therefrom is not submitted with the Letter of
Transmittal, the amount of such transfer taxes will be billed directly to such
tendering holder.
ACCOUNTING TREATMENT
The Exchange Preferred Stock will be recorded at the same carrying value as
the Original Preferred Stock, which is face value, as reflected in the
Company's accounting records on the date that the Exchange Offer is
consummated. Accordingly, no gain or loss for accounting purposes will be
recognized by the Company.
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CONSEQUENCES OF FAILURE TO EXCHANGE
Participation in the Exchange Offer is voluntary, and holders of Original
Preferred Stock should carefully consider whether to accept the terms and
conditions thereof. Holders of the Original Preferred Stock are urged to
consult their own financial and tax advisors in making their decisions as to
what actions to take with respect to the Exchange Offer.
Original Preferred Stock which is not exchanged for Exchange Preferred Stock
pursuant to the Exchange Offer will remain outstanding, continue to accrue
dividends (if declared) and continue to be subject to the restrictions on
transfer under the Securities Act, as set forth in the legends thereon, as a
consequence of the issuance of the Original Preferred Stock pursuant to
exemptions from, or in transactions not subject to, the registration
requirements of the Securities Act and applicable state securities laws.
Accordingly, such Original Preferred Stock may only be resold (i) to the
Company, (ii) to a "qualified institutional buyer" within the meaning of Rule
144A of the Securities Act pursuant to Rule 144A, (iii) to an institutional
"accredited investor" within the meaning of Rule 501(a) (1), (2), (3) or (7)
of the Securities Act, (iv) outside the United States to non-U.S. persons in
compliance with Regulation S of the Securities Act, (v) pursuant to an
effective registration statement, or (vi) pursuant to any other available
exemption from the registration requirements of the Securities Act, in each
case in accordance with any applicable state securities laws. The Company does
not currently anticipate that it will register the Original Preferred Stock
under the Securities Act. Holders of Original Preferred Stock not tendered in
the Exchange Offer will not retain any registration rights under the
Registration Rights Agreement.
DESCRIPTION OF THE EXCHANGE PREFERRED STOCK
The following is a description of the terms of the Exchange Preferred Stock.
This description does not purport to be complete and is subject to, and
qualified in its entirety by reference to, the Delaware General Corporation
Law (the "DGCL"), the Company's Amended and Restated Certificate of
Incorporation, as amended (the "Restated Certificate"), and the New
Certificate of Designation, which will be filed with the Secretary of State of
the State of Delaware as part of the Restated Certificate upon consummation of
the Exchange Offer and a copy of which has been filed as an exhibit to the
Registration Statement. The Restated Certificate has been filed with, and is
available from, the Commission.
GENERAL
The Restated Certificate authorizes the Company to issue 22,000,000 shares
of capital stock, of which 1,999,000 shares shall be designated preferred
stock, no par value per share ("Junior Preferred Stock"), 20,000,000 shares
shall be designated senior preferred stock, $.01 par value per share ("Senior
Preferred Stock" and, together with the Junior Preferred Stock, "Preferred
Stock") and 1,000 shares shall be designated common stock, $.025 par value per
share ("Common Stock"). As of September 15, 1997, there were 6,600,000 shares
of Preferred Stock authorized and issued or reserved for issuance as follows:
5,000,000 shares of Series A Preferred Stock, a series of Senior Preferred
Stock, 1,500,000 shares of Original Preferred Stock, a series of Senior
Preferred Stock, and 100,000 shares of NW Preferred Stock, a series of Junior
Preferred Stock. As of September 15, 1997, 5,000,000 shares of Series A
Preferred Stock, 1,500,000 shares of Original Preferred Stock, no shares of NW
Preferred Stock and 105 shares of Common Stock were issued and outstanding.
All outstanding shares of Common Stock and Preferred Stock are fully paid and
nonassessable, and shares of Exchange Preferred Stock will, upon the Company's
acceptance of shares of Original Preferred Stock in exchange therefor,
likewise be fully paid and nonassessable.
Under the Restated Certificate, the Board of Directors of the Company may
provide for the issuance of Senior or Junior Preferred Stock in one or more
series from time to time, and the rights, preferences, privileges and
restrictions, including dividend rights, voting rights, conversion rights,
terms of redemption and liquidation preferences, of the Senior or Junior
Preferred Stock of each series will be fixed or designated by the Board of
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Directors pursuant to a certificate of designation without any further vote or
action by the Company's stockholders, except that without the vote of the
holders of at least two-thirds of the outstanding shares of Series A Preferred
Stock, the Company shall not (i) issue, from any class or series of stock now
existing or to be created in the future, any shares of stock ranking senior to
the outstanding shares of Series A Preferred Stock as to the payment of
dividends and upon liquidation or (ii) amend the Restated Certificate or the
Company's By-laws, as amended, if such amendment would increase or decrease
the aggregate number of authorized shares of Series A Preferred Stock,
increase or decrease the par value of the shares of Series A Preferred Stock
or alter or change the powers, preferences or special rights of the Series A
Preferred Stock so as to affect the holders of the Series A Preferred Stock
adversely.
The Original Preferred Stock constitutes, and the Exchange Preferred Stock
will constitute, a separate series, consisting of 1,500,000 shares, of the
Senior Preferred Stock. The Original Preferred Stock ranks, and the Exchange
Preferred Stock will, on the date of original issue, rank, on a parity in all
respects with each other outstanding series of the Senior Preferred Stock and
will rank senior in all respects to the Common Stock. No shares of Junior
Preferred Stock are currently outstanding nor will be outstanding upon
consummation of this offering. See "Description of Other Preferred Stock" and
"Description of Common Stock" below.
DIVIDENDS
Holders of shares of the Exchange Preferred Stock will be entitled to
receive cash dividends, as, if and when declared by the Board of Directors of
the Company or a duly authorized committee thereof out of assets of the
Company legally available for payment, at the rate of 6.687% of the
liquidation preference of the Exchange Preferred Stock, or $6.687 per share,
per annum. Dividends on the Exchange Preferred Stock will not be cumulative.
The amount of dividends payable for any period shorter than a full quarterly
dividend period will be calculated on the basis of a 360-day year consisting
of twelve 30-day months. Dividends will be payable to the holders of record at
the close of business on such record date, which shall not be less than five
nor more than 50 days (whether or not a business day) preceding the Dividend
Payment Date (as defined below), as shall be fixed by the Board of Directors
of the Company or a duly authorized committee thereof. Dividends on the
Exchange Preferred Stock will be payable quarterly, as, if and when declared
by the Board of Directors of the Company or a duly authorized committee
thereof on February 15, May 15, August 15 and November 15 of each year (each a
"Dividend Payment Date"). Holders whose Original Preferred Stock is accepted
for exchange will receive declared and accrued, but unpaid, dividends thereon,
if any, to, but not including, the date of issuance of the Exchange Preferred
Stock, such dividends to be payable with the first dividend payment on the
Exchange Preferred Stock, but will not receive any payment in respect of
dividends on the Original Preferred Stock declared and accrued after the
issuance of the Exchange Preferred Stock.
The right of holders of Exchange Preferred Stock to receive dividends is
noncumulative. Accordingly, if the Board of Directors of the Company fails to
declare a dividend on the Exchange Preferred Stock payable on a Dividend
Payment Date, then holders of the Exchange Preferred Stock will have no right
to receive a dividend in respect of the dividend period ending on such
Dividend Payment Date, and the Company will have no obligation to pay any
dividend accrued for such period, whether or not dividends on the Exchange
Preferred Stock are declared payable on any future Dividend Payment Date.
When dividends are not paid in full upon the Exchange Preferred Stock and
any other series of Senior Preferred Stock ranking on a parity as to dividends
with the Exchange Preferred Stock, all dividends declared upon shares of the
Exchange Preferred Stock and any other series of Senior Preferred Stock
ranking on a parity as to dividends shall be declared pro rata so that the
amount of dividends declared per share on the Exchange Preferred Stock and
such other Senior Preferred Stock shall in all cases bear to each other the
same ratio that accrued dividends per share on the Exchange Preferred Stock
for the then-current dividend period (without accumulation of accrued and
unpaid dividends for prior dividend periods unless previously declared) and
such other Senior Preferred Stock bear to each other. Except as provided in
the preceding sentence, unless full dividends for the then-current dividend
period (without accumulation of accrued and unpaid dividends for prior
dividend periods unless previously declared) on the Exchange Preferred Stock
have been, or contemporaneously
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are, paid, or declared and a sum sufficient for the payment thereof has been
or is set apart for such payment, no dividends (other than in Common Stock,
Junior Preferred Stock or any other stock of the Company ranking junior to the
Exchange Preferred Stock as to dividends and upon liquidation) shall be
declared or paid or set aside for payment, nor shall any other distribution be
made on the Common Stock, Junior Preferred Stock or any other stock of the
Company ranking junior to or on a parity with the Exchange Preferred Stock as
to dividends or upon liquidation, nor shall any Common Stock, Junior Preferred
Stock or any other stock of the Company ranking junior to or on a parity with
the Exchange Preferred Stock as to dividends or upon liquidation be redeemed,
purchased or otherwise acquired for any consideration (nor shall any moneys be
paid to, or made available for, a sinking fund for the redemption of any
shares of any such stock) by the Company (except by conversion into or
exchange for stock of the Company ranking junior to the Exchange Preferred
Stock as to dividends and upon liquidation).
Changes in the Dividends Received Percentage
If one or more amendments to the Internal Revenue Code of 1986, as amended
(the "Code"), are enacted that reduce the percentage of the dividends received
deduction (currently 70%) as specified in Section 243(a)(1) of the Code or any
successor provision (the "Dividends Received Percentage"), the amount of each
dividend payable (if declared) per share of the Exchange Preferred Stock for
dividend payments made on or after the effective date of such change shall be
increased by multiplying the amount of the dividend payable described above
(before adjustment) by a factor which shall be the number determined in
accordance with the following formula (the "DRD Formula"), and rounding the
result to the nearest cent (with one-half cent rounded up):
1 - [.35 (1 - .70)]
---------------
1 - [.35 (1 - DRP)]
For the purposes of the DRD Formula, "DRP" means the Dividends Received
Percentage applicable to the dividend in question; provided, however, that if
the Dividends Received Percentage applicable to the dividend in question is
less than 50%, then the DRP will equal .50. No amendment to the Code, other
than a change in the percentage of the dividends received deduction set forth
in Section 243(a)(1) of the Code or any successor provision will give rise to
an adjustment. Notwithstanding the foregoing provisions, in the event that,
with respect to any such amendment, the Company shall receive either (i) an
unqualified opinion of independent recognized tax counsel based upon the
legislation amending or establishing the DRP or upon a published pronouncement
of the Internal Revenue Service (the "IRS") addressing such legislation or
(ii) a private letter ruling or similar form of assurance from the IRS, in
either case to the effect that such an amendment would not apply to dividends
payable on the Exchange Preferred Stock, then any such amendment shall not
result in the adjustment provided for pursuant to the DRD Formula. Unless the
context otherwise requires, references to dividends in this Prospectus shall
mean dividends as adjusted by the DRD Formula. The Company's calculation of
the dividends payable, as so adjusted and as certified accurate as to
calculation and reasonable as to method by the independent certified public
accountants then regularly engaged by the Company, shall be final and not
subject to review.
If any amendment to the Code which reduces the Dividends Received Percentage
is enacted after a dividend payable on a Dividend Payment Date has been
declared but before such dividend has been paid, the amount of dividends
payable on such Dividend Payment Date will not be increased, but instead, an
amount, equal to the excess, if any, of (x) the product of the dividends paid
by the Company on such Dividend Payment Date and the DRD Formula (where the
DRP used in the DRD Formula would be equal to the greater of the reduced
Dividends Received Percentage and .50) over (y) the dividends paid by the
Company on such Dividend Payment Date, will be payable (if declared) on the
next succeeding Dividend Payment Date to holders of the Exchange Preferred
Stock on the record date applicable to such succeeding Dividend Payment Date,
in addition to any other amounts payable on such Dividend Payment Date.
In addition, if an amendment to the Code is enacted that reduces the
Dividends Received Percentage and such reduction retroactively applies to a
Dividend Payment Date as to which the Company previously paid dividends on
shares of the Exchange Preferred Stock (each an "Affected Dividend Payment
Date"), the
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Company will pay (if declared) additional dividends (the "Retroactive
Dividends") on the next succeeding Dividend Payment Date (or if such amendment
is enacted after the dividend payable on such Dividend Payment Date has been
declared, on the second succeeding Dividend Payment Date following the date of
enactment) to holders of the Exchange Preferred Stock on the record date
applicable to such succeeding Dividend Payment Date, in an amount equal to the
excess, if any, of (x) the product of the dividends paid by the Company on
each Affected Dividend Payment Date and the DRD Formula (where the DRP used in
the DRD Formula would be equal to the greater of the reduced Dividends
Received Percentage and .50, applied to each Affected Dividend Payment Date)
over (y) the dividends paid by the Company on each Affected Dividend Payment
Date.
Retroactive Dividends will not be paid in respect of the enactment of any
amendment to the Code if such amendment would not result in an adjustment due
to the Company having received either an opinion of counsel or tax ruling
referred to in the third preceding paragraph. The Company will only make one
payment of Retroactive Dividends.
In the event that the amount of dividend payable per share of the Exchange
Preferred Stock shall be adjusted pursuant to the DRD Formula and/or
Retroactive Dividends are to be paid, the Company will cause notice of each
such adjustment and, if applicable, any Retroactive Dividends to be sent to
the holders of the Exchange Preferred Stock.
See "Certain Federal Income Tax Consequences" for a discussion of certain
Proposals (as defined herein) to reduce the Dividends Received Percentage.
LIQUIDATION RIGHTS
In the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company, the holders of shares of Exchange Preferred Stock
will be entitled to receive out of the assets of the Company available for
distribution to stockholders, before any distribution of assets is made on the
Common Stock, the Junior Preferred Stock or any other class or series of stock
of the Company ranking junior to the Exchange Preferred Stock upon
liquidation, liquidating distributions in the amount of $100.00 per share,
plus an amount equal to the sum of all accrued and unpaid dividends (whether
or not earned or declared) on such shares for the then-current dividend period
to the date of final distribution (without accumulation of accrued and unpaid
dividends for prior dividend periods unless previously declared). If, upon any
voluntary or involuntary dissolution, liquidation or winding up of the
Company, the amounts payable with respect to the Exchange Preferred Stock and
any other shares of stock of the Company ranking as to any such distribution
on a parity with the Exchange Preferred Stock are not paid in full, the
holders of the Exchange Preferred Stock and of such other shares will share
ratably in any such distribution of assets of the Company in proportion to the
full respective distributable amounts to which they are entitled. After
payment of the full amount of the liquidating distributions to which they are
entitled, the holders of the Exchange Preferred Stock will not be entitled to
any further participation in any distribution of assets by the Company.
Neither the sale of all or substantially all of the property or business of
the Company nor the merger or consolidation of the Company into or with any
other corporation shall be deemed to be a dissolution, liquidation or winding
up, voluntary or involuntary, of the Company.
REDEMPTION
The Exchange Preferred Stock is not redeemable prior to August 15, 2007. On
and after such date, the Exchange Preferred Stock is redeemable in cash at the
option of the Company, in whole or in part, from time to time upon not less
than 30 nor more than 60 days' notice, at a redemption price of $100.00 per
share, plus accrued and unpaid dividends (whether or not earned or declared)
for the then-current dividend period to the redemption date (without
accumulation of accrued and unpaid dividends for prior dividend periods unless
previously declared), including any dividends payable due to changes in the
Dividends Received Percentage and Retroactive Dividends. The Exchange
Preferred Stock will not be entitled to the benefits of any sinking fund.
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If fewer than all of the outstanding shares of the Exchange Preferred Stock
are to be redeemed, the number of shares to be redeemed will be determined by
the Board of Directors of the Company and the shares to be redeemed will be
determined by lot or pro rata as determined by the Board of Directors of the
Company or by any other method determined by the Board to be equitable.
Notwithstanding the foregoing, if dividends for the then-current dividend
period to the redemption date (without accumulation of accrued and unpaid
dividends for prior dividend periods unless previously declared) have not been
declared and paid or set apart for payment on all outstanding shares of the
Exchange Preferred Stock, no shares of the Exchange Preferred Stock shall be
redeemed unless all outstanding shares of Exchange Preferred Stock are
simultaneously redeemed, and the Company shall not purchase or otherwise
acquire any shares of Exchange Preferred Stock; provided, however, that the
foregoing shall not prevent the purchase or acquisition of shares of the
Exchange Preferred Stock pursuant to a tender or exchange offer made on the
same terms to all holders of the Exchange Preferred Stock and mailed to the
holders of record of the Exchange Preferred Stock at such holders' addresses
as the same appear on the stock register of the Company; and provided,
further, that if some, but less than all, of the shares of the Exchange
Preferred Stock are to be purchased or otherwise acquired pursuant to such
tender or exchange offer and the number of shares so tendered exceeds the
number of shares so to be purchased or otherwise acquired by the Company, the
shares of the Exchange Preferred Stock tendered will be purchased or otherwise
acquired by the Company on a pro rata basis (with adjustments to eliminate
fractions) according to the number of such shares tendered by each holder
tendering shares of the Exchange Preferred Stock.
Notice of redemption shall be given by mailing the same to each record
holder of the shares of the New Preferred to be redeemed, not less than 30 nor
more than 60 days prior to the date fixed for redemption thereof, to the
respective addresses of such holders as the same shall appear on the stock
register of the Company. Each such notice shall state: (i) the redemption
date; (ii) the number of shares to be redeemed; (iii) the redemption price;
(iv) the place or places where certificates for such shares of Exchange
Preferred Stock are to be surrendered for payment of the redemption price; and
(v) that dividends on the shares to be redeemed will cease to accrue or
accumulate on such redemption date. If fewer than all shares of the Exchange
Preferred Stock held by any holder are to be redeemed, the notice mailed to
such holder shall also specify the number of shares to be redeemed from such
holder.
If notice of redemption has been given, dividends on the shares of Exchange
Preferred Stock so called for redemption shall cease to accrue or accumulate
from and after the redemption date for the shares of the Exchange Preferred
Stock called for redemption (unless default shall be made by the Company in
providing funds for the payment of the redemption price of the shares so
called for redemption), and such shares shall no longer be deemed to be
outstanding, and all rights of the holders thereof as stockholders of the
Company (except the right to receive the redemption price) shall cease. Upon
surrender in accordance with such notice of the certificates representing any
shares of the Exchange Preferred Stock so redeemed (properly endorsed or
assigned for transfer, if the Board of Directors of the Company shall so
require and the notice shall so state), the redemption price set forth above
shall be paid out of funds provided by the Company. The Company's obligation
to provide funds in accordance with the preceding sentence will be deemed
fulfilled if, on or before 12:00 noon, Chicago time on the date fixed for
redemption, the Company irrevocably deposits with a paying agent (which may be
an affiliate of the Company) (a "Paying Agent"), which shall be a bank or
trust company organized and in good standing under the laws of the United
States, the State of Illinois or the State of New York, and having capital,
surplus and undivided profits aggregating at least $10,000,000, funds
necessary for such redemption, including any accrued and unpaid dividends to
the redemption date, with irrevocable instructions and authorization that such
funds be applied to the redemption of the shares of Exchange Preferred Stock
called for redemption upon surrender of certificates for such shares (properly
endorsed or assigned for transfer). BankBoston, N.A. will initially serve as
the Paying Agent. If fewer than all of the shares of the Exchange Preferred
Stock represented by any certificate are redeemed, a new certificate shall be
issued representing the unredeemed shares without cost to the holder thereof.
See "--Transfer Agent, Registrar and Paying Agent."
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VOTING RIGHTS
Except as indicated below or except as expressly required by applicable law,
the holders of the Exchange Preferred Stock will not be entitled to vote.
If dividends payable on any share or shares of the Exchange Preferred Stock
or on any other class or series of Senior Preferred Stock for which dividends
are noncumulative ("Noncumulative Preferred Stock") ranking on a parity with
the Exchange Preferred Stock and upon which like voting rights have been
conferred and are exercisable (excluding any class or series of Noncumulative
Preferred Stock entitled to elect additional directors by a separate vote,
"Voting Preferred Stock") have not been paid or declared and set aside for
payment for the equivalent of six full quarterly dividend periods (whether or
not consecutive), the number of directors of the Company will be increased by
two (without duplication of any increase made pursuant to the terms of any
other class or series of Voting Preferred Stock), and the holders of the
Exchange Preferred Stock, voting as a single class with the holders of the
Voting Preferred Stock, will be entitled to elect such two directors to fill
such newly-created directorships. Such right of the holders of the Exchange
Preferred Stock and the Voting Preferred Stock shall continue until dividends
on the Exchange Preferred Stock and the Voting Preferred Stock have been paid
or declared and set apart for payment regularly for at least one year (i.e.,
four consecutive full quarterly dividend periods). Any such elected directors
shall serve until the Company's next annual meeting of stockholders and until
their respective successors are elected and qualified (notwithstanding that
prior to the end of such term the dividend default shall cease to exist).
The affirmative vote or consent of the holders of at least 66 2/3% of the
outstanding shares of the Exchange Preferred Stock will be required for any
amendment, alteration or repeal of any provisions of the Restated Certificate,
of the Certificate of Designation or of any other certificate amendatory of or
supplemental to the Restated Certificate which would adversely affect the
powers, preferences, privileges or rights of the Exchange Preferred Stock. The
affirmative vote or consent of the holders of at least 66 2/3% of the
outstanding shares of the Exchange Preferred Stock and any other series of
Noncumulative Preferred Stock ranking on a parity with the Exchange Preferred
Stock either as to dividends or upon liquidation, voting as a single class
without regard to series, will be required to issue, authorize or increase the
authorized amount of, or issue or authorize any obligation or security
convertible into or evidencing a right to purchase, any additional class or
series of stock ranking prior to the Exchange Preferred Stock as to dividends
or upon liquidation, or to reclassify any authorized stock of the Company into
such prior shares, but such vote will not be required for the Company to take
any such actions with respect to any stock ranking on a parity with or junior
to the Exchange Preferred Stock. See "--General" above and "Description of
Other Preferred Stock--Series A Preferred Stock" below for a discussion of
certain voting rights of the Series A Preferred Stock.
Subject to such affirmative vote or consent of the holders of the
outstanding shares of the Exchange Preferred Stock, the Company may, by
resolution of its Board of Directors or as otherwise permitted by law, from
time to time alter or change the preferences, rights or powers of the Exchange
Preferred Stock. Nothing in this section shall be taken to require a class
vote or consent in connection with the authorization, designation, increase or
issuance of any shares of any class or series (including additional Exchange
Preferred Stock) ranking junior to or on a parity with the Exchange Preferred
Stock as to dividends and liquidation rights or in connection with the
authorization, designation, increase or issuance of any bonds, mortgages,
debentures or other obligations of the Company.
PREEMPTIVE AND CONVERSION RIGHTS
No holder of the Exchange Preferred Stock will have any preemptive right to
purchase or subscribe for any other shares, rights, options or other
securities of the Company which at any time may be sold or offered for sale by
the Company. The Exchange Preferred Stock is not convertible into shares of
any other class or series of the capital stock of the Company.
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TRANSFER AGENT, REGISTRAR AND PAYING AGENT
The transfer agent, registrar, dividend disbursing agent, paying agent and
redemption agent for the Exchange Preferred Stock is BankBoston, N.A. (the
"Transfer Agent" or "Paying Agent").
DESCRIPTION OF THE ORIGINAL PREFERRED STOCK
The terms of the Original Preferred Stock are substantially similar in all
material respects to those of the Exchange Preferred Stock, except that the
Original Preferred Stock is not registered under the Securities Act and,
therefore, bears legends restructuring their transfer under the Securities Act
and contains provisions regarding minimum unit size, the payment of Additional
Dividends and registration rights. See "Original Preferred Stock Registration
Rights." A copy of the Original Certificate of Designation has been filed
with, and is available from, the Commission.
DESCRIPTION OF OTHER PREFERRED STOCK
The following summary does not purport to be complete and is subject to, and
qualified in its entirety by reference to, the DGCL, the Restated Certificate
and the Certificate of Designation, Preferences and Rights relating to the
Series A Preferred Stock. Such Certificate of Designation, Preferences and
Rights has been filed with, and is available from, the Commission.
SERIES A PREFERRED STOCK
The Series A Preferred Stock has an annual dividend rate of 8.125%.
Dividends are cumulative and payable quarterly. The Company is prohibited from
declaring or paying cash dividends on Common Stock, Junior Preferred Stock or
other series of Senior Preferred Stock on parity with the Series A Preferred
Stock, including the Exchange Preferred Stock and the Original Preferred
Stock, unless full cumulative dividends on all outstanding shares of Series A
Preferred Stock for all past dividend periods have been paid. The Series A
Preferred Stock is not redeemable prior to September 22, 2000. On or after
that date, the Series A Preferred Stock will be redeemable at the option of
the Company, in whole or in part, at a redemption price of $25 per share, plus
accrued and unpaid dividends. Except as required by law and as set forth
herein, the holders of Series A Preferred Stock have no voting rights. In case
the Company shall be in arrears in the payment of six consecutive quarterly
dividends on the outstanding Series A Preferred Stock, the holders of Series A
Preferred Stock, voting separately as a class and in addition to any voting
rights that holders of the Series A Preferred Stock shall have as required by
law, shall have the exclusive right to elect two additional directors beyond
the number to be elected by the stockholders at the next annual meeting of the
stockholders called for the election of directors, and at every subsequent
such meeting at which the terms of office of the directors so elected by the
Series A Preferred Stock expire, provided such arrearage exists on the date of
such meeting or subsequent meetings, as the case may be. Any such elected
directors shall serve until the dividend default shall cease to exist. In
addition, without the vote of the holders of at least two-thirds of the
outstanding shares of Series A Preferred Stock, the Company shall not (i)
issue, from any class or series of stock now existing or to be created in the
future, any shares of stock ranking senior to the outstanding shares of Series
A Preferred Stock as to the payment of dividends and upon liquidation or (ii)
amend the Restated Certificate or the Company's By-laws, as amended, if such
amendment would increase or decrease the aggregate number of authorized shares
of Series A Preferred Stock, increase or decrease the par value of the shares
of Series A Preferred Stock or alter or change the powers, preferences or
special rights of the Series A Preferred Stock so as to affect the holders of
the Series A Preferred Stock adversely. The Series A Preferred Stock carries a
liquidation preference of $25 per share, plus accrued and unpaid dividends.
The Series A Preferred Stock ranks senior with respect to payment of dividends
and liquidation preferences to the Common Stock and Junior Preferred Stock.
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NW PREFERRED STOCK
The Company has authorized the issuance of 100,000 shares of NW Preferred
Stock pursuant to the Keep Well Agreement wherein, among other things, Fuji
Bank has agreed to purchase NW Preferred Stock in an amount required to
maintain the Company's net worth at $500 million. The Company's net worth was
approximately $1.5 billion at December 31, 1996. If and when issued, the NW
Preferred Stock will have an annual dividend rate equal to 1% per annum above
the three-month rate at which deposits in United States dollars are offered by
The Fuji Bank, Limited in London, England to prime banks in the London
interbank market. Dividends on the NW Preferred Stock will be noncumulative
and payable (if declared) quarterly, and the Company will be prohibited from
paying cash dividends on the Common Stock unless full dividends for the then-
current dividend period (without accumulation of accrued and unpaid dividends
for prior dividend periods unless previously declared) on all outstanding
shares of NW Preferred Stock have been declared and paid or declared and a sum
sufficient set aside for such payment. Subject to certain conditions, NW
Preferred Stock will be redeemable at the option of the holder, in whole or in
part, within a specified period of time after the end of a calendar quarter in
an aggregate amount not greater than the excess of the net worth of the
Company as of the end of such calendar quarter over $500 million and at a
redemption price equal to the price paid to the Company upon the issuance
thereof, plus accrued and unpaid dividends for the then-current dividend
period (without accumulation of accrued and unpaid dividends for prior
dividend periods unless previously declared). Except as required by law, the
holders of NW Preferred Stock will have no voting rights. The NW Preferred
Stock will carry a liquidation preference equal to the price paid for each
share upon issuance thereof, plus accrued and unpaid dividends for the then-
current dividend period (without accumulation of accrued and unpaid dividends
for prior dividend periods unless previously declared). The NW Preferred Stock
will rank senior with respect to payment of dividends and liquidation
preference to the Common Stock and junior to the Senior Preferred Stock,
including the Exchange Preferred Stock and the Original Preferred Stock. No
purchases of NW Preferred Stock have been made by Fuji Bank under the Keep
Well Agreement.
DESCRIPTION OF COMMON STOCK
The following summary does not purport to be complete and is subject to, and
qualified in its entirety by reference to, the DGCL and the Restated
Certificate.
All outstanding shares of the Common Stock are held by the Parent. Subject
to the rights of holders of the Senior and Junior Preferred Stock, including
any Preferred Stock offered hereby, the holders of outstanding shares of
Common Stock are entitled to share ratably in dividends declared out of assets
legally available therefor at such time and in such amounts as the Board of
Directors of the Company may from time to time lawfully determine. Each holder
of Common Stock is entitled to one vote for each share held. All shares of
Common Stock currently outstanding are fully paid and nonassessable, not
subject to redemption and assessment and without conversion, preemptive or
other rights to subscribe for or purchase any proportionate part of any new or
additional issues of any class or of securities convertible into stock of any
class.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The Exchange Preferred Stock and payments thereon are generally subject to
taxation by the United States and other taxing jurisdictions to the same
extent and in the same manner as stock of and payments thereon by any other
corporation. The following summary addresses some of the U.S. federal income
tax consequences that may result from the exchange of Original Preferred Stock
for Exchange Preferred Stock and the ownership of the Exchange Preferred Stock
by a U.S. person who holds the Exchange Preferred Stock as a capital asset.
For this purpose, a U.S. person is an individual who is a citizen or resident
of the United States for federal income tax purposes, a corporation,
partnership or other type of entity organized under the laws of the United
States or any political subdivision thereof, an estate whose income is subject
to U.S. federal income tax regardless of its
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source, or a trust if a court within the United States is able to exercise
primary supervision of the administration of the trust and one or more United
States fiduciaries have the authority to control all substantial decisions of
the trust. THIS DISCUSSION DOES NOT PURPORT TO ADDRESS ALL RULES WHICH MAY
APPLY TO THOSE WHO TENDER ORIGINAL PREFERRED STOCK IN THE EXCHANGE OFFER.
PROSPECTIVE TENDERORS SHOULD CONSULT THEIR OWN TAX ADVISORS REGARDING THE
FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSIDERATIONS APPLICABLE TO AN
INVESTMENT IN THE EXCHANGE PREFERRED STOCK.
This discussion reflects current federal income tax laws and regulations and
administrative and judicial interpretations thereof. Changes to any of these
subsequent to the date of this Prospectus may affect the tax consequences
described herein.
EXCHANGE OF ORIGINAL PREFERRED STOCK FOR EXCHANGE PREFERRED STOCK
Under current U.S. federal income tax law, the exchange of Original
Preferred Stock for Exchange Preferred Stock pursuant to the Exchange Offer
should not be a taxable event to a stockholder because the Exchange Preferred
Stock will be by operation of the original terms of the Original Preferred
Stock, pursuant to a unilateral act by the Company and will not result in any
material alteration in the terms of the Original Preferred Stock. If a holder
of Original Preferred Stock exchanges Original Preferred Stock for Exchange
Preferred Stock pursuant to the Exchange Offer, such Exchange Preferred Stock
will have the same adjusted tax basis and holding period as such Original
Preferred Stock immediately prior to the exchange.
DIVIDENDS
Current Law
Distributions on the Exchange Preferred Stock which are paid out of current
earnings and profits, or earnings and profits accumulated after 1984,
generally constitute dividends taxable as ordinary income. To the extent that
the amount of any distribution paid on a share of Exchange Preferred Stock
exceeds the current or accumulated earnings and profits for federal income tax
purposes attributable to that share, such excess will be treated first as a
return of capital (rather than as ordinary income) and will be applied against
and reduce the holder's adjusted tax basis in that share of Exchange Preferred
Stock. Any such amount in excess of the holder's adjusted tax basis will then
be taxed as capital gain. For purposes of the remainder of this discussion, it
is assumed that dividends paid on the Exchange Preferred Stock will constitute
dividends for U.S. federal income tax purposes.
Dividends received by corporations generally will be eligible for the
dividends received deduction as specified in Section 243(a)(1) of the Code.
The dividends received deduction generally is available only with respect to a
dividend received on stock held for more than 45 days during the 90-day period
beginning 45 days before and ending 44 days after the date on which the stock
becomes ex-dividend with respect to such dividend. In the case of a preferred
dividend attributable to a period aggregating in excess of 366 days, the
dividends received deduction is available only with respect to a dividend
received on stock held for more than 90 days during the 180-day period
beginning 90 days before and ending 89 days after the date on which the stock
becomes ex-dividend with respect to such dividend. For these purposes, a
stockholder is deemed to own stock on the day it is sold, but not on the day
it is acquired.
The length of time that a corporate stockholder is deemed to have held stock
for these purposes does not include any period during which the stockholder's
risk of loss with respect to the stock is diminished by reason of the
existence of certain options, contracts to sell, short sales or other similar
transactions. The Taxpayer Reform Act of 1997, which was signed into law on
August 5, 1997, contains a complex set of rules that may limit the
availability of the dividends received deduction for corporate stockholders
who have diminished or who plan to diminish their risk of loss with respect to
either the Original Preferred Stock or the Exchange Preferred Stock. Such
stockholders should consult their own tax advisors regarding the availability
of the dividends received deduction with respect to any dividends paid on the
Exchange Preferred Stock.
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The amount of the dividends received deduction generally will equal 70
percent of the amount of the dividends received, subject to reduction in
certain events, including where a holder has indebtedness outstanding that is
directly attributable to an investment in the Exchange Preferred Stock. For
this purpose, indebtedness of a depository institution attributable to
deposits received in the ordinary course of its business is not treated as
indebtedness directly attributable to an exchange of the Original Preferred
Stock for the Exchange Preferred Stock.
For purposes of the corporate alternative minimum tax, alternative minimum
taxable income is increased by 75% of the amount by which a corporation's
adjusted current earnings exceeds it alternative minimum taxable income prior
to the addition of the applicable tax preference item. The amount of any
dividend that is included in a corporate stockholder's adjusted current
earnings will not be reduced by any dividends received deduction otherwise
allowable with respect to that dividend.
Recent Proposals
On February 6, 1997, the Clinton Administration submitted to Congress a
proposed fiscal 1998 budget. This proposed budget contained certain tax
proposals (the "Proposals") which, if enacted, could have adversely affect
holders of the Exchange Preferred Stock. Under the Proposals, the 70%
dividends received deduction generally available to corporate shareholders, as
discussed above under "Current Law," would have been reduced from 70 percent
to 50 percent for dividends paid or accrued after the 30th day after the date
of enactment of the provision.
The Proposals were not enacted and were not included in the fiscal 1998
budget signed into law, or in any tax legislation signed into law as of the
date of this Registration Statement. However, it is impossible to predict
whether the Proposals will be enacted in the future, either in their original
form or in some other form.
DISPOSITIONS, INCLUDING REDEMPTIONS
Any sale, exchange, redemption or other disposition of the Exchange
Preferred Stock, except in the case of an exchange pursuant to the Exchange
Offer (see "--Exchange of Original Preferred Stock for Exchange Preferred
Stock"), generally will result in taxable gain or loss equal to the difference
between the amount received and the stockholder's adjusted tax basis in the
Exchange Preferred Stock. Such gain or loss generally will be capital gain or
loss and will be long-term capital gain or loss if the holding period for the
Exchange Preferred Stock which includes the holding period for the Original
Preferred Stock exceeds one year.
A redemption of Exchange Preferred Stock may be treated as a dividend,
rather than as payment in exchange for the Exchange Preferred Stock, unless
the redemption is "not essentially equivalent to a dividend" with respect to
the holder within the meaning of Section 302(b)(1) of the Code. In applying
this standard, the holder must take into account not only the Exchange
Preferred Stock and other stock of the Company that it owns directly, but also
the Exchange Preferred Stock and other stock of the Company that it
constructively owns within the meaning of Section 318 of the Code. A
redemption payment made to a holder will be "not essentially equivalent to a
dividend" if it results in a "meaningful reduction" in the holder's aggregate
stock interest in the Company. Because of the ambiguities in applying this
rule, each holder should consult its tax advisor to determine whether a
redemption of Exchange Preferred Stock will be treated as a dividend or as
payment in exchange for the Exchange Preferred Stock. If the redemption
payment were treated as a dividend, the rules discussed above under
"Dividends" apply.
INFORMATION REPORTING AND BACKUP WITHHOLDING
Payments of dividends on shares of Exchange Preferred Stock held of record
by U.S. persons other than corporations and other exempt holders are required
to be reported to the IRS.
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BACKUP WITHHOLDING
Unless a holder provides its correct taxpayer identification number
(employer identification number or social security number) to the Company and
certifies that such number is correct and that such holder is not subject to
backup withholding, a holder may be subject to backup withholding of U.S.
federal income tax at a 31% rate on payments received with respect to the
Exchange Preferred Stock, including payments of proceeds from the sale of
Exchange Preferred Stock. Therefore, each holder should complete and sign the
Substitute Form W-9 included with the Letter of Transmittal so as to provide
the information and certification necessary to avoid backup withholding.
Certain holders (including, among others, corporations and foreign individuals
who comply with certain certification requirements) are not subject to such
backup withholding. Holders should consult their tax advisors for further
information concerning backup withholding and instructions for completing the
Substitute Form W-9 (including how to obtain a taxpayer identification number
if you do not have one and how to complete the Substitute Form W-9) and to
find out whether they are qualified for exemption from backup withholding.
Backup withholding is not an additional federal income tax. Rather, the
federal income tax liability of a person subject to withholding will be
reduced by the amount of tax withheld. If withholding results in an
overpayment of taxes, a refund may be obtained from the IRS.
ORIGINAL PREFERRED STOCK REGISTRATION RIGHTS
Pursuant to the Registration Rights Agreement, the Company has agreed for
the benefit of holders of the Original Preferred Stock (i) to use its
reasonable best efforts to file with the Commission, within 150 days after the
initial issuance of the Original Preferred Stock, an Exchange Offer
Registration Statement under the Securities Act relating to the Exchange Offer
for the Exchange Preferred Stock, which will have terms substantially the same
as the Original Preferred Stock (except that the Exchange Preferred Stock will
be registered under the Securities Act and, therefore, not bear legends
restricting their transfer under the Securities Act and will not contain
provisions regarding minimum unit size, the payment of Additional Dividends or
registration rights) and (ii) to use its reasonable best efforts to cause such
Exchange Offer Registration Statement to be declared effective under the
Securities Act within 180 days after the initial issuance of the Original
Preferred Stock. The Registration Statement is intended to serve as the
Exchange Offer Registration Statement. Promptly after the Exchange Offer
Registration Statement has been declared effective, the Company will offer the
Exchange Preferred Stock in exchange for surrender of the Original Preferred
Stock. The Company will keep the Exchange Offer open until the Expiration
Date. For each share of Original Preferred Stock validly tendered to the
Company pursuant to the Exchange Offer and not validly withdrawn by the holder
thereof, the holder of such share of Original Preferred Stock will receive a
share of Exchange Preferred Stock having a liquidation preference equal to the
liquidation preference of the tendered Exchange Preferred Stock.
If in the reasonable opinion of counsel to the Company there is a question
as to whether the Exchange Offer is permitted by applicable law, the Company
will seek its own no-action letter from the Commission's Staff allowing the
Company to consummate the Exchange Offer. There can be no assurance that the
Commission's Staff would make a similar determination with respect to the
Exchange Offer as it has in other no-action letters to third parties. See "The
Exchange Offer--Resale of Exchange Preferred Stock" and "Plan of
Distribution."
If, (a) because of any change in law or in the applicable interpretations of
the Commission's Staff, the Company is not permitted to effect the Exchange
Offer, or (b) any holder of Original Preferred Stock that is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act
or an institutional "accredited investor" within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act shall notify the Company
within 20 business days after the consummation of the Exchange Offer (i) that
such holder is prohibited by applicable law or Commission policy from
participating in the Exchange Offer, (ii) that such holder may not resell the
Exchange Preferred Stock to the public without a prospectus and that this
Prospectus is not appropriate or available for such resales, or (iii) that
such holder is a broker-dealer and holds Original Preferred
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Stock acquired directly from the Company or one of its affiliates, or (c) for
any reason the Exchange Offer Registration Statement is not declared effective
within 180 days of the initial issuance of the Original Preferred Stock, then
in addition to or in lieu of effecting the registration of the Exchange
Preferred Stock pursuant to the Exchange Offer Registration Statement, the
Company will (i) promptly deliver to the holders written notice thereof and
(ii) at the Company's sole expense, (x) as promptly as practicable, use its
reasonable best efforts to file a shelf registration covering resales of the
Original Preferred Stock (the "Shelf Registration Statement"), (y) use its
reasonable best efforts to cause the Shelf Registration Statement to be
declared effective under the Securities Act and (z) use its reasonable best
efforts to keep effective the Shelf Registration Statement until the earlier
of two years (or such shorter period as may hereafter be provided in Rule
144(k) under the Securities Act, or similar successor role) after the initial
issuance of the Original Preferred Stock, or such time as all of the
applicable Original Preferred Stock has been sold thereunder or otherwise
ceased to be registrable securities within the meaning of the Registration
Rights Agreement. The Company will, in the event that a Shelf Registration
Statement is filed, notify each such holder when the Shelf Registration
Statement for the Original Preferred Stock has become effective and take
certain other actions as are required to permit unrestricted resales of the
Original Preferred Stock. A holder that sells Original Preferred Stock
pursuant 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 a holder (including certain indemnification rights and
obligations). In addition, each holder of Original Preferred Stock will be
required to deliver information to be used in connection with the Shelf
Registration Statement in order to have its Original Preferred Stock included
in the Shelf Registration Statement.
Each share of Original Preferred Stock contains a legend to the effect that
the holder thereof, by its acceptance thereof, is deemed to have agreed to be
bound by the provisions of the Registration Rights Agreement. In that regard,
each holder is deemed to have agreed that, upon receipt of notice from the
Company of the occurrence of any event which makes any statement of a material
fact in the prospectus which is part of the Shelf Registration Statement (or,
in the case of Participating Broker-Dealers, this Prospectus) untrue or which
requires the making of any changes in the prospects which is a part of the
Shelf Registration Statement or this Prospectus in order to make the
statements therein or herein not misleading, such holder (or Participating
Broker-Dealer, as the case may be) will suspend the sale of Original Preferred
Stock pursuant to such prospectus until the Company has amended or
supplemented this Prospectus to correct such misstatement or omission and has
furnished copies of the amended or supplemented prospectus to such holder (or
Participating Broker-Dealer, as the case may be) or the Company has given
notice that the sale of the Exchange Preferred Stock may be resumed, as the
case may be.
If (a) the Exchange Offer Registration Statement or the Shelf Registration
Statement required by the Registration Rights Agreement has not been filed
with the Commission on or prior to the date specified for such filing in the
Registration Rights Agreement, (b) the Exchange Offer Registration Statement
or the Shelf Registration Statement has not been declared effective by the
Commission on or prior to the date specified for such effectiveness in the
Registration Rights Agreement, (c) the Exchange Offer has not been consummated
within 30 business days after the date specified for effectiveness of the
Exchange Offer Registration Statement or (d) if applicable, the Shelf
Registration Statement has been filed and declared effective and at any time
prior to the second anniversary (or such shorter period as may hereafter be
provided in Rule 144(k) under the Securities Act, or similar successor rule)
of the initial issuance of the Original Preferred Stock (other than after such
time as all shares of Original Preferred Stock have been disposed of
thereunder or ceased to be registrable securities under the Registration
Rights Agreement) ceases to be effective, or fails to be usable for its
intended purpose without being succeeded within two business days by a post-
effective amendment to such registration statement that cures such failure and
that is itself immediately declared effective (each such event referred to in
clauses (a) through (d), a "Registration Default"), then, as liquidated
damages, additional dividends (the "Additional Dividends") shall be payable
(if declared) by the Company on the Original Preferred Stock at a rate of
0.25% of the liquidation preference thereof, or $0.25 per share, per annum;
provided, however, that the Additional Dividends rate on the Original
Preferred Stock will not exceed, in the aggregate, 0.25% of the
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liquidation preference thereof, or $0.25 per share, per annum; and provided,
further, that upon the cure of all Registration Defaults or upon the
expiration of two years (or such shorter period as may hereafter be provided
in Rule 144(k) under the Securities Act (or similar successor rule))
commencing on the date of the initial issuance of the Original Preferred
Stock, Additional Dividends on the liquidation amount of the Original
Preferred Stock shall cease to accrue.
Any Additional Dividends payable as described above will be payable (if
declared) in cash on February 15, May 15, August 15 and November 15 of each
year, together with the dividends otherwise payable in respect of the Original
Preferred Stock.
The Registration Rights Agreement is governed by, and construed in
accordance with, the laws of the State of New York. The summary herein of
certain provisions of the Registration Rights Agreement does not purport to be
complete 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 has
been filed as an exhibit to the Registration Statement of which this
Prospectus is a part. In addition, the information set forth above concerning
certain interpretations of, and positions taken by, the Commission's staff is
not intended to constitute legal advice, and prospective investors should
consult their own legal advisors with respect to such matters.
BOOK-ENTRY ISSUANCE
The Exchange Preferred Stock initially will be represented by one or more
certificates in registered, global form (collectively, the "Global
Securities"). The Global Securities will be deposited upon issuance with, or
on behalf of, DTC, in New York, New York, and registered in the name of DTC or
its nominee, in each case for credit to an account of a direct or indirect
participant in DTC as described below.
Except as set forth below, the Global Securities may be transferred, in
whole and not in part, only to another nominee of DTC or to a successor of DTC
or its nominee. Beneficial interests in the Global Securities may not be
exchanged for Exchange Preferred Stock in certificated form except in the
limited circumstances described below. See "--Exchange of Book-Entry
Securities for Certificated Securities."
In addition, transfer of beneficial interests in the Global Securities will
be subject to the applicable rules and procedures of DTC and its direct or
indirect participants (including, if applicable, those of Euroclear System
("Euroclear") and Cedel Bank, societe anonyme ("CEDEL"), which may change from
time to time.
DEPOSITARY PROCEDURES
General
DTC has advised the Company that DTC is a limited-purpose trust company
created to hold securities for its participating organizations (collectively,
the "Participants") and to facilitate the clearance and settlement of
transactions in those securities between Participants through electronic book-
entry changes in accounts of its Participants. The Participants include
securities brokers and dealers (including the Initial Purchasers), banks,
trust companies, clearing corporations and certain other organizations. Access
to DTC's system is also available to other entities such as banks, brokers,
dealers and trust companies that clear through or maintain a custodial
relationship with a Participant, either directly or indirectly (collectively,
the "Indirect Participants"). Persons who are not Participants may
beneficially own securities held by or on behalf of DTC only through the
Participants or the Indirect Participants. The ownership interest and transfer
of ownership interest of each actual purchaser of each security held by or on
behalf of DTC are recorded on the records of the Participants and Indirect
Participants.
DTC has also advised the Company that, pursuant to procedures established by
it, (i) upon deposit of the Global Securities, DTC will credit the accounts of
Participants who have beneficial interests represented by such
39
<PAGE>
Global Securities with portions of the shares represented by of the Global
Securities and (ii) ownership of such interests in the Global Securities will
be shown on, and the transfer of ownership thereof will be effected only
through, records maintained by DTC (with respect to the Participants) or by
the Participants and the Indirect Participants (with respect to the other
owners of beneficial interests in the Global Securities).
Investors in the Global Securities may hold their interests therein through
DTC if they are Participants in such system, or indirectly through
organizations (including Euroclear and CEDEL) which are Participants in such
system. All interests in a Global Security, including those held through
Euroclear or CEDEL, may be subject to the procedures and requirements of DTC.
Those interests held through Euroclear or CEDEL may also be subject to the
procedures and requirements of such system. The laws of some states require
that certain persons take physical delivery in certificated form of securities
that they own. Consequently, the ability to transfer beneficial interests in a
Global Security to such persons will be limited to that extent. Because DTC
can act only on behalf of Participants, which in turn act on behalf of
Indirect Participants and certain banks, the ability of a person having
beneficial interests in a Global Security to pledge such interests to persons
or entities that do not participate in the DTC system, or otherwise take
actions in respect of such interests, may be affected by the lack of a
physical certificate evidencing such interests. For certain other restrictions
on the transferability of the Global Securities, see "--Exchange of Book-Entry
Securities for Certificated Securities."
Except as described below, owners of interests in the Global Securities will
not have Exchange Preferred Stock registered in their name, will not receive
physical delivery of Exchange Preferred Stock in certificated form and will
not be considered the registered owners or holders thereof for any purpose.
Payments in respect of the Global Securities registered in the name DTC or
its nominee will be payable by the Company through the Paying Agent to DTC in
its capacity as the registered holder. The Company will treat the persons in
whose names the Exchange Preferred Stock, including the Global Securities, are
registered as the owners thereof for the purpose of receiving such payments
and for any and all other purposes whatsoever. Consequently, neither the
Company nor any agent thereof has or will have any responsibility or liability
for (i) any aspect of DTC's records or any Participant's or Indirect
Participant's records relating to, or payments made on account of beneficial
ownership interests in, the Global Securities, or for maintaining, supervising
or reviewing any of DTC's records or any Participant's or Indirect
Participant's records relating to the beneficial ownership interests in the
Global Securities or (ii) any other matter relating to the actions and
practices of DTC or any of its Participants or Indirect Participants. DTC has
advised the Company that its current practice, upon receipt of any payment in
respect of securities such as the Exchange Preferred Stock, is to credit the
accounts of the relevant Participants with the payment on the payment due
date. Payments by the Participants and the Indirect Participants to the
beneficial owners of the Exchange Preferred Stock will be governed by standing
instructions and customary practices and will be the responsibility of the
Participants or the Indirect Participants and will not be the responsibility
of DTC or the Company. The Company will not be liable for any delay by DTC or
any of its Participants in identifying the beneficial owners of the Exchange
Preferred Stock, and the Company may conclusively rely on and will be
protected in relying on instructions from DTC or its nominee for all purposes.
Except for trades involving only Euroclear or CEDEL participants, interests
in the Global Securities will trade in DTC's Same-Day Funds Settlement System,
and secondary market trading activity in such interests will therefore settle
in immediately available funds, subject in all cases to the rules and
procedures of DTC and its participants.
Transfers between Participants in DTC will be effected in accordance with
DTC's procedures, and will be settled in same-day funds. Transfers between
participants in Euroclear or CEDEL will be effected in the ordinary way in
accordance with their respective rules and operating procedures.
Subject to compliance with the transfer restrictions applicable in the
Exchange Preferred Stock described herein, cross-market transfers between the
Participants in DTC, on the one hand, and Euroclear or CEDEL participants, on
the other hand, will be effected through DTC in accordance with DTC's rules on
behalf of Euroclear or CEDEL, as the case may be, by its respective
depositary; however, such cross-market transactions
40
<PAGE>
will require delivery of instructions to Euroclear or CEDEL, as the case may
be, by the counterpart in such system in accordance with the rules and
procedures and within the established deadlines (Brussels time) of such
system. Euroclear or CEDEL, as the case may be, will, if the transaction meets
its settlement requirements, deliver instructions to its respective depositary
to take action to effect final settlement on its behalf by delivering or
receiving interests in the relevant Global Securities in DTC, and making or
receiving payment in accordance with normal procedures of same-day funds
settlement applicable to DTC. Euroclear participants and CEDEL participants
may not deliver instructions directly to the depositaries for Euroclear or
CEDEL.
Because of time zone differences, the securities account of a Euroclear or
CEDEL participant purchasing an interest in a Global Security from a
Participant in DTC will be credited, and any such crediting will be reported
to the relevant Euroclear or CEDEL participant, during the securities
settlement processing day (which must be a business day for Euroclear and
CEDEL) immediately following the settlement date of DTC. Cash received in
Euroclear or CEDEL as a result of sales of interests in a Global Security by
or through a Euroclear or CEDEL participant to a Participant in DTC will be
received with value on the settlement date of DTC but will be available in the
relevant Euroclear or CEDEL cash account only as of the business day for
Euroclear or CEDEL following DTC's settlement date.
DTC has advised the Company that it will take any action permitted to be
taken by a holder of the Exchange Preferred Stock only at the direction of one
or more Participants to whose account with DTC interests in the Global
Securities are credited. However, DTC reserves the right to exchange the
Global Securities for the Exchange Preferred Stock in certificated form and to
distribute such Exchange Preferred Stock to its Participants.
Exchange of Book-Entry Securities for Certificated Securities
A Global Security is exchangeable for Exchange Preferred Stock in registered
certificated form if (i) DTC (x) notifies the Company that it is unwilling or
unable to continue as depositary for the Global Security and the Company
thereupon fails to appoint a successor depositary or (y) has ceased to be a
clearing agency registered under the Exchange Act, or (ii) the Company in its
sole discretion elects to cause the issuance of the Exchange Preferred Stock
in certificated form. In addition, beneficial interests in a Global Security
may be exchanged for certificated Exchange Preferred Stock upon request, but
only upon at least 20 days' prior written notice given to the Company by or on
behalf of DTC in accordance with customary procedures. In all cases,
certificated Exchange Preferred Stock delivered in exchange for any Global
Security or beneficial interests therein will be registered in the names, and
issued in any approved denominations, requested by or on behalf of the
depositary (in accordance with its customary procedures).
The information in this section concerning DTC, Euroclear and CEDEL, and
their book-entry systems, has been obtained from sources that the Company
believes to be reliable, but the Company takes no responsibility for the
accuracy thereof.
Although DTC, Euroclear and CEDEL have agreed to the foregoing procedures to
facilitate transfers of interest in the Global Securities among Participants
in DTC, Euroclear and CEDEL, they are under no obligation to perform or to
continue to perform such procedures, and such procedures may be discontinued
at any time. The Company will have no responsibility for the performance by
DTC, Euroclear or CEDEL or their respective Participants or Indirect
Participants of their respective obligations under the rules and procedures
governing their operations.
41
<PAGE>
PLAN OF DISTRIBUTION
Based on interpretations by the staff of the Commission set forth in several
no-action letters issued to third parties, the Company believes that Exchange
Preferred Stock issued pursuant to the Exchange Offer in exchange for the
Original Preferred Stock 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 of the Securities Act), without
compliance with the registration and prospectus delivery provisions of the
Securities Act, provided that such Exchange Preferred Stock is acquired in the
ordinary course of such holders' business, and such holders are not engaged
in, and do not intend to engage in, and have no arrangement or understanding
with any person to participate in, a distribution of such Exchange Preferred
Stock. Participating Broker-Dealers will be subject to a prospectus delivery
requirement with respect to any resales of Exchange Preferred Stock received
pursuant to the Exchange Offer. To date, the Commission's staff has taken the
position that Participating Broker-Dealers may fulfill their prospectus
delivery requirements with respect to transactions involving an exchange of
securities such as the exchange pursuant to the Exchange Offer (other than a
resale of an unsold allotment from the sale of the Original Preferred Stock to
the Initial Purchasers) with this Prospectus contained in the Exchange Offer
Registration Statement. Pursuant to the Registration Rights Agreement, the
Company has agreed to permit Participating Broker-Dealers and other persons,
if any, subject to similar prospectus delivery requirements to use this
Prospectus in connection with the resale of such Exchange Preferred Stock. The
Company has agreed that, for a period of 180 days after the effective date of
the Exchange Offer Registration Statement, it will make this Prospectus, and
any amendment or supplement to this Prospectus, available to any Participating
Broker-Dealer that requests such documents in the Letter of Transmittal.
Each holder of the Original Preferred Stock who wishes to exchange its
Original Preferred Stock for Exchange Preferred Stock in the Exchange Offer
will be required to make certain representations to the Company as set forth
in "The Exchange Offer--Terms and Conditions of the Letter of Transmittal." In
addition, each holder who is a Participating Broker-Dealer will be required to
acknowledge that it will deliver a prospectus in connection with any resale by
it of such Exchange Preferred Stock.
The Company will not receive any proceeds from any sale of Exchange
Preferred Stock by Participating Broker-Dealers. Exchange Preferred Stock
received by Participating 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 Exchange Preferred Stock 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 at 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
Participating Broker-Dealer and/or the purchasers of any such Exchange
Preferred Stock. Any Participating Broker-Dealer that resells Exchange
Preferred Stock that was received by it for its own account pursuant to the
Exchange Offer and any broker or dealer that participates in a distribution of
such Exchange Preferred Stock may be deemed to be an "underwriter" within the
meaning of the Securities Act and any profit on any such resale of Exchange
Preferred Stock and any commissions or concessions received by any such
persons may be deemed to be underwriting compensation under the Securities
Act. The Letter of Transmittal states that a Participating Broker-Dealer will
not, by acknowledging that it will deliver and by delivering a prospectus, be
deemed to admit that it is an "underwriter" within the meaning of the
Securities Act.
The Company has agreed to pay all expenses incidental to the Exchange Offer,
other than commissions and concessions of any brokers or dealers or other
expenses of holders in connection with the resales of Exchange Preferred
Stock, and will indemnify the Initial Purchasers and Participating Broker-
Dealers selling Exchange Preferred Stock against certain liabilities,
including liabilities under the Securities Act, as set forth in the
Registration Rights Agreement.
42
<PAGE>
LEGAL MATTERS
Certain legal matters regarding the validity of the Exchange Preferred Stock
offered hereby will be passed upon for the Company by Mark J. Ohringer, Esq.,
Associate General Counsel of the Company.
INDEPENDENT PUBLIC ACCOUNTANTS
The financial statements and schedules of the Company incorporated in this
Prospectus by reference to the Company's Annual Report on Form 10-K for the
year ended December 31, 1996 and the financial statements of the Company for
the five years ended December 31, 1996 from which the five-year selected
financial data included in this Prospectus have been derived, have been audited
by Arthur Andersen LLP, independent public accountants, as stated in their
reports with respect thereto, and have been so included in reliance upon the
reports of such firm given upon their authority as experts in accounting and
auditing. The interim financial statements for the periods ended June 30, 1996
and June 30, 1997 have not been audited.
43
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY IN-
FORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS OR THE ACCOMPANYING LETTER OF TRANSMITTAL IN CONNECTION WITH THE
OFFER MADE BY THIS PROSPECTUS. IF GIVEN OR MADE, SUCH INFORMATION OR REPRESEN-
TATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY. NEI-
THER THE DELIVERY OF THIS PROSPECTUS AND THE ACCOMPANYING LETTER OF TRANSMIT-
TAL NOR ANY EXCHANGE MADE HEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE AN IM-
PLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE
THE DATE HEREOF. THIS PROSPECTUS AND THE ACCOMPANYING LETTER OF TRANSMITTAL DO
NOT CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OF-
FER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UN-
LAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
----------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information..................................................... 1
Documents Incorporated By Reference....................................... 1
Prospectus Summary........................................................ 2
Safe Harbor For Forward-Looking Statements................................ 9
The Company............................................................... 9
Capitalization............................................................ 16
Selected Financial Data................................................... 17
Ratios of Earnings to Fixed Charges and Earnings to Combined Fixed Charges
and Preferred Stock Dividends............................................ 18
Use of Proceeds........................................................... 18
The Exchange Offer........................................................ 19
Description of the Exchange Preferred Stock............................... 27
Description of the Original Preferred Stock............................... 33
Description of Other Preferred Stock...................................... 33
Description of Common Stock............................................... 34
Certain Federal Income Tax Consequences................................... 34
Original Preferred Stock Registration Rights.............................. 37
Book-Entry Issuance....................................................... 39
Plan of Distribution...................................................... 42
Legal Matters............................................................. 43
Independent Public Accountants............................................ 43
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
LOGO
HELLER FINANCIAL, INC.
----------------
PROSPECTUS
----------------
OFFER TO EXCHANGE
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES C
FOR ALL OUTSTANDING FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK,
SERIES B
, 1997
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 20. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Registrant, a Delaware corporation, is empowered by Section 145 of the
Delaware General Corporation Law, subject to the procedures and limitations
stated therein, to indemnify any person against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in the defense of any threatened, pending or completed action,
suit or proceeding in which such person is made a party by reason of his being
or having been a director or officer of the Registrant. The statute provides
that indemnification pursuant to its provisions is not exclusive of other
rights of indemnification to which a person may be entitled under any by-law,
agreement, vote of stockholders or disinterested directors, or otherwise. In
effect, the By-Laws of the Registrant provide for indemnification by the
Registrant of its directors and officers to the full extent permitted by the
Delaware General Corporation Law. Also, as permitted by the Delaware General
Corporation Law, the Registrant's Restated Certificate of Incorporation
eliminates the personal liability of each director of the Registrant to the
Registrant or its stockholders for monetary damages arising out of or
resulting from any breach of his fiduciary duty as a director, except where
such director breached his duty of loyalty to the Registrant or its
stockholders, failed to act in good faith, engaged in intentional misconduct
or a knowing violation of the law, paid an unlawful dividend, approved an
unlawful stock purchase or redemption, or obtained an improper personal
benefit.
ITEM 21. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
(a) EXHIBITS.
<TABLE>
<C> <S>
4.1 Amended and Restated Certificate of Incorporation of the
Registrant, as amended, filed as Exhibit 4.1 to the Registrant's
Registration Statement on Form S-3 (File No. 333-38545)
(the "Form S-3") and incorporated herein by reference.
4.2 By-laws of the Registrant, as amended, filed as Exhibit 3(ii) to
the Registrant's Quarterly Report on Form 10-Q for the period
ended June 30, 1996 and incorporated herein by reference.
4.3 Certificate of Designation, Rights and Preferences for the
Original Preferred Stock, filed as Exhibit 3(i)(b) to the
Registrant's Quarterly Report on Form 10-Q for the period ended
June 30, 1997 and incorporated herein by reference.
4.4 Certificate of Designation, Rights and Preferences for the
Exchange Preferred Stock.
4.5 Purchase Agreement dated as of June 11, 1997, among the
Registrant and the Initial Purchasers.
4.6 Registration Rights Agreement dated June 11, 1997, among the
Registrant and the Initial Purchasers.
4.7 Specimen Certificate for Exchange Preferred Stock.
4.8 Amended and Restated Keep Well Agreement between the Fuji Bank,
Limited and the Registrant, as amended, filed as Exhibit 28(a)
to the Registrant's Registration Statement on Form S-3 (File No.
33-51692), Exhibit 10 to the Registrant's Quarterly Report on
Form 10-Q for the period ended March 31, 1995 and Exhibit 10 to
the Registrant's Quarterly Report on Form 10-Q for the period
ended June 30, 1997 and incorporated herein by reference.
5 Opinion of Mark J. Ohringer, Esq., Associate General Counsel of
the Registrant, as to the legality of the securities being
registered.
12 Computation of ratio of earnings to fixed charges, filed as
Exhibit 12 to the Form S-3 and incorporated herein by reference.
</TABLE>
II-1
<PAGE>
<TABLE>
<S> <C>
23.1 Consent of Arthur Andersen LLP, independent auditors.
23.2 Consent of Mark J. Ohringer, Esq. (contained in his opinion filed as Exhibit 5 hereto).
24 Power of Attorney (included on the signature page hereof).
99.1 Form of Letter of Transmittal for Exchange Preferred Stock.
99.2 Form of Notice of Guaranteed Delivery for Exchange Preferred Stock.
99.3 Form of Letter to Clients.
99.4 Form of Letter to The Depository Trust Company and other Registered Holders.
99.5 Guidelines for Certificate of Taxpayer Identification Number on Substitute Form W-9.
</TABLE>
(b) FINANCIAL STATEMENT SCHEDULES.
None.
ITEM 22. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to the registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933 (the "Securities Act");
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-
effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the
registration statement. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table in
the effective Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant
to section 13 or section 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of
the offering.
(4) That, for purposes of determining any liability under the Securities
Act, each filing of the Registrant's annual report pursuant to section 13(a)
or section 15(d) of the Securities Exchange Act of 1934 that is incorporated
by reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
II-2
<PAGE>
(5) Insofar as indemnification for liabilities arising under the Securities
Act, may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
(6) To respond to requests for information that is incorporated by reference
into the prospectus pursuant to Item 4, 10(b), 11, or 13 of this form, within
one business day of receipt of such request, and to send the incorporated
documents by first class mail or other equally prompt means. This includes
information contained in documents filed subsequent to the effective date of
the registration statement through the date of responding to the request.
(7) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the registration statement when it
became effective.
II-3
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THE
REGISTRANT HAS DULY CAUSED THIS REGISTRATION STATEMENT TO BE SIGNED ON ITS
BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF CHICAGO,
STATE OF ILLINOIS ON THE 23RD OF OCTOBER, 1997.
Heller Financial, Inc.
/s/ Richard J. Almeida
By: _________________________________
Richard J. Almeida
Chairman and Chief Executive
Officer
POWER OF ATTORNEY
EACH PERSON WHOSE SIGNATURE APPEARS BELOW HEREBY CONSTITUTES AND APPOINTS
DEBRA H. SNIDER, LAURALEE E. MARTIN AND MARK J. OHRINGER AND EACH OF THEM HIS
TRUE AND LAWFUL ATTORNEYS-IN-FACT AND AGENTS, WITH FULL POWER OF SUBSTITUTION,
TO SIGN ON HIS BEHALF, INDIVIDUALLY AND IN EACH CAPACITY STATED BELOW, ALL
AMENDMENTS AND POST-EFFECTIVE AMENDMENTS TO THIS REGISTRATION STATEMENT ON FORM
S-4 AND TO FILE THE SAME, WITH ALL EXHIBITS THERETO AND ANY OTHER DOCUMENTS IN
CONNECTION THEREWITH, WITH THE COMMISSION UNDER THE SECURITIES ACT, GRANTING
UNTO SAID ATTORNEYS-IN-FACT AND AGENTS FULL POWER AND AUTHORITY TO DO AND
PERFORM EACH AND EVERY ACT AND THING REQUISITE AND NECESSARY TO BE DONE IN AND
ABOUT THE PREMISES, AS FULLY AND TO ALL INTENTS AND PURPOSES AS EACH MIGHT OR
COULD DO IN PERSON, HEREBY RATIFYING AND CONFIRMING EACH ACT THAT SAID
ATTORNEYS-IN-FACT AND AGENTS MAY LAWFULLY DO OR CAUSE TO BE DONE BY VIRTUE
THEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, AS AMENDED, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON OCTOBER 23, 1997.
SIGNATURE AND TITLE SIGNATURE AND TITLE
/s/ Richard J. Almeida /s/ Tsutomu Hayano
_____________________________________ _____________________________________
Richard J. Almeida Tsutomu Hayano
Chairman, Chief Executive Officer Director
(Principal Executive Officer) and
Director
/s/ Mark Kessel
_____________________________________
/s/ Atsushi Takano Mark Kessel
_____________________________________ Director
Atsushi Takano
Director /s/ Masahiro Sawada
_____________________________________
/s/ Yukihiko Chayama Masahiro Sawada
_____________________________________ Director
Yukihiko Chayama
Director /s/ Michael J. Litwin
_____________________________________
/s/ Kenichi Tomita Michael J. Litwin
_____________________________________ Director
Kenichi Tomita
Director
II-4
<PAGE>
SIGNATURE AND TITLE SIGNATURE AND TITLE
/s/ Dennis P. Lockhart /s/ Hideo Nakajima
_____________________________________ _____________________________________
Dennis P. Lockhart Hideo Nakajima
Director Director
/s/ Lauralee E. Martin /s/ Kenichiro Tanaka
_____________________________________ _____________________________________
Lauralee E. Martin Kenichiro Tanaka
Executive Vice President,Chief Director
Financial Officer and Director
(Principal Financial Officer)
/s/ Lawrence G. Hund
_____________________________________
/s/ Takeshi Takahashi Lawrence G. Hund
_____________________________________ Senior Vice President and Controller
Takeshi Takahashi (Principal Accounting Officer)
Director
/s/ Osamu Ogura
_____________________________________
Osamu Ogura
Director
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
------- -------
<C> <S> <C>
4.4 Certificate of Designation, Rights and Preferences for the Ex-
change Preferred Stock.
4.5 Purchase Agreement dated as of June 11, 1997, among the Regis-
trant and the Initial Purchasers.
4.6 Registration Rights Agreement dated June 11, 1997, among the
Registrant and the Initial Purchasers.
4.7 Specimen Certificate for Exchange Preferred Stock.
5 Opinion of Mark J. Ohringer, Esq., Associate General Counsel
of the Registrant, as to the legality of the securities being
registered.
23.1 Consent of Arthur Andersen LLP, independent auditors.
23.2 Consent of Mark J. Ohringer, Esq. (contained in his opinion
filed as Exhibit 5 hereto).
24 Power of Attorney (included on the signature page hereof).
99.1 Form of Letter of Transmittal for Exchange Preferred Stock.
99.2 Form of Notice of Guaranteed Delivery for Exchange Preferred
Stock.
99.3 Form of Letter to Clients.
99.4 Form of Letter to The Depository Trust Company and other Reg-
istered Holders.
99.5 Guidelines for Certificate of Taxpayer Identification Number
on Substitute Form W-9.
</TABLE>
<PAGE>
Exhibit 4.4
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
OF
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK,
SERIES C
(Liquidation Preference $100.00 Per Share)
------------------------------------
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
------------------------------------
The undersigned DOES HEREBY CERTIFY that the following resolutions were
duly adopted by the Board of Directors (the "Board of Directors" or "Board") of
Heller Financial, Inc., a Delaware corporation (the "Corporation"), by unanimous
written consent dated as of October 15, 1997 and in accordance with the
provisions of Section 151 of the Delaware General Corporation Law:
RESOLVED, that pursuant to authority conferred upon the Board of Directors
by the provisions of the Restated Certificate of Incorporation and the By-laws
of the Corporation, the Board of Directors hereby creates one series of the
Senior Preferred Stock, $.01 par value per share, of the Corporation ("Senior
Preferred Stock") and fixes the designation and voting powers of the shares of
such series as follows:
1. Designation. The designation of the series of Senior Preferred Stock
created by these resolutions shall be Fixed Rate Noncumulative Perpetual Senior
Preferred Stock, Series C ("Series C Senior Preferred Stock"). The number of
authorized shares constituting the Series C Senior Preferred Stock is 1,500,000.
The shares of the Series C Senior Preferred Stock shall have a stated value of
$100.000 per share.
2. Voting Rights. The Series C Senior Preferred Stock shall not have any
voting powers, either general or special, except as required by applicable law
and as stated herein.
(a) Unless the vote or consent of the holders of a greater number of
shares shall then be required by law, the consent of the holders of at least 66
2/3% of all of the shares of Series C Senior Preferred Stock at the time
outstanding, given in person or by proxy, either in writing or by a vote at a
meeting called for the purpose at which the holders of shares of Series C Senior
Preferred Stock shall vote together as a separate class, shall be necessary for
authorizing, effecting or validating the amendment, alteration or repeal of any
of the provisions of the Restated Certificate of Incorporation of the
Corporation (the "Restated Certificate"), of this Certificate of Designation,
Preferences and Rights or of any other certificate amendatory of or supplemental
to the Restated
<PAGE>
Certificate (including any certificate of designation, preferences and rights or
any similar document relating to any series of Senior Preferred Stock or any
series of the Preferred Stock, no par value per share, of the Corporation
("Junior Preferred Stock") or of the By-laws of the Corporation which would
adversely affect the preferences, rights, powers or privileges of the Series C
Senior Preferred Stock;
(b) Unless the vote or consent of the holders of a greater number of
shares shall then be required by law, the consent of the holders of at least 66
2/3% of all of the Series C Senior Preferred Stock and all other series of
Senior Preferred Stock for which dividends are noncumulative ("Noncumulative
Senior Preferred Stock") ranking on a parity with shares of the Series C Senior
Preferred Stock, either as to dividends or upon liquidation, at the time
outstanding, given in person or by proxy, either in writing or by a vote at a
meeting called for the purpose at which the holders of shares of the Series C
Senior Preferred Stock and such other series of Noncumulative Senior Preferred
Stock shall vote together as a single class without regard to series, shall be
necessary for authorizing, effecting, increasing or validating the creation,
authorization or issue of any shares of any class of stock of the Corporation
ranking prior to the shares of the Series C Senior Preferred Stock as to
dividends or upon liquidation, or the reclassification of any authorized stock
of the Corporation into any such prior shares, or the creation, authorization or
issue of any obligation or security convertible into or evidencing the right to
purchase any such prior shares.
(c) If, at the time of any annual meeting of stockholders for the
election of directors of the Corporation, a default in preference dividends on
the Series C Senior Preferred Stock or any other class or series of
Noncumulative Senior Preferred Stock ranking on a parity with the Series C
Senior Preferred Stock, either as to dividends or upon liquidation, and upon
which like voting rights have been conferred and are exercisable (excluding any
other class or series of Series C Senior Preferred Stock expressly entitled to
elect additional directors to the Board by a vote separate and distinct from the
vote provided for in this paragraph (c), "Voting Noncumulative Senior Preferred
Stock") shall exist, the number of directors constituting the Board shall be
increased by two (without duplication of any increase made pursuant to the terms
of any other class or series of Voting Noncumulative Senior Preferred Stock),
and the holders of the Series C Senior Preferred Stock and the Voting
Noncumulative Senior Preferred Stock shall have the right at such meeting,
voting together as a single class without regard to class or series (to the
exclusion of the holders of Common Stock, Junior Preferred Stock and of any
series of Senior Preferred Stock which is not Voting Noncumulative Senior
Preferred Stock), to elect two directors of the Corporation to fill such newly
created directorships. Each director elected by the holders of shares of Series
C Senior Preferred Stock and any class or series of Voting Noncumulative
Preferred Stock in an election provided for by this Section 2(c) (herein called
a "Preferred Director") shall continue to serve as such director until the next
annual meeting of stockholders for the election of directors of the Corporation
and until his successor is elected and qualified, notwithstanding that prior to
the end of such term a default in preference dividends shall cease to exist. Any
Preferred Director may be removed by, and shall not be removed except by, the
vote of the holders of record of the outstanding shares of Series C Senior
Preferred Stock and Voting Noncumulative Senior Preferred Stock entitled to have
originally voted for such director's election, voting together as a single class
without regard to class or series, at a meeting of the Corporation's
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<PAGE>
stockholder, or of the holders of shares of Series C Senior Preferred Stock and
Voting Noncumulative Senior Preferred Stock, called for that purpose. So long as
a default in any preference dividends on the Series C Senior Preferred Stock or
any class or series of Voting Noncumulative Senior Preferred Stock shall exist,
(A) any vacancy in the office of a Preferred Director may by filled (except as
provided in the following clause (B)) by an instrument in writing signed by the
remaining Preferred Director and filed with the Corporation and (B) in the case
of the removal of any Preferred Director, the vacancy may be filled by the vote
of the holders of the outstanding shares of Series C Senior Preferred Stock and
Voting Noncumulative Senior Preferred Stock entitled to have originally voted
for the removed director's election, voting together as a single class without
regard to class or series, at the same meeting at which such removal shall be
voted. Each director appointed as aforesaid shall be deemed for all purposes
hereto to be a Preferred Director.
Whenever the term of office of the Preferred Directors shall end a default
in preference dividends shall no longer exist, the number of directors
constituting the Board shall be reduced by two. For purposes hereof, a "default
in preference dividends" on the Series C Series Preferred Stock or any class or
series of Voting Noncumulative Senior Preferred Stock shall be deemed to have
occurred whenever dividends upon the Series C Senior Preferred Stock or such
class or series of Voting Noncumulative Senior Preferred Stock have not been
paid or declared and set aside for payment for the equivalent of six full
quarterly dividends or more (whether or not consecutive), and, having so
occurred, such default shall be deemed to exist thereafter until, but only
until, all dividends on the Series C Senior Preferred Stock or such other class
or series of Voting Noncumulative Senior Preferred Stock have been paid or
declared and set apart for payment regularly for at least one year (i.e., four
consecutive full quarterly dividend periods).
3. Preferences. The Series C Senior Preferred Stock will be fixed rate
noncumulative perpetual (i.e., will be redeemable, if at all, solely at the
option of the Corporation) Senior Preferred Stock and will rank senior to the
Junior Preferred Stock as to payments of dividends and upon liquidation.
4. Dividends.
(a) The holders of shares of the Series C Senior Preferred Stock
shall be entitled to receive cash dividends thereon at a rate per annum of
6.687%, such rate per annum to be computed on the basis of the stated value
thereof of $100.00 per share, and no more, payable (if declared) quarterly out
of the funds of the Corporation legally available for the payment of dividends.
Such dividends shall be payable, when, as and if declared by the Board or a duly
authorized committee thereof, on February 15, May 15, August 15 and November 15
of each year (each a "Dividend Payment Date"), commencing August 15, 1997. Each
such dividend shall be paid to the holders of record of shares of Series C
Senior Preferred Stock as they appear on the stock register of the Corporation
on the close of business on such record date, which shall be not less than five
nor more than 50 days (whether or not business days) preceding the Dividend
Payment Date, as shall be fixed by the Board or a duly authorized committee
thereof. The right of holders of the Series C Senior Preferred Stock shall be
noncumulative. Accordingly, if the Board fails to declare a dividend on the
Series C Senior Preferred
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<PAGE>
Stock payable on a Dividend Payment Date, then holders of Series C Senior
Preferred Stock will have no right to receive a dividend in respect of the
dividend period ending on such Dividend Payment Date, and the Corporation will
have no obligation to pay dividends accrued for such period, whether or not
dividends on the Series C Senior Preferred Stock are declared payable on any
future Dividend Payment Date. The amount of dividends payable for any period
shorter than a full quarterly dividend period will be calculated on the basis of
a 360-day year consisting of twelve 30-day months.
(b) If one or more amendments to the Internal Revenue Code of 1986,
as amended (the "Code"), are enacted that reduce the percentage of the dividends
received deduction (currently 70%) as specified in Section 243(a)(1) of the Code
or any successor provision (the "Dividends Received Percentage"), the amount of
each dividend payable (if declared) per share of the Series C Senior Preferred
Stock for dividend payments made on or after the date of enactment of such
change shall be increased by multiplying the amount of the dividend payable
determined as described above (before adjustment) by a factor, which shall be
the number determined in accordance with the following formula (the "DRD
Formula") and rounding the result to the nearest cent (with one-half cent
rounded up):
1-[.35(1-.70)]
--------------
1-[.35(1-DRP)]
For purposes of the DRD Formula, "DRP" means the Dividends Received
Percentage applicable to the dividend in question; provided, however, that if
the Dividends Received Percentage applicable to the dividend in question is less
than 50%, then the DRP will equal 0.50. No amendment to the Code, other than a
change in the percentage of the dividends received deduction set forth in
Section 243(a)(1) of the Code or any successor provision, will five rise to an
adjustment. Notwithstanding the foregoing provisions, in the event that, with
respect to any such amendment, the Corporation shall receive either (i) an
unqualified opinion of independent recognized tax counsel based upon the
legislation amending or establishing the DRP or upon a published pronouncement
of the Internal Revenue Service (the "IRS") addressing such legislation or (ii)
a private letter ruling or similar form of assurance from the IRS, in either
case to the effect that such an amendment would not apply to dividends payable
on shares of Series C Senior Preferred Stock, then any such amendment shall not
result in the adjustment provided for pursuant to the DRD Formula. The
Corporation's calculation of the dividends payable, as so adjusted and as
certified accurate as to calculation and reasonable as to method by the
independent certified public accountants then regularly engaged by the
Corporation, shall be final and not subject to review.
If any amendment to the Code which reduces the Dividends Received
Percentage is enacted after a dividend payable on a Dividend Payment Date has
been declared but before such dividend has been paid, the amount of dividends
payable on such Dividend Payment Date will not be increased; but instead, an
amount, equal to the excess, if any, of (x) the product of the dividends paid by
the Corporation on such Dividend Payment Dated and the DRD Formula (where the
DRP used in the DRD Formula would be equal to the greater of the reduced
Dividends Received Percentage and 0.50) over
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<PAGE>
(y) the dividends paid by the Corporation on such Dividend Payment Date, will be
payable (if declared) on the next succeeding Dividend Payment Date to holders of
Series Preferred Stock on the record date applicable to such succeeding Dividend
Payment Date, in addition to any other amounts payable on such Dividend Payment
Date.
In addition, if an amendment to the Code is enacted that reduces the
Dividends Received Percentage and such reduction retroactively applies to a
Dividend Payment Date as to which the Corporation previously paid dividends on
shares of Series C Senior Preferred Stock (each an "Affected Dividend Payment
Date"), the Corporation will pay (if declared) additional dividends (the
"Retroactive Dividends") on the next succeeding Dividend Payment Date (or if
such amendment is enacted after the dividend payable on such Dividend Payment
Date has been declared, on the second succeeding Dividend Payment Date following
the date of enactment), to holders of Series C Senior Preferred Stock on the
record date applicable to such succeeding Dividend Payment Date, in an amount
equal to the excess, if any, of (x) the product of the dividends paid by the
Corporation on each Affected Dividend Payment Date and the DRD Formula (where
the DRP used in the DRD Formula would be equal to the greater of the reduced
Dividends Received Percentage and 0.50, applied to each Affected Dividend
Payment Date) over (y) the dividends paid by the Corporation on each Affected
Dividend Payment Date.
Retroactive Dividends will not be paid in respect of the enactment of any
amendment to the Code if such amendment would not result in an adjustment due to
the Corporation having received either an opinion of counsel or tax ruling
referred to in the third preceding paragraph. The Corporation will only make one
payment of Retroactive Dividends.
In the event that the amount of dividends payable per share of Series C
Senior Preferred Stock shall be adjusted pursuant to the DRD Formula and/or
Retroactive Dividends are to be paid, the Corporation will cause notice of each
such adjustment and, if applicable any Retroactive Dividends, to be sent to each
holder of record of the shares of Series C Senior Preferred Stock at such
holder's address as the same appears on the stock register of the Corporation.
(c) So long as any shares of Series C Senior Preferred Shares are
outstanding, no dividend (other than a dividend in Common Stock, Junior
Preferred Stock or any other stock ranking junior to the Series C Senior
Preferred Stock as to dividends and upon liquidation and other than as provided
in subsection (c) of this Section 4) shall be declared or paid or set aside for
payment, nor shall any other distribution be declared or made upon the Common
Stock, Junior Preferred Stock or any other stock ranking junior to or on a
parity with the Series C Senior Preferred Stock as to dividends or upon
liquidation, nor shall any Common Stock, Junior Preferred Stock or other stock
of the Corporation ranking junior to or on a parity with the Series C Senior
Preferred Stock as to dividends or upon liquidation be redeemed, purchased or
otherwise acquired for any consideration (nor shall any funds be paid to, or
made available for, a sinking fund for the redemption of any shares of any such
stock) by the Corporation (except by conversion into or exchange for stock of
the Corporation ranking junior to the Series C Senior Preferred Stock as to
dividends and upon liquidation) unless, in each case, the full dividends on all
outstanding shares of the Series C Senior Preferred Stock shall have been, or
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<PAGE>
contemporaneously are, paid, or declared and a sum sufficient for the payment
thereof has been or is set apart for such payment, for the then-current dividend
period (without accumulation of accrued and unpaid dividends for prior dividend
periods unless previously declared).
(d) When dividends are not paid or declared and set aside for payment
in full, as aforesaid, upon the shares of Series C Senior Preferred Stock and
any other Senior Preferred Stock ranking on a parity as to dividends with the
Series C Senior Preferred Stock, all dividends declared upon shares of Series C
Senior Preferred Stock and any other class or series of Senior Preferred Stock
ranking on a parity as to dividends with the Series C Senior Preferred Stock
shall be declared pro rata so that the amount of dividends declared per share on
the Series C Senior Preferred Stock and such other Senior Preferred Stock shall
in all cases bear to each other the same ratio that dividends per share on the
shares of Series C Senior Preferred Stock for the then-current dividend period
(without accumulation of accrued and unpaid dividends for prior dividend periods
unless previously declared) and such other Senior Preferred Stock bear to each
other. Holders of shares of Series C Senior Preferred Stock shall not be
entitled to any dividend, whether payable in cash, property or stock, in excess
of full dividends for the then-current dividend period (without accumulation of
accrued and unpaid dividends for prior dividend periods unless previously
declared), as herein provided, on the Series C Senior Preferred Stock.
5. Redemption.
(a) The shares of Series C Senior Preferred Stock shall not be
redeemable prior to August 15, 2007. On and after August 15, 2007, the
Corporation, at its option, may redeem shares of the Series C Senior Preferred
Stock, in whole or in part, at any time or from time to time, at a redemption
price of $100.00 per share, plus accrued and unpaid dividends thereon (whether
or not earned or declared) for the then-current dividend period (without
accumulation of accrued and unpaid dividends for prior dividend periods unless
previously declared), including any dividends payable due to changes in the
Dividends Received Percentage and Retroactive Dividends to the date fixed for
redemption. In the event that fewer than all the outstanding shares of Series C
Senior Preferred Stock are to be redeemed pursuant to this Section 5(a), the
number of shares to be redeemed shall be determined by the Board and the shares
to be redeemed shall be determined by lot or pro rata as may be determined by
the Board or by any other method as may be determined by the Board in its sole
discretion to be equitable.
(b) Notwithstanding the foregoing, if dividends for the then-current
dividend period to the redemption date (without accumulation of accrued and
unpaid dividends for prior dividend periods unless previously declared) have not
been declared and paid or set apart for payment on all outstanding shares of
Series C Senior Preferred Stock, no shares of Series C Senior Preferred Stock
shall be redeemed unless all outstanding shares of Series C Senior Preferred
Stock are simultaneously redeemed, and the Corporation shall not purchase or
otherwise acquire any shares of Series C Senior Preferred Stock; provided,
however, that the foregoing shall not prevent the purchase or acquisition of
shares of Series C Senior Preferred Stock pursuant to a tender or exchange offer
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<PAGE>
made on the same terms to all holders of Series C Senior Preferred Stock and
mailed to the holders of record of the Preferred Stock at such holders'
addresses as the same appear on the stock register of the Corporation; provided,
further, that if some, but less than all, of the shares of the Series C Senior
Preferred Stock are to be purchased or otherwise acquired pursuant to such
tender or exchange offer and the number of shares so tendered exceeds the number
of shares so to be purchased or otherwise acquired by the Corporation, the
shares of the Series C Senior Preferred Stock tendered will be purchased or
otherwise acquired by the Corporation on a pro rata basis (with adjustments to
eliminate fractions) according to the number of such shares tendered by each
holder tendering shares of Series C Senior Preferred Stock.
(c) In the event the Corporation shall redeem shares of Series C
Senior Preferred Stock pursuant to subsection (a) of this Section 5, notice of
such redemption shall be given by first class mail, postage prepaid, mailed not
less than 30 nor more than 60 days prior to the redemption date, to each holder
of record of the shares to be redeemed, at such holder's address as the same
appears on the stock register of the Corporation. Each such notice shall state:
(i) the redemption date; (ii) the number of shares of Series C Senior Preferred
Stock to be redeemed and, if fewer than all the shares held by such holder are
to be redeemed, the number of such shares to be redeemed from such holder; (iii)
the redemption price; (iv) the place or places where certificates for such
shares are to be surrendered for payment of the redemption price; and (v) that
dividends on the shares to be redeemed will cease to accrue on such redemption
date.
(d) Notice having been mailed as aforesaid, from and after the
redemption date (unless default shall be made by the Corporation in providing
funds for the payment of the redemption price) dividends on the shares of Series
C Senior Preferred Stock so called for redemption under subsection (a) of this
Section 5 shall cease to accrue, and said shares shall no longer be deemed to be
outstanding, and all rights of the holders thereof as stockholders of the
Corporation (except the right to receive from the Corporation the redemption
price against delivery of such shares) shall cease. Upon surrender in accordance
with said notice of the certificates for any shares so redeemed (properly
endorsed or assigned for transfer, if the Board shall so require and the notice
shall so state), such shares shall be redeemed by the Corporation at the
applicable redemption price. In case fewer than all the shares represented by
any such certificate are redeemed, a new certificate shall be issued
representing the unredeemed shares without cost to the holder thereof.
(e) If the Corporation gives notice of redemption, then, by 12:00
Noon, Chicago time, on the redemption date, the Corporation shall irrevocably
deposit with a paying agent (which may be an affiliate of the Corporation) (the
"Paying Agent"), which shall be a bank or trust company organized and in good
standing under the laws of the United States, the State of Illinois or the State
of New York and having capital, surplus and undivided profits aggregating at
least $10,000,000, funds sufficient to pay the applicable redemption price,
including any accrued and unpaid dividends to the redemption date, and shall
give the Paying Agent irrevocable instructions and authority to pay the
redemption price to the holder or holders of record of the shares of Series C
Senior Preferred Stock upon surrender of certificates for such shares
(previously endorsed or assigned for transfer). If notice of redemption shall
have been given, then upon the date of such deposit, all rights of holder of the
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<PAGE>
shares so called for redemption shall cease, except the right of the holders of
such shares to receive the redemption price against delivery of such shares, but
without interest, and such shares shall cease to be outstanding. The Corporation
shall be entitled to receive, from time to time, from the Paying Agent, the
interest, if any, earned on such funds deposited with the Paying Agent, and the
holders of any shares to be redeemed with such funds shall have no claim to any
such interest. Any funds so deposited which are unclaimed at the end of two
years from such redemption date shall upon demand be repaid to the Corporation,
after which the holders of the shares of Series C Senior Preferred Stock so
called for redemption shall be entitled to look only to the Corporation for
payment thereof.
6. Liquidation Preference.
(a) Upon the dissolution, liquidation or winding up of the
Corporation, voluntary or involuntary, the holders of the shares of Series C
Senior Preferred Stock shall be entitled to receive and be paid out of the
assets of the Corporation available for distribution to its stockholders, before
any payment or distribution shall be made on the Common Stock, the Junior
Preferred Stock or any other class of stock ranking junior to the Series C
Senior Preferred Stock upon liquidation, the amount of $100.00 per share, plus
an amount equal to the sum of all accrued and unpaid dividends (whether or not
earned or declared) on such shares for the then-current dividend period (without
accumulation of accrued and unpaid dividends for prior dividend periods unless
previously declared) to the date of final distribution.
(b) Neither the sale of all or substantially all the property or
business of the Corporation nor the merger or consolidation of the Corporation
into or with any other corporation or the merger or consolidation of any other
corporation into or with the Corporation, shall be deemed to be a dissolution,
liquidation or winding up, voluntary or involuntary, for the purposes of this
Section 6.
(c) After the payment to the holders of the shares of Series C Senior
Preferred Stock of the full preferential amounts provided for in this Section 6,
the holders of the shares of Series C Senior Preferred Stock, as such, shall
have no right or claim to any of the remaining assets of the Corporation.
(d) In the event the assets of the Corporation available for
distribution to the holders of the shares of Series C Senior Preferred Stock
upon any dissolution, liquidation or winding up of the Corporation, whether
voluntary or involuntary, shall be insufficient to pay in full all amounts to
which such holders are entitled pursuant to subsection (a) of this Section 6, no
such distribution shall be made on account of any shares of any other class or
series of Senior Preferred Stock ranking on a parity with the shares of Series C
Senior Preferred Stock upon such dissolution, liquidation or winding up, unless
proportionate distributive amounts shall be paid on account of the shares of
Series C Senior Preferred Stock ratably, in proportion to the full distributable
amounts for which holders of all such parity shares are respectively entitled
upon such dissolution, liquidation or winding up.
7. Conversion and Exchange. The holders of shares of the Series C Senior
Preferred Stock shall not have any rights to convert such shares into, or to
exchange such shares for, shares of
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<PAGE>
Common Stock, any other class or classes of capital stock (or any other
security) or any other series of any class or classes of capital stock (or any
other security) of the Corporation.
8. Priority as to Certain Distributions. As a series of Senior Preferred
Stock, the shares of the Series C Senior Preferred Stock shall be entitled to
such rights and priorities, and subject to such limitations, as to dividends as
are set forth in these resolutions and in the Restated Certificate of
Incorporation of the Corporation.
9. Sinking Fund. No sinking fund shall be provided for the purchase or
redemption of shares of the Series C Senior Preferred Stock.
10. Ranking. Without limitation to any provision set forth in these
resolutions or in the Restated Certificate of Incorporation, it is hereby
confirmed and expressly declared that the Series C Senior Preferred Stock
constitutes a series of Senior Preferred Stock and, accordingly, ranks senior to
all shares of Junior Preferred Stock as to dividends and distributions of assets
upon liquidation, dissolution or winding up.
For purposes hereof, any class or series or stock of the Corporation shall
be deemed to rank:
(a) prior to the Series C Senior Preferred Stock as to dividends or
distribution of assets upon liquidation, dissolution or winding up, if the
holders of such class or series shall be entitled to the receipt of dividends or
of amounts distributable upon liquidation, dissolution or winding up, as the
case may be, in preference or priority to the holders of Series C Senior
Preferred Stock;
(b) on a parity with the Series C Senior Preferred Stock as to
dividends or distribution of assets upon liquidation, dissolution or winding up,
whether or not the dividend rates, dividend payment dates, redemption prices or
liquidation preferences per share thereof are different from those of the Series
C Senior Preferred Stock, if the holders of such class or series of stock and of
the Series C Senior Preferred Stock shall be entitled to the receipt of
dividends or of amounts distributable upon liquidation, dissolution or winding
up, as the case may be, in proportion to their respective dividend amounts or
liquidation preferences, without preference or priority to the holders of Series
C Senior Preferred Stock; and
(c) junior to the Series C Senior Preferred Stock as to dividends or
distribution of assets upon liquidation, dissolution or winding up, if such
stock shall be Common Stock or Junior Preferred Stock or if the holders of the
Series C Senior Preferred Stock shall be entitled to the receipt of dividends or
of amounts distributable upon liquidation, dissolution or winding up, as the
case may be, in preference or priority to the holders of shares of such class or
series.
11. Exclusion of Other Rights. Unless otherwise required by law, shares
of the Series C Senior Preferred Stock shall not have any rights, including
preemptive rights, or preferences other than those specifically set forth herein
or as provided by applicable law.
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<PAGE>
12. Miscellaneous. The Board of Directors may interpret the provisions
hereof to resolve any inconsistency or ambiguity which may arise or be revealed
and if such inconsistency or ambiguity reflects an inaccurate provision hereof,
the Board of Directors may, in appropriate circumstances, authorize the filing
of a certificate of correction pursuant to Delaware law.
13. Change in Number of Shares. As provided in the Restated Certificate of
Incorporation of the Corporation, but subject to applicable law, the Board of
Directors may increase or decrease the number of shares of this series of Senior
Preferred Stock subsequent to the issue of shares of this series, but not below
the number of shares of Series C Senior Preferred Stock then outstanding.
FURTHER RESOLVED, that the 1,500,000 shares of Series C Senior Preferred
Stock authorized for issuance pursuant to the resolutions of this Board of
Directors all constitute Senior Preferred Stock within the 20,000,000 shares
originally authorized pursuant to the resolutions of this Board of Directors.
IN WITNESS WHEREOF, the Corporation has caused its corporate seal to be
hereunto affixed and this Certificate to be signed by Kurt J. Roemer, its Senior
Vice President and Assistant Treasurer, and attested to by Mark J. Ohringer, its
Assistant Secretary, this ____ day of October, 1997.
By:
Kurt J. Roemer
Senior Vice President and
Assistant Treasurer
[SEAL]
ATTEST
By:
Mark J. Ohringer
Assistant Secretary
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<PAGE>
Exhibit 4.5
$150,000,000
HELLER FINANCIAL, INC.
1,500,000 Shares
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B
PURCHASE AGREEMENT
June 11, 1997
Lehman Brothers Inc.
Chase Securities Inc.
Merrill Lynch, Pierce, Fenner
& Smith Incorporated
c/o Lehman Brothers Inc.
Three World Financial Center
New York, New York 10285
Ladies and Gentlemen:
Heller Financial, Inc., a Delaware corporation (the "Company"), proposes to
sell to you (collectively, the "Initial Purchasers") 1,500,000 shares of the
Company's Fixed Rate Noncumulative Perpetual Senior Preferred Stock, Series B
(liquidation preference $100.00 per share) (the "Securities"), bearing cash
dividends that are payable quarterly, if declared, at a rate of 6.687% of the
liquidation preference of the Securities, or $6.687 per share, per annum.
The Securities will be offered without being registered under the
Securities Act of 1933, as amended (the "Securities Act"), in reliance on
exemptions therefrom.
In connection with the sale of the Securities, the Company will prepare a
final offering memorandum (including the documents incorporated by reference
therein, the "Memorandum") setting forth or including a description of the terms
of the Securities, the terms of the offering, a description of the Company and
any material developments relating to the Company occurring after the date of
the most recent financial statements included or incorporated by reference
therein.
1. Representations, Warranties and Agreements of the Company. The Company
represents and warrants to, and agrees with each of the Initial Purchasers that,
as of the date hereof:
(a) The Memorandum will not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading, except that the representations and warranties set forth in
this Section 1(a) do not apply to statements or omissions in the Memorandum
based upon information furnished to the Company in writing by or on behalf
of any Initial Purchaser through you expressly for use therein.
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Reference herein to the Memorandum shall be deemed to refer to and include
any document filed by the Company under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), which is incorporated in the
Memorandum by reference.
(b) It is not required by applicable law or regulation in connection
with the offer, sale and delivery of the Securities to you in the manner
contemplated by this Agreement to register the Securities under the
Securities Act.
(c) The Company and each of its subsidiaries (as defined in Section 14
hereof) have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective
jurisdictions of incorporation, are duly qualified to do business and are
in good standing as foreign corporations in each jurisdiction in which
their respective ownership or lease of property or the conduct of their
respective businesses requires such qualification, except where the failure
to be so qualified could not reasonably be expected to have a material
adverse effect on their businesses or properties, and have all power and
authority necessary to own or hold their respective properties and to
conduct the businesses in which they are engaged.
(d) The Certificate of Designation, Preferences and Rights relating to
the Securities (the "Certificate of Designation") has been duly authorized
and, when filed by the Company with the Secretary of State of the State of
Delaware, will be duly executed and in full force and effect and will
conform to all statements relating thereto in the Memorandum.
(e) This Agreement has been duly authorized, executed and delivered by
the Company and the Registration Rights Agreement relating to the
Securities to be entered into by and among the Company and the Initial
Purchasers (the "Registration Rights Agreement") has been duly authorized
and will be duly executed and delivered by the Company.
(f) The Company has an authorized capitalization as set forth, or
incorporated by reference, in the Memorandum. All of the issued shares of
capital stock of the Company have been duly authorized, validly issued,
fully paid and non-assessable and conform to the descriptions thereof
contained, or incorporated by reference, in the Memorandum; the Securities,
upon issuance and delivery and payment therefor in the manner described
herein, and the Exchange Securities (as defined in the Registration Rights
Agreement), upon issuance and delivery in the manner described in the
Registration Rights Agreement, will be duly authorized, validly issued,
fully paid and non-assessable and will conform to the descriptions thereof
contained in the Memorandum; and all of the issued shares of capital stock
of each subsidiary of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable and, except for Heller
International Group, Inc. (the ownership of which is as described in the
Memorandum) and any subsidiaries that would not be considered "significant
subsidiaries" under Rule 1-02(w) of Regulation S-X promulgated by the
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Securities and Exchange Commission (the "Commission"), are owned directly
or indirectly by the Company, free and clear of all liens, encumbrances,
equities or claims.
(g) The execution, delivery and performance of this Agreement and the
Registration Rights Agreement and the consummation by the Company of the
transactions contemplated herein and therein (the "Company Transactions")
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries is bound or to which any of the
properties or assets of the Company or any of its subsidiaries is subject,
nor will such actions result in any violation of the provisions of the
charter or by-laws of the Company or any of its subsidiaries or any statute
or order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company, any of its subsidiaries or any of
their properties or assets; and except for such consents, approvals,
authorizations, registrations or qualifications as may be required under
applicable state securities laws in connection with the purchase and
distribution of the Securities by the Initial Purchasers and such consents,
approvals, authorizations, registrations or qualifications as may be
required under applicable federal and state securities laws in connection
with the issuance of the Exchange Securities, no consent, approval,
authorization or order of, or filing or registration with, any such court
or governmental agency or body is required for the Company Transactions.
(h) Neither the Company nor any of its subsidiaries has sustained,
since the date of the latest quarterly financial statements included, or
incorporated by reference, in the Memorandum, any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Memorandum; and, since such date, there has not been
any change in the capital stock or long-term debt of the Company or any of
its subsidiaries or any material adverse change, or any development
involving a prospective material adverse change, in or affecting the
general affairs, management, financial position, stockholders' equity or
results of operations of the Company and its subsidiaries, otherwise than
as set forth or contemplated in the Memorandum.
(i) The financial statements (including the related notes and
supporting schedules) incorporated by reference in the Memorandum present
fairly the financial condition and results of operations of the entities
purported to be shown thereby, at the dates and for the periods indicated,
and have been prepared in conformity with generally accepted accounting
principles applied on a consistent basis throughout the periods involved.
(j) Arthur Andersen LLP, who have certified certain financial
statements of the Company, whose report is incorporated by reference in the
Memorandum and who have delivered the initial letter referred to in Section
7(e) hereof, are independent public
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<PAGE>
accountants as required by the Securities Act and the rules and regulations
promulgated thereunder (the "Rules and Regulations") during the periods
covered by the financial statements on which they reported contained in the
Memorandum.
(k) There are no legal or governmental proceedings pending to which
the Company or any of its subsidiaries is a party or of which any property
or asset of the Company or any of its subsidiaries is the subject which, if
determined adversely to the Company or any of its subsidiaries, might have
a material adverse effect on the consolidated financial position,
stockholders' equity, results of operations, business or prospects of the
Company and its subsidiaries; and to the best of the Company's knowledge,
no such proceedings are threatened or contemplated by governmental
authorities or threatened by others.
(l) No relationship, direct or indirect, exists between or among the
Company, on the one hand, and the directors, officers, stockholders,
customers or suppliers of the Company, on the other hand, which is required
to be described in the Memorandum, or the documents incorporated therein by
reference, is not so described.
(m) Since the date as of which information is given in the Memorandum
through the date hereof, and except as may otherwise be disclosed in the
Memorandum, the Company has not (i) issued or granted any securities, (ii)
incurred any liability or obligation, direct or contingent, other than
liabilities and obligations which were incurred in the ordinary course of
business, (iii) entered into any transaction not in the ordinary course of
business or (iv) declared or paid any dividend on its capital stock.
(n) Neither the Company nor any of its subsidiaries (i) is in
violation of its charter or by-laws, (ii) is in default in any material
respect, and no event has occurred which, with notice or lapse of time or
both, would constitute such a default, in the due performance or observance
of any term, covenant or condition contained in any material indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which it is a party or by which it is bound or to which any of its
properties or assets is subject or (iii) is in violation in any material
respect of any law, ordinance, governmental rule, regulation or court
decree to which it or its properties or assets may be subject or has failed
to obtain any material license, permit, certificate, franchise or other
governmental authorization or permit necessary to the ownership of its
properties or assets or to the conduct of its business.
(o) Neither the Company nor any of its subsidiaries is an "investment
company" within the meaning of such term under the Investment Company Act
of 1940, as amended, and the rules and regulations of the Commission
thereunder.
(p) Neither the Company nor any of its affiliates (as defined in Rule
501(b) of Regulation D under the Securities Act, an "Affiliate") has
directly, or through any agent, (i) sold, offered for sale, solicited
offers to buy or otherwise negotiated in respect of, any security (as
defined in the Securities Act) which is or will be integrated with the
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<PAGE>
sale of the Securities in a manner that would require the registration
under the Securities Act of the Securities or (ii) engaged in any form of
general solicitation or general advertising in connection with the offering
of the Securities (as those terms are used in Regulation D under the
Securities Act), or in any conduct that could constitute a public offering
of the Securities within the meaning of Section 4(2) of the Securities Act.
(q) When the Securities are issued and delivered pursuant to this
Agreement, the Securities will not be of the same class (within the meaning
of Rule 144A(d)(3) under the Securities Act) as any security of the Company
that is listed on a national securities exchange registered under Section 6
of the Exchange Act or that is quoted in a United States automated
interdealer quotation system.
(r) On the Closing Date (as defined herein), the Amended and Restated
Keep Well Agreement, dated as of August 28, 1992 and as thereafter amended
and to be amended prior to the Closing Date (as so amended, the "Amended
Keep Well Agreement"), by and between the Company and The Fuji Bank,
Limited ("Fuji Bank"), will conform to the description thereof in the
Memorandum and will be duly authorized, executed and delivered and will
constitute a valid and legally binding obligation of each of the Company
and Fuji Bank.
2. Purchase of the Securities by the Initial Purchasers. On the basis of
the representations and warranties herein contained, and subject to the terms
and conditions herein set forth, the Company agrees to sell to you, and each of
you, severally and not jointly, agrees to purchase from the Company, the number
of Securities as set forth opposite each Initial Purchaser's name in Schedule I
hereto, at a purchase price equal to 100% of their liquidation preference.
As compensation to the Initial Purchasers for their commitments hereunder,
the Company agrees to pay the Initial Purchasers a commission of 2.0% of the
purchase price of the Securities set forth in Schedule I opposite each Initial
Purchaser's name.
The Company shall not be obligated to deliver any of the Securities, except
upon payment for all of the Securities to be purchased as hereinafter provided.
3. Sale and Resale of the Securities by the Initial Purchasers. You have
advised the Company that you propose to offer the Securities for resale upon the
terms and conditions set forth in this Agreement and in the Memorandum. You
hereby represent and warrant to, and agree with, the Company that you (i) are
purchasing the Securities pursuant to a private sale exempt from registration
under the Securities Act, (ii) will not solicit offers for, or offer or sell,
the Securities by means of any form of general solicitation or general
advertising or in any manner involving a public offering within the meaning of
Section 4(2) of the Securities Act, and (iii) will solicit offers for the
Securities only from, and will offer, sell or deliver the Securities, as part of
your initial offering, only to (A) in the case of offers inside the United
States, (x) persons whom you reasonably believe to be qualified institutional
buyers ("Qualified Institutional Buyers") as defined in Rule 144A under the
Securities Act, as such rule may be amended from
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<PAGE>
time to time ("Rule 144A") or, if any such person is buying for one or more
institutional accounts for which such person is acting as fiduciary or agent,
only when such person has represented to you that each such account is a
Qualified Institutional Buyer, to whom notice has been given that such sale or
delivery is being made in reliance on Rule 144A or (y) institutional accredited
investors ("Accredited Investors") as defined in Rule 501(a)(1), (2), (3) or (7)
under Regulation D who execute letters of representation in the form included as
Appendix A to the Memorandum in private sales exempt from registration under the
Securities Act and (B) in the case of offers outside the United States, to
persons other than U.S. persons ("foreign purchasers," which term shall include
dealers or other professional fiduciaries in the United States acting on a
discretionary basis for foreign beneficial owners (other than an estate or
trust)) in compliance with Regulation S under the Securities Act.
4. Delivery of and Payment for the Securities. Payment of the purchase
price for, and delivery of, the Securities shall be made at the offices of
Katten Muchin & Zavis, Chicago, Illinois or at such other place as shall be
agreed upon by the Company and you, at 8:30 a.m. (Chicago time), on June 17,
1997 or at such other time or date as you and the Company shall determine (such
date and time of payment and delivery being herein called the "Closing Date").
On the Closing Date, payment shall be made to the Company in same-day funds by
wire transfer to such account or accounts as the Company shall specify prior to
the Closing Date or by such means as the parties hereto shall agree prior to the
Closing Date against delivery to you of one or more global security certificates
(the "Global Securities") and/or additional certificated securities evidencing
the Securities. Upon delivery, in the case of a Global Security, the Securities
shall be registered in the name of Cede & Co. as nominee of The Depository Trust
Company ("DTC") and, in the other cases, in such names and in such denominations
as the Initial Purchasers shall request in writing not less than two full
business days prior to the Closing Date. For the purpose of expediting the
checking and packaging of the Global Securities and/or other certificates
evidencing the Securities, the Company agrees to make such certificates
available for inspection at least 24 hours prior to the Closing Date.
5. Further Agreements of the Company. The Company agrees:
(a) To furnish to you, without charge, as many copies of the
Memorandum and any supplements and amendments thereto as you may reasonably
request.
(b) Prior to making any amendment or supplement to the Memorandum, the
Company shall furnish a copy thereof to the Initial Purchasers and counsel
to the Initial Purchasers and will not effect any such amendment or
supplement to which the Initial Purchasers shall reasonably object by
notice to the Company after a reasonable period to review, which shall not
in any case be longer than five business days after receipt of such copy.
(c) If, at any time prior to completion of the distribution of the
Securities by you to purchasers, any event shall occur or condition exist
as a result of which it is necessary, in the opinion of counsel for you or
counsel for the Company, to amend or supplement the Memorandum in order
that the Memorandum will not include an untrue
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<PAGE>
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein not misleading in light of the
circumstances existing at the time it is delivered to a purchaser, or if it
is necessary to amend or supplement the Memorandum to comply with
applicable law, to promptly prepare such amendment or supplement as may be
necessary to correct such untrue statement or omission or so that the
Memorandum, as so amended or supplemented, will comply with applicable law
and to furnish you such number of copies as you may reasonably request.
(d) So long as the Securities are outstanding and are "Restricted
Securities" within the meaning of Rule 144(a)(3) under the Securities Act,
to furnish to holders of the Securities and prospective purchasers of
Securities designated by such holders, upon request of such holders or such
prospective purchasers, the information required to be delivered pursuant
to Rule 144A(d)(4) under the Securities Act.
(e) For a period of five years following the date of the Memorandum,
to furnish to the Initial Purchasers copies of all materials furnished by
the Company to its stockholders and all public reports and all reports and
financial statements furnished by the Company to the principal national
securities exchange upon which any securities of the Company may be listed
pursuant to requirements of or agreements with such exchange or to the
Commission pursuant to the Exchange Act or any rule or regulation of the
Commission thereunder.
(f) Promptly from time to time to take such action as the Initial
Purchasers may reasonably request to qualify the Securities for offering
and sale under the securities laws of such jurisdictions as the Initial
Purchasers may request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions for as long
as may be necessary to complete the distribution of the Securities.
(g) Not to offer, sell, contract to sell or otherwise dispose of any
additional securities of the Company substantially similar to the
Securities or any securities convertible into or exchangeable for or that
represent the right to receive any such similar securities, without the
consent (which consent shall not be unreasonably withheld) of the Initial
Purchasers during the period beginning from the date of this Agreement and
continuing to and including the earlier of (i) the termination of trading
restrictions on the Securities under the Securities Act, as communicated to
the Company by the Initial Purchasers, and (ii) 90 days following the
Closing Date.
(h) To use its best efforts to permit the Securities to be eligible
for clearance and settlement through DTC.
(i) To apply the net proceeds from the sale of the Securities being
sold by the Company as set forth in the Memorandum.
(j) Except following the effectiveness of the Registration Statement
(as defined in the Registration Rights Agreement), not to, and will cause
its Affiliates not to, solicit
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any offer to buy or offer to sell the Securities by means of any form of
general solicitation or general advertising (as those terms are used in
Regulation D under the Securities Act) or in any manner involving a public
offering within the meaning of Section 4(2) of the Securities Act.
(k) Not to, and will cause its Affiliates not to, sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any security
(as defined in the Securities Act) in a transaction that could be
integrated with the sale of the Securities in a manner that would require
the registration under the Securities Act of the Securities.
(l) To take such steps as shall be necessary to ensure that neither
the Company nor any subsidiary of the Company shall become an "investment
company" within the meaning of such term under the Investment Company Act
of 1940, as amended, and the rules and regulations of the Commission
thereunder.
6. Expenses. The Company agrees to pay (a) the costs incident to the
authorization, issuance, sale and delivery of the Securities and any taxes
payable in that connection; (b) the costs incident to the preparation and
printing of the Memorandum and any amendments or supplements thereto; (c) the
costs of distributing the Memorandum and any amendments or supplements thereto;
(d) the fees and expenses of qualifying the Securities under the securities laws
of the several jurisdictions as provided in Section 5(f) hereof and of
preparing, printing and distributing a Blue Sky Memorandum (including related
fees and expenses of counsel to the Initial Purchasers); (e) any fees charged by
securities rating services for rating the Securities; and (f) all other costs
and expenses incident to the performance of the obligations of the Company.
7. Conditions to the Initial Purchasers' Obligations. The respective
obligations of the Initial Purchasers hereunder are subject to the accuracy,
when made and on the Closing Date, of the representations and warranties of the
Company contained herein, to the performance by the Company of its obligations
hereunder, and to each of the following additional terms and conditions:
(a) No Initial Purchaser shall have discovered and disclosed to the
Company on or prior to the Closing Date that the Memorandum or any
amendment or supplement thereto contains any untrue statement of a fact
which, in the opinion of Katten Muchin & Zavis, counsel for the Initial
Purchasers ("KMZ"), is material or omits to state any fact which, in the
opinion of KMZ, is material and is required to be stated therein or is
necessary to made the statements therein not misleading.
(b) All corporate proceedings and other legal matters incident to the
authorization, form and validity of this Agreement, the Registration Rights
Agreement, the Memorandum, the Amended Keep Well Agreement and all other
legal matters relating to this Agreement and the transactions contemplated
hereby shall be satisfactory in all respects to KMZ, and the Company shall
have furnished to KMZ all documents
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<PAGE>
and information that KMZ may reasonably request to enable KMZ to pass upon
such matters.
(c) Counsel for the Company shall have furnished to the Initial
Purchasers its written legal opinion addressed to the Initial Purchasers
and dated the Closing Date, in form and substance satisfactory to the
Initial Purchasers, to the effect set forth in Exhibit A hereto and to such
further effect as KMZ may reasonably request.
(d) On or prior to the Closing Date, the Certificate of Designation
shall have been filed with the Secretary of State of the State of Delaware.
(e) You shall have received on the date hereof and the Closing Date a
letter, dated the date hereof and the Closing Date, as the case may be, in
form and substance satisfactory to you, from Arthur Andersen LLP,
independent public accountants, containing statements and information of
the type ordinarily included in accountants' "comfort letters" to
underwriters with respect to the financial statements and certain financial
information contained or incorporated by reference in the Memorandum as
identified by you.
(f) The Company shall have furnished to the Initial Purchasers a
certificate, dated the Closing Date, of the Chief Financial Officer of the
Company stating that:
(i) The representations, warranties and agreements of the Company
in Section 1 hereof are true and correct as of the Closing Date and
the Company has complied with all its agreements contained herein;
(ii) (A) Neither the Company nor any of its subsidiaries has
sustained since the date of the latest quarterly financial statements
included or incorporated by reference in the Memorandum any material
loss or interference with its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Memorandum or (B) since such
date there has not been any change in the capital stock or long-term
debt of the Company or any of its subsidiaries or any change, or any
development involving a prospective change, in or affecting the
general affairs, management, financial position, stockholders' equity
or results of operations of the Company and its subsidiaries,
otherwise than as set forth or contemplated in the Memorandum; and
(iii) She has carefully examined the Memorandum and, in her
opinion (A) the Memorandum, as of its date, did not include any untrue
statement of a material fact and did not omit to state any material
fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and (B)
since the date of the Memorandum, no event has occurred
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which should have been set forth in a supplement or amendment to the
Memorandum.
(g) (i) Neither the Company nor any of its subsidiaries shall have
sustained, since the date of the latest audited financial statements
included or incorporated by reference in the Memorandum, any loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Memorandum or (ii) since such date there shall not
have been any change in the capital stock or long-term debt of the Company
or any of its subsidiaries or any change, or any development involving a
prospective change, in or affecting the general affairs, management,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries, otherwise than as set forth or contemplated
in the Memorandum, the effect of which, in any such case described in
clause (i) and (ii), is, in the judgment of the Initial Purchasers, so
material and adverse as to make it impracticable or inadvisable to proceed
with the offering or the delivery of the Securities on the terms and in the
manner contemplated in the Memorandum.
(h) Subsequent to the execution and delivery of this Agreement (i) no
downgrading shall have occurred in the rating accorded the Securities or
any other outstanding securities of the Company by any "nationally
recognized statistical rating organization," as that term is defined by the
Commission for purposes of Rule 436(g)(2) of the Rules and Regulations and
(ii) no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of
the Securities.
(i) Subsequent to the execution and delivery of this Agreement there
shall not have occurred any of the following: (i) trading in securities
generally on the New York Stock Exchange or the American Stock Exchange or
in the over-the-counter market, or trading in any securities of the Company
on any exchange or in the over-the-counter market, shall have been
suspended or minimum prices shall have been established on any such
exchange or such market by the Commission, by such exchange or market or by
any other regulatory body or governmental authority having jurisdiction,
(ii) a banking moratorium shall have been declared by Federal or state
authorities, (iii) the United States shall have become engaged in
hostilities, there shall have been an escalation in hostilities involving
the United States or there shall have been a declaration of a national
emergency or war by the United States or (iv) there shall have occurred
such a material adverse change in general economic, political or financial
conditions (or the effect of international conditions on the financial
markets in the United States shall be such) as to make it, in the judgment
of a majority in interest of the Initial Purchasers, impracticable or
inadvisable to proceed with the offering or delivery of the Securities on
the terms and in the manner contemplated in the Memorandum.
(j) The Initial Purchasers shall have received on the date hereof the
Registration Rights Agreement executed by the Company.
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(k) KMZ shall have furnished to the Initial Purchasers their written
legal opinion addressed to the Initial Purchasers and dated the Closing
Date, in form and substance satisfactory to the Initial Purchasers.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance satisfactory to KMZ.
8. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Initial
Purchaser, its officers and employees and each person, if any, who controls
any Initial Purchaser within the meaning of the Securities Act, from and
against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of Securities),
to which such Initial Purchaser, officer, employee or controlling person
may become subject, under the Securities Act or otherwise, insofar as such
loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in the Memorandum or in any amendment or supplement thereto,
or (B) in any blue sky application or other document prepared or executed
by the Company (or based upon any written information furnished by the
Company) specifically for the purpose of qualifying any or all of the
Securities under the securities laws of any state or other jurisdiction
(any such application, document or information being hereinafter called a
"Blue Sky Application"), or (ii) the omission or alleged omission to state
in the Memorandum or in any amendment or supplement thereto, or in any Blue
Sky Application, any material fact required to be stated therein or
necessary to make the statements therein not misleading and shall reimburse
each Initial Purchaser and each such officer, employee and controlling
person promptly upon demand for any legal or other expenses reasonably
incurred by that Initial Purchaser, officer, employee or controlling person
in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that the Company shall not be liable in
any such case to the extent that any such loss, claim, damage, liability or
action arises out of, or is based upon, any untrue statement or alleged
untrue statement or omission or alleged omission made in the Memorandum or
in any such amendment or supplement, or in any Blue Sky Application in
reliance upon and in conformity with the written information furnished to
the Company by or on behalf of any Initial Purchaser specifically for
inclusion therein and described in Section 8(e) hereof. The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any Initial Purchaser or to any officer, employee or
controlling person of that Initial Purchaser.
(b) Each Initial Purchaser, severally and not jointly, shall indemnify
and hold harmless the Company, its officers and employees, each of its
directors, and each person, if any, who controls the Company within the
meaning of the Securities Act, from and
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against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company, any such director or
officer, or any controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained (A) in the Memorandum or in any
amendment or supplement thereto, or (B) in any Blue Sky Application or (ii)
the omission or alleged omission to state in the Memorandum or in any
amendment or supplement thereto, or in any Blue Sky Application, any
material fact required to be stated therein or necessary to make the
statements therein not misleading, but in each case only to the extent that
the untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with the written
information furnished to the Company by or on behalf of that Initial
Purchaser specifically for inclusion therein and described in Section 8(e)
hereof, and shall reimburse the Company and any such director, officer or
controlling person for any legal or other expenses reasonably incurred by
the Company or any such director, officer or controlling person in
connection with investigating or defending or preparing to defend against
any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any
liability which any Initial Purchaser may otherwise have to the Company or
any such director, officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Section
8 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have under this Section 8 except to the extent
it has been materially prejudiced by such failure and, provided further,
that the failure to notify the indemnifying party shall not relieve it from
any liability which it may have to an indemnified party otherwise than
under this Section 8. If any such claim or action shall be brought against
an indemnified party, and it shall notify the indemnifying party thereof,
the indemnifying party shall be entitled to participate therein and, to the
extent that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel satisfactory
to the indemnified party. After notice from the indemnifying party to the
indemnified party of its election to assume the defense of such claim or
action, the indemnifying party shall not be liable to the indemnified party
under this Section 8 for any legal or other expenses subsequently incurred
by the indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that (i) if counsel
for the indemnifying party and counsel designated by the indemnified party
jointly determine that there may be a conflict between the positions of the
indemnifying party and of the indemnified party in conducting the defense
of such claim or action or that there may be legal defenses available to
such indemnified party different from or in addition to those available to
the indemnifying party, then counsel for the indemnified party shall be
entitled to conduct the defense to the extent reasonably determined by such
counsel to be necessary to protect the interests of the indemnified party
or parties, and in that event the fees and expenses of such
-12-
<PAGE>
counsel for the indemnified party shall be paid by the Company, and (ii) in
any event, the indemnified party shall be entitled to have counsel chosen
and paid for by such indemnified party participate in, but not conduct, the
defense. Each indemnified party, as a condition of the indemnity
agreements contained in Sections 8(a) and (b) hereof, shall use its best
efforts to cooperate with the indemnifying party in the defense of any such
action or claim. No indemnifying party shall (i) without the prior written
consent of the indemnified parties (which consent shall not be unreasonably
withheld), settle or compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, suit or proceeding
in respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to
such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding, or (ii) be
liable for any settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld), but if settled
with its written consent or if there be a final judgment of the plaintiff
in any such action, the indemnifying party agrees to indemnify and hold
harmless any indemnified party from and against any loss or liability by
reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for
any reason be unavailable to or insufficient to hold harmless an
indemnified party under Sections 8(a) or (b) hereof in respect of any loss,
claim, damage or liability, or any action in respect thereof, referred to
therein, then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate
to reflect the relative benefits received by the Company, on the one hand,
and the Initial Purchasers, on the other hand, from the offering of the
Securities or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company, on the one hand, and the Initial
Purchasers, on the other hand, with respect to the statements or omissions
which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the
Initial Purchasers, on the other hand, with respect to such offering shall
be deemed to be in the same proportion as the total net proceeds from the
offering of the Securities purchased under this Agreement (before deducting
expenses) received by the Company, on the one hand, and the total
underwriting commissions received by the Initial Purchasers with respect to
the Securities purchased under this Agreement, on the other hand, bear to
the total gross proceeds from the offering of the shares of the Securities
under this Agreement. The relative fault shall be determined by reference
to whether the untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to
information supplied by the Company, on the one hand, or the Initial
Purchasers, on the other hand, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
-13-
<PAGE>
The Company and the Initial Purchasers agree that it would not be just and
equitable if contributions pursuant to this Section 8(d) were to be
determined by pro rata allocation (even if the Initial Purchasers were
treated as one entity for such purpose) or by any other method of
allocation which does not take into account the equitable considerations
referred to herein. The amount paid or payable by an indemnified party as
a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section 8(d) shall be deemed to include,
for purposes of this Section 8(d), any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 8(d), no Initial Purchaser shall be required to contribute any
amount in excess of the amount by which the total price at which the
Securities sold and distributed by it was offered to the purchasers exceeds
the amount of any damages which such Initial Purchaser has otherwise paid
or become liable to pay by reason of any untrue or alleged untrue statement
or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation. The Initial Purchasers' obligations
to contribute as provided in this Section 8(d) are several in proportion to
their respective underwriting obligations and not joint.
(e) The Initial Purchasers severally confirm that the statements with
respect to the offering of the Securities set forth in the bottom paragraph
on the cover page, the bottom paragraph on page ii, the penultimate
paragraph on page 33 and the fifth paragraph on page 34 of the Memorandum
are correct and constitute the only information furnished in writing to the
Company by or on behalf of the Initial Purchasers specifically for
inclusion in the Memorandum.
9. Termination. The obligations of the Initial Purchasers hereunder may
be terminated by them by notice given to and received by the Company prior to
delivery of and payment for the Securities if, prior to that time, any of the
events described in Sections 7(g), (h) or (i) hereof shall have occurred or if
the Initial Purchasers shall decline to purchase the Securities for any reason
permitted under this Agreement.
10. Reimbursement of Initial Purchasers' Expenses. If (a) the Company
shall fail to tender the Securities for delivery to the Initial Purchasers for
any reason, or (b) the Initial Purchasers shall decline to purchase the
Securities for any reason permitted under this Agreement, the Company shall
reimburse the Initial Purchasers for the reasonable fees and expenses of their
counsel and for such other out-of-pocket expenses as shall have been incurred by
them in connection with this Agreement and the proposed purchase of the
Securities, and upon demand the Company shall pay the full amount thereof to the
Initial Purchasers.
11. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
-14-
<PAGE>
(a) if to the Initial Purchasers, shall be delivered or sent by mail
or facsimile transmission to Lehman Brothers Inc., Three World Financial
Center, New York, New York 10285, Attention: Syndicate Department (Fax:
212-528-8822);
(b) if to the Company, shall be delivered or sent by mail or facsimile
transmission to the address of the Company set forth in the Memorandum,
Attention: Treasurer (Fax: 312-441-7586), with a copy to Corporate Legal
Services (Fax: 312-441-7173).
Any such statements, requests, notices or agreements shall take effect at
the time of receipt thereof. The Company shall be entitled to act and rely upon
any request, consent, notice or agreement given or made on behalf of the Initial
Purchasers by Lehman Brothers Inc.
12. Persons Entitled to Benefit of Agreement. This Agreement shall inure
to the benefit of and be binding upon the Initial Purchasers, the Company and
their respective successors. This Agreement and the terms and provisions hereof
are for the sole benefit of only those persons, except that (A) the
representations, warranties, indemnities and agreements of the Company contained
in this Agreement shall also be deemed to be for the benefit of the officers and
employees of each Initial Purchaser and the person or persons, if any, who
control each Initial Purchaser within the meaning of Section 15 of the
Securities Act and (B) the indemnity agreement of the Initial Purchasers
contained in Section 8(b) hereof of this Agreement shall be deemed to be for the
benefit of directors, officers and employees of the Company and any person
controlling the Company within the meaning of Section 15 of the Securities Act.
Nothing in this Agreement is intended or shall be construed to give any person,
other than the persons referred to in this Section 12, any legal or equitable
right, remedy or claim under or in respect of this Agreement or any provision
contained herein.
13. Survival. The respective indemnities, representations, warranties and
agreements of the Company and the Initial Purchasers contained in this Agreement
or made by or on behalf of them, respectively, pursuant to this Agreement, shall
survive the delivery of and payment for the Securities and shall remain in full
force and effect, regardless of any investigation made by or on behalf of any of
them or any person controlling any of them.
14. Definition of the Terms "Business Day" and "Subsidiary". For purposes
of this Agreement, (a) "business day" means any day on which the New York Stock
Exchange, Inc. is open for trading and (b) "subsidiary" has the meaning set
forth in Rule 405 of the Rules and Regulations.
15. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of New York.
16. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
17. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
-15-
<PAGE>
If the foregoing correctly sets forth the agreement among the Company and
the Initial Purchasers, please indicate your acceptance in the space provided
for that purpose below.
Very truly yours,
HELLER FINANCIAL, INC.
By: /s/ SIGNATURE
--------------------------
Its:
-------------------------
Accepted:
LEHMAN BROTHERS INC.
By: /s/ SIGNATURE
------------------------
Its:
-----------------------
For itself and the several other
Initial Purchasers named in
Schedule I hereto
-16-
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Number of
Initial Purchasers Securities
- ------------------------------------------------------------ ------------
<S> <C>
Lehman Brothers Inc....................................... 500,000
Chase Securities Inc...................................... 500,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated........ 500,000
------------
Total................................................... 1,500,000
============
</TABLE>
-1-
<PAGE>
EXHIBIT A
FORM OF OPINION OF COUNSEL FOR
HELLER FINANCIAL, INC., TO BE DELIVERED
PURSUANT TO SECTION 7(c)
1. The Company and each of its "significant subsidiaries" (as defined in
Rule 1-02(w) of Regulation S-X promulgated by the Commission) (the "Significant
Subsidiaries") have been duly incorporated and are validly existing as
corporations in good standing under the laws of their respective jurisdictions
of incorporation, are duly qualified to do business and are in good standing as
foreign corporations in each jurisdiction in which their respective ownership or
lease of property or the conduct of their respective businesses requires such
qualification (other than those jurisdictions in which the failure to so qualify
would not have a material adverse effect on the Company or the Company and its
subsidiaries taken as a whole), and have all power and authority necessary to
own or hold their respective properties and conduct the businesses in which they
are engaged.
2. Each of the Purchase Agreement and the Registration Rights Agreement has
been duly authorized, executed and delivered by the Company and constitutes a
valid and legally binding obligation of the Company, enforceable against the
Company in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other similar
laws relating to or affecting creditors' rights generally, general equitable
principles (whether considered in a proceeding in equity or at law) and implied
covenant of good faith and fair dealing.
3. The Certificate of Designation has been duly authorized, executed and
filed with the Secretary of State of the State of Delaware, is in full force and
effect and conforms to all statements relating thereto contained in the
Memorandum.
4. The Amended Keep Well Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding obligation
of the Company, enforceable against the Company in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally, general equitable principles (whether considered in
a proceeding in equity or at law) and implied covenant of good faith and fair
dealing.
5. The execution, delivery and performance of the Purchase Agreement and
the Registration Rights Agreement by the Company and the consummation by the
Company of the transactions contemplated therein will not conflict with, or
constitute a material breach of, or constitute a default under, any material
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its subsidiaries is bound or to which any of the
property or assets
A-1
<PAGE>
of the Company or any of its subsidiaries is subject, nor will such actions
result in any violation of the provisions of the charter or by-laws of the
Company or any of its subsidiaries or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its subsidiaries or any of their respective properties or
assets, the effects of which breach, violation or default would be material to
the Company and its subsidiaries taken as a whole.
6. All of the issued shares of capital stock of the Company and each
significant subsidiary (as such term is defined in the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), have been duly authorized and validly
issued and are fully paid and non-assessable; except as disclosed in the
Memorandum, all shares of each of the Significant Subsidiaries are owned by the
Company free and clear of any pledge, lien, security interest, charge, claim,
equitable right or encumbrance of any kind. The Securities, upon issuance and
delivery and payment therefor in the manner described in the Purchase Agreement,
and the Exchange Securities, upon issuance and delivery in the manner described
in the Registration Rights Agreement, will be duly authorized, validly issued,
fully paid and non-assessable.
7. No consent, approval, authorization, order, registration or
qualification of or which any Federal or state governmental agency or body or
any Delaware governmental agency or body acting pursuant to the Delaware General
Corporation Law or, to my knowledge, any Federal or state court or any Delaware
court acting pursuant to the Delaware General Corporation Law is required for
the issue and sale by the Company of the Securities, the issue by the Company of
the Exchange Securities, or the compliance by the Company with all of the
provisions of the Purchase Agreement and the Registration Rights Agreement,
except for such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws in
connection with the purchase and distribution of the Securities by the Initial
Purchasers and such consents, approvals, authorizations, registrations or
qualifications as may be required under the applicable federal or state
securities or Blue Sky laws in connection with the issuance of the Exchange
Securities.
8. The statements made in the Memorandum under the captions "Description of
the Offered Preferred Stock," "Description of Existing Preferred Stock," and
"Description of Common Stock," insofar as such statements purport to constitute
summaries of the terms of the Securities and the authorized capital stock of the
Company, constitute accurate summaries of the terms of the Securities and the
authorized capital stock of the Company, respectively.
9. All descriptions in the Memorandum (or the documents incorporated
therein by reference) of contracts and other documents which the Company or its
subsidiaries are a party, including (without limitation) the Amended Keep Well
Agreement, are accurate in all material respects; to the best of my knowledge,
there are no franchises, contracts, indentures, mortgages, loan agreements,
notes, leases or other instruments required to be described or referred to in
the Memorandum, or the documents incorporated by reference therein, other than
those described or referred to therein.
A-2
<PAGE>
10. To my knowledge, there is not pending or threatened any legal or
governmental proceeding required to be described in the Memorandum, or the
documents incorporated by reference therein, which is not described as required.
11. Neither the Company nor any of its subsidiaries is required to be
registered as an "investment company" under the Investment Company Act of 1940,
as amended.
12. No registration of the Securities under the Securities Act of 1933, as
amended (the "Securities Act"), is required for the offer and sale of the
Securities by the Company to the Initial Purchasers or the initial reoffer and
resale of the Securities by the Initial Purchasers solely in the manner
contemplated by the Memorandum.
13. When the Securities are issued and delivered pursuant to this
Agreement, such securities will not be of the same class (within the meaning of
Rule 144A(d)(3) under the Securities Act) as any security of the Company that is
listed on a national securities exchange registered under Section 6 of the
Exchange Act or that is quoted in a United States automated interdealer
quotation system.
I have not independently verified the accuracy, completeness or fairness of
the statements made or included in the Memorandum or in the documents
incorporated by reference therein (the "Exchange Act Documents") and take no
responsibility therefor, except as and to the extent set forth in paragraphs
(7), (8) and (9) above. In the course of the preparation by the Company of the
Memorandum, I participated in conferences with certain officers and employees of
the Company, with representatives of Arthur Andersen LLP and with counsel to the
Initial Purchasers. Based on my examination of the Memorandum and the Exchange
Act Documents, my investigations made in connection with the preparation of the
Memorandum and my participation in the conferences referred to above, I have no
reason to believe that the Memorandum, including the Exchange Act Documents
(except for the financial statements and schedules and other financial and
statistical data, as to which I express no opinion or belief), contains any
untrue statement of a material fact or omits to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
A-3
<PAGE>
Exhibit 4.6
================================================================================
REGISTRATION RIGHTS AGREEMENT
Dated as of June 11, 1997
Among
HELLER FINANCIAL, INC.
and
LEHMAN BROTHERS INC.,
CHASE SECURITIES INC.
and
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
as Initial Purchasers
================================================================================
<PAGE>
This Registration Rights Agreement (this "Agreement") is made and entered
into as of June 11, 1997 by and among Heller Financial, Inc., a Delaware
corporation (the "Company"), and Lehman Brothers Inc., Chase Securities Inc. and
Merrill Lynch, Pierce, Fenner & Smith Incorporated (together, the "Initial
Purchasers").
This Agreement is entered into in connection with the Purchase Agreement,
dated as of June 11, 1997, among the Company and the Initial Purchasers (the
"Purchase Agreement"), which provides for the sale by the Company to the Initial
Purchasers of 1,500,000 shares of the Company's Fixed Rate Noncumulative
Perpetual Senior Preferred Stock, Series B, liquidation preference $100.00 per
share (the "Securities"). In order to induce the Initial Purchasers to enter
into the Purchase Agreement, the Company has agreed to provide the registration
rights set forth in this Agreement for the benefit of the Initial Purchasers and
their direct and indirect transferees and assigns. The execution and delivery
of this Agreement is a condition to the Initial Purchasers obligations to
purchase the Securities under the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions. As used in this Agreement, the following capitalized
terms shall have the following meanings:
Additional Dividends: As defined in Section 5 hereof.
Broker-Dealer: Any broker or dealer registered under the Exchange
Act.
Closing Date: The date on which the Securities were sold.
Commission: The Securities and Exchange Commission.
Consummate: An Exchange Offer shall be deemed "Consummated" for
purposes of this Agreement upon the occurrence of (i) the filing and
effectiveness under the Securities Act of the Exchange Offer Registration
Statement relating to the Exchange Securities to be issued in the Exchange
Offer, (ii) the maintenance of such Registration Statement continuously
effective and the keeping of the Exchange Offer open for a period not less
than the minimum period required pursuant to Section 3(b) hereof, and (iii)
the delivery by the Company of the same number of Exchange Securities as
the number of Transfer Restricted Securities that were tendered by Holders
thereof pursuant to the Exchange Offer.
Effectiveness Target Date: As defined in Section 5.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Offer: The registration by the Company under the Securities
Act of the Exchange Securities pursuant to a Registration Statement
pursuant to which the Company offers the Holders of all outstanding
Transfer Restricted Securities the opportunity to exchange all such
outstanding Transfer Restricted Securities held by such Holders for an
-2-
<PAGE>
aggregate number of Exchange Securities equal to the aggregate number of
Transfer Restricted Securities tendered in such exchange offer by such
Holders.
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the Prospectus which forms a part
thereof.
Exchange Securities: The shares of fixed rate noncumulative perpetual
senior preferred stock of the Company to be issued in the Exchange Offer,
which will have terms substantially identical to the Securities (except the
Exchange Securities will not contain terms with respect to transfer
restrictions under the Securities Act, minimum unit size or the payment of
Additional Dividends as Liquidated Damages).
Holders: As defined in Section 2(b) hereof.
Initial Purchasers: As defined in the preamble hereto.
Liquidated Damages: As defined in Section 5 hereof.
NASD: National Association of Securities Dealers, Inc.
Participant: As defined in Section 8(a) hereof.
Person: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political
subdivision thereof.
Prospectus: The prospectus included in a Registration Statement, as
amended or supplemented by any prospectus supplement and by all other
amendments thereto, including post-effective amendments, and all material
incorporated by reference into such Prospectus.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the Company
relating to (a) an offering of Exchange Securities pursuant to an Exchange
Offer or (b) the registration for resale of Transfer Restricted Securities
pursuant to the Shelf Registration Statement, which is filed pursuant to
the provisions of this Agreement, in each case, including the Prospectus
included therein, all amendments and supplements thereto (including post-
effective amendments) and all exhibits and material incorporated by
reference therein.
Securities: As defined in the preamble hereto.
Securities Act: The Securities Act of 1933, as amended.
Shelf Filing Deadline: As defined in Section 4 hereof.
Shelf Registration Statement: As defined in Section 4 hereof.
-3-
<PAGE>
Transfer Restricted Securities: Each Security, until the earliest to
occur of (i) the date on which such Security has been exchanged by a person
other than a Broker-Dealer for an Exchange Security in the Exchange Offer,
(ii) following the exchange by a Broker-Dealer in the Exchange Offer of
such Security for an Exchange Security, the date on which such Exchange
Security 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, (iii) the date on which such
Security has been effectively registered under the Securities Act and
disposed of in accordance with the Shelf Registration Statement or (iv) the
date on which such Security is distributed to the public pursuant to Rule
144 under the Securities Act;
Underwritten Registration or Underwritten Offering: A registration in
which securities of the Company are sold to an underwriter for reoffering
to the public.
2. Securities Subject to This Agreement.
(a) Transfer Restricted Securities. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is deemed to
be a holder of Transfer Restricted Securities (each, a "Holder") whenever
such Person owns Transfer Restricted Securities.
3. Registered Exchange Offer.
(a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in
Section 6(a) below have been complied with), the Company shall (i) use its
reasonable best efforts to cause to be filed with the Commission as soon as
practicable after the Closing Date, but in no event later than 150 days
after the Closing Date, an Exchange Offer Registration Statement under the
Securities Act relating to the Exchange Securities and the Exchange Offer,
(ii) use its reasonable best efforts to cause such Exchange Offer
Registration Statement to become effective at the earliest possible time,
but in no event later than 180 days after the Closing Date, (iii) in
connection with the foregoing, (A) file all pre-effective amendments to
such Exchange Offer Registration Statement as may be necessary in order to
cause such Exchange Offer Registration Statement to become effective, (B)
if applicable, file a post-effective amendment to such Exchange Offer
Registration Statement pursuant to Rule 430A under the Securities Act and
(C) cause all necessary filings in connection with the registration and
qualification of the Exchange Securities to be made under the Blue Sky laws
of such jurisdictions as are necessary to permit Consummation of the
Exchange Offer, and (iv) after the Exchange Offer Registration Statement
has been declared effective, immediately commence the Exchange Offer and
promptly, but in no event later than 30 business days after the date on
which such Exchange Offer Registration Statement was declared effective by
the Commission, issue Exchange Securities in exchange for all Securities
tendered prior thereto in the Exchange Offer. The Exchange Offer
Registration Statement shall be on the appropriate form permitting
registration of the Exchange Securities to be offered in exchange for the
Transfer Restricted Securities
-4-
<PAGE>
and to permit resales of Exchange Securities held by Broker-Dealers as
contemplated by Section 3(c) below.
(b) The Company shall cause the Exchange Offer Registration Statement
to be effective continuously and shall keep the Exchange Offer open for a
period of not less than the minimum period required under applicable
federal and state securities laws to Consummate the Exchange Offer;
provided, however, that in no event shall such period be less than 30
business days. The Company shall cause the Exchange Offer to comply with
all applicable federal and state securities laws. No securities other than
the Exchange Securities shall be included in the Exchange Offer
Registration Statement. The Company shall use its best efforts to cause
the Exchange Offer to be Consummated on the earliest practicable date after
the Exchange Offer Registration Statement has become effective, but in no
event later than 30 business days thereafter.
(c) The Company shall indicate in a "Plan of Distribution" section
contained in the Prospectus contained in the Exchange Offer Registration
Statement that any Broker-Dealer who holds Securities that are Transfer
Restricted Securities and that were acquired for its own account as a
result of market-making activities or other trading activities (other than
Transfer Restricted Securities acquired directly from the Company), may
exchange such Securities pursuant to the Exchange Offer; however, such
Broker-Dealer may be deemed to be an "underwriter" within the meaning of
the Securities Act and must, therefore, deliver a prospectus meeting the
requirements of the Securities Act in connection with any resales of the
Exchange Securities received by such Broker-Dealer in the Exchange Offer,
which prospectus delivery requirement may be satisfied by the delivery by
such Broker-Dealer of the Prospectus contained in the Exchange Offer
Registration Statement. Such "Plan of Distribution" section shall also
contain all other information with respect to such resales by Broker-
Dealers that the Commission may require in order to permit such resales
pursuant thereto, but such "Plan of Distribution" section shall not name
any such Broker-Dealer or disclose the amount of Exchange Securities held
by any such Broker-Dealer except to the extent required by the Commission
as a result of a change in policy announced after the date of this
Agreement.
The Company shall use its best efforts to keep the Exchange Offer
Registration Statement continuously effective, supplemented and amended as
required by the provisions of Section 6(c) below to the extent necessary to
ensure that it is available for resales of Exchange Securities acquired by
Broker-Dealers for their own accounts as a result of market-making activities or
other trading activities, and to ensure that it conforms with the requirements
of this Agreement, the Securities Act and the policies, rules and regulations of
the Commission as announced from time to time, for a period of 180 days from the
date on which the Exchange Offer Registration Statement is declared effective.
The Company shall provide sufficient copies of the latest version of such
Prospectus to Broker-Dealers promptly upon request at any time during such 180-
day period in order to facilitate such resales.
-5-
<PAGE>
4. Shelf Registration.
(a) Shelf Registration. If (i) the Company is not required to file an
Exchange Offer Registration Statement or to consummate the Exchange Offer
because the Exchange Offer is not permitted by applicable law or Commission
policy (after the procedures set forth in Section 6(a) below have been
complied with), (ii) if any Holder that is a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act) or an "accredited
investor" (as defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act) shall notify the Company within 20 business days of the
Consummation of the Exchange Offer (A) that such Holder is prohibited by
applicable law or Commission policy from participating in the Exchange
Offer, or (B) that such Holder may not resell the Exchange Securities
acquired by it in the Exchange Offer to the public without delivering a
prospectus and that the Prospectus contained in the Exchange Offer
Registration Statement is not appropriate or available for such resales by
such Holder, or (C) that such Holder is a Broker-Dealer and holds
Securities acquired directly from the Company or one of its affiliates, or
(iii) if for any reason the Exchange Offer Registration Statement is not
declared effective within 180 days of the Closing Date, then, in addition
to or in lieu of effecting the registration of the Exchange Offered
Preferred Sock pursuant to the Exchange Offer Registration Statement, the
Company shall:
(x) promptly deliver to the Holders written notice thereof;
(y) as promptly as practicable, but in no event later than the
earliest to occur of (1) the 30th day after the date on which the
Company determines that it is not required to file the Exchange Offer
Registration Statement, (2) the 30th day after the date on which the
Company receives notice from a Holder as contemplated by clause (ii)
above, or (3) the 30th day after the date on which the Exchange Offer
Registration Statement was to be declared effective as contemplated by
clause (iii) above (such earliest date being the "Shelf Filing
Deadline"), use its reasonable best efforts to cause to be filed a
shelf registration statement pursuant to Rule 415 under the Securities
Act, which may be an amendment to the Exchange Offer Registration
Statement (in either event, the "Shelf Registration Statement"), which
Shelf Registration Statement shall provide for resales of all Transfer
Restricted Securities the Holders of which shall have provided the
information required pursuant to Section 4(b) hereof; and
(z) use its reasonable best efforts to cause such Shelf
Registration Statement to be declared effective by the Commission on
or before the 60th day after the Shelf Filing Deadline.
The Company will, in the event that a Shelf Registration Statement is
filed, notify each Holder when the Shelf Registration Statement has become
effective and take such other
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actions as are required to permit unrestricted resales of the Securities.
The Company shall use its reasonable best efforts to keep such Shelf
Registration Statement continuously effective, supplemented and amended as
required by the provisions of Sections 6(b) and (c) hereof to the extent
necessary to ensure that it is available for resales of Securities by the
Holders of Transfer Restricted Securities entitled to the benefit of this
Section 4(a), and to ensure that it conforms with the requirements of this
Agreement, the Securities Act and the policies, rules and regulations of
the Commission as announced from time to time, for the earlier of the
period ending on the second anniversary of the Closing Date (or such
shorter period as may hereafter be provided by Rule 144(k) under the
Securities Act, or similar successor rule) or such time as all of the
applicable Securities have been sold thereunder or otherwise cease to be
registrable securities with the meaning of this Agreement.
(b) Provision by Holders of Certain Information in Connection with the
Shelf Registration Statement. No Holder may include any of its Transfer
Restricted Securities in any Shelf Registration Statement pursuant to this
Agreement unless and until such Holder furnishes to the Company in writing,
within 10 business days after receipt of a request therefor, such
information as the Company may reasonably request for use in connection
with any Shelf Registration Statement or Prospectus or preliminary
prospectus included therein. No Holder shall be entitled to Liquidated
Damages pursuant to Section 5 hereof unless and until such Holder shall
have used its reasonable best efforts to provide all such reasonably
requested information. Each Holder as to which any Shelf Registration
Statement is being effected agrees to furnish promptly to the Company all
information required to be disclosed in order to make the information
previously furnished to the Company by such Holder not materially
misleading.
5. Liquidated Damages.
If (a) any of the Registration Statements required by this Agreement is not
filed with the Commission on or prior to the date specified for such filing in
this Agreement, (b) any of such Registration Statements has not been declared
effective by the Commission on or prior to the date specified for such
effectiveness in this Agreement (the "Effectiveness Target Date"), (c) the
Exchange Offer has not been Consummated within 30 business days after the
Effectiveness Target Date with respect to the Exchange Offer Registration
Statement or (d) if applicable, the Shelf Registration Statement required by
this Agreement is filed and declared effective and shall at any time prior to
the second anniversary (or such shorter period as may hereafter be provided in
Rule 144(k) under the Securities Act, or similar successor rule) of the initial
issuance of the Securities (other than after such time as all Securities have
been disposed of thereunder or otherwise cease to be registrable securities
within the meaning of this Agreement) cease to be effective or fail to be usable
for its intended purpose without being succeeded within two business days by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (a) through (d), a "Registration Default"), then, as liquidated
damages ("Liquidated Damages") to each Holder, additional dividends (the
"Additional Dividends") shall become payable (if declared) by the Company on the
Securities at a rate of 0.25% of the liquidation preference thereof, or $0.25
per share, per annum; provided, however, that the Additional Dividends rate on
the Securities may not exceed, in the aggregate, 0.25% of the liquidation
preference thereof,
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<PAGE>
or $0.25 per share, per annum; provided further that following the cure of all
Registration Defaults relating to any particular Transfer Restricted Securities
or upon the expiration of two years (or such shorter period as may hereafter be
provided in Rule 144(k) under the Securities Act, or similar successor rule)
commencing on the date of the initial issuance of the Securities, the accrual of
Liquidated Damages with respect to such Transfer Restricted Securities shall
cease to accrue.
Any Additional Dividends payable pursuant to clause (i), (ii) or (iii)
above will be payable (if declared) in cash on February 15, May 15, August 15
and November 15 of each year, together with any dividends otherwise payable in
respect of the Securities.
All obligations of the Company set forth in the this Section 5 that are
outstanding with respect to any Transfer Restricted Security at the time such
security ceases to be a Transfer Restricted Security shall survive until such
time as all such obligations with respect to such Transfer Restricted Security
shall have been satisfied in full.
6. Registration Procedures.
(a) Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company shall comply with all of the provisions of
Section 6(c) below, shall use its reasonable best efforts to effect such
exchange to permit the sale of Transfer Restricted Securities being sold in
accordance with the intended method or methods of distribution thereof, and
shall comply with all of the following provisions:
(i) If in the reasonable opinion of counsel to the Company there
is a question as to whether the Exchange Offer is permitted by
applicable law, the Company hereby agrees to seek a no-action letter
or other favorable decision from the Commission allowing the Company
to Consummate an Exchange Offer for such Securities. The Company
hereby agrees to pursue the issuance of such a decision to the
Commission staff level but shall not be required to take commercially
unreasonable action to effect a change of Commission policy. The
Company hereby agrees, however, to (A) participate in telephonic
conferences with the Commission, (B) deliver to the Commission staff
an analysis prepared by counsel to the Company setting forth the legal
bases, if any, upon which such counsel has concluded that such an
Exchange Offer should be permitted and (C) diligently pursue a
resolution (which need not be favorable) by the Commission staff of
such submission.
(ii) As a condition to its participation in the Exchange Offer
pursuant to the terms of this Agreement, each Holder shall furnish,
upon the request of the Company, prior to the Consummation thereof, a
written representation to the Company (which may be contained in the
letter of transmittal contemplated by the Exchange Offer Registration
Statement) to the effect that (A) it is not an affiliate of the
Company, (B) it is not engaged in, and does not intend to engage in,
and has no arrangement or understanding with any person to participate
in, a distribution of the Exchange Securities to be issued in the
Exchange Offer and (C) it is acquiring the Exchange Securities in its
ordinary course of business. In
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<PAGE>
addition, all such Holders shall otherwise cooperate in the Company's
preparations for the Exchange Offer. Each Holder hereby acknowledges
and agrees that any Broker-Dealer who purchased the Securities from
the Company to resell pursuant to Rule 144A or any other available
exemption under the Securities Act or any Holder who is an affiliate
of the Company or who intends to use the Exchange Offer to participate
in a distribution of the Exchange Securities to be acquired in the
Exchange Offer (1) could not under Commission policy as in effect on
the date of this Agreement rely on the position of the Commission
enunciated in Morgan Stanley and Co., Inc. (available June 5, 1991)
and Exxon Capital Holdings Corporation (available May 13, 1988), as
interpreted in the Commission's letter to Shearman & Sterling dated
July 2, 1993, and similar no-action letters (including any no-action
letter obtained pursuant to clause (i) above), (2) will not be
entitled to tender Securities in the Exchange Offer, and (3) must
comply with the registration and prospectus delivery requirements of
the Securities Act in connection with any sale or transfer of the
Securities unless such sale or transfer is made pursuant to any
exemption from such requirements.
(iii) Prior to effectiveness of the Exchange Offer Registration
Statement, the Company shall provide a supplemental letter to the
Commission (A) stating that the Company is registering the Exchange
Offer in reliance on the position of the Commission enunciated in
Exxon Capital Holdings Corporation (available May 13, 1988), Morgan
Stanley and Co., Inc. (available June 5, 1991) and, if applicable, any
no-action letter obtained pursuant to clause (i) above and (B)
including a representation that the Company has not entered into any
arrangement or understanding with any Person to distribute the
Exchange Securities to be received in the Exchange Offer and that, to
the best of the Company's information and belief, each Holder
participating in the Exchange Offer is acquiring the Exchange
Securities in its ordinary course of business and has no arrangement
or understanding with any Person to participate in the distribution of
the Exchange Securities received in the Exchange Offer.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company shall comply with all the provisions of
Section 6(c) below and shall use its reasonable best efforts to effect such
registration to permit the sale of the Transfer Restricted Securities being
sold in accordance with the intended method or methods of distribution
thereof, and pursuant thereto the Company will as expeditiously as possible
prepare and file with the Commission a Registration Statement relating to
the registration on any appropriate form under the Securities Act, which
form shall be available for the sale of the Transfer Restricted Securities
in accordance with the intended method or methods of distribution thereof.
(c) General Provisions. In connection with any Registration Statement
and any Prospectus required by this Agreement to permit the sale, resale or
exchange of Transfer Restricted Securities (including, without limitation,
any Registration Statement and the related Prospectus required to permit
resales of Securities by Broker-Dealers), the Company shall:
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<PAGE>
(i) use its reasonable best efforts to keep such Registration
Statement continuously effective and provide all requisite financial
statements for the period specified in Section 3 or 4 of this
Agreement, as applicable; upon the occurrence of any event that would
cause any such Registration Statement or the Prospectus contained
therein (A) to contain a material misstatement or omission or (B) not
to be effective and usable for resale of Transfer Restricted
Securities during the period required by this Agreement, the Company
shall file promptly an appropriate amendment to such Registration
Statement, in the case of clause (A), correcting any such misstatement
or omission, and, in the case of either clause (A) or (B), use its
reasonable best efforts to cause such amendment to be declared
effective and such Registration Statement and the related Prospectus
to become usable for their intended purpose(s) as soon as practicable
thereafter;
(ii) prepare and file with the Commission such amendments and
post-effective amendments to the Registration Statement as may be
necessary to keep the Registration Statement effective for the
applicable period set forth in Section 3 or 4 hereof, as applicable,
or such shorter period as will terminate when all Transfer Restricted
Securities covered by such Registration Statement have been sold;
cause the Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424
under the Securities Act, and to comply fully with the applicable
provisions of Rules 424 and 430A under the Securities Act in a timely
manner; and comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such
Registration Statement during the applicable period in accordance with
the intended method or methods of distribution by the sellers thereof
set forth in such Registration Statement or supplement to the
Prospectus;
(iii) advise the underwriter(s), if any, and selling Holders
promptly and, if requested by such Persons, to confirm such advice in
writing, (A) when the Prospectus or any Prospectus supplement or post-
effective amendment has been filed, and, with respect to any
Registration Statement or any post-effective amendment thereto, when
the same has become effective, (B) of any request by the Commission
for amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information relating
thereto, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement under the
Securities Act or of the suspension by any state securities commission
of the qualification of the Transfer Restricted Securities for
offering or sale in any jurisdiction, or the initiation of any
proceeding for any of the preceding purposes, (D) of the existence of
any fact or the happening of any event that makes any statement of a
material fact made in the Registration Statement, the Prospectus, any
amendment or supplement thereto, or any document incorporated by
reference therein untrue, or that requires the making of any additions
to or changes in the Registration Statement or the Prospectus in order
to make the statements therein not misleading. If at any time the
Commission shall issue any stop order suspending the effectiveness of
the Registration Statement, or any state securities commission or
other regulatory authority shall issue an order suspending the
qualification or exemption
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<PAGE>
from qualification of the Transfer Restricted Securities under state
securities or Blue Sky laws, the Company shall use its reasonable best
efforts to obtain the withdrawal or lifting of such order at the
earliest possible time;
(iv) furnish to each of the selling Holders and each of the
underwriter(s), if any, before filing with the Commission, copies of
any Registration Statement or any Prospectus included therein or any
amendments or supplements to any such Registration Statement or
Prospectus (including all documents incorporated by reference after
the initial filing of such Registration Statement), which documents
will be subject to the review of such Holders and underwriter(s), if
any, for a period of at least five business days, and the Company will
not file any such Registration Statement or Prospectus or any
amendment or supplement to any such Registration Statement or
Prospectus (including all such documents incorporated by reference) to
which a selling Holder of Transfer Restricted Securities covered by
such Registration Statement or the underwriter(s), if any, shall
reasonably object within five business days after the receipt thereof.
A selling Holder or underwriter, if any, shall be deemed to have
reasonably objected to such filing if such Registration Statement,
amendment, Prospectus or supplement, as applicable, as proposed to be
filed, contains a material misstatement or omission;
(v) promptly prior to the filing of any document that is to be
incorporated by reference into a Registration Statement or Prospectus,
provide copies of such document to the selling Holders and to the
underwriter(s), if any, make the Company's representatives available
for discussion of such document and other customary due diligence
matters, and include such information in such document prior to the
filing thereof as such selling Holders or underwriter(s), if any,
reasonably may request;
(vi) make available at reasonable times for inspection by the
selling Holders, any underwriter participating in any disposition
pursuant to such Registration Statement, and any attorney or
accountant retained by such selling Holders or any of the
underwriter(s), all financial and other records, pertinent corporate
documents and properties of the Company and cause the Company's
officers, directors, managers and employees to supply all information
reasonably requested by any such Holder, underwriter, attorney or
accountant in connection with such Registration Statement subsequent
to the filing thereof and prior to its effectiveness;
(vii) if requested by any selling Holders or the underwriter(s),
if any, promptly incorporate in any Registration Statement or
Prospectus, pursuant to a supplement or post-effective amendment if
necessary, such information as such selling Holders and
underwriter(s), if any, may reasonably request to have included
therein, including, without limitation, information relating to the
"Plan of Distribution" section therein with respect to the Transfer
Restricted Securities, information with respect to the principal
amount of Transfer Restricted Securities being sold to such
underwriter(s), the purchase price being paid therefor and any
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<PAGE>
other terms of the offering of the Transfer Restricted Securities to
be sold in such offering; and make all required filings of such
Prospectus supplement or post-effective amendment as soon as
practicable after the Company is notified of the matters to be
incorporated in such Prospectus supplement or post-effective
amendment;
(viii) cause the Transfer Restricted Securities covered by the
Registration Statement to be rated with the appropriate rating
agencies, if so requested by the Holders of a majority of the
Securities covered thereby or the underwriter(s), if any;
(ix) furnish to each selling Holder and each of the
underwriter(s), if any, without charge, at least one copy of the
Registration Statement, as first filed with the Commission, and of
each amendment thereto, including all documents incorporated by
reference therein and all exhibits (including exhibits incorporated
therein by reference);
(x) deliver to each selling Holder and each of the
underwriter(s), if any, without charge, as many copies of the
Prospectus (including each preliminary prospectus) and any amendment
or supplement thereto as such Persons reasonably may request; the
Company hereby consents to the use of the Prospectus and any amendment
or supplement thereto by each of the selling Holders and each of the
underwriter(s), if any, in connection with the offering and the sale
of the Transfer Restricted Securities covered by the Prospectus or any
amendment or supplement thereto;
(xi) enter into such agreements (including an underwriting
agreement), and make such representations and warranties, and take all
such other actions in connection therewith in order to expedite or
facilitate the disposition of the Transfer Restricted Securities
pursuant to any Registration Statement contemplated by this Agreement,
all to such extent as may be requested by any Initial Purchaser or by
any Holder of Transfer Restricted Securities or underwriter in
connection with any sale or resale pursuant to any Registration
Statement contemplated by this Agreement; and in connection with an
Underwritten Registration, the Company shall:
(A) upon request, furnish to each selling Holder and each
underwriter, if any, in such substance and scope as they may
request and as are customarily made by issuers to underwriters in
primary underwritten offerings, upon the date of the
effectiveness of the Shelf Registration Statement:
(1) a certificate, dated the date of the effectiveness
of the Shelf Registration Statement, signed by the Chief
Financial Officer of the Company, confirming, as of the date
thereof, such matters as such parties may reasonably
request;
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<PAGE>
(2) an opinion, dated the date of the effectiveness of
the Shelf Registration Statement, of counsel for the
Company, covering such matters as such parties may
reasonably request, and in any event including a statement
to the effect that such counsel has participated in
conferences with officers and other representatives of the
Company, representatives of the independent public
accountants for the Company, the Initial Purchasers'
representatives and the Initial Purchasers' counsel in
connection with the preparation of such Registration
Statement and the related Prospectus and have considered the
matters required to be stated therein and the statements
contained therein, although such counsel has not
independently verified the accuracy, completeness or
fairness of such statements; and that such counsel advises
that, on the basis of the foregoing (relying as to
materiality to a large extent upon facts provided to such
counsel by officers and other representatives of the Company
and without independent check or verification), no facts
came to such counsel's attention that caused such counsel to
believe that the applicable Registration Statement, at the
time such Registration Statement or any post-effective
amendment thereto became effective, contained an untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Prospectus
contained in such Registration Statement as of its date,
contained an untrue statement of a material fact or omitted
to state a material fact necessary in order to make the
statements therein, in light of the circumstances under
which they were made, not misleading. Without limiting the
foregoing, such counsel may state further that such counsel
assumes no responsibility for, and has not independently
verified, the accuracy, completeness or fairness of the
financial statements, notes and schedules and other
financial data included in any Registration Statement
contemplated by this Agreement or the related Prospectus;
and
(3) a customary "comfort" letter, dated the date of the
effectiveness of the Shelf Registration Statement, from the
Company's independent accountants, in the customary form and
covering matters of the type customarily covered in comfort
letters by underwriters in connection with primary
underwritten offerings.
(B) set forth in full or incorporate by reference in the
underwriting agreement, if any, the indemnification provisions
and procedures of Section 8 hereof with respect to all parties to
be indemnified pursuant to said Section; and
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<PAGE>
(C) deliver such other documents and certificates as may be
reasonably requested by such parties to evidence compliance with
clause (A) above and with any customary conditions contained in
the underwriting agreement or other agreement entered into by the
Company pursuant to this clause (xi), if any.
If at any time the representations and warranties of the Company
contemplated in clause (A)(1) above cease to be true and correct, the
Company shall so advise the Initial Purchasers and the underwriter(s),
if any, and each selling Holder promptly and, if requested by such
Persons, shall confirm such advice in writing;
(xii) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders, the underwriter(s), if
any, and their respective counsel in connection with the registration
and qualification of the Transfer Restricted Securities under the
securities or Blue Sky laws of such jurisdictions as the selling
Holders or underwriter(s) may reasonably request and do any and all
other acts or things necessary or advisable to enable the disposition
in such jurisdictions of the Transfer Restricted Securities covered by
the Shelf Registration Statement; provided, however, that the Company
shall not be required to register or qualify as a foreign corporation
where it is not now so qualified or to take any action that would
subject it to the service of process in suits or to taxation, other
than as to matters and transactions relating to the Registration
Statement, in any jurisdiction where it is not now so subject;
(xiii) shall issue, upon the request of any Holder of Securities
covered by the Shelf Registration Statement, Exchange Securities in
the same amount as the Securities surrendered to the Company by such
Holder in exchange therefor or being sold by such Holder; such
Exchange Securities to be registered in the name of such Holder or in
the name of the purchaser(s) of such Offered Preferred Stock, as the
case may be; in return, the Securities held by such Holder shall be
surrendered to the Company for cancellation;
(xiv) cooperate with the selling Holders and the underwriter(s),
if any, to facilitate the timely preparation and delivery of
certificates representing Transfer Restricted Securities to be sold
and not bearing any restrictive legends; and enable such Transfer
Restricted Securities to be in such denominations and registered in
such names as the Holders or the underwriter(s), if any, may request
at least two business days prior to any sale of Transfer Restricted
Securities made by such underwriter(s);
(xv) use its reasonable best efforts to cause the Transfer
Restricted Securities covered by the Registration Statement to be
registered with or approved by such other governmental agencies or
authorities as may be necessary to enable the seller or sellers
thereof or the underwriter(s), if any, to consummate the disposition
of such Transfer Restricted Securities, subject to the proviso
contained in clause (xii) above;
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<PAGE>
(xvi) if any fact or event contemplated by clause (c)(iii)(D)
above shall exist or have occurred, prepare a supplement or post-
effective amendment to the Registration Statement or related
Prospectus or any document incorporated therein by reference or file
any other required document so that, as thereafter delivered to the
purchasers of Transfer Restricted Securities, the Prospectus will not
contain an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein not misleading;
(xvii) provide CUSIP numbers for all Transfer Restricted
Securities not later than the effective date of the Registration
Statement and provide certificates for the Transfer Restricted
Securities;
(xviii) cooperate and assist in any filings required to be made
with the NASD and in the performance of any due diligence
investigation by any underwriter (including any "qualified independent
underwriter") that is required to be retained in accordance with the
rules and regulations of the NASD, and use its best efforts to cause
such Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to enable the
Holders selling Transfer Restricted Securities to consummate the
disposition of such Transfer Restricted Securities;
(xix) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make generally
available to its security holders, as soon as practicable, a
consolidated earnings statement meeting the requirements of Rule 158
(which need not be audited) for the twelve-month period (A) commencing
at the end of any fiscal quarter in which Transfer Restricted
Securities are sold to underwriters in a firm or best efforts
Underwritten Offering or (B) if not sold to underwriters in such an
offering, beginning with the first month of the Company's first fiscal
quarter commencing after the effective date of the Registration
Statement; and
(xx) provide promptly to each Holder upon request each document
filed with the Commission pursuant to the requirements of Section 13
and Section 15 of the Exchange Act.
Each Holder agrees by acquisition of a Transfer Restricted Security
that, upon receipt of any notice from the Company of the existence of any
fact of the kind described in Section 6(c)(iii)(D) hereof, such Holder will
forthwith discontinue disposition of Transfer Restricted Securities
pursuant to the applicable Registration Statement until such Holder's
receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 6(c)(xvi) hereof, or until it is advised in writing
(the "Advice") by the Company that the use of the Prospectus may be
resumed, and has received copies of any additional or supplemental filings
that are incorporated by reference in the Prospectus. If so directed by
the Company, each Holder will deliver to the Company (at the Company's
expense) all copies, other than permanent file copies then in such Holder's
possession, of the Prospectus covering such Transfer Restricted Securities
that was current at the time of receipt of such notice.
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<PAGE>
7. Registration Expenses.
All expenses incident to the Company's performance of or compliance
with this Agreement will be borne by the Company, regardless of whether a
Registration Statement becomes effective, including without limitation: (i)
all registration and filing fees and expenses (including filings made by
any Initial Purchaser or Holder with the NASD (and, if applicable, the fees
and expenses of any "qualified independent underwriter" and its counsel
that may be required by the rules and regulations of the NASD)); (ii) all
fees and expenses of compliance with federal securities and state Blue Sky
or securities laws; (iii) all expenses of printing (including printing
certificates for the Exchange Securities to be issued in the Exchange Offer
and printing of Prospectuses), messenger and delivery services and
telephone; (iv) all fees and disbursements of counsel for the Company; and
(v) all fees and disbursements of independent certified public accountants
of the Company (including the expenses of any special audit and comfort
letters required by or incident to such performance).
The Company will, in any event, bear its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expenses of any annual audit
and the fees and expenses of any Person, including special experts,
retained by the Company.
8. Indemnification and Contribution.
(a) In connection with a Shelf Registration Statement or in connection
with any delivery of a Prospectus contained in an Exchange Offer Registration
Statement by any participating Broker-Dealer or Initial Purchaser, as
applicable, who seeks to sell Exchange Securities, the Company shall indemnify
and hold harmless each Holder of Transfer Restricted Securities included within
any such Shelf Registration Statement and each participating Broker-Dealer or
Initial Purchaser selling Exchange Securities, and each person, if any, who
controls any such person within the meaning of Section 15 of the Securities Act
(each, a "Participant") from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof (including, but not limited
to, any loss, claim, damage, liability or action relating to purchases and sales
of Securities) to which such Participant or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in any such
Registration Statement or any prospectus forming part thereof or in any
amendment or supplement thereto or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and shall reimburse each Participant
promptly upon demand for any legal or other expenses reasonably incurred by such
Participant in connection with investigating or defending or preparing to defend
against any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that (i) the Company shall not be liable in any
such case to the extent that any such loss, claim, damage, liability or action
arises out of, or is based upon, any untrue statement or alleged untrue
statement or omission or alleged omission made in any such Registration
Statement or any prospectus forming part thereof or in any such amendment or
supplement in reliance upon and in conformity with written information furnished
to the Company by or on behalf of any Participant specifically for inclusion
therein; and
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<PAGE>
provided further that as to any preliminary prospectus, the indemnity agreement
contained in this Section 8(a) shall not inure to the benefit of any such
Participant or any controlling person of such Participant on account of any
loss, claim, damage, liability or action arising from the sale of the Transfer
Restricted Securities to any person by that Participant if (i) that Participant
failed to send or give a copy of the Prospectus, as the same may be amended or
supplemented, to that person within the time required by the Securities Act and
(ii) the untrue statement or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact in such preliminary
Prospectus was corrected in the prospectus, unless, in each case, such failure
resulted from non-compliance by the Company with Section 6(c). The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to any Participant or to any controlling person of that
Participant.
(b) Each Participant, severally and not jointly, shall indemnify and hold
harmless the Company, each of its directors, officers, employees or agents and
each person, if any, who controls the Company within the meaning of Section 15
of the Securities Act, from and against any loss, claim, damage or liability,
joint or several, or any action in respect thereof, to which the Company or any
such director, officer, employee or agent or controlling person may become
subject, under the Securities Act or otherwise, insofar as such loss, claim,
damage, liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in any
preliminary Prospectus, Registration Statement or Prospectus or in any amendment
or supplement thereto or (ii) the omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, but in each case only to the extent that the
untrue statement or alleged untrue statement or omission or alleged omission was
made in reliance upon and in conformity with written information furnished to
the Company by or on behalf of that Participant specifically for inclusion
herein, and shall reimburse the Company and any such director, officer,
employees or agents or controlling person for any legal or other expenses
reasonably incurred by the Company or any such director, officer, employees or
agents or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action as
such expenses are incurred. The foregoing indemnity agreement is in addition to
any liability which any Participant may otherwise have to the Company or any
such director, officer or controlling person.
(c) Promptly after receipt by an indemnified party under this Section 8 of
notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 8 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 8. If any such claim or
action shall be brought against an indemnified party, and it shall have notified
the indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the
-17-
<PAGE>
indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, that
(i) if counsel for the indemnifying party and counsel designated by the
indemnified party jointly determine that there may be a conflict between the
positions of the indemnifying party and of the indemnified party in conducting
the defense of such claim or action or that there may be legal defenses
available to such indemnified party different from or in addition to those
available to the indemnifying party, then counsel for the indemnified party
shall be entitled to conduct the defense to the extent reasonably determined by
such counsel to be necessary to protect the interests of the indemnified party
or parties, and in that event the fees and expenses of such counsel for the
indemnified party shall be paid by the Company, and (ii) in any event, the
indemnified party shall be entitled to have counsel chosen and paid for by such
indemnified party participate in, but not conduct, the defense. Each
indemnified party, as a condition of the indemnity agreements contained in
Section 8, shall use its best efforts to cooperate with the indemnifying party
in the defense of any such action or claim. No indemnifying party shall (i)
without the prior written consent of the indemnified parties (which consent
shall not be unreasonably withheld), settle or compromise or consent to the
entry of any judgment with respect to any pending or threatened claim, action,
suit or proceeding in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding, or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written
consent or if there be a final judgment of the plaintiff in any such action, the
indemnifying party agrees to indemnify and hold harmless any indemnified party
from and against any loss of liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, in such proportion as
shall be appropriate to reflect the relative fault of the Company, on the one
hand, and the Participants, on the other hand, with respect to the statements or
omissions which resulted in such loss, claim, damage or liability, or action in
respect thereof, as well as any other relevant equitable considerations. The
relative fault shall be determined by reference to whether the untrue or alleged
untrue statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or the
Participants, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Participants agree that it would not be just and equitable
if contributions pursuant to this Section 8(d) were to be determined by pro rata
allocation (even if the Participants were treated as one entity for such
purpose) or by any other method of allocation which does not take into account
the equitable considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the loss, claim, damage or liability, or
action in respect thereof, referred to above in this Section 8(d) shall be
deemed to include, for purposes of this Section 8(d), any legal or other
expenses reasonably incurred by
-18-
<PAGE>
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8(d), no
Participant shall be required to contribute any amount in excess of the amount
by which proceeds received by such Participant from an offering of the
Securities exceeds the amount of any damages which such Participant has
otherwise paid or become liable to pay by reason of any untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Participants' obligations to contribute as
provided in this Section 8(d) are several and not joint.
9. Rule 144A.
The Company hereby agrees with each Holder, for so long as any Transfer
Restricted Securities remain outstanding, to make available to any Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
from such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Securities Act in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144A.
10. Participation in Underwritten Registrations.
No Holder may participate in any Underwritten Registration hereunder unless
such Holder (a) agrees to sell such Holder's Transfer Restricted Securities on
the basis provided in any underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements and (b) completes and executes
all reasonable questionnaires, powers of attorney, indemnities, underwriting
agreements, lock-up letters and other documents required under the terms of such
underwriting arrangements.
11. Furnishing of Information.
So long as any Transfer Restricted Securities remain outstanding, the
Company covenants to timely file all reports required to be filed by the Company
after the date hereof pursuant to Section 13(a) or 15(d) of the Exchange Act.
12. Selection of Underwriters.
The Holders of Transfer Restricted Securities covered by the Shelf
Registration Statement who desire to do so may sell such Transfer Restricted
Securities in an Underwritten Offering. In any such Underwritten Offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Holders of a majority of the
Transfer Restricted Securities included in such offering; provided, that such
investment bankers and managers must be reasonably satisfactory to the Company.
-19-
<PAGE>
13. Legend.
Each certificate representing the Securities shall bear the following
legend:
THE HOLDER OF THIS SECURITY AGREES TO BE BOUND BY THE PROVISIONS OF
THE REGISTRATION RIGHTS AGREEMENT (THE "AGREEMENT"), DATED AS OF JUNE
___, 1997, BY AND AMONG THE COMPANY AND LEHMAN BROTHERS INC., CHASE
SECURITIES INC. AND MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED. A COPY OF THE AGREEMENT IS ON FILE AT THE PRINCIPAL
OFFICE OF THE COMPANY AND IS AVAILABLE UPON REQUEST.
14. Miscellaneous.
(a) Remedies. The Company agrees that monetary damages (including the
liquidated damages contemplated hereby) would not be adequate compensation
for any loss incurred by reason of a breach by it of the provisions of this
Agreement and hereby agree to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not on or after the
date of this Agreement enter into any agreement with respect to their
securities that is inconsistent with the rights granted to the Holders in
this Agreement or otherwise conflicts with the provisions hereof. The
Company is not a party to any existing agreement granting any registration
rights with respect to its securities to any Person. The rights granted to
the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's
securities under any agreement in effect on the date hereof.
(c) Adjustments Affecting the Securities . The Company will not take
any action, or permit any change to occur, with respect to Securities that
would materially and adversely affect the ability of the Holders to
Consummate any Exchange Offer.
(d) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given unless the Company
has obtained the written consent of Holders of a majority of the
outstanding Transfer Restricted Securities. Notwithstanding the foregoing,
a waiver or consent to departure from the provisions hereof that relates
exclusively to the rights of Holders whose securities are being tendered
pursuant to the Exchange Offer and that does not affect directly or
indirectly the rights of other Holders whose securities are not being
tendered pursuant to such Exchange Offer may be given by the Holders of a
majority of the outstanding Transfer Restricted Securities being tendered
or registered.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class
mail (registered or
-20-
<PAGE>
certified, return receipt requested), telecopier, or air courier
guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of
the Company; and
(ii) if to the Company:
Heller Financial, Inc.
500 West Monroe Street
Chicago, Illinois 60661
Attention: Treasurer
Fax: (312) 441-7586
with a copy to:
Corporate Legal Services
Fax: (312) 441-7173
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if
mailed; when receipt acknowledged, if telecopied; and on the next business
day, if timely delivered to an air courier guaranteeing overnight delivery.
(f) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Securities; provided,
however, that this Agreement shall not inure to the benefit of or be
binding upon a successor or assign of a Holder unless and to the extent
such successor or assign acquired Transfer Restricted Securities from such
Holder.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, without regard to the
conflict of law rules thereof.
(j) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or
-21-
<PAGE>
unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement together with the other
transaction documents is intended by the parties as a final expression of
their agreement and intended to be a complete and exclusive statement of
the agreement and understanding of the parties hereto in respect of the
subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Company with
respect to the Transfer Restricted Securities. This Agreement supersedes
all prior agreements and understandings between the parties with respect to
such subject matter.
(l) Required Consents. Whenever the consent or approval of Holders of
a specified percentage of Transfer Restricted Securities is required
hereunder, Transfer Restricted Securities held by the Company or its
affiliates (as such term is defined in Rule 405 under the Securities Act)
shall not be counted in determining whether such consent or approval was
given by the Holders of such required percentage.
-22-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
Heller Financial, Inc.
By: /s/ SIGNATURE
------------------------
Name:
-----------------------
Title:
----------------------
Accepted as of the date thereof:
LEHMAN BROTHERS INC.
By: /s/ SIGNATURE
--------------------------------
Name:
------------------------
Title:
------------------------
Acting on behalf of itself
and the several other Initial
Purchasers named herein
-23-
<PAGE>
Exhibit 4.7
Description of Specimen Exchange Preferred Stock Certificate
Face of Certificate:
The front of the specimen Exchange Preferred Stock certificate (the
"Certificate") contains the logo of the Company above the name of the Company
and the Exchange Preferred Stock's CUSIP number (423328 88 9). The Certificate
is signed by Debra H. Snider, Executive Vice President, Chief Administrative
Officer, General Counsel and Secretary of the Company, and Richard J. Almeida,
Chairman and Chief Executive Officer of the Company. The Company's corporate
seal appears in the middle of the lower edge of the Certificate. The face of the
Certificate also contains the following language:
This certifies that ________________________ is the owner of _____________
full-paid and non-assessable shares of Fixed Rate Noncumulative Perpetual Senior
Preferred Stock, Series C, of HELLER FINANCIAL, INC. (the "Corporation"), a
Delaware corporation. The shares represented by this certificate are
transferable only on the stock transfer books of the Corporation by the holder
of record hereof, or by his duly authorized attorney or legal representative,
upon the surrender of this certificate properly endorsed. This certificate is
not valid unless countersigned and registered by the Corporation's transfer
agent and registrar.
In witness whereof, the Corporation has caused this certificate to be
executed by the facsimile signatures of its duly authorized officers and has
caused a facsimile of its corporate seal to be hereunto affixed.
Reverse of Certificate:
The back of the certificate contains the following language:
The Corporation will furnish without charge to each stockholder who so
requests, the powers, designations, preferences and relative, participating,
optional or other special rights of each class of stock or series thereof of the
Corporation and the qualifications, limitations or restrictions of such
preferences and/or rights. Such request may be made to the Corporation or its
transfer agent.
The reverse of the Certificate also contains standard stock transfer
instructions.
<PAGE>
EXHIBIT 5
October 22, 1997
Heller Financial, Inc.
500 West Monroe Street
Chicago, Illinois 60661
Ladies and Gentlemen:
I have acted as counsel for Heller Financial, Inc., a Delaware corporation
(the "Company"), in connection with the preparation and filing of a registration
statement on Form S-4 (the "Registration Statement") to be filed with the
Securities and Exchange Commission (the "Commission") under the Securities Act
of 1933, as amended (the "Securities Act"). The Registration Statement relates
to the registration of 1,500,000 shares of the Company's Fixed Rate
Noncumulative Perpetual Senior Preferred Stock, Series C (the "Series C
Preferred Stock"). The Series C Preferred Stock is to be established pursuant
to the execution and filing by the Company with the Secretary of State of the
State of Delaware of a Certificate of Designation in the form attached as an
exhibit to the Registration Statement (the "Certificate of Designation"). The
Company will offer to exchange the Series C Preferred Stock for all outstanding
shares of its previously issued Fixed Rate Noncumulative Perpetual Senior
Preferred Stock, Series B (the "Series B Preferred Stock").
I am familiar with the corporate proceedings of the Company to date with
respect to the proposed issuance and sale of the Series C Preferred Stock, and I
have examined such corporate records of the Company and such other documents and
certificates as I have deemed necessary as a basis for the opinions hereinafter
expressed, including (i) the Registration Statement, (ii) the Amended and
Restated Certificate of Incorporation of the Company, (iii) the By-Laws of the
Company and (iv) the Certificate of Designation. In connection with this
opinion, I have assumed the accuracy and completeness of all documents and
records I have reviewed, the genuineness of all signatures, the authenticity of
the documents submitted to me as originals and the conformity to authentic
original documents of all documents submitted to me as certified, conformed or
reproduced copies.
Based on the foregoing, I am of the opinion that upon (i) the Company's
execution and filing with the Secretary of State of the State of Delaware of the
Certificate of Designation and (ii) the issuance and delivery by the Company of
<PAGE>
shares of the Series C Preferred Stock in exchange for shares of the Series B
Preferred Stock in the manner contemplated by the Registration Statement, such
exchanged shares of the Series C Preferred Stock will be validly issued, fully
paid and nonassessable.
The foregoing opinion is subject to all bankruptcy, insolvency or other
laws affecting the enforcement of creditors' rights generally and general
equitable principles.
I hereby consent that to the filing of this opinion as an exhibit to the
Registration Statement and to the use of my name in the Registration Statement
and the Prospectus related thereto.
Very truly yours,
/s/ Mark J. Ohringer
Mark J. Ohringer
Associate General Counsel
2
<PAGE>
[ARTHUR ANDERSEN'S LETTERHEAD GOES HERE]
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report dated January 24, 1997
(except with the matter discussed in Note 18, as to which the date is
February 5, 1997) included in Heller Financial, Inc.'s Form 10-K for the year
ended December 31, 1996 and to all references to our firm included in this
registration statement.
/s/ Arthur Andersen LLP
Chicago, Illinois
October 22, 1997
<PAGE>
Exhibit 99.1
LOGO
LETTER OF TRANSMITTAL
TENDER OF
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B
IN EXCHANGE FOR
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES C
OF
HELLER FINANCIAL, INC.
PURSUANT TO THE PROSPECTUS DATED , 1997
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
, 1997, UNLESS EXTENDED (IN ANY CASE, THE "EXPIRATION DATE"). FIXED RATE
NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B ("ORIGINAL PREFERRED
STOCK"), TENDERED IN THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY TIME PRIOR TO
THE EXPIRATION DATE.
Deliver To The Exchange Agent:
BankBoston, N.A.
By Hand/Overnight Courier/Registered By Facsimile:
or Certified Mail: (617) 575-2233
BankBoston, N.A. Confirm by Telephone:
c/o Boston EquiServe L.P. (617) 575-3400
Attn: Corporate Reorganization
150 Royall Street
Canton, Massachusetts 02021
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN THE ONE LISTED
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS ACCOMPANYING THIS
LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF
TRANSMITTAL IS COMPLETED.
The undersigned hereby acknowledges that the undersigned has received and
reviewed the Prospectus, dated , 1997 (as the same may be amended
from time to time, the "Prospectus"), of Heller Financial, Inc. (the
"Company") and this Letter of Transmittal (the "Letter of Transmittal"), which
together constitute the Company's offer (the "Exchange Offer") to exchange its
Fixed Rate Noncumulative Perpetual Senior Preferred Stock, Series C (the
"Exchange Preferred Stock"), for an equal number of shares of its issued and
outstanding Original Preferred Stock. The terms of the Exchange Preferred
Stock are substantially the same in all material respects as those of the
Original Preferred Stock, except that the Exchange Preferred Stock has been
registered under the Securities Act of 1933, as amended (the "Securities
Act"), and, therefore, will not bear legends restricting its transfer under
the Securities Act and will not contain provisions regarding minimum unit
size, registration rights or the payment of additional dividends under certain
circumstances relating to the timing of the Exchange Offer or the filing of
registration statements. The term "Expiration Date" shall mean 5:00 p.m., New
York City time, on , 1997, unless the Company, in its sole discretion,
extends the Exchange Offer, in which case such term shall mean the latest date
and time to which the Exchange Offer is extended. The Company shall notify the
<PAGE>
Holders (as defined herein) of the Original Preferred Stock of any extension by
oral or written notice prior to 9:00 A.M., New York City time, on the next
business day after the previously scheduled Expiration Date. Capitalized terms
used but not defined herein have the meaning given to them in the Prospectus.
This Letter of Transmittal is to be used by a Holder of Original Preferred
Stock if (i) certificates representing Original Preferred Stock are to be
forwarded herewith or (ii) delivery of Original Preferred Stock is to be made
by book-entry transfer to the account maintained by the Exchange Agent at The
Depository Trust Company ("DTC") pursuant to the procedures set forth in the
Prospectus under the caption "The Exchange Offer--Book-Entry Transfer." Holders
of Original Preferred Stock (i) whose Original Preferred Stock is not
immediately available, (ii) who are unable to complete the procedure for book-
entry transfer on a timely basis, or (iii) who are unable to deliver their
Original Preferred Stock, this Letter of Transmittal or any other documents
required hereby to the Exchange Agent on or prior to the Expiration Date, must
tender their Original Preferred Stock according to the guaranteed delivery
procedures set forth in the Prospectus under the caption "The Exchange Offer--
Guaranteed Delivery Procedures." See Instruction 2. Delivery of documents to
DTC does not constitute delivery to the Exchange Agent.
The term "Holder" with respect to the Exchange Offer means any person in
whose name Original Preferred Stock is registered on the books of the Company
or any other person who has obtained a properly completed stock power from the
registered Holder. The undersigned has completed, executed and delivered this
Letter of Transmittal to indicate the action the undersigned desires to take
with respect to the Exchange Offer. Holders who wish to tender their Original
Preferred Stock must complete this Letter of Transmittal in its entirety.
PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL AND THE PROSPECTUS CAREFULLY
BEFORE COMPLETING THIS LETTER OF TRANSMITTAL.
THE INSTRUCTIONS INCLUDED WITH THIS LETTER OF TRANSMITTAL MUST BE FOLLOWED.
QUESTIONS AND REQUESTS FOR ASSISTANCE OR FOR ADDITIONAL COPIES OF THE
PROSPECTUS AND THIS LETTER OF TRANSMITTAL MAY BE DIRECTED TO THE EXCHANGE
AGENT.
2
<PAGE>
List below the Original Preferred Stock to which this Letter of Transmittal
relates. If the space below is inadequate, list the registered numbers and
principal amounts on a separate signed schedule and affix the list to this
Letter of Transmittal.
DESCRIPTION OF ORIGINAL PREFERRED STOCK TENDERED
<TABLE>
- -------------------------------------------------------------------------------------------
<CAPTION>
AGGREGATE
NUMBER OF
SHARES OF
ORIGINAL
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S), PREFERRED
EXACTLY AS NAME(S) APPEAR(S) ON CERTIFICATES STOCK NUMBER OF
FOR ORIGINAL PREFERRED STOCK CERTIFICATE REPRESENTED BY SHARES
(PLEASE FILL IN, IF BLANK) NUMBER(S)* CERTIFICATE(S) TENDERED**
- -------------------------------------------------------------------------------------------
<S> <C>
----------------------------------------------
----------------------------------------------
----------------------------------------------
</TABLE>
TOTAL
- --------------------------------------------------------------------------------
*Need not be completed if Original Preferred Stock is being tendered by book-
entry transfer.
**Unless otherwise indicated, any tendering Holder of Original Preferred
Stock will be deemed to have tendered the entire aggregate number of shares
represented by the certificate(s) or Book-Entry Confirmation for such
Original Preferred Stock.
[_] CHECK HERE IF CERTIFICATES FOR TENDERED ORIGINAL PREFERRED STOCK ARE
ENCLOSED HEREWITH.
[_] CHECK HERE IF TENDERED ORIGINAL PREFERRED STOCK IS BEING DELIVERED BY
BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT
WITH DTC AND COMPLETE THE FOLLOWING:
Name of Tendering Holder: _________________________________________________
Account Number: ___________________________________________________________
Transaction Code Number: __________________________________________________
[_] CHECK HERE IF TENDERED ORIGINAL PREFERRED STOCK IS BEING DELIVERED
PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE
AGENT AND COMPLETE THE FOLLOWING:
Name(s) of Registered Holder(s) of Original Preferred Stock: ______________
Date of Execution of Notice of Guaranteed Delivery: _______________________
Window Ticket Number (if any): ____________________________________________
Name of Eligible Institution that Guaranteed Delivery: ____________________
Account Number (if delivered by book-entry transfer): _____________________
[_] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL
COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS
THERETO.
Name: _____________________________________________________________________
Address: __________________________________________________________________
If the undersigned is not a broker-dealer, the undersigned represents that
it is not engaged in, does not intend to engage in, and has no arrangement
or understanding with any person to participate in, a distribution of
Exchange Preferred Stock. If the undersigned is a broker-dealer that will
receive Exchange Preferred Stock for its own account in exchange for
Original Preferred Stock, it acknowledges that the Original Preferred
Stock was acquired as a result of market-making activities or other
trading activities and that it will deliver a prospectus meeting the
requirements of the Securities Act in connection with any resale of such
Exchange Preferred Stock. The undersigned, by so acknowledging and by
delivering a prospectus, will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
3
<PAGE>
SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
Subject to the terms and conditions of the Exchange Offer, the undersigned
hereby tenders to the Company for exchange the number of shares of Original
Preferred Stock indicated above. Subject to and effective upon the acceptance
for exchange of the number of shares of Original Preferred Stock tendered in
accordance with this Letter of Transmittal, the undersigned hereby exchanges,
assigns and transfers to, or upon the order of, the Company all right, title
and interest in and to the Original Preferred Stock tendered for exchange
hereby. The undersigned hereby irrevocably constitutes and appoints the
Exchange Agent as the agent and attorney-in-fact of the undersigned (with full
knowledge that the Exchange Agent also acts as the agent of the Company in
connection with the Exchange Offer) with respect to the tendered Original
Preferred Stock with full power of substitution, to (i) deliver certificates
representing such Original Preferred Stock or transfer ownership of such
Original Preferred Stock on the account books maintained by DTC, as the case
may be, to the Company and deliver all accompanying evidences of transfer and
authenticity to, or upon the order of, the Company and (ii) present such
Original Preferred Stock for transfer on the books of the Company and receive
all benefits and otherwise exercise all rights of beneficial ownership of such
Original Preferred Stock, all in accordance with the terms of the Exchange
Offer. The power of attorney granted in this paragraph shall be deemed to be
irrevocable and coupled with an interest.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, exchange, assign and transfer the Original
Preferred Stock tendered hereby and to acquire the Exchange Preferred Stock
issuable upon the exchange of such tendered Original Preferred Stock and that
the Company will acquire good and unencumbered title to the Original Preferred
Stock tendered hereby, free and clear of all liens, restrictions, charges and
encumbrances and not subject to any adverse claim, when the same are accepted
for exchange by the Company.
The undersigned acknowledges that this Exchange Offer is being made in
reliance upon interpretations contained in several no-action letters issued to
third parties by the Staff of the Securities and Exchange Commission (the
"Commission") that the Exchange Preferred Stock issued in exchange for the
Original Preferred Stock pursuant to the Exchange Offer may be offered for
resale, resold and otherwise transferred by Holders thereof (other than any
such Holder that is an "affiliate" of the Company within the meaning of Rule
405 under the Securities Act), without compliance with the registration and
prospectus delivery provisions of the Securities Act, provided that such
Exchange Preferred Stock is acquired in the ordinary course of such Holders'
business and such Holders are not engaging in, do not intend to engage in, and
have no arrangement or understanding with any person to participate in, a
distribution of such Exchange Preferred Stock. The undersigned hereby further
represents to the Company that (i) any Exchange Preferred Stock acquired in
exchange for Original Preferred Stock tendered hereby is being acquired in the
ordinary course of business of the person obtaining such Exchange Preferred
Stock, whether or not the undersigned, (ii) neither the undersigned nor any
such other person is engaging in, intends to engage in, or has an arrangement
or understanding with any person to participate in, a distribution of the
Exchange Preferred Stock, and (iii) neither the Holder not any such other
person is an "affiliate" of the Company within the meaning of Rule 405 of the
Securities Act.
If the undersigned or the person receiving the Exchange Preferred Stock is a
broker-dealer that is receiving Exchange Preferred Stock for its own account
in exchange for Original Preferred Stock that was acquired as a result of
market-making activities or other trading activities (other than Original
Preferred Stock acquired directly from the Company), the undersigned
acknowledges that it or such other person may be deemed to be an "underwriter"
within the meaning of the Securities Act and, therefore, will deliver a
prospectus in connection with any resale of such Exchange Preferred Stock. The
undersigned will not be deemed, by so acknowledging and by delivering a
prospectus, to admit that the undersigned or such other person is an
"underwriter" within the meaning of the Securities Act. The undersigned
acknowledges that, if the undersigned or the person receiving the Exchange
Preferred Stock is an "affiliate" (as defined in Rule 405 under the Securities
Act) or is participating in the Exchange Offer for the purpose of distributing
the Exchange Preferred Stock, (i) the undersigned or such other person cannot
rely on the position of the Staff of the Commission in certain no-action
letters and, in the absence of an exemption therefrom, must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with a secondary resale transaction of the Exchange Preferred
Stock, in which case the registration statement must contain the selling
security holder information required by the Commission, and (ii) failure to
4
<PAGE>
comply with such requirements in such instance could result in the undersigned
or such other person incurring liability under the Securities Act for which
the undersigned or such other person is not indemnified by the Company.
The undersigned will, upon request, execute and deliver any additional
documents deemed by the Exchange Agent or the Company to be necessary or
desirable to complete the exchange, assignment and transfer of the Original
Preferred Stock tendered hereby, including the transfer of such Original
Preferred Stock on the account books maintained by DTC.
For purposes of the Exchange Offer, the Company shall be deemed to have
accepted for exchange validly tendered Original Preferred Stock when, as and
if the Company gives oral or written notice thereof to the Exchange Agent. Any
tendered Original Preferred Stock that is not accepted for exchange pursuant
to the Exchange Offer for any reason will be returned, without expense, to the
undersigned at the address shown below or at a different address as may be
indicated herein under "Special Delivery Instructions" as promptly as
practicable after the Expiration Date.
All authority conferred or agreed to be conferred by this Letter of
Transmittal shall survive the death, incapacity or dissolution of the
undersigned, and every obligation of the undersigned under this Letter of
Transmittal shall be binding upon the undersigned's heirs, personal
representatives, successors and assigns.
The undersigned acknowledges that the Company's acceptance of properly
tendered Original Preferred Stock pursuant to the procedures described under
the caption "The Exchange Offer--Procedures for Tendering" in the Prospectus
and in the instructions hereto will constitute a binding agreement between the
undersigned and the Company upon the terms and subject to the conditions of
the Exchange Offer, subject only to withdrawal of such tenders on the terms
set forth in the Prospectus under the caption "The Exchange Offer--Withdrawal
of Tenders".
Unless otherwise indicated under "Special Issuance Instructions," please
issue the certificates representing any Exchange Preferred Stock or credit the
Holder's account at DTC with respect to the Exchange Preferred Stock, as the
case may be, issued in exchange for the Original Preferred Stock accepted for
exchange and return any certificates representing any Original Preferred Stock
or credit the Holder's account at DTC with respect to any Original Preferred
Stock, as the case may be, not tendered or not exchanged, in the name(s) of
the undersigned. Similarly, unless otherwise indicated under "Special Delivery
Instructions," please mail or deliver any certificates representing the
Exchange Preferred Stock issued in exchange for the Original Preferred Stock
accepted for exchange and any certificates representing any Original Preferred
Stock not tendered or not exchanged (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature(s). In the event that both "Special Issuance Instructions" and
"Special Delivery Instructions" are completed, please issue the Exchange
Preferred Stock issued in exchange for the Original Preferred Stock accepted
for exchange in the name(s) of, and return any Original Preferred Stock not
tendered or not exchanged to, the person(s) so indicated. The undersigned
recognizes that the Company has no obligation pursuant to the "Special
Issuance Instructions" and "Special Delivery Instructions" to transfer any
Original Preferred Stock from the name of the registered holder(s) thereof if
the Company does not accept for exchange any of the Original Preferred Stock
so tendered for exchange.
5
<PAGE>
PLEASE SIGN HERE WHETHER OR NOT
ORIGINAL PREFERRED STOCK IS BEING PHYSICALLY TENDERED HEREBY
(COMPLETE ACCOMPANYING SUBSTITUTE FORM W-9 ON REVERSE SIDE)
X
---------------------------------------------------------
-------------
Date
X
---------------------------------------------------------
-------------
Date
Area Code and Telephone Number:
---------------------
The above line(s) must be signed by the registered Holder(s) of Original
Preferred Stock as their name(s) appear(s) on the Original Preferred Stock or
by person(s) authorized to become registered Holder(s) by a properly
completed stock power from the registered Holder(s), a copy of which must be
transmitted with this Letter of Transmittal. If Original Preferred Stock to
which this Letter of Transmittal relates is held of record by two or more
joint Holders, then all such Holders must sign this Letter of Transmittal. If
signature is by a trustee, executor, administrator, guardian, attorney-in-
fact, officer of a corporation or other person acting in a fiduciary or
representative capacity, then such person must (i) set forth his or her full
title below and (ii) unless waived by the Company, submit evidence
satisfactory to the Company of such person's authority so to act. See
Instruction 5 regarding the completion of this Letter of Transmittal, printed
below.
Name(s)
-----------------------------------------------------------------------
(Please Type or Print)
-----------------------------------------------------------------------
(Please Type or Print)
Capacity:
-----------------------------------------------------------------------
Address:
-----------------------------------------------------------------------
-----------------------------------------------------------------------
(Include Zip Code)
SIGNATURE GUARANTEE
(IF REQUIRED BY INSTRUCTION 5)
Signature(s) Guaranteed by an Eligible Institution:
-----------------------------------------------------------------------
(Authorized Signature)
-----------------------------------------------------------------------
(Title)
-----------------------------------------------------------------------
(Name of Firm)
-----------------------------------------------------------------------
(Address, Include Zip Code)
-----------------------------------------------------------------------
(Area Code and Telephone Number)
Dated: __________________________________________________________, 1997
6
<PAGE>
SPECIAL ISSUANCE INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 5 AND 6) (SEE INSTRUCTIONS 5 AND 6)
To be completed ONLY (i) if To be completed ONLY if
certificates for Original Preferred certificates for Original Preferred
Stock for a number of shares not Stock for a number of shares, or
tendered, or for Exchange Preferred for Exchange Preferred Stock issued
Stock issued in exchange for in exchange for Original Preferred
Original Preferred Stock accepted Stock accepted for exchange, are to
for exchange, are to be issued in be mailed or delivered to someone
the name of someone other than the other than the undersigned or to
undersigned, or (ii) if Original the undersigned at an address other
Preferred Stock tendered by book- than that shown below the
entry transfer which is not undersigned's signature.
exchanged, or Exchange Preferred
Stock issued in exchange for
Original Preferred Stock accepted
for exchange, is to be credited to
an account maintained at DTC other
than the account previously
indicated herein.
Mail or deliver Certificates to:
Name:
-----------------------------
(Please Type or Print)
[_] Issue Certificate(s) to: Address:
-----------------------------
Name(s):
----------------------------- ------------------------------------
(Please Type or Print) (Include Zip Code)
------------------------------------ ------------------------------------
(Please Type or Print) (Tax Identification or Social
Security No.)
Address:
-----------------------------
------------------------------------
(Include Zip Code)
------------------------------------
(Tax Identification or Social
Security No.)
(Complete Substitute Form W-9)
[_] Credit book-entry transfers to
DTC as set forth below:
------------------------------------
(DTC Account Number, if applicable)
7
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. DELIVERY OF THIS LETTER OF TRANSMITTAL AND ORIGINAL PREFERRED STOCK OR
BOOK-ENTRY CONFIRMATIONS. All physically delivered certificates representing
Original Preferred Stock or any confirmation of a book-entry transfer to the
Exchange Agent's account at DTC of Original Preferred Stock tendered by book-
entry transfer (a "Book-Entry Confirmation"), as well as a properly completed
and duly executed copy of this Letter of Transmittal (or facsimile hereof) and
any other documents required by this Letter of Transmittal, must be received
by the Exchange Agent at its address set forth herein prior to 5:00 p.m., New
York City time, on the Expiration Date. The method of delivery of the tendered
Original Preferred Stock, this Letter of Transmittal and all other required
documents to the Exchange Agent shall be at the election and sole risk of the
Holder and, except as otherwise provided below, the delivery will be deemed
made only when actually received or confirmed by the Exchange Agent. Instead
of delivery by mail, it is recommended that the Holder use an overnight or
hand delivery service. In all cases, sufficient time should be allowed to
assure delivery to the Exchange Agent before the Expiration Date. No Letter of
Transmittal or Original Preferred Stock should be sent to the Company.
2. GUARANTEED DELIVERY PROCEDURES. Holders who wish to tender their Original
Preferred Stock and (i) whose Original Preferred Stock is not immediately
available, (ii) who are unable to complete the procedure for book-entry
transfer on a timely basis, or (iii) who are unable to deliver their Original
Preferred Stock, this Letter of Transmittal or any other documents required
hereby to the Exchange Agent prior to the Expiration Date, must tender their
Original Preferred Stock according to the guaranteed delivery procedures set
forth in the Prospectus. Pursuant to such procedures: (a) such tender must be
made by or through a firm which is a member of a registered national
securities exchange or of the National Association of Securities Dealers Inc.,
a commercial bank or trust company having an office or correspondent in the
United States or an "eligible guarantor institution" within the meaning of
Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended (each, an
"Eligible Institution"); (b) prior to the Expiration Date, the Exchange Agent
must have received from the Eligible Institution a properly completed and duly
executed Notice of Guaranteed Delivery (by facsimile transmission, mail or
hand delivery) setting forth the name and address of the Holder of the
Original Preferred Stock, the certificate number(s) of such Original Preferred
Stock or the name and number of the Holder's account at DTC, as the case may
be, and the number of shares of Original Preferred Stock tendered, stating
that the tender is being made thereby and guaranteeing that, within three (3)
New York Stock Exchange, Inc. ("NYSE") trading days after the Expiration Date,
this Letter of Transmittal (or facsimile hereof) together with the
certificates for tendered shares of Original Preferred Stock in proper form
for transfer or a Book-Entry Confirmation, as the case may be, and any other
documents required hereby will be received by the Exchange Agent; and (c) this
Letter of Transmittal (or facsimile hereof), properly completed and executed,
the certificates for tendered shares of Original Preferred Stock in proper
form for transfer or Book-Entry Confirmation, as the case may be, and all
other documents required hereby are received by the Exchange Agent within
three (3) NYSE trading days after the Expiration Date. See "The Exchange
Offer--Guaranteed Delivery Procedures" section of the Prospectus.
Any Holder of Original Preferred Stock who wishes to tender Original
Preferred Stock pursuant to the guaranteed delivery procedures described above
must ensure that the Exchange Agent receives the Notice of Guaranteed Delivery
prior to 5:00 p.m., New York City time, on the Expiration Date. Upon request
of the Exchange Agent, a Notice of Guaranteed Delivery will be sent to Holders
who wish to tender their Original Preferred Stock according to the guaranteed
delivery procedures set forth above.
3. TENDER BY HOLDER. Only a Holder of Original Preferred Stock may tender
such Original Preferred Stock in the Exchange Offer. Any beneficial owner of
Original Preferred Stock that is not the registered Holder and that wishes to
tender should arrange with the registered Holder to execute and deliver this
Letter of Transmittal on its behalf or must, prior to completing and executing
this Letter of Transmittal and delivering its Original Preferred Stock, either
make appropriate arrangements to register ownership of the Original Preferred
Stock in such Holder's name or obtain a properly completed stock power from
the registered Holder.
4. PARTIAL TENDERS. If less than a Holder's entire number of shares of
Original Preferred Stock is tendered, the tendering Holder should fill in the
principal amount tendered in the fourth column of the box entitled
"Description of Original Preferred Stock" above. The entire number of shares
of Original Preferred Stock delivered to the Exchange Agent will be deemed to
have been tendered unless otherwise indicated. If the entire number of shares
of all Original Preferred Stock is
8
<PAGE>
not tendered, then certificates for the number of shares of Original Preferred
Stock not tendered and certificates for Exchange Preferred Stock issued in
exchange for any Original Preferred Stock accepted will be sent to the Holder
at his or her registered address (or such shares will be credited to an account
at DTC maintained by the Holder), unless a different address (or account at
DTC) is provided in the appropriate box on this Letter of Transmittal, promptly
after the Original Preferred Stock is accepted for exchange.
5. SIGNATURES ON THIS LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS;
GUARANTEE OF SIGNATURES. If this Letter of Transmittal (or facsimile hereof) is
signed by the registered Holder(s) of the Original Preferred Stock tendered
hereby, the signature must correspond with the name(s) as written on the face
of the Original Preferred Stock without alteration, enlargement or any change
whatsoever.
If this Letter of Transmittal (or facsimile hereof) is signed by the
registered Holder or Holders of Original Preferred Stock listed and tendered
hereby and the certificates for Exchange Preferred Stock issued in exchange
therefor are to be issued (or any untendered number of shares of Original
Preferred Stock is to be reissued) to the registered Holder and neither the box
entitled "Special Issuance Instructions" or "Special Delivery Instructions" has
been completed, then such Holder need not and should not endorse any tendered
Original Preferred Stock nor provide a separate stock power. In any other case,
such Holder must either properly endorse the Original Preferred Stock tendered
or transmit a properly completed separate stock power with this Letter of
Transmittal, with the signatures on the endorsement or stock power guaranteed
by an Eligible Institution.
If this Letter of Transmittal (or facsimile hereof) is signed by a person
other than the registered Holder or Holders of any Original Preferred Stock
listed, such Original Preferred Stock must be endorsed or accompanied by
appropriate stock powers, in each case signed as the name of the registered
Holder or Holders appears on the Original Preferred Stock.
If this Letter of Transmittal (or facsimile hereof) or any Original Preferred
Stock or stock powers are signed by trustees, executors, administrators,
guardians, attorneys-in-fact, or 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, evidence satisfactory to the
Company of their authority so to act must be submitted with this Letter of
Transmittal.
Endorsements on Original Preferred Stock or signatures on stock powers
required by this Instruction 5 must be guaranteed by an Eligible Institution.
No signature guarantee is required if (i) this Letter of Transmittal is
signed by the registered Holder(s) of the Original Preferred Stock tendered
herewith and neither the box entitled "Special Delivery Instructions" nor the
box entitled "Special Registration Instructions" has been completed, or (ii)
such Original Preferred Stock is tendered for the account of an Eligible
Institution. In all other cases, all signatures on this Letter of Transmittal
must be guaranteed by an Eligible Institution.
6. SPECIAL REGISTRATION AND DELIVERY INSTRUCTIONS. Tendering holders should
indicate, in the applicable box or boxes, the name and address (or account at
DTC) to which Exchange Preferred Stock or substitute Original Preferred Stock
for shares not tendered or not accepted for exchange are to be issued or sent,
if different from the name and address (or account at DTC) of the person
signing this Letter of Transmittal. In the case of issuance in a different
name, the taxpayer identification or social security number of the person named
must also be indicated.
7. TRANSFER TAXES. The Company will pay all transfer taxes, if any,
applicable to the exchange of Original Preferred Stock pursuant to the Exchange
Offer. If, however, Exchange Preferred Stock, or Original Preferred Stock for
shares not tendered or accepted for exchange, is to be delivered to, or is to
be registered or issued in the name of, any person other than the registered
Holder of the Original Preferred Stock tendered hereby, or if tendered Original
Preferred Stock is registered in the name of any person other than the person
signing this Letter of Transmittal, or if a transfer tax is imposed for any
reason other than the exchange of Original Preferred Stock pursuant to the
Exchange Offer, then the amount of any such transfer taxes (whether imposed on
the registered Holder or any other persons) will be payable by the tendering
Holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with this Letter of Transmittal, the amount of such
transfer taxes will be billed directly to such tendering Holder.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 7, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE ORIGINAL PREFERRED STOCK LISTED IN
THIS LETTER OF TRANSMITTAL.
9
<PAGE>
8. TAX IDENTIFICATION NUMBER. Federal income tax law requires that a Holder
of any Original Preferred Stock which is accepted for exchange must provide the
Company (as payor) with its correct taxpayer identification number ("TIN"),
which, in the case of a Holder who is an individual, is his or her social
security number. If the Company is not provided with the correct TIN, the
Holder may be subject to a $50 penalty imposed by the Internal Revenue Service.
(If withholding results in an over-payment of taxes, a refund may be obtained.)
Certain Holders (including, among others, all corporations and certain foreign
individuals) are not subject to these backup withholding and reporting
requirements. See the enclosed "Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9" for additional instructions.
To prevent backup withholding, each tendering Holder must provide its correct
TIN by completing the Substitute Form W-9 set forth herein, certifying that the
TIN provided is correct (or that such Holder is awaiting a TIN) and that (i)
the Holder has not been notified by the Internal Revenue Service that it is
subject to backup withholding as a result of failure to report all interest or
dividends, or (ii) the Internal Revenue Service has notified the Holder that it
is no longer subject to backup withholding. If the Original Preferred Stock is
registered in more than one name or is not in the name of the actual owner, see
the enclosed "Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9" for information on which TIN to report.
The Company reserves the right, in its sole discretion, to take whatever
steps are necessary to comply with the Company's obligation regarding backup
withholding.
9. VALIDITY OF TENDERS. All questions as to the validity, form, eligibility
(including time of receipt), and acceptance or withdrawal of tendered Original
Preferred Stock will be determined by the Company, in its sole discretion,
which determination will be final and binding. The Company reserves the right
to reject any and all Original Preferred Stock not validly tendered or any
Original Preferred Stock, the Company's acceptance of which would, in the
opinion of counsel for the Company, be unlawful. The Company also reserves the
right to waive any conditions of the Exchange Offer or defects or
irregularities in tenders of Original Preferred Stock as to any ineligibility
of any Holder who seeks to tender Original Preferred Stock in the Exchange
Offer. The interpretation of the terms and conditions of the Exchange Offer
(includes this Letter of Transmittal and the instructions hereto) by the
Company shall be final and binding on all parties. Unless waived, any defects
or irregularities in connection with tenders of Original Preferred Stock must
be cured within such time as the Company shall determine. The Company will use
reasonable efforts to give notification of defects or irregularities with
respect to tenders of Original Preferred Stock, but shall not incur any
liability for failure to give such notification. Tenders of Original Preferred
Stock will not be deemed to have been made until such defects or irregularities
have been cured or waived. Any Original Preferred Stock received by the
Exchange Agent that is not validly tendered and as to which the defects or
irregularities have not been cured or waived will be returned by the Exchange
Agent to the tendering Holders, unless otherwise provided in this Letter of
Transmittal, as soon as practicable following the Expiration Date.
10. WAIVER OF CONDITIONS. The Company reserves the right, in its sole
discretion, to amend, waive or modify, in whole or part, any of the conditions
to the Exchange Offer set forth in the Prospectus with respect to any Original
Preferred Stock tendered.
11. MUTILATED, LOST, STOLEN OR DESTROYED ORIGINAL PREFERRED STOCK. If any
certificates representing Original Preferred Stock have been mutilated, lost,
stolen or destroyed, the Holder of such Original Preferred Stock should contact
the Exchange Agent at the address indicated above for further instructions.
12. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance or
for additional copies of the Prospectus or this Letter of Transmittal should be
directed to the Exchange Agent at the address or telephone number set forth on
the cover page of this Letter of Transmittal.
13. ACCEPTANCE OF TENDERED ORIGINAL PREFERRED STOCK AND ISSUANCE OF EXCHANGE
PREFERRED STOCK; RETURN OF ORIGINAL PREFERRED STOCK. Subject to the terms and
conditions of the Exchange Offer, the Company will accept for exchange all
validly tendered Original Preferred Stock as soon as practicable after the
Expiration Date and will issue Exchange Preferred Stock therefor as soon as
practicable thereafter. For purposes of the Exchange Offer, the Company shall
be deemed to have accepted tendered Original Preferred Stock when, as and if
the Company has given written or oral notice thereof to the Exchange Agent. If
any tendered Original Preferred Stock is not exchanged pursuant to the Exchange
Offer for any
10
<PAGE>
reason, such unexchanged Original Preferred Stock will be returned, without
expense, to the undersigned at the address shown above (or credited to the
Exchange Agent's account at DTC in the name of the undersigned) or at a
different address as may be indicated under the box entitled "Special Delivery
Instructions."
14. WITHDRAWAL. Tenders may be withdrawn only pursuant to the limited
withdrawal rights set forth in the Prospectus under the caption "The Exchange
Offer--Withdrawal of Tenders."
IMPORTANT: THIS LETTER OF TRANSMITTAL OR A MANUALLY SIGNED FACSIMILE HEREOF,
TOGETHER WITH CERTIFICATES OR A BOOK-ENTRY CONFIRMATION REPRESENTING TENDERED
ORIGINAL PREFERRED STOCK OR THE NOTICE OF GUARANTEED DELIVERY, MUST BE
RECEIVED BY THE EXCHANGE AGENT PRIOR TO THE EXPIRATION TIME.
11
<PAGE>
(TO BE COMPLETED BY ALL TENDERING HOLDERS (SEE INSTRUCTION 8))
PAYOR'S NAME: HELLER FINANCIAL, INC.
Part I -- Taxpayer
Identification No.-- -------------------------
For All Accounts
SUBSTITUTE Enter your taxpayer
FORM W-9 identification Social security number
number on the
appropriate line.
For most individuals
and sole
proprietors, this is
your social security
number. For other
entities, it is your
Employer
Identification
Number. If you do
not have a number,
see How to Obtain a
TIN in the enclosed
Guidelines.
DEPARTMENT OF THE Note: If the account
TREASURY is in more than one OR
INTERNAL REVENUE name, see the chart -------------------------
SERVICE on page 2 of the Employer identification
enclosed Guidelines number
to determine what
number to enter.
Under penalties of perjury, I certify
that:
PAYER'S REQUEST (1) The number shown on this form is my correct
FOR Taxpayer Identification Number (or I am
waiting for a number to be issued to me, and
either (a) I have mailed or delivered an
application to receive a Taxpayer
Identification Number to the appropriate
Internal Revenue Service Center or Social
Security Administration Office or (b) I
intend to mail or deliver an application in
the near future). I understand that if I do
not provide a Taxpayer Identification Number
within sixty (60) days, 31% of all reportable
payments made to me thereafter will be
withheld until I provide a number;
TAXPAYER ------------------------------------------------------
IDENTIFICATION Part II -- Certification -- For Payees Exempt
NO. from Backup Withholding (see enclosed Guidelines)
(2) I am not subject to backup withholding either
because (a) I am exempt from backup
withholding, (b) I have not been notified by
the Internal Revenue Service ("IRS") that I
am subject to backup withholding as a result
of a failure to report all interest or
dividends, or (c) the IRS has notified me
that I am no longer subject to backup
withholding; and
(3) Any other information provided on this form
is true, correct and complete.
SIGNATURE ____________________________ DATE _______
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU WITH RESPECT TO THE EXCHANGE PREFERRED
STOCK. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
12
<PAGE>
Exhibit 99.2
LOGO
NOTICE OF GUARANTEED DELIVERY
OF
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B
IN EXCHANGE FOR
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES C
OF
HELLER FINANCIAL, INC.
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON ,
1997, UNLESS EXTENDED (IN ANY CASE, THE "EXPIRATION DATE"). FIXED RATE
NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B ("ORIGINAL
PREFERRED STOCK"), TENDERED IN THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY
TIME PRIOR TO THE EXPIRATION DATE.
This form or one substantially equivalent hereto must be used by a holder of
Original Preferred Stock to accept the offer (the "Exchange Offer") of Heller
Financial, Inc., a Delaware corporation (the "Company"), to exchange its Fixed
Rate Noncumulative Perpetual Senior Preferred Stock, Series C, for an equal
number of shares of its issued and outstanding Original Preferred Stock,
pursuant to the guaranteed delivery procedures described under the caption
"The Exchange Offer--Guaranteed Delivery Procedures" of the Prospectus, dated
, 1997 (as the same may be amended from time to time, the "Prospectus") and
Instruction 2 to the related Letter of Transmittal (the "Letter of
Transmittal"), if (i) certificates representing Original Preferred Stock to be
exchanged are not immediately available, (ii) the procedure for book-entry
transfer cannot be completed in a timely manner or (iii) the Original
Preferred Stock to be tendered for exchange, the Letter of Transmittal or any
other required documents cannot be delivered to BankBoston, N.A. (the
"Exchange Agent") prior to the Expiration Date (as defined below). Any holder
who wishes to tender Original Preferred Stock pursuant to such guaranteed
delivery procedures must ensure that the Exchange Agent receives this Notice
of Guaranteed Delivery prior to the Expiration Date of the Exchange Offer.
Capitalized terms used but not defined herein have the meanings ascribed to
them in the Prospectus or the Letter of Transmittal.
The Exchange Agent for the Exchange Offer is:
BankBoston, N.A.
By Hand/Overnight Courier/Registered or Certified Mail:
BankBoston, N.A.
c/o Boston EquiServe L.P.
Attn: Corporate Reorganization
150 Royall Street
Canton, Massachusetts 02021
By Facsimile:
(617)575-2233
Confirm by Telephone:
(617) 575-3400
DELIVERY, OR TRANSMISSION VIA FACSIMILE, OF THIS NOTICE OF GUARANTEED
DELIVERY TO AN ADDRESS OR FACSIMILE NUMBER OTHER THAN AS SET FORTH ABOVE, WILL
NOT CONSTITUTE A VALID DELIVERY.
THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE
SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE
GUARANTEED BY AN ELIGIBLE INSTITUTION UNDER THE INSTRUCTIONS THERETO, SUCH
SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE BOX
MARKED "GUARANTEE OF SIGNATURES" ON THE LETTER OF TRANSMITTAL.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tender(s) for exchange to the Company, upon the terms
and subject to the conditions set forth in the Prospectus and related Letter
of Transmittal, receipt of which is hereby acknowledged, the number of shares
of Original Preferred Stock set forth below pursuant to the guaranteed
delivery procedures set forth in the Prospectus under the caption "The
Exchange Offer--Guaranteed Delivery Procedures" and Instruction 2 to the
Letter of Transmittal.
The undersigned understands and acknowledges that the Exchange offer will
expire at 5:00 p.m., New York City time, on , 1997, unless extended by
the Company. With respect to the Exchange Offer, "Expiration Date" means such
time and date or, if the Exchange Offer is extended, the latest time and date
to which the Exchange Offer is so extended by the Company.
All authority herein conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall survive the death or incapacity of the undersigned,
and every obligation of the undersigned under this Notice of Guaranteed
Delivery shall be binding upon the heirs, personal representatives, executors,
administrators, successors, assigns, trustees in bankruptcy and other legal
representatives of the undersigned.
The undersigned hereby tenders the Original Preferred Stock listed below:
<TABLE>
<CAPTION>
CERTIFICATE
NUMBER(S)
(IF KNOWN)
OF ORIGINAL
PREFERRED AGGREGATE NUMBER OF AGGREGATE NUMBER
STOCK SHARES REPRESENTED OF SHARES TENDERED
- ------------------------------------------------------
<S> <C> <C>
- ------------------------------------------------------
- ------------------------------------------------------
</TABLE>
This Notice of Guaranteed Delivery must be signed by the Holder(s) exactly
as their name(s) appear on certificates for Original Preferred Stock, or by
person(s) authorized to become Holder(s) by endorsements and documents
transmitted with this Notice of Guaranteed Delivery.
- -------------------------------------------------------------------------------
PLEASE SIGN AND COMPLETE
Signatures of Registered Date: , 1997
Holder(s): _________________________ Address: ___________________________
------------------------------------ ------------------------------------
------------------------------------ (Include Zip Code)
Area Code and Telephone No.: _______
Name(s) of Registered Holder(s): ___
------------------------------------ Taxpayer Identification Number or
------------------------------------ Social Security Number: ____________
Name and capacity, if signing in a
fiduciary or representative
capacity: __________________________
2
<PAGE>
GUARANTEE OF DELIVERY
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm which is a member of a registered national
securities exchange or of the National Association of Securities Dealers,
Inc., or is a commercial bank or trust company having an office or
correspondent in the United States, or is otherwise an "eligible guarantor
institution" within the meaning of Rule 17Ad-15 under the Securities
Exchange Act of 1934, guarantees deposit with the Exchange Agent of the
Letter of Transmittal (or facsimile thereof), together with the Original
Preferred Stock tendered hereby in proper form for transfer (or confirmation
of the book-entry transfer of such Original Preferred Stock into the
Exchange Agent's account at DTC as described in the Prospectus under the
caption "The Exchange Offer
--Guaranteed Delivery Procedures" and in the Letter of Transmittal) and any
other required documents, all by 5:00 p.m., New York City time, within three
New York Stock Exchange trading day following the Expiration Date.
Name of Firm: ______________________ ____________________________________
Authorized Signature
Address: ___________________________
Name: ______________________________
____________________________________
(Include Zip Code) Title: _____________________________
(Please type or print)
Area Code and Telephone Number:
____________________________________ Date: ________________________, 1997
DO NOT SEND ORIGINAL PREFERRED STOCK WITH THIS FORM. ACTUAL SURRENDER OF
ORIGINAL PREFERRED STOCK MUST BE MADE PURSUANT TO, AND BE ACCOMPANIED BY, A
PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL AND ANY OTHER
REQUIRED DOCUMENTS.
INSTRUCTIONS FOR NOTICE OF GUARANTEED DELIVERY
1. Delivery of this Notice of Guaranteed Delivery. A properly completed and
duly executed copy of this Notice of Guaranteed Delivery and any other
documents required by this Notice of Guaranteed Delivery must be received by
the Exchange Agent at its address set forth herein prior to the Expiration
Date. The method of delivery of this Notice of Guaranteed Delivery and any
other required documents to the Exchange Agent shall be at the election and
sole risk of the holder, and the delivery will be deemed made only when
actually received or confirmed by the Exchange Agent. Instead of delivery by
mail, it is recommended that holders use an overnight or hand delivery
service. In all cases, sufficient time should be allowed to assure delivery to
the Exchange Agent before the Expiration Date. For a description of the
guaranteed delivery procedures, see Instruction 2 of the Letter of
Transmittal.
2. Signatures on this Notice of Guaranteed Delivery. If this Notice of
Guaranteed Delivery is signed by the registered holder(s) of the Original
Preferred Stock referred to herein, the signature must correspond with the
name(s) written on the face of the Original Preferred Stock, without
alteration, enlargement, or any change whatsoever. If this Notice of
Guaranteed Delivery is signed by a person other than the registered holder(s)
of any Original Preferred Stock, this Notice of Guaranteed Delivery must be
accompanied by appropriate stock powers, signed as the name of the registered
holder(s) appears on the Original Preferred Stock. If this Notice of
Guaranteed Delivery is signed by a trustee, executor, administrator, guardian,
attorney-in-fact, officer of a corporation, or other person acting in a
fiduciary or representative capacity, such person should so indicate when
signing and submit with the Letter of Transmittal evidence satisfactory to the
Company of such person's authority to so act.
3. Requests for Assistance or Additional Copies. Questions and requests for
assistance and requests for additional copies of the Prospectus or the Letter
of Transmittal may be directed to the Exchange Agent at the address, facsimile
number or telephone number specified on the cover page hereof.
3
<PAGE>
Exhibit 99.3
LOGO
TENDER OF
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B
IN EXCHANGE FOR
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES C
OF
HELLER FINANCIAL, INC.
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
, 1997, UNLESS EXTENDED (IN ANY CASE, THE "EXPIRATION DATE"). FIXED RATE
NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B ("ORIGINAL
PREFERRED STOCK"), TENDERED IN THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY
TIME PRIOR TO THE EXPIRATION DATE.
To Our Clients:
Enclosed for your consideration is a Prospectus, dated , 1997 (as
the same may be amended from time to time, the "Prospectus"), of Heller
Financial, Inc., a Delaware corporation (the "Company"), and a related Letter
of Transmittal (the "Letter of Transmittal"), which together with the
Prospectus constitutes the Company's offer (the "Exchange Offer") to exchange
its Fixed Rate Noncumulative Perpetual Senior Preferred Stock, Series C (the
"Exchange Preferred Stock"), for an equal number of shares of its issued and
outstanding Original Preferred Stock, upon the terms and subject to the
conditions set forth in the Exchange Offer. As set forth in the Prospectus,
the terms of the Exchange Preferred Stock are substantially the same in all
material respects to those of the Original Preferred Stock, except that the
Exchange Preferred Stock will be registered under the Securities Act and,
therefore, will not bear legends restricting their transfer under the
Securities Act and will not contain certain provisions regarding minimum unit
size, registration rights, the payment of additional dividends under certain
circumstances relating to the timing of the Exchange Offer or the filing of
registration statements.
THE ENCLOSED MATERIAL IS BEING FORWARDED TO YOU AS THE BENEFICIAL OWNER OF
ORIGINAL PREFERRED STOCK HELD BY US FOR YOUR OWN ACCOUNT OR BENEFIT BUT NOT
REGISTERED IN YOUR NAME. A TENDER OF SUCH ORIGINAL PREFERRED STOCK CAN BE MADE
ONLY BY US AS THE REGISTERED HOLDER OF RECORD AND PURSUANT TO YOUR
INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR
INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER FOR EXCHANGE ORIGINAL
PREFERRED STOCK HELD BY US FOR YOUR ACCOUNT.
Accordingly, we request instructions as to whether you wish to tender for
exchange any or all of the Original Preferred Stock held by us for your
account or benefit, pursuant to the terms and conditions of the Exchange Offer
set forth in the Prospectus and the Letter of Transmittal. We urge you to read
carefully the Prospectus and the Letter of Transmittal before instructing us
whether to exchange your Original Preferred Stock. We also request that you
confirm that we may on your behalf make the representations contained in the
Letter of Transmittal.
The Exchange Offer expires at 5:00 p.m., New York City time, on ,
1997, unless extended by the Company (in any case, the "Expiration Date").
Your instructions to us should be forwarded as promptly as possible in order
to permit us to exchange Original Preferred Stock on your behalf in accordance
with the provisions of the Exchange Offer
<PAGE>
prior to the Expiration Date. Original Preferred Stock tendered in the
Exchange Offer may be withdrawn at any time prior to 5:00 p.m., New York City
time, on the Expiration Date.
Your attention is directed to the following:
1. The Exchange Offer is for the exchange of one share of the Exchange
Preferred Stock for each share of the Original Preferred Stock, of which
1,5000,000 shares are issued and outstanding as of the date hereof.
2. THE EXCHANGE OFFER IS NOT CONDITIONED UPON ANY MINIMUM AGGREGATE
NUMBER OF SHARES OF ORIGINAL PREFERRED STOCK BEING TENDERED. THE EXCHANGE
OFFER IS, HOWEVER, SUBJECT TO CERTAIN CUSTOMARY CONDITIONS. SEE "THE
EXCHANGE OFFER--CONDITIONS TO THE EXCHANGE OFFER" IN THE PROSPECTUS.
3. The Company has agreed to pay the expenses of the Exchange Offer.
4. Any transfer taxes incident to the transfer of Original Preferred
Stock from the tendering holder to the Company will be paid by the Company,
except as provided in the Prospectus and the Letter of Transmittal.
The Exchange Offer is not being made to, nor will exchanges be accepted from
or on behalf of, holders of Original Preferred Stock residing in any
jurisdiction in which the making of the Exchange Offer or acceptance thereof
would not be in compliance with the laws of such jurisdiction.
If you wish us to exchange any or all of your Original Preferred Stock held
by us for your account or benefit, please so instruct us by completing,
executing, detaching and returning to us the instruction form that appears
herewith. An envelope in which to return your instructions to us is enclosed.
If you authorize the exchange of your Original Preferred Stock, all such
Original Preferred Stock will be tendered for exchange, unless otherwise
indicated in the instruction form.
Very truly yours,
2
<PAGE>
INSTRUCTIONS
The undersigned acknowledge(s) receipt of your letter and the enclosed
Prospectus, dated , 1997, and the related Letter of Transmittal
relating to the offer by Heller Financial, Inc., a Delaware corporation, to
exchange its Fixed Rate Noncumulative Perpetual Senior Preferred Stock, Series
C, for an equal number of shares of its issued and outstanding Fixed Rate
Noncumulative Perpetual Senior Preferred Stock, Series B (the "Original
Preferred Stock").
You are instructed to tender the number of shares of Original Preferred
Stock indicated below (or, if no number is indicated below, all of the
undersigned's Original Preferred Stock) that are held by you for the account
or benefit of the undersigned, upon the terms and subject to the conditions
set forth in the Prospectus and the Letter of Transmittal.
SIGN HERE
Number of shares of Original
Preferred Stock to be tendered for
exchange*
-------------------------------------
-------------------------------------
---------------- Signature(s)
-------------------------------------
-------------------------------------
-------------------------------------
Print name(s) and address(es)
-------------------------------------
-------------------------------------
Area Code and Telephone Number(s)
-------------------------------------
Dated: , 1997 Name and capacity, if signing in a
representative or fiduciary capacity
-------------------------------------
Tax Identification or Social
Security Number(s)
- --------
*The undersigned understand(s) that if the undersigned sign(s) this
instruction form without indicating a number of shares of Original
Preferred Stock in the space provided, all shares of Original Preferred
Stock held by you for the undersigned's account or benefit will be tendered
for exchange.
<PAGE>
Exhibit 99.4
LOGO
TENDER OF
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B
IN EXCHANGE FOR
FIXED RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES C
OF
HELLER FINANCIAL, INC.
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
, 1997, UNLESS EXTENDED (IN ANY CASE, THE "EXPIRATION DATE"). FIXED
RATE NONCUMULATIVE PERPETUAL SENIOR PREFERRED STOCK, SERIES B ("ORIGINAL
PREFERRED STOCK"), TENDERED IN THE EXCHANGE OFFER MAY BE WITHDRAWN AT ANY
TIME PRIOR TO THE EXPIRATION DATE.
To The Depository Trust Company
and other Registered Holders:
Heller Financial, Inc., a Delaware corporation (the "Company"), is offering
upon the terms and conditions set forth in the Prospectus, dated , 1997
(as the same may be amended from time to time, the Prospectus), and the
related Letter of Transmittal enclosed herewith (the "Letter of Transmittal"),
which together constitute the Company's offer (the "Exchange Offer") to
exchange its Fixed Rate Noncumulative Perpetual Senior Preferred Stock, Series
C (the "Exchange Preferred Stock"), for an equal number of shares of its
issued and outstanding Original Preferred Stock. As set forth in the
Prospectus, the terms of the Exchange Preferred Stock are substantially the
same in all material respects to those of the Original Preferred Stock, except
that the Exchange Preferred Stock will be registered under the Securities Act
of 1933, as amended (the "Securities Act"), and, therefore, will not bear
legends restricting their transfer under the Securities Act and will not
contain provisions regarding minimum unit size, registration rights or the
payment of additional dividends under certain circumstances relating to the
timing of the Exchange Offer or the filing of registration statements.
THE EXCHANGE OFFER IS NOT CONDITIONED UPON ANY MINIMUM AGGREGATE NUMBER OF
SHARES OF ORIGINAL PREFERRED STOCK BEING TENDERED. THE EXCHANGE OFFER IS,
HOWEVER, SUBJECT TO CERTAIN CUSTOMARY CONDITIONS. SEE "THE EXCHANGE OFFER--
CONDITIONS TO THE EXCHANGE OFFER" IN THE PROSPECTUS.
Enclosed herewith for your information and for forwarding to your clients are
copies of the following documents:
1. The Prospectus, dated , 1997;
2. The Letter of Transmittal (facsimile copies of which may be used);
3. A letter which may be sent to your clients for whose account you hold
Original Preferred Stock in your name or in the name of your nominee,
with space provided for obtaining such client's instruction with regard
to the Exchange Offer;
4. A Notice of Guaranteed Delivery;
5. Guidelines of the Internal Revenue Service for Certification of Taxpayer
Identification Number on Substitute Form W-9; and
6. A return envelope addressed to BankBoston, N.A., the Exchange Agent.
<PAGE>
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE EXCHANGE OFFER WILL EXPIRE AT 5:00
P.M., NEW YORK CITY TIME, ON , 1997, UNLESS EXTENDED BY THE COMPANY.
PLEASE FURNISH COPIES OF THE ENCLOSED MATERIALS TO THOSE OF YOUR CLIENTS FOR
WHOM YOU HOLD ORIGINAL PREFERRED STOCK REGISTERED IN YOUR NAME OR THE NAME OF
YOUR NOMINEE AS QUICKLY AS POSSIBLE.
In all cases, exchanges of Original Preferred Stock accepted for exchange
pursuant to the Exchange Offer will be made only after timely receipt by the
Exchange Agent of (i) certificates representing such Original Preferred Stock
or confirmation of a book-entry transfer of Original Preferred Stock to the
Exchange Agent's account at The Depository Trust Company, (ii) the Letter of
Transmittal (or facsimile thereof) properly completed and duly executed with
any required signature guarantees and (iii) any other documents required by
the Letter of Transmittal.
If holders of Original Preferred Stock wish to tender, but it is
impracticable for them to forward their certificates for Original Preferred
Stock, the Letter of Transmittal or any other documents required by the Letter
of Transmittal prior to the expiration of the Exchange Offer or to comply with
the book-entry transfer procedures on a timely basis, tender may be offered by
following the guaranteed delivery procedure described in the Prospectus under
"The Exchange Offer--Guaranteed Delivery Procedures."
The Exchange Offer is not being made to, nor will tenders be accepted from
or on behalf of, holders of Original Preferred Stock residing in any
jurisdiction in which the making of the Exchange Offer or the acceptance
thereof would not be in compliance with the laws of such jurisdiction.
The Company will not pay any fee or commission to any broker-dealers or
other persons (other than the Exchange Agent) in connection with the
solicitation of tenders of Original Preferred Stock pursuant to the Exchange
Offer. The Company will pay or cause to be paid any transfer taxes payable on
the transfer of Original Preferred Stock to it, except as otherwise provided
in Instruction 7 to the Letter of Transmittal.
Questions and requests for assistance with respect to the Exchange Offer or
for additional copies of the enclosed materials may be directed to the
Exchange Agent at its address, facsimile number or phone number set forth in
the Prospectus and the Letter of Transmittal.
Very truly yours,
BankBoston, N.A.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON THE AGENT OF THE COMPANY, OR ANY AFFILIATE THEREOF, OR
AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY DOCUMENT ON
BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED
DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN.
2
<PAGE>
Exhibit 99.5
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER--Social Security numbers have nine digits separated by two hyphens: i.e.
000-00-0000. Employer identification numbers have nine digits separated by
only one hyphen: i.e. 00-0000000. The table below will help determine the
number to give the payer.
- --------------------------------------- ---------------------------------------
<TABLE>
<CAPTION>
GIVE THE
FOR THIS TYPE OF ACCOUNT: SOCIAL SECURITY
NUMBER OF--
- -----------------------------------------------
<S> <C>
1. An individual's account The individual
2. Two or more individuals The actual owner
(joint account) of the account
or, if combined
funds, any one of
the
individuals(1)
3. Husband and wife (joint The actual owner
account) of the account
or, if joint
funds, either
person(1)
4. Custodian account of a The minor(2)
minor (Uniform Gift to
Minors Act)
5. Adult and minor (joint The adult or, if
account) the minor is the
only contributor,
the minor(1)
6. Account in the name of The ward, minor
guardian or committee for a or incompetent
designated ward, minor or person(3)
incompetent person
7. a. The usual revocable The grantor-
savings trust account trustee(1)
(grantor is also
trustee)
b. So-called trust account The actual
that is not a legal or owner(1)
valid trust under State
law
8. Sole proprietorship The owner(4)
account
</TABLE>
<TABLE>
<CAPTION>
GIVE THE EMPLOYER
FOR THIS TYPE OF ACCOUNT: IDENTIFICATION
NUMBER OF--
--------
<S> <C>
9. A valid trust, estate or The legal entity
pension trust (do not furnish
the identifying
number of the
personal
representative or
trustee unless
the legal entity
itself is not
designated in the
account title)(5)
10. Corporate account The corporation
11. Partnership account held The partnership
in the name of the business
12. Association, club, The organization
religious, charitable,
educational or other tax-
exempt organization
13. A broker or registered The broker or
nominee nominee
14. Account with the The public entity
Department of Agriculture
in the name of a public
entity (such as a State or
local government, school
district or prison) that
receives agricultural
program payments
</TABLE>
---------------------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
- ---------------------------------------
(4) You must show your individual name, but you may also enter your business
or "doing business as" name. You may use either your social security
number or employer identification number.
(5) List first and circle the name of the legal trust, estate, or pension
trust.
NOTE: If no name is circled when there is more than one name, the number will
be considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Internal Revenue Service Form SS-5 (Application for Social
Security Number Card) or Form SS-4 (Application for Employer Identification
Number) from your local office of the Social Security Administration or the
Internal Revenue Service and apply for a number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include
the following:
. A corporation.
. A financial institution.
. An organization exempt from tax under Section 501(a) of the Internal Reve-
nue Code of 1986, as amended (the "Code"), or an individual retirement
plan or a custodial account under Section 403(b)(7) of the Code.
. The United States or any agency or instrumentality thereof.
. A State, the District of Columbia, a possession of the United States or
any subdivision or instrumentality thereof.
. A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
. An international organization or any agency or instrumentality thereof.
. A registered dealer in securities or commodities registered in the United
States or a possession of the United States.
. A real estate investment trust.
. A common trust fund operated by a bank under Section 584(a) of the Code.
. An exempt charitable remainder trust, or a non-exempt trust described in
Section 4947(a)(1) of the Code.
. An entity registered at all times under the Investment Company Act of
1940.
. A foreign central bank of issue.
PAYMENTS EXEMPT FROM BACKUP WITHHOLDING
Payments of dividends and patronage dividends not generally subject to backup
withholding include the following:
. Payments to nonresident aliens subject to withholding under Section 1441
of the Code.
. Payments to partnerships not engaged in a trade or business in the United
States and which have at least one nonresident partner.
. Payments of patronage dividends where the amount received is not paid in
money.
. Payments made by certain foreign organizations.
. Payments made to a nominee.
Payments of interest not generally subject to backup withholding include the
following:
. Payments of interest on obligations issued by individuals. NOTE: You may
be subject to backup withholding if this interest is $600 or more and is
paid in the course of the payer's trade or business and you have not pro-
vided your correct taxpayer identification number to the payer.
. Payments of tax-exempt interest (including exempt interest dividends under
Section 852 of the Code).
. Payments described in Section 6049(b)(5) of the Code to non resident al-
iens.
. Payments on tax-free covenant bonds under Section 1451 of the Code.
. Payments made by certain foreign organizations.
. Payments made to a nominee.
Exempt payees described above should file Substitute Form W-9 to avoid possi-
ble erroneous backup withholding. FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER,
SIGN AND DATE THE CERTIFICATION ON THE FORM AND RETURN IT TO THE PAYER. IF YOU
ARE A NONRESIDENT ALIEN OR A FOREIGN ENTITY NOT SUBJECT TO BACKUP WITHHOLDING,
FILE WITH PAYER A COMPLETED INTERNAL REVENUE FORM W-8 (CERTIFICATE OF FOREIGN
STATUS).
Certain payments other than interest, dividends, and patronage dividends that
are not subject to information reporting are also not subject to backup with-
holding. For details, see Sections 6041, 6041A(a), 6045, and 6050A of the
Code.
PRIVACY ACT NOTICE - Section 6109 of the Code requires most recipients of div-
idend, interest or other payments to give taxpayer identification numbers to
payers who must report the payments to the Internal Revenue Service. The In-
ternal Revenue Service uses the numbers for identification purposes and to
help verify the accuracy of your tax return. Payers must be given the numbers
whether or not recipients are required to file tax returns. Payers must gener-
ally withhold 31% of taxable interest, dividends, and certain other payments
to a payee who does not furnish a taxpayer identification number to a payer.
Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER - If you
fail to furnish your taxpayer identification number to a payer, you are sub-
ject to a penalty of $50 for each such failure, unless your failure is due to
reasonable cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING - If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION - Wilfully falsifying certifi-
cations or affirmations may subject you to criminal penalties, including fines
and/or imprisonment.
(4) FAILURE TO REPORT CERTAIN DIVIDEND AND INTEREST PAYMENTS - If you fail to
include any portion of an includible payment for interest, dividends, or pat-
ronage dividends in gross income, such failure will be subject to a penalty of
5% on any portion of an under-payment attributable to that failure unless
there is clear and convincing evidence to the contrary.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX ADVISOR OR THE INTERNAL REVENUE
SERVICE
