<PAGE>
Rule 424(b)(2)
Reg. No. 033-43268
PROSPECTUS SUPPLEMENT TO PROSPECTUS
DATED JUNE 18, 1997
U.S.$500,000,000
[LOGO] AMERICAN EXPRESS COMPANY
6 3/4% NOTES DUE JUNE 23, 2004
------------------------
The Notes are offered for sale both inside and outside the United States.
See 'Underwriting'.
Interest on the Notes is payable semiannually on June 23 and December 23 of
each year, commencing December 23, 1997. The Notes will mature on June 23, 2004
and may not be redeemed by American Express Company (the 'Company') prior to
maturity unless certain events occur involving United States taxation. See
'Description of Notes--Redemption'.
The Notes will be represented by one or more Global Notes registered in the
name of the nominee of The Depository Trust Company (the 'Depository').
Beneficial interests in the Global Notes will be shown on, and transfers thereof
will be effected only through, records maintained by the Depository and its
participants, including the U.S. Depositaries (as defined below) for Cedel Bank,
societe anonyme ('Cedel') and Morgan Guaranty Trust Company of New York,
Brussels Office, as operator of the Euroclear System ('Euroclear'). Except as
described herein, Notes in definitive form will not be issued. The Notes will
trade in the Depository's Same-Day Funds Settlement System until maturity, and
secondary market trading activity for the Notes will, therefore, settle in
immediately available funds. All payments of principal and interest will be made
by the Company in immediately available funds. See 'Description of Notes--Global
Clearance and Settlement Procedures'.
Application has been made to list the Notes on the Luxembourg Stock
Exchange (the 'Exchange').
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS
SUPPLEMENT OR THE PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
[CAPTION]
<TABLE>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO THE
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
------------------------ ------------------------ ------------------------
<S> <C> <C> <C>
Per Note.................................. 99.824% .350% 99.474%
Total..................................... U.S.$499,120,000 U.S.$1,750,000 U.S.$497,370,000
</TABLE>
- ------------------
(1) Plus accrued interest, if any, from June 23, 1997 to date of delivery.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, and to
pay to the Representatives U.S.$75,000 as reimbursement for all or a portion
of their expenses.
(3) Before deducting expenses payable by the Company estimated to be
U.S.$470,000.
------------------------
The Notes are offered severally by the Underwriters as specified herein,
subject to receipt and acceptance by them and subject to their right to reject
any order in whole or in part. It is expected that delivery of the Global
Notes will be made through the facilities of the Depository, Cedel and Euroclear
on or about June 23, 1997.
LEHMAN BROTHERS
ABN AMRO HOARE GOVETT CREDIT SUISSE FIRST BOSTON
DRESDNER KLEINWORT BENSON GOLDMAN, SACHS & CO.
HSBC MARKETS J.P. MORGAN SECURITIES LTD.
SALOMON BROTHERS INC
------------------------
The date of this Prospectus Supplement is June 18, 1997.
<PAGE>
THE LUXEMBOURG STOCK EXCHANGE TAKES NO RESPONSIBILITY FOR THE CONTENTS OF
THIS DOCUMENT, MAKES NO REPRESENTATION AS TO ITS ACCURACY OR COMPLETENESS AND
EXPRESSLY DISCLAIMS ANY LIABILITY WHATSOEVER FOR ANY LOSS HOWSOEVER ARISING FROM
OR IN RELIANCE UPON THE WHOLE OR ANY PART OF THE CONTENTS OF THIS DOCUMENT AND
THE PROSPECTUS.
OFFERS AND SALES OF THE NOTES ARE SUBJECT TO RESTRICTIONS IN RELATION TO
THE UNITED KINGDOM, DETAILS OF WHICH ARE SET OUT IN 'UNDERWRITING' BELOW. THE
DISTRIBUTION OF THIS PROSPECTUS SUPPLEMENT AND ACCOMPANYING PROSPECTUS ATTACHED
HERETO AND THE OFFERING OF THE NOTES IN CERTAIN OTHER JURISDICTIONS MAY ALSO BE
RESTRICTED BY LAW.
THE COMPANY ACCEPTS RESPONSIBILITY FOR THE INFORMATION CONTAINED IN THIS
PROPECTUS SUPPLEMENT AND ACCOMPANYING PROSPECTUS.
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE NOTES. SUCH
TRANSACTIONS MAY INCLUDE THE PURCHASE OF NOTES FOLLOWING THE PRICING OF THE
OFFERING TO COVER A SYNDICATE SHORT POSITION IN THE NOTES OR FOR THE PURPOSE OF
MAINTAINING THE PRICE OF THE NOTES. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE
'UNDERWRITING'.
No person has been authorized to give any information or to make any
representations other than those contained in this Prospectus Supplement or the
accompanying Prospectus and, if given or made, such information or
representations must not be relied upon as having been authorized. The
distribution of this Prospectus Supplement and the accompanying Prospectus and
the offering of the Notes in certain jurisdictions may be restricted by law.
Persons into whose possession this Prospectus Supplement and the accompanying
Prospectus come should inform themselves about and observe any such
restrictions. This Prospectus Supplement and the accompanying Prospectus do not
constitute an offer to sell or the solicitation of an offer to buy any
securities other than the securities described in this Prospectus Supplement or
an offer to sell or the solicitation of an offer to buy such securities in any
circumstances in which such offer or solicitation is unlawful. Neither the
delivery of this Prospectus Supplement or the accompanying Prospectus nor any
sale made hereunder or thereunder shall, under any circumstances, create any
implication that the information contained herein or therein is correct as of
any time subsequent to the date of such information.
NOTICE TO NORTH CAROLINA RESIDENTS
These Notes have not been approved or disapproved by the Commissioner of
Insurance for the State of North Carolina, nor has the Commissioner of Insurance
ruled upon the accuracy or the adequacy of this document.
In this Prospectus Supplement and accompanying Prospectus, unless otherwise
specified or the context otherwise requires, references to 'dollars', '$' and
'U.S.$' are to United States dollars.
S-2
<PAGE>
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Incorporation of Certain Information By Reference.......................................................... S-3
Summary of the Offering.................................................................................... S-5
Consolidated Capitalization of American Express Company and Subsidiaries................................... S-7
American Express Company and Consolidated Subsidiaries--Selected Financial Data............................ S-8
Directors and Principal Executive Officers of American Express Company..................................... S-9
Use of Proceeds............................................................................................ S-10
Description of Notes....................................................................................... S-11
United States Taxation of Non-United States Persons........................................................ S-16
Underwriting............................................................................................... S-18
General Information........................................................................................ S-20
</TABLE>
PROSPECTUS
<TABLE>
<S> <C>
Available Information...................................................................................... 2
Incorporation of Certain Information by Reference.......................................................... 2
The Company................................................................................................ 3
Use of Proceeds............................................................................................ 4
Description of Debt Securities............................................................................. 4
Description of Preferred Shares............................................................................ 12
Description of Depositary Shares........................................................................... 13
Description of Common Shares............................................................................... 16
Description of Securities Warrants......................................................................... 16
Description of Currency Warrants........................................................................... 17
Description of Other Warrants.............................................................................. 17
Plan of Distribution....................................................................................... 18
Legal Matters.............................................................................................. 19
Experts.................................................................................................... 19
</TABLE>
------------------------
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
There are hereby incorporated by reference herein (i) the Company's Annual
Report on Form 10-K for its fiscal year ended December 31, 1996, (ii) the
Company's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31,
1997, and (iii) the Company's Current Reports on Form 8-K dated January 27, 1997
and April 25, 1997, as amended by the Company's Form 8-K/A dated April 28, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date hereof and prior to the
termination of the offering made hereunder shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus Supplement and accompanying Prospectus to the
extent that a statement contained herein or in any other subsequently filed
document which also is incorporated or 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 Supplement and accompanying Prospectus.
S-3
<PAGE>
THE COMPANY HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH PERSON TO
WHOM THIS PROSPECTUS SUPPLEMENT AND ACCOMPANYING PROSPECTUS IS DELIVERED, ON THE
WRITTEN OR ORAL REQUEST OF SUCH PERSON, A COPY OF ANY AND ALL OF THE DOCUMENTS
INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT AND ACCOMPANYING
PROSPECTUS (OTHER THAN EXHIBITS TO SUCH DOCUMENTS UNLESS SUCH EXHIBITS ARE
SPECIFICALLY INCORPORATED BY REFERENCE INTO THE DOCUMENTS THAT THIS PROSPECTUS
SUPPLEMENT AND ACCOMPANYING PROSPECTUS INCORPORATES). WRITTEN OR ORAL REQUESTS
FOR SUCH COPIES SHOULD BE DIRECTED TO MR. STEPHEN P. NORMAN, SECRETARY, AMERICAN
EXPRESS COMPANY, WORLD FINANCIAL CENTER, NEW YORK, NEW YORK 10285, U.S.A. (212)
640-2000.
This Prospectus Supplement and accompanying Prospectus, together with the
documents incorporated by reference herein, will be available free of charge at
the office of Bankers Trust Luxembourg S.A., 14 Boulevard F.D. Roosevelt, L-2450
Luxembourg.
S-4
<PAGE>
SUMMARY OF THE OFFERING
The following summary is qualified in its entirety by, and should be read
in conjunction with, the more detailed information appearing elsewhere in this
Prospectus Supplement and the accompanying Prospectus.
<TABLE>
<S> <C>
Issuer.................................... American Express Company (the 'Company').
Securities Offered........................ U.S.$500,000,000 principal amount of 6 3/4% Notes due June 23, 2004
(the 'Notes').
Use of Proceeds........................... The net proceeds from the sale of the Notes will be used for general
corporate purposes. Net proceeds to be paid to the Company will be
U.S.$497,370,000.
Maturity Date............................. June 23, 2004.
Interest Payment Dates.................... June 23 and December 23 of each year, commencing December 23, 1997.
Interest Rate............................. 6 3/4% per annum.
Redemption................................ The Notes may not be redeemed by the Company prior to maturity unless
certain events occur involving United States taxation. See
'Description of Notes--Redemption'.
Markets................................... The Notes are offered for sale in those jurisdictions both inside and
outside the United States where it is legal to make such offers. See
'Underwriting'.
Listing................................... Application has been made to list the Notes on the Luxembourg Stock
Exchange.
Form and Settlement....................... The Notes will be issued in the form of one or more fully registered
global certificates (the 'Global Notes'), which will be deposited on
or about June 23, 1997 (the 'Closing Date') with, or on behalf of,
The Depository Trust Company, New York, New York (the 'Depository')
and registered in the name of Cede & Co., the Depository's nominee,
for the accounts of their respective participants, including Morgan
Guaranty Trust Company of New York, as operator of the Euroclear
System ('Euroclear') and Cedel Bank, societe anonyme ('Cedel').
Except as described in this Prospectus Supplement, beneficial
interests in the Global Notes will be represented through book-entry
accounts of financial institutions acting on behalf of beneficial
owners as direct and indirect participants in the Depository.
Investors may elect to hold interests in the Global Notes through the
Depository or through Euroclear or Cedel if they are participants in
such systems, or indirectly through organizations that are
participants in such systems. Euroclear and Cedel will hold interests
on behalf of their participants through their respective
depositaries, Morgan Guaranty Trust Company of New York and Citibank,
N.A., which in turn will hold such interests in accounts as
participants of the Depository. See 'Description of
Notes--Book-Entry, Delivery and Form'. Initial settlement for the
Notes will be made in immediately available funds in U.S. dollars.
Secondary market trading between Depository participants of
</TABLE>
S-5
<PAGE>
<TABLE>
<S> <C>
beneficial interests in the Global Notes will be settled in
immediately available funds using the Depository's Same-Day Funds
Settlement System; secondary market trading of beneficial interests
in the Global Notes between Cedel participants and/or Euroclear
participants will settle in immediately available funds.
Withholding Tax........................... Principal of and interest on the Notes beneficially owned by a non-
United States person are payable by the Company without withholding
or deduction for United States withholding taxes subject to the
requirements and limitations set forth in this Prospectus Supplement
under the heading 'United States Taxation of Non-United States
Persons'.
</TABLE>
S-6
<PAGE>
CONSOLIDATED CAPITALIZATION OF AMERICAN EXPRESS COMPANY
AND SUBSIDIARIES
The consolidated capitalization of the Company and its subsidiaries at
December 31, 1996, and the additional long-term indebtedness represented by the
Notes offered hereby, are as follows (in millions of U.S. dollars):
<TABLE>
<CAPTION>
OUTSTANDING ADDITIONL
DECEMBER 31, LONG-TERM
1996 INDEBTEDNESS
------------ ------------
<S> <C> <C>
LONG-TERM INDEBTEDNESS
Notes due June 15, 2000........................................ $ 299 $ 299
Notes due November 15, 2001.................................... 299 299
Notes due August 15, 2001...................................... 299 299
Floating Rate Notes due 2001................................... 300 300
Notes due June 2004............................................ -- 500
Other Fixed Senior Notes due 1997-2022......................... 1,879 1,879
Other Floating Senior Notes due 1997-2001...................... 2,666 2,666
Other Floating Rate Notes due 1997-2004........................ 509 509
Other Fixed Rate Notes due 1997-2006........................... 301 301
------------ ------------
Total....................................................... $ 6,552 $ 7,052
STOCKHOLDERS' EQUITY
Common shares, par value $.60 a share (authorized 1.2 billion
shares; 472.9 million shares issued and outstanding)........ 284 284
Capital surplus................................................ 4,191 4,191
Net unrealized securities gains................................ 386 386
Foreign currency translation adjustments....................... (89) (89)
Retained earnings.............................................. 3,756 3,756
------------ ------------
Total stockholders' equity.................................. 8,528 8,528
------------ ------------
TOTAL CAPITALIZATION............................................. $ 15,080 $ 15,580
------------ ------------
------------ ------------
</TABLE>
Except as set forth herein, there has been no material change in the
consolidated capitalization of the Company and its subsidiaries since December
31, 1996 to the date of this Prospectus Supplement.
S-7
<PAGE>
AMERICAN EXPRESS COMPANY AND CONSOLIDATED SUBSIDIARIES
SELECTED FINANCIAL DATA
(IN MILLIONS OF U.S. DOLLARS)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
MARCH 31 YEARS ENDED DECEMBER 31,
-------------------- -----------------------------------------------------
1997 1996 1996 1995 1994 1993 1992
-------- -------- -------- -------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
OPERATING RESULTS
Net revenues............................. $ 4,164 $ 3,909 $ 16,237 $ 15,841 $14,282 $13,254 $14,255
Expenses................................. 3,524 3,344 13,573 13,658 12,391 10,928 13,359
Income from continuing operations before
accounting changes..................... 454 396 1,901 1,564 1,380 1,605 578
Net income............................... 454 396 1,901 1,564 1,413 1,478 461
Adjusted income from continuing
operations before accounting
changes*............................... 454 396 1,739 1,564 1,380 1,172 795
Return on average shareholders'
equity**............................... 23.0% 22.3% 22.8% 22.0% 20.3% 20.9% 16.2%
BALANCE SHEET
Cash and cash equivalents................ $ 3,170 $ 5,629 $ 2,677 $ 3,200 $ 3,433 $ 3,312 $ 3,408
Accounts receivable and accrued interest,
net.................................... 19,164 17,763 20,491 19,914 17,147 16,142 15,293
Investments.............................. 38,140 41,444 38,339 42,561 40,108 39,308 37,629
Loans, net............................... 19,182 16,159 18,518 16,091 14,722 14,796 14,750
Total assets............................. 108,105 107,910 108,512 107,405 97,006 94,132 90,112
Customers' desposits and credit
balances............................... 10,603 9,335 9,555 9,889 10,013 11,131 11,637
Travelers Cheques outstanding............ 5,766 5,900 5,838 5,697 5,271 4,800 4,729
Insurance and annuity reserves........... 25,817 25,081 25,674 25,157 24,849 23,406 20,893
Short-term debt.......................... 17,324 18,306 18,402 17,654 14,810 12,489 11,163
Long-term debt........................... 6,331 7,793 6,552 7,570 7,162 8,561 8,614
Shareholders' equity..................... 8,382 7,992 8,528 8,220 6,433 8,734 7,499
</TABLE>
- ------------------
Note: Excluding First Data Corporation ('FDC'), a former subsidiary of the
Company, from 1992, net revenues were $13.1 billion and expenses were $12.4
billion.
* Adjusted to exclude: in 1996--a $300 million gain on the exchange of the
Company's Debt Exchangeable for Common Stock (DECS) and a $138 million
restructuring charge; in 1993--a $433 million gain on the sale of FDC shares;
in 1992--a $425 million gain on the sale of FDC shares, a $342 million
restructuring charge and $300 million of additional Balcor reserves.
** Return on average shareholders' equity is based on adjusted income from
continuing operations before accounting changes and excludes the effect of
SFAS No. 115 beginning in 1994. In addition, book value per share excludes
the effect of SFAS No. 115 beginning in 1994.
S-8
<PAGE>
DIRECTORS AND PRINCIPAL EXECUTIVE OFFICERS OF AMERICAN EXPRESS COMPANY
The Directors and Executive Officers of the Company are as follows:
<TABLE>
<CAPTION>
DIRECTORS
NAME PRINCIPAL OCCUPATION
- ------------------------------------ ---------------------------------------------------------------------------
<S> <C>
Daniel F. Akerson................... Chairman and Chief Executive Officer, Nextel Communications, Inc.
Anne L. Armstrong................... Chairman of the Board of Trustees, Center for Strategic and International
Studies
Edwin L. Artzt...................... Chairman of the Executive Committee, The Procter & Gamble Company
William G. Bowen.................... President, The Andrew W. Mellon Foundation
Kenneth I. Chenault................. President and Chief Operating Officer of the Company
Charles W. Duncan, Jr............... Chairman, Duncan Interests
Harvey Golub........................ Chairman and Chief Executive Officer of the Company
Beverly Sills Greenough............. Chairman, Lincoln Center for the Performing Arts
F. Ross Johnson..................... Chairman and Chief Executive Officer, RJM Group
Vernon E. Jordan, Jr................ Senior Partner, Akin, Gump, Strauss, Hauer & Feld, L.L.P.
Jan Leschly......................... Chief Executive, SmithKline Beecham PLC
Drew Lewis.......................... Former Chairman and Chief Executive Officer, Union Pacific Corporation
Aldo Papone......................... Senior Advisor, American Express Company
Frank P. Popoff..................... Chairman, The Dow Chemical Company
<CAPTION>
EXECUTIVE OFFICERS
NAME OFFICE
- ------------------------------------ ---------------------------------------------------------------------------
<S> <C>
Harvey Golub........................ Chairman and Chief Executive Officer of the Company; Chairman, American
Express Travel Related Services Company, Inc. ('TRS')
Kenneth I. Chenault................. President and Chief Operating Officer of the Company; President and Chief
Executive Officer, TRS
George L. Farr...................... Vice Chairman of the Company
Richard K. Goeltz................... Vice Chairman and Chief Financial Officer of the Company
Jonathan S. Linen................... Vice Chairman of the Company
Steven W. Alesio.................... President, Consumer Travel, Small Business Services and Government Card,
TRS
Anne M. Busquet..................... President, American Express Relationship Services, TRS
Ursula F. Fairbairn................. Executive Vice President, Human Resources and Quality of the Company
Edward P. Gilligan.................. President, Corporate Services, TRS
John D. Hayes....................... Executive Vice President, Global Advertising of the Company
William T. Heron, Jr................ President, American Express Financial Direct
David C. House...................... President, Establishment Services Worldwide, TRS
David R. Hubers..................... President and Chief Executive Officer, American Express Financial
Corporation
</TABLE>
S-9
<PAGE>
<TABLE>
<CAPTION>
NAME OFFICE
- ------------------------------------ ---------------------------------------------------------------------------
<S> <C>
Carl B. Lehmann..................... President, Stored Value Group, TRS
Allan Z. Loren...................... Executive Vice President and Chief Information Officer of the Company
Louise M. Parent.................... Executive Vice President and General Counsel of the Company
Philip J. Riese..................... President, Consumer Card Services Group, TRS; Chairman of the Board of
American Express Centurion Bank
Thomas O. Ryder..................... President, TRS International
Thomas Schick....................... Executive Vice President, Corporate Affairs and Communications of the
Company
John A. Ward, III................... Chairman and Chief Executive Officer, American Express Bank Ltd.
</TABLE>
USE OF PROCEEDS
The net proceeds from the sale of the Notes will be used for general
corporate purposes. Net proceeds to be paid to the Company will be
U.S.$497,370,000.
S-10
<PAGE>
DESCRIPTION OF NOTES
The following description of the particular terms of the Notes offered
hereby supplements, and to the extent inconsistent therewith replaces, the
description of the general terms and provisions of Debt Securities set forth in
the Prospectus.
GENERAL
The aggregate principal amount of the Notes will be U.S.$500,000,000. The
Notes will be unsecured obligations of the Company and will mature on June 23,
2004. The Notes will rank prior to all subordinated indebtedness of the Company
and pari passu with all other senior unsecured indebtedness of the Company.
The Notes will bear interest from June 23, 1997 at the rate per annum set
forth on the cover page of this Prospectus Supplement, payable on June 23 and
December 23 of each year, commencing December 23, 1997 (each, an 'Interest
Payment Date'), to the person in whose name the Note was registered at the close
of business on the 15th day preceding the respective Interest Payment Date,
subject to certain exceptions. The Notes are not subject to redemption prior to
maturity unless certain events occur involving United States taxation. In such
event, the Notes will be redeemed at a redemption price of 100% of their
principal amount plus accrued and unpaid interest to the date of redemption. See
'Description of Notes--Redemption'. If any day on which a payment is due with
respect to a Note is not a Business Day, then the holder thereof shall not be
entitled to payment of the amount due until the next following Business Day nor
to any additional principal, interest or other payment as a result of such delay
except as otherwise provided under 'Payment of Additional Amounts'. 'Business
Day' shall mean any day which is not a Saturday or Sunday or a day on which
banks in New York City, Pittsburgh and, in the event definitive Notes are
issued, Luxembourg, and any other place of payment are authorized or obligated
by law or regulation to close.
BOOK-ENTRY, DELIVERY AND FORM
The Notes will be issued in the form of one or more fully registered Global
Notes (the 'Global Notes') in denominations of U.S.$1,000 or integral multiples
thereof, and will be deposited with, or on behalf of, The Depository Trust
Company, New York, New York (the 'Depository') and registered in the name of
Cede & Co., the Depository's nominee. Beneficial interests in the Global Notes
will be represented through book-entry accounts of financial institutions acting
on behalf of beneficial owners as direct and indirect participants in the
Depository. Investors may elect to hold interests in the Global Notes either
through the Depository (in the United States) or through Cedel Bank, societe
anonyme ('Cedel') or Morgan Guaranty Trust Company of New York, Brussels Office,
as operator of the Euroclear System ('Euroclear') (outside of the United States)
if they are participants of such systems, or indirectly through organizations
which are participants in such systems. Cedel and Euroclear will hold interests
on behalf of their participants through customers' securities accounts in
Cedel's and Euroclear's names on the books of their respective depositaries,
which in turn will hold such interests in customers' securities accounts in the
depositaries' names on the books of the Depository. Citibank, N.A. will act as
depositary for Cedel, and Morgan Guaranty Trust Company of New York will act as
depositary for Euroclear (in such capacities, the 'U.S. Depositaries' ). Except
as set forth below, the Global Notes may be transferred, in whole and not in
part, only to another nominee of the Depository or to a successor of the
Depository or its nominee.
The Depository advises that it is a limited-purpose trust company organized
under the New York Banking Law, a 'banking organization' within the meaning of
the New York Banking Law, a member of the Federal Reserve System, a 'clearing
corporation' within the meaning of the New York Uniform Commercial Code, and a
'clearing agency' registered pursuant to the provisions of Section 17A of the
U.S. Securities Exchange Act of 1934, as amended (the 'Exchange Act'). The
Depository was created to hold securities of its participants and to facilitate
the clearance and settlement of securities transactions, such as transfers and
pledges, among its participants in such securities through electronic
computerized book-entry changes in accounts of the participants, thereby
eliminating the need for physical movement of securities certificates. The
Depository's participants include securities brokers and dealers (including the
Underwriters), banks, trust companies, clearing corporations and certain other
organizations, some of whom (and/or their representatives) own the Depository.
S-11
<PAGE>
Access to the Depository's book-entry system is also available to others, such
as banks, brokers, dealers and trust companies that clear through or maintain a
custodial relationship with a participant, either directly or indirectly.
Cedel advises that it is incorporated under the laws of Luxembourg as a
professional depositary. Cedel holds securities for its participating
organizations ('Cedel Participants') and facilitates the clearance and
settlement of securities transactions between Cedel Participants through
electronic book-entry changes in accounts of Cedel Participants, thereby
eliminating the need for physical movement of certificates. Cedel provides to
Cedel Participants, among other things, services for safekeeping,
administration, clearance and settlement of internationally traded securities
and securities lending and borrowing. Cedel interfaces with domestic markets in
several countries. As a professional depositary, Cedel is subject to regulation
by the Luxembourg Monetary Institute. Cedel Participants are recognized
financial institutions around the world, including underwriters, securities
brokers and dealers, banks, trust companies, clearing corporations and certain
other organizations and may include the Underwriters. Indirect access to Cedel
is also available to others, such as banks, brokers, dealers and trust companies
that clear through or maintain a custodial relationship with a Cedel Participant
either directly or indirectly.
Distributions with respect to the Notes held beneficially through Cedel
will be credited to cash accounts of Cedel Participants in accordance with its
rules and procedures, to the extent received by the U.S. Depositary for Cedel.
Euroclear advises that it was created in 1968 to hold securities for
participants of Euroclear ('Euroclear Participants') and to clear and settle
transactions between Euroclear Participants through simultaneous electronic
book-entry delivery against payment, thereby eliminating the need for physical
movement of certificates and any risk from lack of simultaneous transfers of
securities and cash. Euroclear includes various other services, including
securities lending and borrowing and interfaces with domestic markets in several
countries. Euroclear is operated by the Brussels, Belgium office of Morgan
Guaranty Trust Company of New York (the 'Euroclear Operator'), under contract
with Euroclear Clearance Systems S.C., a Belgian cooperative corporation (the
'Cooperative'). All operations are conducted by the Euroclear Operator, and all
Euroclear securities clearance accounts and Euroclear cash accounts are accounts
with the Euroclear Operator, not the Cooperative. The Cooperative establishes
policy for Euroclear on behalf of Euroclear Participants. Euroclear Participants
include banks (including central banks), securities brokers and dealers and
other professional financial intermediaries and may include the Underwriters.
Indirect access to Euroclear is also available to other firms that clear through
or maintain a custodial relationship with a Euroclear Participant, either
directly or indirectly.
The Euroclear Operator is the Belgian branch of a New York banking
corporation which is a member bank of the Federal Reserve System. As such, it is
regulated and examined by the Board of Governors of the Federal Reserve System
and the New York State Banking Department, as well as the Belgian Banking
Commission.
Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions Governing Use of Euroclear and the
related Operating Procedures of the Euroclear System, and applicable Belgian law
(collectively, the 'Terms and Conditions'). The Terms and Conditions govern
transfers of securities and cash within Euroclear, withdrawals of securities and
cash from Euroclear, and receipts of payments with respect to securities in
Euroclear. All securities in Euroclear are held on a fungible basis without
attribution of specific certificates to specific securities clearance accounts.
The Euroclear Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants, and has no record of or relationship with persons
holding through Euroclear Participants.
Distributions with respect to Notes held beneficially through Euroclear
will be credited to the cash accounts of Euroclear Participants in accordance
with the Terms and Conditions, to the extent received by the U.S. Depositary for
Euroclear. In the event definitive Notes are issued, the Company will appoint a
paying agent and transfer agent in Luxembourg.
GLOBAL CLEARANCE AND SETTLEMENT PROCEDURES
Initial settlement for the Notes will be made in immediately available
funds. Secondary market trading between DTC Participants will occur in the
ordinary way in accordance with Depository rules and will be settled in
immediately available funds using the Depository's Same-Day Funds Settlement
System. Secondary market
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<PAGE>
trading between Cedel Participants and/or Euroclear Participants will occur in
the ordinary way in accordance with the applicable rules and operating
procedures of Cedel and Euroclear and will be settled using the procedures
applicable to conventional eurobonds in immediately available funds.
Cross-market transfers between persons holding directly or indirectly
through the Depository on the one hand, and directly or indirectly through Cedel
or Euroclear Participants, on the other, will be effected in the Depository in
accordance with the Depository rules on behalf of the relevant European
international clearing system by its U.S. Depositary; however, such cross-market
transactions will require delivery of instructions to the relevant European
international clearing system by the counterparty in such system in accordance
with its rules and procedures and within its established deadlines (European
time). The relevant European international clearing system will, if the
transaction meets its settlement requirements, deliver instructions to its U.S.
Depositary to take action to effect final settlement on its behalf by delivering
or receiving Notes in the Depository, and making or receiving payment in
accordance with normal procedures for same-day funds settlement applicable to
the Depository. Cedel Participants and Euroclear Participants may not deliver
instructions directly to their respective U.S. Depositaries.
Because of time-zone differences, credits of Notes received in Cedel or
Euroclear as a result of a transaction with a DTC Participant will be made
during subsequent securities settlement processing and dated the business day
following the Depository settlement date. Such credits or any transactions in
such Notes settled during such processing will be reported to the relevant
Euroclear or Cedel Participants on such business day. Cash received in Cedel or
Euroclear as a result of sales of Notes by or through a Cedel Participant or a
Euroclear Participant to a DTC Participant will be received with value on the
Depository settlement date but will be available in the relevant Cedel or
Euroclear cash account only as of the business day following settlement in the
Depository.
Although the Depository, Cedel and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of Notes among participants of the
Depository, Cedel and Euroclear, they are under no obligation to perform or
continue to perform such procedures and such procedures may be discontinued at
any time.
DEFINITIVE NOTES
If the Depository notifies the Company that it is unwilling or unable to
continue as depository for the Global Notes or ceases to be a clearing agency
registered under the Exchange Act at a time when it is required to be and a
successor depository is not appointed by the Company within 90 days after
receiving such notice or becoming aware that the Depository is no longer so
registered, or if an event of default with respect to the Notes shall have
occurred and be continuing as described under 'Description of Debt
Securities--Provisions Applicable to Both Senior and Subordinated Debt
Securities--Events of Default, Notice and Waiver' in the accompanying Prospectus
attached hereto, the Company will issue or cause to be issued Notes in
definitive form in exchange for the Global Notes. In such circumstances, the
Notes may be presented for registration of transfer and exchange at the office
of the Trustee in Pittsburgh, Pennsylvania and the Paying Agent in Luxembourg.
In such circumstances, principal of, and interest on, the Notes will be payable
at the office of the Trustee in Pittsburgh, Pennsylvania and at the office of
the Paying Agent in Luxembourg. Payments in respect of principal on the Notes
will be made only against surrender of such Notes. Payment in respect of
interest on any Interest Payment Date with respect to any such Notes will be
made to the person in whose name such Note is registered on the June 8 or
December 8, as the case may be, immediately preceding such Interest Payment
Date, except that interest payable at maturity will be payable to the person to
whom the principal of the Note is paid. All payments of principal and interest
will be made by U.S. dollar check drawn on a bank in the City of New York and
mailed to the person in whose name such Notes are registered at such person's
address as provided in the register or, for holders of at least U.S.$1,000,000
in aggregate principal amount of Notes, by wire transfer to a U.S. dollar
account maintained by the payee with a bank in the City of New York or in
Europe, provided that a written request from such holder to such effect
designating such account is received by the Trustee no later than the June 8 or
December 8, as the case may be, immediately preceding such Interest Payment
Date.
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<PAGE>
PAYMENT OF ADDITIONAL AMOUNTS
The Company will, subject to the exceptions and limitations set forth
below, pay as additional interest on the Notes, such additional amounts as are
necessary in order that the net payment by the Company or a paying agent of the
principal of and interest on the Notes to a holder who is a non-United States
person (as defined below), after deduction for any present or future tax,
assessment or governmental charge of the United States or a political
subdivision or taxing authority thereof or therein, imposed by withholding with
respect to the payment, will not be less than the amount provided in the Notes
to be then due and payable; provided, however, that the foregoing obligation to
pay additional amounts shall not apply:
(1) to a tax, assessment or governmental charge that is imposed or
withheld solely by reason of the holder, or a fiduciary, settlor,
beneficiary, member or shareholder of the holder if the holder is an
estate, trust, partnership or corporation, or a person holding a power over
an estate or trust administered by a fiduciary holder, being considered as:
(a) being or having been present or engaged in trade or business in
the United States or having or having had a permanent establishment in
the United States;
(b) having a current or former relationship with the United States,
including a relationship as a citizen or resident thereof;
(c) being or having been a foreign or domestic personal holding
company, a passive foreign investment company or a controlled foreign
corporation with respect to the United States or a corporation that has
accumulated earnings to avoid United States federal income tax; or
(d) being or having been a '10-percent shareholder' of the Company
as defined in section 871(h)(3) of the United States Internal Revenue
Code or any successor provision or being or having been a bank whose
receipt of interest on a Note is described in section 881(c)(3)(A) of
the United States Internal Revenue Code (as defined below);
(2) to any holder that is not the sole beneficial owner of the Note,
or a portion thereof, or that is a fiduciary or partnership, but only to
the extent that a beneficiary or settlor with respect to the fiduciary, a
beneficial owner or member of the partnership would not have been entitled
to the payment of an additional amount had the beneficiary, settlor,
beneficial owner or member received directly its beneficial or distributive
share of the payment;
(3) to a tax, assessment or governmental charge that is imposed or
withheld solely by reason of the failure of the holder or any other person
to comply with certification, identification or information reporting
requirements concerning the nationality, residence, identity or connection
with the United States of the holder or beneficial owner of such Note, if
compliance is required by statute, by regulation of the United States
Treasury Department or by an applicable income tax treaty to which the
United States is a party as a precondition to exemption from such tax,
assessment or other governmental charge;
(4) to a tax, assessment or governmental charge that is imposed
otherwise than by withholding by the Company or a paying agent from the
payment;
(5) to a tax, assessment or governmental charge that is imposed or
withheld solely by reason of a change in law, regulation, or administrative
or judicial interpretation that becomes effective more than 15 days after
the payment becomes due or is duly provided for, whichever occurs later;
(6) to an estate, inheritance, gift, sales, excise, transfer, wealth
or personal property tax or a similar tax, assessment or governmental
charge;
(7) to any tax, assessment or other governmental charge required to be
withheld by any paying agent from any payment of principal of or interest
on any Note, if such payment can be made without such withholding by any
other paying agent; or
(8) in the case of any combination of items (1), (2), (3), (4), (5),
(6) and (7).
The Notes are subject in all cases to any tax, fiscal or other law or regulation
or administrative or judicial interpretation applicable thereto. Except as
specifically provided under this heading 'Payment of Additional
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<PAGE>
Amounts' and under the heading 'Description of Notes--Redemption', the Company
shall not be required to make any payment with respect to any tax, assessment or
governmental charge imposed by any government or a political subdivision or
taxing authority thereof or therein.
As used under this heading 'Payment of Additional Amounts' and under the
headings 'Description of Notes--Redemption' and 'United States Taxation of
Non-United States Persons' the term 'United States' means the United States of
America (including the States and the District of Columbia) and its territories,
its possessions and other areas subject to its jurisdiction, 'United States
person' means any individual who is a citizen or resident of the United States,
a corporation, partnership or other entity created or organized in or under the
laws of the United States, an estate the income of which is subject to United
States federal income taxation regardless of its source or a trust if a court
within the United States is able to exercise primary supervision over the
administration of the trust, and one or more United States fiduciaries have the
authority to control all substantial decisions of the trust, 'non-United States
person' means a person that is, for United States federal income tax purposes,
(i) a nonresident alien individual, (ii) a foreign corporation, (iii) a
nonresident alien fiduciary of a foreign estate or trust or (iv) a foreign
partnership one or more members of which is, for United States federal income
tax purposes, a nonresident alien individual, a foreign corporation or a
nonresident alien fiduciary of a foreign estate or trust and 'United States
Internal Revenue Code' means the United States Internal Revenue Code of 1986, as
amended.
REDEMPTION
If (a) as a result of any change in, or amendment to, the laws (or any
regulations or rulings promulgated thereunder) of the United States (or any
political subdivision or taxing authority thereof or therein), or any change in,
or amendment to, official position regarding the application or interpretation
of such laws, regulations or rulings, which change or amendment is announced or
becomes effective on or after the date of this Prospectus Supplement, the
Company becomes or will become obligated to pay additional amounts as described
herein under the heading 'Payment of Additional Amounts' or (b) any act is taken
by a taxing authority of the United States on or after the date of this
Prospectus Supplement, whether or not such act is taken with respect to the
Company or any affiliate, that results in a substantial probability that the
Company will or may be required to pay such additional amounts, then the Company
may, at its option, redeem, as a whole, but not in part, the Notes on not less
than 30 nor more than 60 days' prior written notice, at a redemption price equal
to 100% of their principal amount, together with interest accrued thereon to the
date fixed for redemption; provided that the Company determines, in its business
judgment, that the obligation to pay such additional amounts cannot be avoided
by the use of reasonable measures available to it, not including substitution of
the obligor under the Notes. No redemption pursuant to (b) above may be made
unless the Company shall have received an opinion of independent counsel to the
effect that an act taken by a taxing authority of the United States results in a
substantial probability that it will or may be required to pay the additional
amounts described herein under the heading 'Payment of Additional Amounts' and
the Company shall have delivered to the Trustee a certificate, signed by a duly
authorized officer, stating that based on such opinion the Company is entitled
to redeem the Notes pursuant to their terms.
FURTHER ISSUES
The Company may from time to time, without notice to or the consent of the
registered holders of the Notes, create and issue further notes ranking pari
passu with the Notes in all respects (or in all respects except for the payment
of interest accruing prior to the issue date of such further notes or except for
the first payment of interest following the issue date of such further notes)
and such further notes shall be consolidated and form a single series with the
Notes and shall have the same terms as to status, redemption or otherwise as the
Notes.
NOTICES
Notices to holders of the Notes will be published in a leading daily
newspaper in The City of New York, in London, and, so long as the Notes are
listed on the Luxembourg Stock Exchange, in Luxembourg. It is expected that
publication will be made in The City of New York in The Wall Street Journal, in
London in the Financial Times, and in Luxembourg in the Luxemburger Wort. Any
such notice shall be deemed to have been given on the date of such publication
or, if published more than once, on the date of the first such publication.
S-15
<PAGE>
APPLICABLE LAW
The Notes and the Indenture will be governed by and construed in accordance
with the laws of the State of New York.
UNITED STATES TAXATION OF NON-UNITED STATES PERSONS
The following discussion addresses certain of the United States federal
income and estate tax consequences applicable to the ownership of the Notes by
initial holders who are non-United States persons. It is based on currently
existing provisions of the United States Internal Revenue Code, existing
regulations thereunder and current administrative rulings and judicial
decisions, any of which may be repealed, revoked or modified so as to produce
different tax results than those set forth below.
INCOME AND WITHHOLDING TAX
In the opinion of Bruce A. Cogan, General Tax Counsel of the Company, under
United States federal tax law as of the date of this Prospectus Supplement, and
subject to the discussion of certain United States documentation requirements
and backup withholding below:
(i) payments of principal and interest on a Note that is beneficially
owned by a non-United States person will not be subject to United States
federal withholding tax; provided, that in the case of interest, (x) (a)
the beneficial owner does not actually or constructively own 10% or more of
the total combined voting power of all classes of stock of the Company
entitled to vote, (b) the beneficial owner is not a controlled foreign
corporation that is related to the Company through stock ownership and is
not a bank whose receipt of interest on a Note is described in section
881(c)(3)(A) of the United States Internal Revenue Code, and (c) either (A)
the beneficial owner of the Note certifies to the person otherwise required
to withhold United States federal income tax from such interest, under
penalties of perjury, that it is not a United States person and provides
its name and address or (B) a securities clearing organization, bank or
other financial institution that holds customers' securities in the
ordinary course of its trade or business (a 'financial institution') and
holds the Note certifies to the person otherwise required to withhold
United States federal income tax from such interest, under penalties of
perjury, that such statement has been received from the beneficial owner by
it or by a financial institution between it and the beneficial owner and
furnishes the payor with a copy thereof; (y) the beneficial owner is
entitled to the benefits of an income tax treaty under which the interest
is exempt from United States federal withholding tax and the beneficial
owner of the Note or such owner's agent provides an IRS Form 1001 claiming
the exemption; or (z) the beneficial owner conducts a trade or business in
the United States to which the interest is effectively connected and the
beneficial owner of the Note or such owner's agent provides an IRS Form
4224; provided that in each such case, the relevant certification or IRS
Form is delivered pursuant to applicable procedures and is properly
transmitted to the person otherwise required to withhold United States
federal income tax, and none of the persons receiving the relevant
certification or IRS Form has actual knowledge that the certification or
any statement on the IRS Form is false;
(ii) a non-United States person will not be subject to United States
federal withholding tax on any gain realized on the sale, exchange or
redemption of a Note unless the gain is effectively connected with the
beneficial owner's trade or business in the United States or, in the case
of an individual, the holder is present in the United States for 183 days
or more in the taxable year in which the sale, exchange or redemption
occurs and certain other conditions are met; and
(iii) a Note owned by an individual who at the time of death is not a
citizen or resident of the United States will not be subject to United
States federal estate tax as a result of such individual's death if the
individual does not actually or constructively own 10% or more of the total
combined voting power of all classes of stock of the Company entitled to
vote and the income on the Note would not have been effectively connected
with a U.S. trade or business of the individual.
Interest on a Note that is effectively connected with the conduct of a
trade or business in the United States by a holder of a Note who is a non-United
States person, although exempt from United States withholding tax,
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<PAGE>
will be subject to United States income tax as if such interest was earned by a
United States person and in the case of a holder that is a foreign corporation,
may be subject to an additional 'branch profits tax.'
CERTAIN UNITED STATES TAX DOCUMENTATION REQUIREMENTS
In general, a beneficial owner of a Note will be subject to the 30% United
States federal withholding tax that applies to payments of interest on a
registered form debt obligation issued by a United States person, unless,
generally, one of the following steps is taken to obtain an exemption from or
reduction of the tax:
Exemption for Non-United States persons (IRS Form W-8). A beneficial owner
of a Note that is a non-United States person (other than certain persons that
are related to the Company through stock ownership or are banks as described in
clauses (x) (a) and (b) of Paragraph (i) under 'Income and Withholding Tax') can
obtain an exemption from the withholding tax by providing a properly completed
IRS Form W-8 (Certificate of Foreign Status). Copies of IRS Form W-8 may be
obtained from the Luxembourg listing agent.
Exemption for Non-United States persons with effectively connected income
(IRS Form 4224). A beneficial owner of a Note that is a non-United States
person, including a non-United States corporation or bank with a United States
branch, that conducts a trade or business in the United States with which
interest income on a Note is effectively connected, can obtain an exemption from
the withholding tax by providing a properly completed IRS Form 4224 (Exemption
from Withholding of Tax on Income Effectively Connected with the Conduct of a
Trade or Business in the United States).
Exemption or reduced rate for Non-United States persons entitled to the
benefits of a treaty (IRS Form 1001). A beneficial owner of a Note that is a
non-United States person entitled to the benefits of an income tax treaty to
which the United States is a party can obtain an exemption from or reduction of
the withholding tax (depending on the terms of the treaty) by providing a
properly completed IRS Form 1001 (Ownership, Exemption or Reduced Rate
Certificate).
United States federal income tax reporting procedure. A beneficial owner of
a Note, or, in the case of IRS Forms 1001 and 4224, its agent, is required to
submit the appropriate IRS Form under applicable procedures to the person
through which the owner directly holds the Note. For example, if the beneficial
owner is listed directly on the books of Euroclear or Cedel as the holder of the
Note, the IRS Form must be provided to Euroclear or Cedel, as the case may be.
Each other person through which a Note is held must submit, on behalf of the
beneficial owner, the IRS Form (or in certain cases a copy thereof) under
applicable procedures to the person through which it holds the Note, until the
IRS Form is received by the United States person who would otherwise be required
to withhold United States federal income tax from interest on the Note. For
example, in the case of Notes held through Euroclear or Cedel, the IRS Form (or
a copy thereof) must be received by the U.S. Depositary of such clearing agency.
Applicable procedures include additional certification requirements, described
in clause (x)(c)(B) of Paragraph (i) under 'Income and Withholding Tax', if a
beneficial owner of the Note provides an IRS Form W-8 to a securities clearing
organization, bank or other financial institution that holds the Note on its
behalf.
BACKUP WITHHOLDING AND INFORMATION REPORTING
In general, information reporting requirements will apply to payments of
principal and interest made on a Note and the proceeds of the sale of a Note
within the United States to non-corporate holders of the Notes, and 'backup
withholding' at a rate of 31% will apply to such payments if the holder fails to
provide an accurate taxpayer identification number in the manner required or to
report all interest and dividends required to be shown on its federal income tax
returns.
Information reporting on IRS Form 1099 and backup withholding will not
apply to payments made by the Company or a paying agent to a non-United States
person on a Note if, in the case of interest, the IRS Form described in clause
(y) or (z) in Paragraph (i) under 'Income and Withholding Tax' has been provided
under applicable procedures, or, in the case of interest or principal, the
certification described in clause (x) (c) in Paragraph (i) under 'Income and
Withholding Tax' and a certification that the beneficial owner satisfies certain
other conditions have been supplied under applicable procedures, provided that
the payor does not have actual knowledge that the certifications are incorrect.
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<PAGE>
Payments of the proceeds from the sale of a Note made to or through a
foreign office of a broker will not be subject to information reporting or
backup withholding, except that if the broker is a United States person, a
controlled foreign corporation for United States tax purposes or a foreign
person 50% or more of whose gross income is effectively connected with a United
States trade or business for a specified three-year period, information
reporting may apply to such payments. Payments of the proceeds from the sale of
a Note to or through the United States office of a broker are subject to
information reporting and backup withholding unless the holder or beneficial
owner certifies that it is a non-United States person and that it satisfies
certain other conditions or otherwise establishes an exemption from information
reporting and backup withholding.
Backup withholding is not a separate tax, but is allowed as a refund or
credit against the holder's United States federal income tax, provided the
necessary information is furnished to the Internal Revenue Service.
Interest on a Note that is beneficially owned by a non-United States person
will be reported annually on IRS Form 1042S, which must be filed with the
Internal Revenue Service and furnished to such beneficial owner.
EACH HOLDER OF A NOTE SHOULD BE AWARE THAT IF IT DOES NOT PROPERLY PROVIDE
THE REQUIRED IRS FORM, OR IF THE IRS FORM (OR, IF PERMISSIBLE, A COPY OF SUCH
FORM) IS NOT PROPERLY TRANSMITTED TO AND RECEIVED BY THE UNITED STATES PERSON
OTHERWISE REQUIRED TO WITHHOLD UNITED STATES FEDERAL INCOME TAX, INTEREST ON THE
NOTE MAY BE SUBJECT TO UNITED STATES WITHHOLDING TAX AT A 30% RATE AND THE
HOLDER (INCLUDING THE BENEFICIAL OWNER) WILL NOT BE ENTITLED TO ANY ADDITIONAL
AMOUNTS FROM THE COMPANY DESCRIBED UNDER THE HEADING 'DESCRIPTION OF NOTES--
PAYMENT OF ADDITIONAL AMOUNTS' WITH RESPECT TO SUCH TAX. SUCH TAX, HOWEVER, MAY
IN CERTAIN CIRCUMSTANCES BE ALLOWED AS A REFUND OR AS A CREDIT AGAINST SUCH
HOLDER'S UNITED STATES FEDERAL INCOME TAX. FOR THE CERTIFICATION AND OTHER
REQUIREMENTS TO AVOID A 31% BACKUP WITHHOLDING TAX WITH RESPECT TO A NOTE, SEE
THE DISCUSSION ABOVE UNDER 'BACKUP WITHHOLDING AND INFORMATION REPORTING.' THE
FOREGOING IS FOR GENERAL INFORMATION ONLY AND DOES NOT DEAL WITH ALL ASPECTS OF
FEDERAL INCOME TAX OR ESTATE TAX THAT MAY BE RELEVANT TO FOREIGN HOLDERS OF THE
NOTES. POTENTIAL INVESTORS ARE ADVISED TO CONSULT THEIR OWN TAX ADVISORS FOR
SPECIFIC ADVICE CONCERNING THE UNITED STATES FEDERAL TAX CONSEQUENCES AS WELL AS
ANY CONSEQUENCES ARISING UNDER ANY LAWS OF ANY STATE OR LOCALITY IN THE UNITED
STATES OR ANY FOREIGN TAXING JURISDICTION OF THE PURCHASE, OWNERSHIP AND
DISPOSITION OF NOTES IN LIGHT OF THEIR PARTICULAR CIRCUMSTANCES.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
dated June 18, 1997 relating to the Notes, the Company has agreed to sell to
each of the underwriters named below (the 'Underwriters') and each of the
Underwriters, for whom Lehman Brothers International (Europe) is acting as
representative (the 'Representative'), has severally agreed to purchase the
principal amount of Notes set forth opposite its name below.
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
UNDERWRITER OF NOTES
- ----------------------------------------------------- ----------------
<S> <C>
Lehman Brothers International (Europe)............... U.S.$360,000,000
ABN AMRO Bank N.V.................................... 20,000,000
Credit Suisse First Boston Corporation............... 20,000,000
Dresdner Bank Aktiengesellschaft..................... 20,000,000
Goldman, Sachs & Co.................................. 20,000,000
Midland Bank plc..................................... 20,000,000
J.P. Morgan Securities Ltd........................... 20,000,000
Salomon Brothers Inc................................. 20,000,000
----------------
Total.............................................. U.S.$500,000,000
----------------
----------------
</TABLE>
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<PAGE>
The Underwriters have advised the Company that they propose to offer all or
part of the Notes directly to retail purchasers at the initial public offering
price set forth on the cover page of this Prospectus Supplement, and to certain
securities dealers at such price less a concession of .250% of the principal
amount of the Notes. After the Notes are released for sale to the public, the
offering price and other selling terms may from time to time be varied by the
Underwriters.
The Notes are offered for sale both inside and outside the United States.
In connection with the offering, the rules of the U.S. Securities and
Exchange Commission permit the Underwriters to engage in certain transactions
that stabilize the price of the Notes. Such transactions may consist of bids or
purchases for the purpose of pegging, fixing or maintaining the price of the
Notes.
If the Underwriters create a short position in the Notes in connection with
the offering (i.e., if they sell a larger principal amount of the Notes than is
set forth on the cover page of this Prospectus Supplement), the Underwriters may
reduce that short position by purchasing Notes in the open market.
In general, purchases of a security for the purpose of stabilization or to
reduce a syndicate short position could cause the price of the security to be
higher than it might otherwise be in the absence of such purchases.
Neither the Company nor any of the Underwriters makes any representation or
prediction as to the direction or magnitude of any effect that the transactions
described above may have on the price of the Notes. In addition, neither the
Company nor any of the Underwriters makes any representation that the
Underwriters will engage in such transactions or that such transactions, once
commenced, will not be discontinued without notice.
Each of the Underwriters has agreed that it will only offer or sell the
Notes in compliance with the laws and regulations in any jurisdiction applicable
to such offer or sale and it has not taken and will not take any action in any
jurisdiction, other than the United States, that would permit a public offering
of the Notes, or possession or distribution of any Prospectus or any amendment
or supplement thereto or any offering or publicity material relating to the
Notes, in any country or jurisdiction where action for that purpose is required.
Each Underwriter has represented and agreed that (a) it has not offered or
sold, and, prior to the expiration of the period of six months from the closing
date for the issue of the Notes, will not offer or sell any Notes to persons in
the United Kingdom, except to those persons whose ordinary activities involve
them in acquiring, holding, managing or disposing of investments (as principal
or agent) for the purpose of their businesses or otherwise in circumstances
which have not resulted and will not result in an offer to the public in the
United Kingdom within the meaning of the Public Offers of Securities Regulations
1995, (b) it has complied and will comply with all applicable provisions of the
Financial Services Act 1986, with respect to anything done by it in relation to
the Notes in, from or otherwise involving the United Kingdom, and (c) it has
only issued or passed on and will only issue or pass on in the United Kingdom
any document received by it in connection with the issue of the Notes to a
person who is of a kind described in Article 11(3) of the Financial Services Act
1986 (Investment Advertisements) (Exemptions) Order 1996 (as amended) or is a
person to whom the document may otherwise lawfully be issued or passed on.
Purchasers of the Notes may be required to pay stamp taxes and other
charges in accordance with the laws and practices of the country of purchase in
addition to the issue price set forth on the cover page hereof.
The Company has been advised by the Underwriters that they intend to make a
market in the Notes, but they are not obligated to do so and may discontinue
such market-making at any time without notice. No assurance can be given as to
the liquidity of the trading market for the Notes.
All secondary trading in the Notes will settle in immediately available
funds. See 'Description of Notes--Global Clearance and Settlement Procedures'.
It is expected that delivery of the Notes will be made against payment
therefor on or about June 23, 1997, which is the third business day following
the date hereof (such settlement cycle being herein referred to as 'T+3').
Purchasers of Notes should note that the ability to settle secondary market
trades of the Notes effected on the date of pricing and the next succeeding
business day may be affected by the T+3 settlement.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as amended.
In the ordinary course of their respective businesses, ABN AMRO Bank N.V.,
Dresdner Bank Aktiengesellschaft, Midland Bank plc and J.P. Morgan Securities
Ltd. or their affiliates engage in general financing and banking transactions
with the Company.
S-19
<PAGE>
Salomon Brothers Inc may be deemed to be an affiliate of the Company under
the rules of the National Association of Securities Dealers, Inc. (the 'NASD').
Accordingly, this offering is being made in compliance with NASD Conduct Rule
2720. The Underwriters will not make sales to discretionary accounts without the
prior written consent of the customers.
GENERAL INFORMATION
Application has been made to list the Notes on the Luxembourg Stock
Exchange. In connection with the listing application, the Certificate of
Incorporation and the By-Laws of the Company and a legal notice relating to the
issuance of the Notes have been deposited prior to listing with Greffier en Chef
du Tribunal d'Arrondissement de et a Luxembourg, where copies thereof may be
obtained upon request. Copies of the above documents together with this
Prospectus Supplement, the accompanying Prospectus, the Indenture and the
Company's current Annual and Quarterly Reports, as well as all future Annual
Reports and Quarterly Reports, so long as any of the Notes are outstanding, will
be made available for inspection at the main office of Bankers Trust Luxembourg
S.A., in Luxembourg. Bankers Trust Luxembourg S.A. will act as intermediary
between the Luxembourg Stock Exchange and the Company and the holders of the
Notes. In addition, copies of the Annual Reports and Quarterly Reports of the
Company may be obtained free of charge at such office.
Other than as disclosed or contemplated herein or in the documents
incorporated herein by reference, there has been no material adverse change in
the financial position of the Company since March 31, 1997.
The Independent Auditors of the Company are Ernst & Young LLP, New York.
Neither the Company nor any of its subsidiaries is involved in litigation,
arbitration, or administrative proceedings relating to claims or amounts that
are material in the context of the issue of the Notes and the Company is not
aware of any such litigation, arbitration, or administrative proceedings pending
or threatened.
Resolutions relating to the issue and sale of the Notes were adopted by the
Board of Directors of the Company on July 22, 1991.
The Notes have been assigned Euroclear and Cedel Common Code No. 7764502,
International Security Identification Number (ISIN) US025816AK56 and CUSIP No.
025816AK5.
------------------------
S-20
<PAGE>
PROSPECTUS
AMERICAN EXPRESS COMPANY
DEBT SECURITIES
PREFERRED SHARES
COMMON SHARES
WARRANTS
------------------------
American Express Company (the 'Company') may offer from time to time in one
or more series (i) unsecured debt securities, which may be either senior (the
'Senior Securities') or subordinated (the 'Subordinated Securities';
collectively, with the Senior Securities, the 'Debt Securities'), (ii) preferred
shares, par value $1.66 2/3 per share ('Preferred Shares'), (iii) common shares,
par value $0.60 per share ('Common Shares'), (iv) warrants to purchase Debt
Securities, Preferred Shares, Common Shares or equity securities issued by an
affiliated or unaffiliated corporation or other entity (collectively,
'Securities Warrants'), (v) currency warrants entitling the holder to receive
the cash value in U.S. dollars of the right to purchase or the right to sell
foreign currencies or composite currencies, including European Currency Units
('ECU') ('Currency Warrants') or (vi) warrants relating to other items or
indices ('Other Warrants'; collectively with the Securities Warrants and the
Currency Warrants, 'Warrants') (the Debt Securities, Preferred Shares, Common
Shares and Warrants are collectively referred to as 'Securities'), or any
combination of the foregoing, at an aggregate initial offering price not to
exceed $1,050,000,000, at prices and on terms to be determined at or prior to
the time of sale.
The Senior Securities will rank equally with all other unsubordinated and
unsecured indebtedness of the Company. The Subordinated Securities will be
subordinate to all existing and future Senior Indebtedness, each as defined
herein. Unless otherwise indicated in the applicable Prospectus Supplement
('Prospectus Supplement'), the maturity of the Subordinated Securities will be
subject to acceleration only in the event of certain events of bankruptcy or
reorganization of the Company. See 'Description of Debt Securities'.
Specific terms of the Securities in respect of which this Prospectus is
being delivered will be set forth in an accompanying Prospectus Supplement,
together with the terms of the offering of the Securities and the initial
offering price and the net proceeds to the Company from the sale thereof. The
Prospectus Supplement will set forth with regard to the particular Securities,
without limitation, the following: (i) in the case of Debt Securities, the terms
of the Debt Securities being offered, including the specific designation,
aggregate principal amount, ranking as senior debt or subordinated debt,
authorized denomination, maturity, rate or method of calculation of principal,
premium (if any) and interest and dates for payment thereof (or the method of
calculation thereof), any exchangeability, conversion, redemption, prepayment or
sinking fund provisions and the currency or currencies or currency unit or
currency units in which principal, premium, if any, or interest, if any, is
payable, (ii) in the case of Preferred Shares, the designation, number of
shares, liquidation preference per share, initial public offering price,
dividend rate (or method of calculation thereof), dates on which dividends shall
be payable (or the method of calculation thereof) and dates from which dividends
shall accrue, any redemption or sinking fund provisions, any conversion or
exchange rights, and whether the Company has elected to offer the Preferred
Shares in the form of depositary shares, (iii) in the case of Common Shares, the
number of Common Shares and the terms of the offering and sale thereof, (iv) in
the case of Securities Warrants, the number and terms thereof, the designation
and the number of securities issuable upon their exercise, the exercise price,
the terms of the offering and sale thereof and, where applicable, the duration
and detachability thereof, (v) in the case of Currency Warrants, whether the
Currency Warrants are call warrants or put warrants, the currency to which U.S.
dollars will be compared, the method of determining the cash value payable upon
exercise of such Currency Warrants, the aggregate amount, offering price and
exercise period of such Currency Warrants, (vi) in the case of Other Warrants,
the terms and procedures relating to exercise, expiration date and other terms,
and (vii) in the case of all Securities, whether such Security will be offered
separately or as a unit with other securities. The Prospectus Supplement will
also contain information, where applicable, about certain United States Federal
income tax considerations relating to, and any listing on a securities exchange
of, the Securities covered by the Prospectus Supplement.
The Company may sell Securities through underwriters or dealers, and also
may sell Securities directly to purchasers or through agents. The names of any
underwriters or agents involved in the sale of the Securities in respect of
which this Prospectus is being delivered and their compensation are set forth in
the accompanying Prospectus Supplement.
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is June 18, 1997.
<PAGE>
NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS OR
THE ACCOMPANYING PROSPECTUS SUPPLEMENT AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ANY AGENT OR UNDERWRITER. THIS PROSPECTUS AND THE ACCOMPANYING
PROSPECTUS SUPPLEMENT DO NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER
THE DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE
HEREUNDER OR THEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE
HEREOF.
------------------------
AVAILABLE INFORMATION
American Express Company (the 'Company') is subject to the informational
requirements of the Securities Exchange Act of 1934 (the 'Exchange Act'), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the 'Commission'). Such reports, proxy
statements and other information filed by the Company with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549;
New York Regional Office, Seven World Trade Center, 13th Floor, New York, New
York 10048; and Chicago Regional Office, Northwest Atrium Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such materials
can be obtained from the Public Reference Section of the Commission at Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Such
reports, proxy statements 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, at the offices of the Pacific Stock Exchange,
Inc., 301 Pine Street, San Francisco, California 94104, at the offices of the
Chicago Stock Exchange, Inc., 440 South LaSalle Street, Chicago, Illinois 60605,
and at the offices of the Boston Stock Exchange, Inc., One Boston Place, Boston,
Massachusetts 02108. This Prospectus does not contain all information set forth
in the Registration Statement and the exhibits thereto which the Company has
filed with the Commission under the Securities Act of 1933, and to which
reference is hereby made.
The Company was founded in 1850 as a joint stock association and was
incorporated under the laws of the State of New York in 1965. Its principal
executive offices are located at American Express Tower, World Financial Center,
New York, New York 10285 (telephone (212) 640-2000).
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
There are hereby incorporated by reference herein (i) the Company's Annual
Report on Form 10-K for its fiscal year ended December 31, 1996, (ii) the
Company's Quarterly Report on Form 10-Q for the fiscal quarter ended March 31,
1997, and (iii) the Company's Current Reports on Form 8-K dated January 27, 1997
and April 25, 1997, as amended by the Company's Form 8-K/A dated April 28, 1997.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date hereof and prior to the
termination of the offering made hereunder shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of filing of such
documents. Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein
or in any other subsequently filed document which also is incorporated or 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 HEREBY UNDERTAKES TO PROVIDE WITHOUT CHARGE TO EACH PERSON TO
WHOM THIS PROSPECTUS IS DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF SUCH
PERSON, A COPY OF ANY AND ALL OF THE DOCUMENTS INCORPORATED BY REFERENCE IN THIS
PROSPECTUS (OTHER THAN EXHIBITS TO SUCH DOCUMENTS UNLESS SUCH EXHIBITS ARE
SPECIFICALLY INCORPORATED BY REFERENCE INTO THE DOCUMENTS THAT THIS PROSPECTUS
INCORPORATES). WRITTEN OR ORAL REQUESTS FOR SUCH COPIES SHOULD BE DIRECTED TO
MR. STEPHEN P. NORMAN, SECRETARY, AMERICAN EXPRESS COMPANY, AMERICAN EXPRESS
TOWER, WORLD FINANCIAL CENTER, NEW YORK, NEW YORK 10285, (212) 640-2000.
2
<PAGE>
THE COMPANY
Through its subsidiaries the Company is primarily engaged in the business
of providing travel related services, financial advisory services and
international banking services throughout the world.
Travel related services are offered principally through American Express
Travel Related Services Company, Inc. and its subsidiaries ('TRS') and include a
variety of products and services, including the American Express(Registered)
Card, the Optima(Registered) Card and other consumer lending products, the
American Express(Registered) Travelers Cheque (the 'Travelers Cheque') and other
stored value products, business expense management products and services,
corporate and consumer travel products and services, magazine publishing,
database marketing and management and merchant transaction processing, point of
sale and back office products and services. At December 31, 1996, there were
41.5 million Cards in force worldwide, and worldwide Card billed business for
the year ended December 31, 1996 was $184.3 billion. U.S. consumer lending
operations are conducted by American Express Centurion Bank, a wholly-owned
subsidiary of TRS whose deposits are insured by the Federal Deposit Insurance
Corporation. Travelers Cheque sales for the year ended December 31, 1996 were
$26 billion.
American Express Financial Corporation ('AEFC') and its subsidiaries are
engaged in providing a variety of financial products and services to help
individuals, businesses and institutions establish and achieve their financial
goals. AEFC's products and services include financial planning and advice,
insurance and annuities, a variety of investment products, including investment
certificates, mutual funds and limited partnerships, investment advisory
services, trust and employee plan administration services, tax preparation and
bookkeeping services, personal auto and homeowner's insurance and retail
securities brokerage services. At December 31, 1996, American Express Financial
Advisors Inc., AEFC's principal marketing subsidiary, maintained a nationwide
financial planning field force of 8,340 persons. At December 31, 1996, AEFC's
assets owned and/or managed totaled approximately $149.4 billion.
American Express Bank Ltd., together with its subsidiaries ('AEBL'), offers
products that meet the financial service needs of three client groups:
corporations, financial institutions and affluent individuals. AEBL's five
business lines are commercial, correspondent, and private banking, personal
financial services and global trading. AEBL does not do business in the United
States except as an incident to its activities outside the United States.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the historical ratios of earnings to fixed
charges of the Company for the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED YEAR ENDED DECEMBER 31,
MARCH 31, ------------------------------------
1997 1996 1995 1994 1993 1992
------------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges............... 2.26 2.17 1.86 1.90 2.20 1.40
</TABLE>
In computing the ratio of earnings to fixed charges, 'earnings' consist of
pretax income from continuing operations, interest expense and other
adjustments. Interest expense includes interest expense related to the
international banking operations of the Company and TRS's Cardmember lending
activities, which is netted against interest and dividends and Cardmember
lending net finance charge revenue, respectively, in the Company's Consolidated
Statement of Income.
For purposes of computing 'earnings', other adjustments included adding the
amortization of capitalized interest, the net loss of affiliates accounted for
under the equity method whose debt is not guaranteed by the Company, the
minority interest in the earnings of majority-owned subsidiaries with fixed
charges, and the interest component of rental expense and subtracting
undistributed net income of affiliates accounted for under the equity method.
'Fixed charges' consist of interest and other adjustments, including
capitalized interest costs and the interest component of rental expense.
3
<PAGE>
On May 31, 1994, the Company completed the spin-off of Lehman Brothers
Holdings Inc. ('Lehman Brothers') through a dividend to American Express common
shareholders. Accordingly, Lehman Brothers' results are reported as a
discontinued operation and are excluded from the above computation for all
periods presented. In March 1993, the Company reduced its ownership in First
Data Corporation ('FDC') to approximately 22 percent through a public offering.
As a result, beginning in 1993, FDC was reported as an equity investment in the
above computation. In the fourth quarter of 1995, the Company's ownership was
further reduced to approximately 10 percent as a result of shares issued by FDC
in connection with a merger transaction. Accordingly, as of December 31, 1995,
the Company's investment in FDC is accounted for as Investments-- Available for
sale.
USE OF PROCEEDS
Except as may be otherwise set forth in the Prospectus Supplement
accompanying this Prospectus, the net proceeds to be received by the Company
from sales of the Securities will be used for general corporate purposes.
DESCRIPTION OF DEBT SECURITIES
The following description sets forth certain general terms and provisions
of the Debt Securities to which any Prospectus Supplement may relate. The
particular terms of the Debt Securities being offered and the extent to which
such general provisions may apply will be described in a Prospectus Supplement
relating to such Debt Securities.
The Senior Securities are to be issued under an indenture dated as of May
1, 1997, between the Company and PNC Bank, National Association, as trustee (the
'Senior Securities Trustee') (the 'Senior Securities Indenture'). The
Subordinated Securities are to be issued under an Indenture dated as of May 1,
1997 (the 'Subordinated Securities Indenture') between the Company and PNC Bank,
National Association, as Trustee (the 'Subordinated Securities Trustee'). The
Senior Securities Indenture and the Subordinated Securities Indenture are
referred to herein individually as the 'Indenture' and collectively as the
'Indentures,' and the Senior Securities Trustee and the Subordinated Securities
Trustee are referred to herein individually as the 'Trustee' and collectively as
the 'Trustees.' The following summaries of certain provisions of the Indentures
do not purport to be complete and are qualified in their entirety by reference
to the Indentures, a copy of each of which is filed as an exhibit to the
Registration Statement of which this Prospectus is a part. Where no distinction
is made between the Senior Securities and the Subordinated Securities or between
the Senior Securities Indenture and the Subordinated Securities Indenture, such
summaries refer to any Debt Securities and either Indenture. All article and
section references appearing herein are to articles and sections of the
Indenture, and all capitalized terms have the meanings specified in the
Indenture.
PROVISIONS APPLICABLE TO BOTH SENIOR AND SUBORDINATED DEBT SECURITIES
General
Neither Indenture limits the amount of Debt Securities which may be issued
thereunder and Debt Securities may be issued under either of the Indentures from
time to time in one or more series up to the aggregate principal amount which
may be authorized from time to time by the Company. Each Indenture permits the
appointment of a different trustee for each series of Debt Securities.
(Section8.09) If there is at any time more than one trustee under the Indenture,
the term 'Trustee' as used in this Prospectus will mean each such trustee and
will apply to each such trustee only with respect to those series of Debt
Securities with respect to which it is serving as trustee.
Reference is made to the Prospectus Supplement that accompanies this
Prospectus for the following terms and other information with respect to the
Debt Securities being offered thereby: (i) the designation, aggregate principal
amount and authorized denominations of such Debt Securities; (ii) the percentage
of their principal amount at which such Debt Securities will be issued; (iii)
the date (or the manner of determining or extending the date or dates) on which
the principal of such Debt Securities will be payable; (iv) the terms for
conversion or exchange, if any, of the Debt Securities; (v) the classification
as Senior Securities or Subordinated Securities; (vi) whether such Debt
Securities will be issued in fully registered form or in bearer form or any
combination thereof; (vii) whether such Debt Securities will be issued in the
form of one or more global securities and whether such global securities are to
be issuable in a temporary global form or permanent global form; (viii) if other
than U.S. dollars, the currency or currencies or currency unit or units for
which Debt Securities may be denominated
4
<PAGE>
and purchased and the currency or currencies or currency unit or units in which
principal, premium (if any) and any interest may be payable; (ix) if the
currency for which Debt Securities may be purchased or in which principal,
premium (if any) and any interest may be payable is at the election of the
Company or the purchaser, the manner in which such an election may be made and
the terms of such election; (x) the rate per annum at which such Debt Securities
will bear interest, if any, or the method of determination of such rate; (xi)
the dates on which such interest, if any, will be payable, or the method of
determining such dates; (xii) any mandatory or optional sinking fund, redemption
or other similar terms; (xiii) any index or other method used to determine the
amount of payments of principal, premium (if any) and interest, if any, on such
Debt Securities; (xiv) if a Trustee other than PNC Bank, National Association is
named for such Debt Securities, the name of such Trustee; and (xv) any other
specific terms of the Debt Securities. All Debt Securities of any one series
need not be issued at the same time and all the Debt Securities of any one
series need not bear interest at the same rate or mature on the same date.
If any of the Debt Securities are sold for foreign currencies or foreign
currency units or if the principal of or interest, if any, on any series of Debt
Securities is payable in foreign currencies or foreign currency units, the
restrictions, elections, tax consequences, specific terms and other information
with respect to such issue of Debt Securities and such currencies or currency
units will be set forth in an applicable Prospectus Supplement relating thereto.
The Debt Securities may be issued in one or more series with the same or
various maturities. (Section 3.02) Debt Securities may be issued solely in fully
registered form without coupons ('Registered Securities'), solely in bearer form
with or without coupons ('Bearer Securities'), or both as Registered Securities
and Bearer Securities. (Section 11.01) Registered Securities may be exchangeable
for other Debt Securities of the same series, registered in the same name, for a
like aggregate principal amount in authorized denominations and will be
transferable at any time or from time to time at the aforementioned office. No
service charge will be made to the Holder for any such exchange or transfer
except for any tax or governmental charge incidental thereto. (Section 3.05) If
Debt Securities of any series are issued as Bearer Securities, the Prospectus
Supplement will contain any restrictions applicable to the offer, sale or
delivery of Bearer Securities and the terms upon which Bearer Securities of the
series may be exchanged for Registered Securities of the series and, if
permitted by applicable laws and regulations, the terms upon which Registered
Securities of the series may be exchanged for Bearer Securities of the series,
whether such Debt Securities are to be issuable in permanent global form with or
without coupons and, if so, whether beneficial owners of interests in any such
permanent global security may exchange such interests for Debt Securities of
such series and the circumstances under which any such exchanges may occur.
Unless otherwise specified in the applicable Prospectus Supplement,
principal and interest, if any, on the Debt Securities offered thereby are to be
payable at the office or agency of the Company maintained for such purposes in
the city where the principal corporate trust office of the Trustee is located,
and will initially be the principal corporate trust office of the Trustee,
provided that payment of interest, if any, may be made (subject to collection)
at the option of the Company by check mailed to the persons in whose names the
Debt Securities are registered at the close of business on the day specified in
the Prospectus Supplement accompanying this Prospectus. (Section 12.02) The
principal corporate trust office of the Trustee at the date hereof is PNC Bank,
National Association, One Oliver Plaza, 210 Sixth Avenue, Pittsburgh,
Pennsylvania 15222.
The Debt Securities may be sold at a substantial discount below their
stated principal amount, bearing no interest or interest at a rate which at the
time of issuance is below market rates. Federal income tax consequences and
special considerations applicable to any such series will be described in the
Prospectus Supplement relating thereto.
Global Securities
The Debt Securities of a series may be issued in whole or in part in the
form of one or more Global Securities that will be deposited with or on behalf
of a depositary (a 'Depositary') identified in the Prospectus Supplement
relating to such series. Global Securities will be issued in registered form and
may be in either temporary or permanent form.
5
<PAGE>
The specific terms of the depositary arrangement with respect to any Debt
Securities of a series will be described in the Prospectus Supplement relating
to such series. The Company anticipates that the following provisions will apply
to all depositary arrangements.
Unless otherwise specified in an applicable Prospectus Supplement, Debt
Securities which are to be represented by a Global Security to be deposited with
or on behalf of a Depositary will be registered in the name of such depositary
or its nominee. Upon the issuance of a Global Security, the Depositary for such
Global Security will credit the respective principal amounts of the Debt
Securities represented by such Global Security to the accounts of institutions
that have accounts with such depositary or its nominee ('participants'). The
accounts to be credited shall be designated by the underwriters or agents of
such Debt Securities or by the Company, if such Debt Securities are offered and
sold directly by the Company. Ownership of beneficial interests in such Global
Securities will be limited to participants or persons that may hold interests
through participants. Ownership of beneficial interests by participants in such
Global Securities will be shown on, and the transfer of those ownership
interests will be effected only through, records maintained by the Depositary or
its nominee for such Global Security. Ownership of beneficial interests in
Global Securities by persons that hold through participants will be shown on,
and the transfer of that ownership interest within such participant will be
effected only through, records maintained by such participant. The laws of some
jurisdictions require that certain purchasers of securities take physical
delivery of such securities in definitive form. Such limits and such laws may
impair the ability to transfer beneficial interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the Debt
Securities represented by such Global Security for all purposes under the
Indenture governing such Debt Securities. Except as set forth below, owners of
beneficial interests in such Global Securities will not be entitled to have Debt
Securities of the series represented by such Global Security registered in their
names, will not receive or be entitled to receive physical delivery of Debt
Securities of such series in definitive form and will not be considered the
owners or holders thereof under the Indenture.
Payment of principal of, premium, if any, and any interest on Debt
Securities registered in the name of or held by a Depositary or its nominee will
be made to the Depositary or its nominee, as the case may be, as the registered
owner or the holder of the Global Security. None of the Company, the Trustee,
any Paying Agent or the Securities Registrar for such Debt Securities will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in a Global Security
or for maintaining, supervising or reviewing any records relating to such
beneficial ownership interests. (Section 3.09)
The Company expects that the Depositary for a permanent Global Security,
upon receipt of any payment of principal, premium or interest in respect of a
permanent Global Security, will credit immediately participants' accounts with
payments in amounts proportionate to their respective beneficial interests in
the principal amount of such Global Security as shown on the records of such
Depositary. The Company also expects that payments by participants to owners of
beneficial interests in such Global Security held through such participants will
be governed by standing instructions and customary practices, as is now the case
with securities held for the accounts of customers in bearer form or registered
in 'street name', and will be the responsibility of such participants.
A Global Security may not be transferred except as a whole by the
Depositary for such Global Security to a nominee or a successor of such
depositary. If a Depositary for a permanent Global Security is at any time
unwilling or unable to continue as depositary and a successor depositary is not
appointed by the Company within ninety days, the Company will issue Debt
Securities in definitive registered form in exchange for the Global Security
representing such Debt Securities. In addition, the Company may at any time and
in its sole discretion determine not to have any Debt Securities represented by
one or more Global Securities and, in such event, will issue Debt Securities in
definitive form in exchange for all of the Global Securities representing such
Debt Securities. (Section 3.05) Further, if the Company so specifies with
respect to the Debt Securities of a series, an owner of a beneficial interest in
a Global Security representing Debt Securities of such series may, on terms
acceptable to the Company and the Depositary for such Global Security, receive
Debt Securities of such series in definitive form. In any such instance, an
owner of a beneficial interest in a Global Security will be entitled to
physical
6
<PAGE>
delivery in definitive form of Debt Securities of the series represented by such
Global Security equal in principal amount to such beneficial interest and to
have such Debt Securities registered in its name.
Consolidation, Merger and Sale of Assets
The Company, without the consent of the Holders of any of the Outstanding
Debt Securities under either Indenture, may consolidate with or merge into, or
convey or transfer its properties and assets substantially as an entirety to,
any corporation organized under the laws of the United States of America or any
State thereof or the District of Columbia, provided, that the successor
corporation assumes the Company's obligations on all the Debt Securities and
under the Indentures, that after giving effect to the transaction no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have occurred and be continuing, and that
certain other conditions are met. Neither Indenture restricts a merger or
consolidation in which the Company is the surviving corporation. (Section 10.01)
Modification of the Indenture
Modifications and amendments of each Indenture with respect to one or more
series of Debt Securities may be made by supplemental indenture without the
consent of the Holders of such Debt Securities for certain enumerated purposes
(including the naming, by supplemental indenture, of a Trustee other than PNC
Bank, National Association for a series of Debt Securities) and otherwise with
the consent of the Holders of a majority in aggregate principal amount of the
Debt Securities at the time Outstanding of each series affected thereby,
provided that no such modification or amendment may, without the consent of the
Holder of each Debt Security affected thereby: (i) modify the terms of payment
of principal or interest; (ii) reduce the stated percentage of Holders of Debt
Securities necessary to modify or amend the Indentures or waive compliance by
the Company with certain provisions of the Indentures and certain defaults
thereunder; or (iii) subordinate the indebtedness evidenced by the Debt
Securities to any other indebtedness of the Company. (Sections 11.01 and 11.02)
Events of Default, Notice and Waiver
Except as otherwise set forth in the Prospectus Supplement relating to any
series of the Debt Securities, Events of Default with respect to any series of
Debt Securities under each Indenture will include: (1) default in the payment of
the principal of (or premium, if any, on) any Debt Securities of such series at
its Maturity; (2) default in making a sinking fund payment, if any, when and as
the same shall be due and payable by the terms of the Debt Securities of such
series; (3) default for 30 days in the payment of any installment of interest on
any Debt Security of such series; (4) default for 90 days after written notice
in the performance of any other covenant in respect of the Debt Securities of
such series; (5) certain events of bankruptcy, insolvency or reorganization, or
court appointment of a receiver, liquidator or trustee of the Company or its
property; (6) an Event of Default with respect to any other series of Debt
Securities outstanding under the applicable Indenture or an event of default
under any other indebtedness of the Company for borrowed money in excess of
$50,000,000 which results in an aggregate principal amount of at least
$50,000,000 of such other series of Debt Securities or such other indebtedness
becoming or being declared due and payable prior to the date on which it would
otherwise become due and payable and such acceleration has not been rescinded or
annulled within 10 days after notice of default is given; and (7) any other
Event of Default provided in or pursuant to the applicable resolution of the
Board of Directors or supplemental indenture under which such series of Debt
Securities is issued. (Section 7.01) The Trustee may withhold notice to the
Holders of any series of Debt Securities of any default with respect to such
series (except in the payment of principal, premium or interest) if it considers
such withholding in the interest of such Holders. (Section 8.02)
If an Event of Default with respect to any series of Debt Securities shall
have occurred and be continuing, the Trustee or the Holders of 25% in aggregate
principal amount of the Debt Securities of such series may declare the
principal, or in the case of discounted Debt Securities, such portion thereof as
may be described in the Prospectus Supplement accompanying this Prospectus, of
all the Debt Securities of such series to be due and payable immediately.
(Section 7.02)
Each Indenture contains a provision entitling the Trustee to be indemnified
by the Holders before proceeding to exercise any right or power under the
Indenture at the request of any of the Holders. (Section 8.03) Each Indenture
provides that the Holders of a majority in principal amount of the Outstanding
Debt Securities of any
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series may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred upon the Trustee, with respect to the Debt Securities of such series.
(Section 7.12) The right of a Holder to institute a proceeding with respect to
the applicable Indenture is subject to certain conditions precedent including
notice and indemnity to the Trustee, but the Holder has an absolute right to
receipt of principal of (and premium, if any) and interest, if any, on the Debt
Securities of any series on the respective Stated Maturities expressed therein
and to institute suit for the enforcement thereof. (Sections 7.07 and 7.08)
The Holders of not less than a majority in principal amount of the
Outstanding Debt Securities of any series under the applicable Indenture may on
behalf of the Holders of all the Debt Securities of such series waive any past
defaults except (a) a default in payment of the principal of (or premium, if
any) or interest, if any, on any Debt Security of such series or in the payment
of any sinking fund installment or analogous obligation with respect to the Debt
Securities of such series and (b) a default in respect of a covenant or
provision of the applicable Indenture which cannot be amended or modified
without the consent of the Holder of each Outstanding Debt Security affected.
(Section 7.13)
Each Indenture requires the Company to furnish to the Trustee annual
statements as to the fulfillment by the Company of its obligations under such
Indenture. (Sections 9.04 and 12.05).
Concerning the Trustee
The Trustee provides banking and corporate trust services to the Company
and extends credit to the Company and many of its subsidiaries worldwide. The
Trustee is a depository of the funds of the Company and holds common shares of
the Company for various of its customers, including customers over whose
accounts it has discretionary authority. If a bank or trust company other than
PNC Bank, National Association is to act as trustee for a series of Debt
Securities, information concerning such other trustee may be set forth in the
Prospectus Supplement relating to such Debt Securities.
Defeasance of the Indenture and Debt Securities
Except as otherwise set forth in the applicable Prospectus Supplement
relating to any series of the Debt Securities, the Company will be deemed to
have paid and discharged the entire indebtedness on the Debt Securities of any
series, and the Company's obligations under each Indenture with respect to the
Debt Securities of such series (other than certain specified obligations of the
Company such as the obligations to maintain a security register pertaining to
transfer of the Debt Securities, to maintain a paying agency office, and to
replace stolen, lost or destroyed Debt Securities) will cease to be in effect,
from and after the ninety-first day following the deposit with the Trustee, in
trust, of (i) money in an amount in the currency in which the Debt Securities of
such series are denominated or (ii) U.S. Government Obligations in the case of
Debt Securities denominated in Dollars or obligations issued or guaranteed by
the government which issued the currency in which the Debt Securities of such
series are denominated in the case of Debt Securities denominated in Foreign
Currencies, which through the payment of interest and principal in respect
thereof in accordance with their terms will provide money in an amount in the
currency in which the Debt Securities of such series are denominated, or (iii) a
combination thereof, sufficient to pay and discharge the principal (and premium,
if any) and interest, if any, to the date of maturity on, such series of Debt
Securities. (Section 6.02) In the event of any such defeasance, Holders of such
Debt Securities would be able to look only to such trust fund for payment of
principal and premium, if any, and interest, if any, on their Debt Securities
thereafter.
Such defeasance may be treated as a taxable exchange of the related Debt
Securities for an issue of obligations of the trust or a direct interest in the
money, U.S. Government Obligations or other obligations held in the trust. In
that case Holders of such Debt Securities would recognize gain or loss as if the
trust obligations or the money, U.S. Government Obligations or other obligations
deposited, as the case may be, had actually been received by them in exchange
for their Debt Securities. Such Holders thereafter might be required to include
in income a different amount than would be includable in the absence of
defeasance. Prospective investors are urged to consult their own tax advisors as
to the specific consequences of defeasance.
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PROVISIONS APPLICABLE SOLELY TO SUBORDINATED SECURITIES
General
Subordinated Securities will be issued under the Subordinated Indenture and
will rank pari passu with certain other subordinated debt of the Company that
may be outstanding from time to time and will rank junior to all Senior
Indebtedness of the Company (including any Senior Securities) that may be
outstanding from time to time.
Subordination
The payment of the principal of (and premium, if any) and interest on the
Subordinated Securities is expressly subordinated, to the extent and in the
manner set forth in the Subordinated Indenture, in right of payment to the prior
payment in full of all Senior Indebtedness of the Company. (Section 13.01) (a)
Upon (i) any acceleration of the principal amount due on the Subordinated
Securities or (ii) any payment or distribution of assets of the Company of any
kind or character, whether in cash, property or securities, to creditors upon
any dissolution or winding-up or total or partial liquidation or reorganization
of the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all principal and premium, if any, and
interest due upon all Senior Indebtedness shall first be paid in full, or
payment thereof provided for in money or money's worth in accordance with its
terms, before any payment is made on account of the principal of, premium, if
any, or interest on the indebtedness evidenced by the Subordinated Securities,
and upon any such dissolution or winding-up or liquidation or reorganization any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities, to which the Holders of the
Subordinated Securities would be entitled, except for the provisions of the
Subordinated Indenture, shall (subject to the power of a court of competent
jurisdiction to make other equitable provision reflecting the rights conferred
by the provisions of the Subordinated Securities upon the Senior Indebtedness
and the holders thereof with respect to the Subordinated Securities and the
Holders thereof by a lawful plan of reorganization under applicable bankruptcy
law), be paid by the Company or any receiver, trustee in bankruptcy, liquidating
trustee, agent or other person making such payment or distribution, or by the
Holders of the Subordinated Securities if received by them, directly to the
holders of Senior Indebtedness (pro rata to each such holder on the basis of the
respective amounts of Senior Indebtedness held by such holder) or their
representatives, to the extent necessary to pay all Senior Indebtedness
(including interest thereon) in full, in money or money's worth, after giving
effect to any concurrent payments or distribution to or for the holders of
Senior Indebtedness, before any payment or distribution is made to the Holders
of the indebtedness evidenced by the Subordinated Securities. The consolidation
of the Company with or the merger of the Company into another Person or the
liquidation or dissolution of the Company following the conveyance or transfer
of its property as an entirety, or substantially as an entirety, to another
Person upon the terms and conditions provided in the Subordinated Indenture
shall not be deemed a dissolution, winding-up, liquidation or reorganization for
these purposes.
(b) In the event that any payment or distribution of assets of the Company
of any kind or character not permitted by the foregoing provisions, whether in
cash, property or securities, shall be received by the Holders of Subordinated
Securities before all Senior Indebtedness is paid in full, or provision made for
such payment, in accordance with its terms, such payment or distribution shall
be held in trust for the benefit of, and shall be paid over or delivered to, the
holders of such Senior Indebtedness or their representative or representatives,
or to the trustee or trustees under any indenture pursuant to which any
instruments evidencing any of such Senior Indebtedness may have been issued, as
their respective interests may appear, for application to the payment of all
Senior Indebtedness remaining unpaid to the extent necessary to pay all such
Senior Indebtedness in full in accordance with its terms, after giving effect to
any concurrent payment or distribution to the holders of such Senior
Indebtedness.
(c) No payment on account of principal of, premium, if any, sinking funds
or interest on the Subordinated Securities shall be made unless full payment of
amounts then due for principal, premium, if any, sinking funds and interest on
any Senior Indebtedness has been made or duly provided for in money or money's
worth in accordance with the terms of such Senior Indebtedness. No payment on
account of principal, premium, if any, sinking funds or interest on the
Subordinated Securities shall be made if, at the time of such payment or
immediately after giving effect thereto, (i) there shall exist a default in the
payment of principal, premium, if any,
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sinking fund or interest with respect to any Senior Indebtedness, or (ii) there
shall have occurred an event or default (other than a default in the payment of
principal, premium, if any, sinking funds or interest) with respect to any
Senior Indebtedness, as defined therein or in the instrument under which the
same is outstanding, permitting the holders thereof to accelerate the maturity
thereof, and such event of default shall not have been cured or waived or shall
not have ceased to exist; provided however, that if the holders of the Senior
Indebtedness to which the default relates have not declared such Senior
Indebtedness to be immediately due and payable within 180 days after the
occurrence of such default (or have declared such Senior Indebtedness to be
immediately due and payable and within such period have rescinded such
declaration of acceleration), then the Company shall resume making any and all
required payments in respect of the Securities (including any missed payments).
On!y one payment blockage period under the immediately preceding sentence may be
commenced within any consecutive 365-day period with respect to the Securities
of any series. No event of default which existed or was continuing on the date
of the commencement of any 180-day payment blockage period with respect to the
Senior Indebtedness initiating such payment blockage period shall be, or be
made, the basis for the commencement of a second payment blockage period by a
Holder or representative of such Senior Indebtedness whether or not within a
period of 365 consecutive days unless such event of default shall have been
cured or waived for a period of not less than 90 consecutive days (and, in the
case of any such waiver, no payment shall be made by the Company to the holders
of Senior Indebtedness in connection with such waiver other than amounts due
pursuant to the terms of the Senior Indebtedness as in effect at the time of
such default).
Subrogation
From and after the payment in full of all Senior Indebtedness, the Holders
of the Subordinated Securities (together with the holders of any other
indebtedness of the Company which is subordinate in right of payment to the
payment in full of all Senior Indebtedness, which is not subordinate in right of
payment to the Subordinated Securities and which by its terms grants such right
of subrogation to the holder thereof) shall be subrogated to the rights of the
holders of Senior Indebtedness to receive payments or distributions of assets or
securities of the Company applicable to the Senior Indebtedness until the
Subordinated Securities shall be paid in full, and, for the purposes of such
subrogation, no such payments or distributions to the holders of Senior
Indebtedness of assets or securities, which otherwise would have been payable or
distributable to Holders of the Subordinated Securities, shall, as between the
Company, its creditors other than the holders of Senior Indebtedness, and the
Holders of the Subordinated Securities, be deemed to be a payment by the Company
to or on account of the Senior Indebtedness, it being understood that these
provisions of the Indenture are and are intended solely for the purpose of
defining the relative rights of the Holders of the Subordinated Securities, on
the one hand, and the holders of the Senior Indebtedness, on the other hand, and
nothing contained in the Subordinated Indenture is intended to or shall impair
as between the Company, its creditors other than the holders of Senior
Indebtedness, and the holders of the Subordinated Securities, the obligation of
the Company, which is unconditional and absolute, to pay to the Holders of the
Subordinated Securities the principal of and interest on the Subordinated
Securities as and when the same shall become due and payable in accordance with
their terms, or to affect the relative rights of the Holders of the Subordinated
Securities and creditors of the Company other than the holders of the Senior
Indebtedness, nor shall anything therein prevent the Holder of any Subordinated
Security from exercising all remedies otherwise permitted by applicable law upon
default under such Security subject to the rights of the holders of Senior
Indebtedness to receive cash, property or securities of the Company otherwise
payable or deliverable to the Holders of the Subordinated Securities or to a
representative of such Holders, on their behalf.
The term 'Senior Indebtedness' is defined in the Subordinated Indenture as
indebtedness incurred by the Company for money borrowed whether outstanding on
the date hereof or incurred in the future, all deferrals, renewals or extensions
of any such indebtedness and all evidences of indebtedness issued in exchange
for any such indebtedness and guarantees by the Company of the foregoing items
of indebtedness for money borrowed by persons other than the Company, unless, in
any such case, such indebtedness or guarantee provides by its terms that it
shall not constitute Senior Indebtedness.
If Subordinated Securities are issued under the Subordinated Indenture, the
aggregate principal amount of Senior Indebtedness outstanding as of a recent
date will be set forth in the Prospectus Supplement. The Subordinated Indenture
does not restrict the amount of Senior Indebtedness that the Company may incur.
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PROVISIONS APPLICABLE SOLELY TO SENIOR SECURITIES
Restrictions as to Liens
Each Indenture contains a covenant providing that the Company will not at
any time directly or indirectly create, assume, incur, or suffer to be created,
assumed, or incurred or to exist any mortgage, pledge, encumbrance or lien of
any kind (except for any bona fide option or agreement to sell) (a 'Lien') upon
(1) any shares of capital stock owned by the Company of any of American Express
Travel Related Services Company, Inc., American Express Bank Ltd. or American
Express Financial Corporation, so long as they continue to be Subsidiaries of
the Company (the 'Principal Subsidiaries') (other than directors' qualifying
shares) or (2) any shares of capital stock owned by the Company of a Subsidiary
of the Company that owns, directly or indirectly, capital stock of any of the
Principal Subsidiaries (other than directors' qualifying shares) without making
effective provision whereby the Securities (and any other indebtedness of the
Company or such Subsidiary entitled to the benefit of a covenant similar to this
covenant, subject to applicable priorities of payment) will be secured by such
Lien equally and ratably with any and all other obligations thereby secured, so
long as any of such other obligations and indebtedness shall be so secured.
However, the Company may incur or suffer to be incurred or to exist upon such
capital stock (a) Liens for taxes, assessments or other governmental charges or
levies which are not yet due or are payable without penalty or of which the
amount, applicability or validity is being contested by the Company in good
faith by appropriate proceedings, or (b) the Liens of any judgment, if such
judgment shall not have remained undischarged, or unstayed on appeal or
otherwise, for more than 60 days. (Section 12.07(a))
The foregoing covenant will cease to be binding on the Company with respect
to any series of the Debt Securities to which such covenant applies from and
after the ninety-first day following the deposit with the Trustee, in trust, of
(i) money in an amount in the currency in which the Debt Securities of such
series are denominated or (ii) U.S. Government Obligations in the case of Debt
Securities denominated in Dollars or obligations issued or guaranteed by the
government which issued the currency in which the Debt Securities of such series
are denominated in the case of Debt Securities denominated in Foreign
Currencies, which through the payment of interest and principal in respect
thereof in accordance with their terms will provide money in an amount in the
currency in which the Debt Securities of such series are denominated, or (iii) a
combination thereof, sufficient to pay and discharge the principal (and premium,
if any) and interest, if any, to the date of maturity on, such series of Debt
Securities. (Section 12.07(b))
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DESCRIPTION OF PREFERRED SHARES
General
Under the Company's Restated Certificate of Incorporation, the Company is
authorized to issue 20,000,000 Preferred Shares, par value $1.66 2/3 per share
(the 'Preferred Shares'), all of which shares are available for issuance at the
date of this Prospectus. The Company's Preferred Shares may be issued from time
to time in one or more series with such designations, voting powers, dividend
rates, rights of redemption, conversion rights or other special rights,
preferences and limitations as may be stated in the resolutions providing for
the issue of such Preferred Shares adopted by the Board of Directors.
The Preferred Shares shall have the dividend, liquidation and voting rights
set forth below unless otherwise provided in the Prospectus Supplement relating
to a particular series of the Preferred Shares. Reference is made to the
Prospectus Supplement relating to the particular series of the Preferred Shares
offered thereby for specific terms, including: (i) the title and liquidation
preference per share of such Preferred Shares and the number of shares offered;
(ii) the price at which such Preferred Shares will be issued; (iii) the dividend
rate (or method of calculation), the dates on which and the conditions under
which dividends shall be payable (or method of calculation), whether such
dividends shall be cumulative or noncumulative and, if cumulative, the dates
from which dividends shall commence to accumulate, and the status of such
dividends as participating or non-participating; (iv) any redemption, sinking
fund or analogous provisions of such Preferred Shares; (v) any conversion or
exchange provisions of such Preferred Shares; (vi) whether the Company has
elected to offer Depositary Shares with respect to such Preferred Shares as
described below under 'Depositary Shares'; (vii) whether such Preferred Shares
shall have voting rights, in addition to the voting rights described below, and,
if so, the terms of such voting rights; (viii) the procedures for any auction
and remarketing of the Preferred Shares; and (ix) any additional dividend,
liquidation, redemption, sinking fund and other rights, preferences, privileges,
limitations and restrictions of such Preferred Shares.
The Preferred Shares will, when issued, be fully paid and nonassessable.
Unless otherwise specified in the Prospectus Supplement relating to a particular
series of the Preferred Shares, each series of the Preferred Shares will rank on
a parity as to dividends and distributions in the event of a liquidation with
the outstanding Preferred Shares of the Company and each other series of the
Preferred Shares. See 'Outstanding Preferred Shares' below.
Dividend Rights
All Preferred Shares shall be of equal rank with each other regardless of
series. In case the stated dividends and the amounts payable on liquidation are
not paid in full, the Preferred Shares of all series shall share ratably in the
payment of dividends including accumulations, if any, in accordance with the
sums which would be payable on such shares if all dividends were declared and
paid in full, and in any distribution of assets other than by way of dividends
in accordance with the sums which would be payable in such distribution if all
sums payable were discharged in full.
Rights Upon Liquidation
Upon any liquidation, dissolution or winding up of the affairs of the
Company (which shall not be deemed to include a consolidation or merger of the
Company, or the sale of all or substantially all of the assets of the Company,
into, with or to any other corporation or corporations), whether voluntary or
involuntary, the holders of the Preferred Shares are to be paid in full the
amounts, if any, to which they are respectively entitled or provision for such
payment shall have been made before any distribution is made to the holders of
the Common Shares.
Voting Rights
Except as described below, the holders of Preferred Shares have no voting
rights, other than as may be required by law. Whenever dividends payable on the
Preferred Shares of any series shall be in arrears in an aggregate amount at
least equal to six full quarterly dividends (which need not be consecutive) on
such series, the holders of the outstanding Preferred Shares of all series shall
have the special right, voting separately as a single
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class, to elect two directors of the Company at the next succeeding annual
meeting of shareholders (and at each succeeding annual meeting of shareholders
thereafter until such right shall terminate as hereinafter provided), and
subject to the terms of any outstanding series of Preferred Shares, the holders
of the Common Shares and the holders of one or more series of Preferred Shares
then entitled to vote shall have the right, voting as a single class, to elect
the remaining authorized number of directors. At each meeting of shareholders at
which the holders of the Preferred Shares of all series shall have the special
right, voting separately as a single class, to elect directors as provided
above, the presence in person or by proxy of the holders of record of one-third
of the total number of the Preferred Shares of all series then issued and
outstanding shall be necessary and sufficient to constitute a quorum of such
class for such election by such shareholders. Each director elected by the
holders of the Preferred Shares of all series shall hold office until the annual
meeting of shareholders next succeeding his election and until his successor, if
any, is elected by such holders and qualified or until his death, resignation or
removal in the manner provided in the By-laws of the Company; provided, however,
that notwithstanding any provision in the By-laws, a director elected by the
holders of the Preferred Shares of all series may be removed only by such
holders if such removal is without cause. In case any vacancy shall occur among
the directors elected by the holders of the Preferred Shares of all series such
vacancy may be filled for the unexpired portion of the term by vote of the
single remaining director theretofore elected by such shareholders, or his
successor in office, or, if such vacancy shall occur more than 90 days prior to
the first anniversary of the next preceding annual meeting of shareholders, by
the vote of such shareholders given at a special meeting of such shareholders
called for the purpose. Whenever all arrears of dividends on the Preferred
Shares of all series shall have been paid and dividends thereon for the current
quarterly period shall have been paid or declared and provided for, the right of
the holders of the Preferred Shares of all series to elect two directors as
provided in this paragraph shall terminate at the next succeeding annual meeting
of shareholders, but subject always to the same provisions for the vesting of
such special right, voting separately as a single class, to elect two directors
in the case of any future arrearages of the kind and amount described above.
The consent of the holders of at least two-thirds of the outstanding
Preferred Shares, given in person or by proxy, at a special or annual meeting of
shareholders called for the purpose, at which the holders of the Preferred
Shares of all series shall vote separately as a single class, shall be necessary
for effecting the authorization of any class of shares ranking prior to the
Preferred Shares as to dividends or upon liquidation, dissolution or winding up,
or an increase in the authorized amount of any class of shares so ranking prior
to the Preferred Shares, or the authorization of any amendment of the Restated
Certificate of Incorporation or the By-laws of the Company as to affect
adversely the relative rights, preferences or limitations of the Preferred
Shares; provided, however, that, if any such amendment shall affect adversely
the relative rights, preferences or limitations of one or more, but not all, of
the series of Preferred Shares then outstanding, the consent of the holders of
at least two-thirds of the outstanding Preferred Shares of the several series so
affected shall be required in lieu of the consent of the holders of at least
two-thirds of the outstanding Preferred Shares of all series.
In any case in which the holders of the Preferred Shares shall be entitled
to vote separately as a single class, each holder of Preferred Shares of any
series shall be entitled to one vote for each such share held.
Outstanding Preferred Shares
The Company has no Preferred Shares issued and outstanding at the date of
this Prospectus.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below and in any Prospectus Supplement of certain
provisions of the Deposit Agreement (as defined below) and of the Depositary
Shares (as defined below) and Depositary Receipts (as defined below) does not
purport to be complete and is subject to and qualified in its entirety by
reference to the forms of Deposit Agreement and Depositary Receipts relating to
each series of Preferred Shares which have been or will be filed with the
Commission in connection with the offering of such series of Preferred Shares.
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General
The Company may, at its option, elect to offer fractional interests in
Preferred Shares, rather than Preferred Shares. In the event such option is
exercised, the Company will provide for the issuance by a Depositary to the
public of receipts for depositary shares ('Depositary Shares'), each of which
will represent fractional interests of a particular series of Preferred Shares
(which will be set forth in the Prospectus Supplement relating to a particular
series of Preferred Shares).
The shares of any series of Preferred Shares underlying the Depositary
Shares will be deposited under a separate Deposit Agreement (the 'Deposit
Agreement') between the Company and a bank or trust company selected by the
Company having its principal office in the United States and having a combined
capital and surplus of at least $50,000,000 (the 'Depositary'). The Prospectus
Supplement relating to a series of Depositary Shares will set forth the name and
address of the Depositary. Subject to the terms of the Deposit Agreement, each
owner of Depositary Shares will be entitled, in proportion to the applicable
fractional interests in Preferred Shares underlying such Depositary Shares, to
all the rights and preferences of the Preferred Shares underlying such
Depositary Shares (including dividend, voting, redemption, conversion and
liquidation rights).
The Depositary Shares will be evidenced by depositary receipts issued
pursuant to the Deposit Agreement (the 'Depositary Receipts'). Depositary
Receipts will be distributed to those persons purchasing the fractional
interests in shares of the related series of Preferred Shares in accordance with
the terms of the offering described in the related Prospectus Supplement.
Dividends and Other Distributions
The Depositary will distribute all cash dividends or other cash
distributions received in respect of Preferred Shares to the record holders of
Depositary Shares relating to such Preferred Shares in proportion to the numbers
of such Depositary Shares owned by such holders on the relevant record date. The
Depositary shall distribute only such amount, however, as can be distributed
without attributing to any holder of Depositary Shares a fraction of one cent,
and any balance not so distributed shall be added to and treated as part of the
next sum received by the Depositary for distribution to record holders of
Depositary Shares.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary may, with the approval of
the Company, sell such property and distribute the net proceeds from such sale
to such holders.
The Deposit Agreement will also contain provisions relating to the manner
in which any subscription or similar rights offered by the Company to holders of
the Preferred Shares shall be made available to the holders of Depositary
Shares.
Redemption of Depositary Shares
If a series of the Preferred Shares underlying the Depositary Shares is
subject to redemption, the Depositary Shares will be redeemed from the proceeds
received by the Depositary resulting from the redemption, in whole or in part,
of such series of the Preferred Shares held by the Depositary. The Depositary
shall mail notice of redemption not less than 30 and not more than 60 days prior
to the date fixed for redemption to the record holders of the Depositary Shares
to be so redeemed at their respective addresses appearing in the Depositary's
books. The redemption price per Depositary Share will be equal to the applicable
fraction of the redemption price per share payable with respect to such series
of the Preferred Shares. Whenever the Company redeems Preferred Shares held by
the Depositary, the Depositary will redeem as of the same redemption date the
number of Depositary Shares relating to shares of Preferred Shares so redeemed.
If less than all of the Depositary Shares are to be redeemed, the Depositary
Shares to be redeemed will be selected by lot or pro rata as may be determined
by the Depositary.
After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be deemed to be outstanding and all rights of the
holders of the Depositary Shares will cease, except the right to receive the
moneys, securities or other property payable upon such redemption and any money,
securities, or
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other property to which the holders of such Depositary Shares were entitled upon
such redemption upon surrender to the Depositary of the Depositary Receipts
evidencing such Depositary Shares.
Voting the Preferred Shares
Upon the receipt of notice of any meeting at which the holders of the
Preferred Shares are entitled to vote, the Depositary will mail the information
contained in such notice of meeting to the record holders of the Depositary
Shares relating to such Preferred Shares. Each record holder of such Depositary
Shares on the record date (which will be the same date as the record date for
the Preferred Shares) will be entitled to instruct the Depositary as to the
exercise of the voting rights pertaining to the number of shares of Preferred
Shares underlying such Depositary Shares in accordance with such instructions,
and the Company will agree to take all action which may be deemed necessary by
the Depositary in order to enable the Depositary to do so.
Amendment and Termination of Depositary Agreement
The form of Depositary Receipt evidencing the Depositary Shares and any
provision of the Deposit Agreement may at any time be amended by agreement
between the Company and the Depositary. However, any amendment which materially
and adversely alters the rights of the existing holders of Depositary Shares
will not be effective unless such amendment has been approved by the record
holders of at least a majority of the Depositary Shares then outstanding. A
Deposit Agreement may be terminated by the Company or the Depositary only if (i)
all outstanding Depositary Shares relating thereto have been redeemed or (ii)
there has been a final distribution in respect of the Preferred Shares of the
relevant series in connection with any liquidation, dissolution or winding up of
the Company and such distribution has been distributed to the holders of the
related Depositary Shares.
Charges of Depositary
The Company will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. The Company
will pay charges of the Depositary in connection with the initial deposit of the
Preferred Shares and any redemption of the Preferred Shares. Holders of the
Depositary Shares will pay transfer and other taxes and governmental charges and
such other charges as are expressly provided in the Deposit Agreement to be for
their accounts.
Resignation and Removal of Depositary
The Depositary may resign at any time by delivering to the Company notice
of its election to do so, and the Company may at any time remove the Depositary,
any such resignation or removal to take effect upon the appointment of a
successor Depositary and its acceptance of such appointment. Such successor
Depositary must be appointed within 60 days after delivery of the notice of
resignation or removal and must be a bank or trust company having its principal
office in the United States and having a combined capital and surplus of at
least $50,000,000.
Miscellaneous
The Depositary will forward to the holders of Depositary Shares all reports
and communications from the Company which are delivered to the Depositary and
which the Company is required to furnish to the holders of the Preferred Shares.
Neither the Depositary nor the Company will be liable if it is prevented or
delayed by law or any circumstance beyond its control in performing its
obligations under the Deposit Agreement. The obligations of the Company and the
Depositary under the Deposit Agreement will be limited to performance in good
faith of their duties thereunder and they will not be obligated to prosecute or
defend any legal proceeding in respect of any Depositary Shares or Preferred
Shares unless satisfactory indemnity is furnished. They may rely upon written
advice of counsel or accountants, or information provided by persons presenting
Preferred Shares for deposit, holders of Depositary Shares or other persons
believed to be competent and on documents believed to be genuine.
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DESCRIPTION OF COMMON SHARES
The following summary does not purport to be complete and is subject in all
respects to the applicable provisions of the New York Business Corporation Law,
the Company's Restated Certificate of Incorporation and By-Laws.
General
The Company is authorized to issue up 1,200,000,000 common shares, par
value $.60 each (the 'Common Shares'). At April 30, 1997, the Company had
outstanding 470,989,424 Common Shares. As of December 31, 1996, approximately
81,600,000 Common Shares were reserved for issuance with respect to various
employee stock plans, employee benefit plans, convertible preferred shares and
debentures, and the dividend reinvestment plan.
Subject to the prior dividend rights of the holders of any Preferred
Shares, holders of Common Shares are entitled to receive dividends when, as and
if declared by the Board of Directors out of funds legally available therefor.
Each Common Share is entitled to one vote on all matters submitted to a
vote of shareholders. Holders of the Common Shares do not have cumulative voting
rights. After the satisfaction in full of the liquidation preferences of holders
of any Preferred Shares, holders of Common Shares are entitled to ratable
distribution of the remaining assets available for distribution to shareholders
in the event of any liquidation, dissolution or winding up of the Company. The
Common Shares are not subject to redemption by operation of a sinking fund or
otherwise. Holders of Common Shares are not entitled to pre-emptive rights. The
issued and outstanding Common Shares are fully paid and nonassessable.
DESCRIPTION OF SECURITIES WARRANTS
The Company may issue Securities Warrants for the purchase of Debt
Securities, Preferred Shares, Depositary Shares, Common Shares or equity
securities issued by an affiliated or unaffiliated corporation or other entity.
Securities Warrants may be issued independently or together with any Securities
offered by any Prospectus Supplement and may be attached to or separate from
such Securities. Each series of Securities Warrants will be issued under a
separate warrant agreement (each a 'Securities Warrant Agreement') to be entered
into between the Company and a warrant agent ('Warrant Agent'). The Warrant
Agent will act solely as an agent of the Company in connection with the
Securities Warrants of such series and will not assume any obligation or
relationship of agency or trust for or with any holders or beneficial owners of
Securities Warrants. The following sets forth certain general terms and
provisions of the Securities Warrants offered hereby. Further terms of the
Securities Warrants and the applicable Securities Warrant Agreement will be set
forth in the applicable Prospectus Supplement.
The applicable Prospectus Supplement will describe the following terms,
where applicable, of the Securities Warrants in respect of which this Prospectus
is being delivered: (1) the title of such Securities Warrants; (2) the aggregate
number of such Securities Warrants; (3) the price or prices at which such
Securities Warrants will be issued; (4) the currencies in which the price of
such Securities Warrants may be payable; (5) the designation, aggregate
principal amount and terms of the securities purchasable upon exercise of such
Securities Warrants; (6) the designation and terms of the Securities with which
such Securities Warrants are issued and the number of such Securities Warrants
issued with each such security; (7) the currency or currencies, including
composite currencies, in which the principal of or any premium or interest on
the securities purchasable upon exercise of such Securities Warrant will be
payable; (8) if applicable, the date on and after which such Securities Warrants
and the related securities will be separately transferable; (9) the price at
which and currency or currencies, including composite currencies, in which the
securities purchasable upon exercise of such Securities Warrants may be
purchased; (10) the date on which the right to exercise such Securities Warrants
shall commence and the date on which such right shall expire; (11) the minimum
or maximum amount of such Securities Warrants which may be exercised at any one
time; (12) information with respect to book-entry procedures, if any; (13) a
discussion of certain Federal income tax considerations; and (14) any other
terms of such Securities Warrants, including terms, procedures and limitations
relating to the exchange and exercise of such Securities Warrants.
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DESCRIPTION OF CURRENCY WARRANTS
The following description of the terms of the Currency Warrants sets forth
certain general terms and provisions of the Currency Warrants to which any
Prospectus Supplement may relate. The particular terms of the Currency Warrants
offered by any Prospectus Supplement and the extent, if any, to which such
general provisions may not apply to the Currency Warrants so offered will be
described in the Prospectus Supplement relating to such Currency Warrants.
Each issue of Currency Warrants will be issued under a warrant agreement (a
'Currency Warrant Agreement') to be entered into between the Company and a
warrant agent (the 'Currency Warrant Agent'). The Currency Warrant Agent will
act solely as the agent of the Company under the applicable Currency Warrant
Agreement and will not assume any obligation or relationship of agency or trust
for or with any holders of such Currency Warrants.
The applicable Prospectus Supplement will describe the following terms,
where applicable, of the Currency Warrants in respect of which this Prospectus
is being delivered: (i) the aggregate amount and number of such Currency
Warrants; (ii) the offering price of such Currency Warrants; (iii) the
designated currency, which currency may be foreign currency or a composite
currency, including ECU, and information regarding such currency or composite
currency; (iv) the date on which the right to exercise such Currency Warrants
commences and the date on which such right expires; (v) the manner in which such
Currency Warrants may be exercised; (vi) the circumstances which will cause the
Currency Warrants to be deemed automatically exercised; (vii) the minimum
number, if any, of such Currency Warrants exercisable at any one time and any
other restrictions on exercise; (viii) the method of determining the amount
payable in connection with the exercise of such Currency Warrants, including the
strike price or range of strike prices of such Currency Warrants, the method of
determining the spot exchange rate and the U.S. Dollar Constant for such
Currency Warrants; (ix) the national securities exchange on which such currency
warrants will be listed; (x) whether such Currency Warrants will, from the
perspective of holders, be represented by certificates or issued in book-entry
form; (xi) the place or places at which payment of the cash settlement value of
such Currency Warrants is to be made by the Corporation, if applicable; (xii)
information with respect to book-entry procedures, if any; (xiii) the plan of
distribution of the Currency Warrants, and (xiv) any other terms of such
Currency Warrants.
Prospective purchasers of Currency Warrants should be aware of special
Federal income tax considerations applicable to instruments such as the Currency
Warrants. The Prospectus Supplement relating to each issue of Currency Warrants
will describe such tax considerations.
DESCRIPTION OF OTHER WARRANTS
The Company may issue Other Warrants to buy or sell debt securities of or
guaranteed by the United States, to buy or sell currencies, to buy or sell units
of a stock index or stock basket, to buy or sell a commodity or a unit of a
commodity index or to buy or sell some other item or unit of an index
(collectively, 'Exercise Items'). Other Warrants will be settled either through
physical delivery or through payment of a cash settlement value as set forth in
the applicable Prospectus Supplement. Other Warrants will be issued under a
warrant agreement (an 'Other Warrant Agreement') to be entered into between the
Company and a warrant agent (the 'Other Warrant Agent'). The Other Warrant Agent
will act solely as the agent of the Company under the applicable Other Warrant
Agreement and will not assume any obligation or relationship of agency or trust
for or with any holders of such Other Warrants.
The applicable Prospectus Supplement will describe the following terms,
where applicable, of the Other Warrants in respect of which this Prospectus is
being delivered: (i) the title and aggregate number of such Other Warrants; (ii)
the offering price of such Other Warrants; (iii) the material risk factors
relating to such Other Warrants; (iv) the Exercise Items that such Other
Warrants represent the right to buy or sell; (v) the procedures and conditions
relating to the exercise of such Other Warrants; (vi) the date on which the
right to exercise such Other Warrants shall commence and the date on which such
right shall expire; (vii) the identity of the Other Warrant Agent for such Other
Warrants; (viii) whether the certificates evidencing such Other Warrants will be
issuable in definitive registered form or global form or both; (ix) a discussion
of federal income tax
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<PAGE>
considerations applicable to such Other Warrants; and (x) any other terms of
such Other Warrants, including any terms that may be required or advisable under
applicable law.
The Other Warrants may entail significant risks, including, without
limitation, the possibility of significant fluctuations in the market for the
applicable Exercise Item, potential illiquidity in the secondary market and the
risk that they will expire worthless. These risks will vary depending on the
particular terms of the Other Warrants and will be more fully described in the
applicable Prospectus Supplement.
PLAN OF DISTRIBUTION
The Company may sell the Securities (i) through underwriters or dealers;
(ii) directly to one or more purchasers; (iii) through agents; or (iv) through a
combination of any of such methods of sale. The Prospectus Supplement with
respect to the Securities being offered thereby sets forth the terms of the
offering of such Securities, including the name or names of any agents or
underwriters, the purchase price of such Securities and the proceeds to the
Company from such sale, any underwriting discounts and other items constituting
underwriters' or agents' compensation, any initial public offering price, any
discounts or concessions allowed or reallowed or paid to dealers and any
securities exchanges on which such Securities may be listed. Only agents or
underwriters so named in the Prospectus Supplement are deemed to be agents or
underwriters in connection with the Securities offered thereby.
If underwriters are used in the sale, the Securities will be acquired by
the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. The
obligations of the underwriters to purchase such Securities will be subject to
certain conditions precedent, and the underwriters will be obligated to purchase
all the Securities of the series offered by the Prospectus Supplement relating
to such series if any of such Securities are purchased. Any initial public
offering price and any discounts or concessions allowed or reallowed or paid to
dealers may be changed from time to time.
Securities may also be sold directly by the Company or through agents
designated by the Company from time to time. Any agent involved in the offering
and sale of the Securities of the series in respect of which this Prospectus is
delivered is named and any commissions payable by the Company to such agent are
set forth in the Prospectus Supplement relating to such series. Unless otherwise
indicated in such Prospectus Supplement, any such agent is acting on a best
efforts basis for the period of its appointment.
If so indicated in a Prospectus Supplement, the Company will authorize
agents, underwriters or dealers to solicit offers by certain institutional
investors to purchase Securities of the series to which such Prospectus
Supplement relates providing for payment and delivery on a future date specified
in such Prospectus Supplement. There may be limitations on the minimum amount
which may be purchased by any such institutional investor or on the portion of
the aggregate principal amount of the particular Securities which may be sold
pursuant to such arrangements. Institutional investors to which such offers may
be made, when authorized, include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions and such other institutions as may be approved by the Company. The
obligations of any such purchasers pursuant to such delayed delivery and payment
arrangements will not be subject to any conditions except that (i) the purchase
by an institution of the particular Securities shall not at the time of delivery
be prohibited under the laws of any jurisdiction in the United States to which
such institution is subject, and (ii) if the particular Securities are being
sold to underwriters, the Company shall have sold to such underwriters the total
principal amount of such Securities or number of Warrants less the principal
amount or number thereof, as the case may be, covered by such arrangements.
Underwriters will not have any responsibility in respect of the validity of such
arrangements or the performance of the Company or such institutional investors
thereunder.
Agents and underwriters may be entitled under agreements entered into with
the Company to indemnification by the Company against certain civil liabilities,
including liabilities under the Securities Act of 1933, as amended, or to
contribution with respect to payments which the agents or underwriters may be
required to make in respect thereof. Agents and underwriters may be customers
of, may engage in transactions with, or perform services for, the Company in the
ordinary course of business.
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LEGAL MATTERS
The validity of the Securities will be passed upon for the Company by
Louise M. Parent, Esq., Executive Vice President and General Counsel of the
Company. Unless provided otherwise in the applicable Prospectus Supplement,
certain legal matters will be passed upon for any underwriters or agents by
Simpson Thacher & Bartlett (a partnership which includes professional
corporations), 425 Lexington Avenue, New York, New York.
EXPERTS
The consolidated financial statements and schedules to financial statements
of the Company included or incorporated by reference in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996 have been audited by
Ernst & Young LLP, independent auditors, as set forth in their report included
therein and incorporated herein by reference. Such consolidated financial
statements and schedules to financial statements have been incorporated herein
by reference in reliance upon such report given upon the authority of such firm
as experts in auditing and accounting.
With respect to the unaudited consolidated interim financial information
for the three month periods ended March 31, 1997 and 1996, incorporated by
reference in the Prospectus and Registration Statement, Ernst & Young LLP have
reported that they have applied limited procedures in accordance with
professional standards for a review of such information. However, their separate
report, included in the Company's Quarterly Report on Form 10-Q for the quarter
ended March 31, 1997, and incorporated herein by reference, states that they did
not audit and they do not express an opinion on that interim financial
information. Accordingly, the degree of reliance on their report on such
information should be restricted considering the limited nature of the review
procedures applied. The independent auditors are not subject to the liability
provisions of Section 11 of the Securities Act of 1933 for their report on the
unaudited interim financial information because that report is not a 'report' or
a 'part' of the Registration Statement prepared or certified by the auditors
within the meaning of Sections 7 and 11 of the Securities Act of 1933.
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PRINCIPAL OFFICES OF
AMERICAN EXPRESS COMPANY
World Financial Center
New York, New York 10285
TRUSTEE
PNC BANK, NATIONAL ASSOCIATION
One Oliver Plaza
210 Sixth Avenue
Pittsburgh, Pennsylvania 15222
LUXEMBOURG STOCK EXCHANGE LISTING AND PAYING AGENT
BANKERS TRUST LUXEMBOURG S.A.
14 Boulevard F. D. Roosevelt
L-2450 Luxembourg
LEGAL ADVISERS
<TABLE>
<S> <C>
To American Express Company as to To American Express Company as to
Certain Matters of United States Law Certain Matters of United States Tax Law
LOUISE M. PARENT BRUCE A. COGAN
Executive Vice President and General Tax Counsel
General Counsel American Express Company
American Express Company World Financial Center
World Financial Center New York, New York 10285
New York, New York 10285
</TABLE>
To the Underwriters
as to United States Law
SIMPSON THACHER & BARTLETT
425 Lexington Avenue
New York, New York 10017
INDEPENDENT AUDITORS TO
AMERICAN EXPRESS COMPANY
ERNST & YOUNG LLP
787 Seventh Avenue
New York, New York 10019
