<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. THIS +
+PROSPECTUS SUPPLEMENT SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE +
+SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE +
+SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE +
+UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF +
+ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Filed pursuant to Rule 424(b)(5)
SEC File No. 333-38619
SUBJECT TO COMPLETION, DATED NOVEMBER 7, 1997
PROSPECTUS SUPPLEMENT
, 1997
(TO PROSPECTUS DATED NOVEMBER 5, 1997)
$200,000,000
MISSISSIPPI CHEMICAL CORPORATION
$100,000,000 % SENIOR NOTES DUE 2007
$100,000,000 % SENIOR NOTES DUE 2017
The % Senior Notes due 2007 (the "2007 Notes") and the % Senior Notes due
2017 (the "2017 Notes") (collectively, the "Notes") in an aggregate principal
amount of $200,000,000 are being issued by Mississippi Chemical Corporation, a
Mississippi corporation (the "Company"). Interest on the Notes is payable semi-
annually on May 15 and November 15 of each year, commencing May 15, 1998.
The Notes constitute senior unsecured obligations of the Company, ranking
pari passu in right of payment with all other senior unsecured obligations of
the Company. See "Description of Notes--General."
The Notes are redeemable, in whole or in part, at the option of the Company
at any time and from time to time at a redemption price equal to the Make-Whole
Price set forth herein. See "Description of Notes--Redemption at the Company's
Option."
The Notes will be represented by a Global Security registered in the name of
the nominee of The Depository Trust Company ("DTC"). Beneficial interests in
such Global Securities will be shown on, and transfers thereof will be effected
only through, records maintained by the DTC, which will act as securities
depository and its direct and indirect participants or persons that hold
interests through participants (with respect to beneficial interests of
beneficial owners). Owners of beneficial interests in the Global Securities
will be entitled to physical delivery of Notes in certificated form equal in
principal amount to their respective beneficial interests in the Global
Securities only under the limited circumstances described in "Description of
Notes--Book-Entry System." Settlement for the Notes will be made in immediately
available funds. The Notes will trade in The Depository Trust Company's Same-
Day Funds Settlement System until maturity, or until the Notes are issued in
certificated form, and secondary market trading activity in the Notes will
therefore settle in immediately available funds. All payments of principal and
interest in respect of the Notes will be made by the Company in immediately
available funds. See "Description of Notes--Same-Day Settlement and Payment."
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 TO
WHICH IT RELATES. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC (1) DISCOUNTS(2) COMPANY(1)(3)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Per % Senior Note due 2007............... % % %
Total..................................... $ $ $
Per % Senior Note due 2017............... % % %
Total..................................... $ $ $
</TABLE>
- --------------------------------------------------------------------------------
(1) Plus accrued interest, if any, from the date of issuance.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended. See "Underwriting."
(3) Before deducting expenses payable by the Company estimated to be $409,909.
The Notes are offered by the Underwriters when, as and if delivered to and
accepted by the Underwriters, subject to certain conditions, including their
rights to withdraw, cancel or reject orders in whole or in part. It is expected
that delivery of the Notes will be made in New York, New York, on or about
November , 1997, in book-entry form through the facilities of the Depository
Trust Company against payment therefor in immediately available funds.
DONALDSON, LUFKIN & JENRETTE NESBITT BURNS SECURITIES INC.
SECURITIES CORPORATION
<PAGE>
CERTAIN PERSONS PARTICIPATING IN THIS OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN, OR OTHERWISE AFFECT THE PRICE OF THE OFFERED
SECURITIES. SPECIFICALLY, THE UNDERWRITERS MAY OVER-ALLOT IN CONNECTION WITH
THE OFFERING AND MAY BID FOR AND PURCHASE THE OFFERED SECURITIES IN THE OPEN
MARKET. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."
<PAGE>
PROSPECTUS SUPPLEMENT SUMMARY
The following summary is qualified in its entirety by the more detailed
information and the Financial Statements and Notes thereto incorporated by
reference in this Prospectus Supplement and the accompanying Prospectus. Unless
otherwise indicated, the "Company" and "MCC" refer to Mississippi Chemical
Corporation and its subsidiaries and predecessors. Fiscal year references refer
to years ending June 30.
THE COMPANY
The Company is a major producer and supplier of nitrogen fertilizers, and
believes it is one of the nation's lowest-cost nitrogen fertilizer producers.
The Company also manufactures phosphate and potash fertilizers, making it a
full product line fertilizer supplier. The Company sells its nitrogen and
potash fertilizer products primarily to farmers, fertilizer dealers and
distributors for ultimate use primarily in the southern farming regions of the
United States. The Company's phosphate fertilizers are sold primarily in
international markets.
Nitrogen, phosphorous (contained in phosphate fertilizer) and potassium
(contained in potash fertilizer) constitute the three major nutrients for plant
growth. Nitrogen is an essential nutrient for most plants. Phosphorous aids in
the photosynthesis process and potassium is an important regulator of the
physiological functions of plants. These elements are all naturally present in
soil but need to be replaced through the use of fertilizers as crops exhaust
them. There are no viable substitutes for nitrogen, phosphate or potash
fertilizers in the development and maintenance of high-yield crops.
Nitrogen Fertilizer. The Company currently produces nitrogen fertilizers at
its production facilities in Yazoo City, Mississippi and Donaldsonville,
Louisiana. The Company's principal nitrogen products include ammonia,
fertilizer-grade ammonium nitrate, which is sold under the Company's trade name
Amtrate(R), UAN solutions, which are sold under the Company's trade name N-Sol,
and urea. In fiscal 1997, the Company sold approximately 2 million tons of
nitrogen fertilizers primarily to farmers, fertilizer dealers and distributors
located in the southern United States. Sales of nitrogen fertilizer products by
the Company in fiscal 1997 were $308.4 million, which represented approximately
59% of net sales. The Company also markets some of its nitrogen products for
industrial use.
In late fiscal 1996, the Company began expanding its Yazoo City facility to
include a 175,000 ton-per-year ammonia plant, a new 227,500 ton-per-year nitric
acid plant and modifications to increase ammonium nitrate production capacity
from 750,000 tons to approximately 950,000 tons per year. The majority of this
project will be completed in 1998 with total completion scheduled for early
1999. In addition, the Company has entered into a joint venture to construct a
714,000 ton-per-year ammonia plant in the Republic of Trinidad and Tobago.
Startup of the facility is scheduled for late spring of 1998. The Company
intends to use the majority of its 50% share of the ammonia production from the
new Trinidad facility primarily as a raw material for upgrading into finished
fertilizer products at its existing facilities. Trinidad has abundant reserves
of competitively priced natural gas. The Company expects to realize favorable
long-term operating costs based on competitive natural gas costs and the
expected production efficiencies of the new facility.
Phosphate Fertilizer. The Company produces diammonium phosphate fertilizer
("DAP"), the most widely used phosphate fertilizer, at its facility in
Pascagoula, Mississippi and exports over 80% of its DAP production, primarily
to China, India, Pakistan and Latin America. In fiscal 1997, the Company sold
approximately 723,000 tons of DAP generating fiscal 1997 sales of $128.1
million, or approximately 25% of net sales. Although the Company has
historically sold substantially all of its DAP through an exclusive marketing
arrangement with Atlantic Fertilizer & Chemical Corporation, effective October
1, 1997, the Company joined the Phosphate Chemicals Export Association, Inc.
("PhosChem"), which handles overseas marketing and distribution for several of
the leading phosphate fertilizer producers in North America. All of the
Company's DAP export sales are currently made through PhosChem. The Company
believes that its export business will benefit from PhosChem's network of sales
representatives and strong international contacts. In 1997, the Company began
construction of an expansion of its DAP facility. The project, which is
expected to be fully operational by the end of fiscal 1998, will increase DAP
production capacity from approximately 720,000 tons to 900,000 tons per year.
S-1
<PAGE>
Potash Fertilizer. The Company produces potash at its mines and related
facilities located near Carlsbad, New Mexico for use primarily as a fertilizer
and for growing industrial applications. A majority of the Company's
agricultural potash sales are in domestic markets in states west of the
Mississippi River, where the Company and other Carlsbad potash producers enjoy
freight cost advantages over Canadian and overseas potash producers. The
Company exports its potash products primarily to Latin America and Japan. In
fiscal 1997, the Company sold approximately 1 million tons of potash, primarily
in granular form, generating fiscal 1997 sales of $81.9 million, which
represented approximately 16% of net sales.
Business Strategy. The Company's products are global commodities which are
available from multiple sources; therefore, the Company competes primarily on
the basis of price. As a result, the Company stresses low cost and high
efficiency in every aspect of its operations. Unlike many of its competitors,
the Company maintains a large and experienced field sales force strategically
located throughout its trade area. Through its sales force, the Company
provides extensive, cost-effective services to its customers to differentiate
its products, enhance competitiveness and establish the Company as a preferred
supplier. The Company's marketing efforts are focused on geographically
proximate markets where lower transportation and distribution costs increase
"net backs" (sales less distribution and delivery expenses) and result in
improved margins. The Company continuously monitors opportunities to expand its
operations through capacity additions, acquisitions, joint ventures and
strategic alliances in the fertilizer business.
The Company was incorporated in Mississippi in 1994 and is the successor by
merger, effective July 1, 1994, to a fertilizer cooperative formed in 1948. The
Company's principal executive offices are located at Highway 49 East, P. O. Box
388, Yazoo City, Mississippi 39194 and its telephone number is (601) 746-4131.
THE OFFERING
Securities Offered........ $100,000,000 aggregate principal amount of %
Senior Notes due 2007; and $100,000,000 aggregate
principal amount of % Senior Notes due 2017.
Maturity.................. November 15, 2007 with respect to the 2007 Notes
and November 15, 2017 with respect to the 2017
Notes.
Interest Payment Dates.... May 15 and November 15 of each year, commencing on
May 15, 1998.
Ranking................... The Notes constitute senior unsecured obligations
of the Company, ranking pari passu in right of
payment with all other senior and unsecured
indebtedness of the Company. See "Description of
Notes--General."
Optional Redemption....... Each series of Notes are redeemable at the option
of the Company at any time and from time to time at
a redemption price equal to the Make-Whole Price
(as defined herein). See "Description of Notes--
Redemption at the Company's Option."
S-2
<PAGE>
Covenants................. The Indenture governing the Notes will contain
certain covenants, including but not limited to,
(i) restrictions on the creation of liens securing
indebtedness, and (ii) limitations on sale and
leaseback transactions.
Use of Proceeds........... The net proceeds to the Company from the sale of
the Notes in this offering (the "Offering") will be
used to repay a portion of the outstanding
indebtedness under the existing bank credit
facilities maintained by the Company and its
subsidiaries (the "Existing Credit Facilities").
See "Use of Proceeds."
S-3
<PAGE>
USE OF PROCEEDS
The net proceeds to the Company from the Offering (after deducting
underwriting discounts and commissions and estimated offering expenses) of
approximately $197.8 million will be used to repay a portion of outstanding
indebtedness under the Existing Credit Facilities. At September 30, 1997, the
aggregate outstanding balance of loans and letters of credit under the five-
year Existing Credit Facilities was approximately $262 million. Borrowings
under the Existing Credit Facilities bear interest at the prime rate or rates
related to the London Inter Bank Offered Rate ("LIBOR"). At September 30,
1997, the average interest rate for borrowings under the Existing Credit
Facilities was 6.13%. Concurrently with the closing of this Offering, the
Company will replace the Existing Credit Facilities with a new $200 million
revolving credit facility with a group of banks for which Harris Trust and
Savings Bank ("Harris Trust") is acting as agent (the "New Credit Facility").
The New Credit Facility will be a five-year facility and will bear interest at
the prime rate or rates related to LIBOR. The Company may borrow funds under
the New Credit Facility from time to time for capital expenditures and other
general corporate purposes, including any future acquisitions.
CAPITALIZATION
The following table sets forth the capitalization of the Company as of
September 30, 1997 (i) on a historical basis and (ii) on a pro forma basis to
give effect to this Offering and the application of the net proceeds
therefrom. See "Use of Proceeds." This table should be read in conjunction
with, and is qualified by reference to, the Company's Consolidated Financial
Statements and notes thereto incorporated by reference in this Prospectus
Supplement and the accompanying Prospectus.
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1997
---------------------------
HISTORICAL PRO FORMA
(IN THOUSANDS)
<S> <C> <C>
Long-term debt, including long-term debt due
within one year:
Bank credit facilities.......................... $ 261,600 $ 63,760
% Senior Notes due 2007....................... -- 100,000
% Senior Notes due 2017....................... -- 100,000
Industrial revenue and pollution control
obligations.................................... 14,500 14,500
Other........................................... 234 234
------------ ------------
Total long-term obligations, including long-
term debt due within one year................ 276,334 278,494
Shareholders' equity:
Common stock (100,000,000 shares authorized;
27,975,936 shares issued)...................... 280 280
Additional paid-in capital...................... 305,882 305,882
Retained earnings............................... 147,382 147,382
Treasury stock, at cost (566,181 shares)........ (12,567) (12,567)
------------ ------------
Total shareholders' equity.................... 440,977 440,977
------------ ------------
Total capitalization......................... $ 717,311 $ 719,471
============ ============
</TABLE>
S-4
<PAGE>
SUMMARY FINANCIAL DATA
The following tables present certain selected consolidated financial data of
the Company for each of the fiscal years in the three-year period ended June
30, 1997 and the interim periods ended September 30, 1997 and 1996. Such
information has been derived from Mississippi Chemical Corporation's
historical financial data. This information should be read in conjunction with
the Company's Consolidated Financial Statements and notes thereto incorporated
by reference in this Prospectus Supplement and the accompanying Prospectus.
Results for the three months ended September 30, 1997 are not necessarily
indicative of results to be expected for the full year.
<TABLE>
<CAPTION>
THREE MONTHS ENDED
SEPTEMBER 30, FISCAL YEARS ENDED JUNE 30,
-------------------- -------------------------------
1997 1996 1997 1996 1995
(IN THOUSANDS, EXCEPT RATIOS)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales............. $ 110,912 $ 91,290 $ 520,569 $ 428,789 $ 388,154
Operating income...... 8,910 14,740 91,209 84,818 80,969
Net income............ 4,297 9,295 55,815 54,178 52,230
BALANCE SHEET DATA (AT
END OF PERIOD):
Working capital....... 60,859 55,461 53,910 81,613 70,790
Total assets.......... 869,145 399,159 858,545 341,006 302,215
Long-term debt,
including long-term
debt due within one
year................. 276,334 51,086 244,656 78 3,253
Shareholders' equity.. 440,977 248,869 439,429 247,825 227,307
OTHER DATA:
Ratio of earnings to
fixed charges(1)
Historical.......... 2.1x 27.5x 9.6x 74.3x 33.9x
Pro Forma(2)........ 1.9 N/A 8.3 N/A N/A
EBITDA (3)............ $18,505 $19,272 $122,898 $104,062 $98,518
EBITDA as a % of
sales(3)............. 16.7% 21.1% 23.6% 24.3% 25.4%
</TABLE>
- ---------------------
(1) For the purpose of computing ratios of earnings to fixed charges,
"earnings" consists of earnings from continuing operations before income
taxes and fixed charges. "Fixed charges" consists of interest charges and
the portion of rental expense deemed representative of the interest
factor.
(2) Represents the pro forma effect of interest expense assuming the Notes
were used to pay outstanding indebtedness under the Existing Credit
Facilities for the given period.
(3) EBITDA represents pre-tax income plus net interest, depreciation,
depletion and amortization. EBITDA is not a measure of performance or
financial condition under generally accepted accounting principles, but is
presented solely as supplemental disclosure because the Company believes
that it enhances the understanding of the Company's ability to service
debt. EBITDA should not be considered in isolation or as substitute for
other measures of financial performance or liquidity under generally
accepted accounting principles.
S-5
<PAGE>
DESCRIPTION OF NOTES
The 2007 Notes and the 2017 Notes each constitute a series of Securities
described in the accompanying Prospectus that will be issued under an
indenture, dated as of November , 1997 (the "Indenture"), between the Company
and Harris Trust and Savings Bank, as trustee (the "Indenture Trustee"). 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 the Securities set forth in
the accompanying Prospectus, to which reference is hereby made. Capitalized
terms used but not defined herein or in the accompanying Prospectus have the
meanings given to them in the Indenture. As used in this section, the
"Company" means Mississippi Chemical Corporation, but not any of its
Subsidiaries, unless the context otherwise requires. The following summary of
the Indenture and the Notes does not purport to be complete and such summary
is subject to the detailed provisions of the Indenture and the Notes to which
reference is hereby made for a full description of such provisions.
GENERAL
The 2007 Notes will mature November 15, 2007 and will be limited to
$100,000,000 aggregate principal amount and the 2017 Notes will mature
November 15, 2017 and will be limited to $100,000,000 aggregate principal
amount. Each series of Notes will bear interest at the respective rates per
annum set forth on the front cover of this Prospectus Supplement. Interest on
the 2007 Notes and the 2017 Notes will be payable semiannually on May 15 and
November 15 of each year, commencing May 15, 1998, to the persons in whose
names such Notes are registered at the close of business on the May 1 and
November 1 immediately preceding such Interest Payment Date. Interest will be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
The Notes will be issued only in fully registered form, without coupons, in
denominations of $1,000 and integral multiples thereof. There is no sinking
fund applicable to the Notes.
The Notes will be direct obligations of the Company and will rank pari passu
with each other and with all other senior unsecured and unsubordinated
indebtedness of the Company. Subject to certain limitations set forth in the
Indenture and as described under "Description of Securities--Certain
Covenants" and "--Merger, Consolidation or Sale" in the Prospectus, the
Indenture permits the Company to incur additional secured and unsecured
indebtedness and does not limit the amount of additional indebtedness incurred
by the Company.
Reference is made to "Description of Securities--Certain Covenants" in the
Prospectus for a description of the covenants applicable to the Notes.
Compliance with such covenants generally may not be waived by the Indenture
Trustee unless the Holders of at least a majority in principal amount of all
outstanding Notes voting as one class consent to such waiver; provided,
however, that the defeasance and covenant defeasance provisions in the
Indenture described under "Description of Securities--Discharge, Defeasance
and Covenant Defeasance" in the Prospectus will apply to the Notes. Notices
and demands to or upon the Company in respect of the Notes may be served at
Mississippi Chemical Corporation, Owen Cooper Building, Highway 49 East, Yazoo
City, Mississippi 39194, attention: Rosalyn Glascoe.
Except as described under "Description of Securities--Merger, Consolidation
or Sale" in the Prospectus, the Indenture does not contain any other
provisions that would limit the ability of the Company to incur indebtedness
or that would afford Holders of the Notes protection in the event of (a) a
highly leveraged or similar transaction involving the Company, or (b) a
reorganization, restructuring, merger or similar transaction involving the
Company that may adversely affect the Holders of the Notes. In addition,
subject to the limitations set forth under "Description of Securities--Certain
Covenants" and "--Merger, Consolidation or Sale" in the Prospectus, the
Company may, in the future, enter into certain transactions such as the sale
of all or substantially all of its assets or the merger or consolidation of
the Company with another entity that would increase the amount of the
Company's indebtedness or substantially reduce or eliminate the Company's
assets, which may have an adverse effect on the Company's ability to service
its indebtedness, including the Notes.
The provisions described in the Prospectus under "Description of
Securities--Discharge, Defeasance and Covenant Defeasance" will be applicable
to the Notes.
S-6
<PAGE>
REDEMPTION AT THE COMPANY'S OPTION
The Notes will be redeemable at the option of the Company at any time and
from time to time, in whole or in part, upon not less than 30 nor more than 60
days notice to each Holder of Notes, at a redemption price equal to the Make-
Whole Price. "Make-Whole Price" means an amount equal to the greater of (i)
100% of the principal amount of such Notes or (ii) as determined by an
Independent Investment Banker, the sum of the present values of the remaining
scheduled payments of principal and interest thereon discounted to the date of
redemption on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Adjusted Treasury Rate, plus, in each case,
accrued and unpaid interest thereon to the date of redemption. Unless the
Company defaults in payment of the redemption price, on and after the date of
redemption, interest will cease to accrue on the Notes or portions thereof
called for redemption.
"Adjusted Treasury Rate" means, with respect to any date of redemption, the
rate per annum equal to the semiannual equivalent yield to maturity of the
Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such date of redemption, plus %.
"Comparable Treasury Issue" means the United States Treasury security
selected by an Independent Investment Banker as having a maturity comparable
to the remaining term of the Notes to be redeemed that would be utilized, at
the time of selection and in accordance with customary financial practice, in
pricing new issues of corporate debt securities of comparable maturity to the
remaining term of such Notes.
"Comparable Treasury Price" means, with respect to any date of redemption,
(i) the average of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) on the third
Business Day preceding such date of redemption, as set forth in the daily
statistical release (or any successor release) published by the Federal
Reserve Bank of New York and designated "Composite 3:30 p.m. Quotations for
U.S. Government Securities", or (ii) if such release (or any successor
release) is not published or does not contain such prices on such Business
Day, (A) the average of the Reference Treasury Dealer Quotations for such date
of redemption or (B) if the Trustee obtains fewer than two, the available
Reference Treasury Dealer Quotation.
"Independent Investment Banker" means one of the Reference Treasury Dealers
appointed by the Trustee after consultation with the Company.
"Reference Treasury Dealer" means each of Donaldson, Lufkin & Jenrette
Securities Corporation and Nesbitt Burns Securities Inc. and their respective
successors; provided, however, that if any of the foregoing shall not be a
primary U.S. Government securities dealer in New York City (a "Primary
Treasury Dealer"), the Company shall substitute therefor another Primary
Treasury Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any date of redemption, the average, as determined by the
Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the trustee by such Reference Treasury Dealer at 5:00 p.m. on the
third Business Day preceding such date of redemption.
The Company may purchase the Notes in the open market, by tender or
otherwise. Notes so purchased may be held, resold or surrendered to the
Trustee for cancellation. If applicable, the Company will comply with the
requirements of Rule 14e-1 under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and other securities laws and regulations in
connection with any such purchase. The Notes may be defeased in the manner
provided in the Indenture.
BOOK-ENTRY SYSTEM
The following are summaries of certain rules and operating procedures of DTC
that affect the payment of principal and interest and transfers of interests
with respect to the Notes. The Notes will be issued in the form of
S-7
<PAGE>
Global Securities, which will be deposited with, or on behalf of, DTC and will
be registered in the name of Cede & Co., as nominee of DTC. Unless and until
exchanged in whole or in part for Notes in definitive form under the limited
circumstances described below, a Global Security may not be transferred except
as a whole (a) by DTC to a nominee of DTC, (b) by a nominee of DTC to DTC or
another nominee of DTC or (c) by DTC or any such nominee to a successor of DTC
or a nominee of such successor.
Ownership of beneficial interests in the Global Securities will be limited
to persons that have accounts with DTC for the Global Securities
("Participants") or persons that may hold interests through Participants. Upon
the issuance of the Global Securities, DTC will credit, on its book-entry
registration and transfer system, Participants' accounts with the respective
principal amounts of the Notes represented by the Global Securities
beneficially owned by such Participants. Ownership of beneficial interests in
the Global Securities will be shown on, and the transfer of such ownership
interests will be effected only through, records maintained by DTC (with
respect to interests of Participants) and on the records of Participants (with
respect to interests of persons holding through Participants). The laws of
some states may require that certain purchasers of securities take physical
delivery of such securities in definitive form. Such laws may limit or impair
the ability to own, transfer or pledge beneficial interests in the Global
Securities.
So long as DTC or its nominee is the registered owner of the Global
Securities, DTC or its nominee, as the case may be, will be considered the
sole owner or Holder of the Notes represented by the Global Securities for all
purposes under the Indenture. Except as set forth below, owners of beneficial
interests in the Global Securities will not be entitled to have Notes
represented by the Global Securities registered in their names, will not
receive or be entitled to receive physical delivery of such Notes in
certificated form, and will not be considered the registered owners or Holders
of any Notes under the Indenture. Accordingly, each person owning a beneficial
interest in the Global Securities must rely on the procedures of DTC and, if
such person is not a participant, on the procedures of the participant through
which such person owns its interest, to exercise any rights of a Holder under
the Indenture. The Company understands that under existing industry practices,
if the Company requests any action of Holders or if an owner of a beneficial
interest in the Global Securities desires to give or take any action that a
Holder is entitled to give or take under the Indenture, the Company would
authorize Participants holding the relevant beneficial interests to give or
take such action, and such Participants would authorize beneficial owners
owning through such Participants to give or take such action, or would
otherwise act upon the instructions of beneficial owners holding through them.
Principal and interest payments on interests in the Global Securities will
be made to DTC, or its nominee, as the case may be, as the registered owner of
the Global Securities. None of the Company, the Indenture Trustee or any other
agent of the Company or agent of the Indenture Trustee will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership of interests in the Global
Securities or for maintaining, supervising or reviewing any records relating
to such beneficial ownership interests.
The Company expects that DTC, upon receipt of any payment of principal or
interest in respect of the Global Securities, will immediately credit
Participants' accounts with payments in amounts proportionate to their
respective beneficial interests in the Global Securities as shown on the
records of DTC. The Company also expects that payments by Participants to
owners of beneficial interests in the Global Securities held through such
Participants will be governed by standing customer instructions and customary
practice, 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.
If DTC is at any time unwilling or unable to continue as depository for the
Notes and the Company fails to appoint a successor depository registered as a
clearing agency under the Exchange Act within 90 days, the Company will issue
the Notes in definitive form in exchange for the Global Securities. Any Notes
issued in definitive form in exchange for the Global Securities will be
registered in such name or names, and will be issued in denominations of
$1,000 and such integral multiples thereof, as DTC shall instruct the
Indenture Trustee. It is expected that such instructions will be based upon
directions received by DTC from Participants with respect to ownership of
beneficial interests in the Global Securities.
S-8
<PAGE>
The following is based on information furnished by DTC:
DTC is a limited-purpose trust company organized under 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 Exchange Act. DTC holds securities that Participants deposit
with DTC. DTC also facilitates the settlement among Participants of
securities transactions, such as transfers and pledges, in deposited
securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement
of securities certificates. Direct Participants include securities brokers
and dealers (including the Underwriters), banks, trust companies, clearing
corporations and certain other organizations (collectively, "Direct
Participants"). DTC is owned by a number of its Direct Participants and by
the New York Stock Exchange, Inc., the American Stock Exchange, Inc., and
the National Association of Securities Dealers, Inc. Access to the DTC
system is also available to others, such as securities brokers and dealers
and banks and trust companies, that clear through or maintain a custodial
relationship with a Direct Participant, either directly or indirectly. The
rules applicable to DTC and its Participants are on file with the
Securities and Exchange Commission.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Notes will be made by the Underwriters in immediately
available funds. All payments of principal and interest in respect of the
Notes will be made by the Company in immediately available funds, so long as
DTC continues to make its Same-Day Funds Settlement System available to the
Company.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearinghouse or next-day funds. In contrast, the Notes
will trade in DTC's Same-Day Funds Settlement System until maturity or until
the Notes are issued in certificated form, and secondary market trading
activity in the Notes will therefore be required by DTC to settle in
immediately available funds. No assurance can be given as to the effect, if
any, of settlement in immediately available funds on trading activity in the
Notes.
UNDERWRITING
Subject to the terms and conditions contained in the Underwriting Agreement
relating to the Notes (the "Underwriting Agreement"), the Company has agreed
to sell to the underwriters named below (the "Underwriters"), and the
Underwriters have agreed to purchase from the Company, the principal amounts
of 2007 Notes and 2017 Notes set forth opposite their names below:
<TABLE>
<CAPTION>
PRINCIPAL PRINCIPAL
AMOUNT OF AMOUNT OF
% NOTES % NOTES
UNDERWRITERS DUE 2007 DUE 2017
<S> <C> <C>
Donaldson, Lufkin & Jenrette Securities
Corporation....................................
Nesbitt Burns Securities Inc....................
------------ ------------
Total....................................... $100,000,000 $100,000,000
============ ============
</TABLE>
The Underwriting Agreement provides that the obligations of the several
Underwriters to purchase and accept delivery of the Notes offered hereby are
subject to approval of certain legal matters by counsel and to certain other
conditions. If any of the Notes of a series are purchased by the Underwriters
pursuant to the Underwriting Agreement, all such Notes must be purchased.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended, or to contribute to payments that the Underwriters may be required to
make in respect thereof.
S-9
<PAGE>
The Underwriters have advised the Company that they propose initially to
offer the 2007 Notes to the public at the public offering price set forth on
the cover page of this Prospectus Supplement, and to certain dealers (who may
include the Underwriters) at such price, less a concession not in excess of
% of the principal amount of the 2007 Notes. The Underwriters may allow, and
such dealers may re-allow, discounts not in excess of % of the principal
amount of the 2007 Notes to any other Underwriter and certain other dealers.
After the initial offering, the offering price and other selling terms of the
2007 Notes may be changed by the Underwriters.
The Underwriters have advised the Company that they propose initially to
offer the 2017 Notes to the public at the public offering price set forth on
the cover page of this Prospectus Supplement, and to certain dealers (who may
include the Underwriters) at such price, less a concession not in excess of
% of the principal amount of the 2017 Notes. The Underwriters may allow, and
such dealers may re-allow, discounts not in excess of % of the principal
amount of the 2017 Notes to any other Underwriter and certain other dealers.
After the initial offering, the offering price and other selling terms of the
2017 Notes may be changed by the Underwriters.
In connection with the Offering, the Underwriters may engage in transactions
that stabilize, maintain or otherwise affect the price of any series of the
Notes. Specifically, the Underwriters may overallot the Offering, creating a
syndicate short position. Underwriters may bid for and purchase such a
syndicate short position. In addition, the Underwriters may bid for and
purchase any series of the Notes in the open market to stabilize the price of
any series of the Notes. These activities may stabilize or maintain the market
price of any series of the Notes above independent market levels. The
Underwriters are not required to engage in these activities, and may end these
activities at any time.
The Notes will constitute a new issue of securities with no established
trading market. The Notes will not be listed on any securities exchange and
there can be no assurance that there will be a secondary market for the Notes.
The Underwriters presently intend to make a market in the Notes although the
Underwriters are under no obligations to do so and may discontinue any market
making at any time without notice. Accordingly, there can be no assurance as
to whether an active trading market for any of the Notes will develop or as to
the liquidity of any trading market.
Harris Trust, an affiliate of Nesbitt Burns Securities, Inc. and the agent
under the Existing Credit Facilities, expects to receive approximately $26.4
million in repayment of its share of the Existing Credit Facilities from the
proceeds of this Offering.
LEGAL MATTERS
The validity of the Notes offered hereby will be passed upon for the Company
by Hughes & Luce, L.L.P., Dallas, Texas and certain legal matters will be
passed upon for the Underwriters by Latham & Watkins, New York, New York.
S-10
<PAGE>
$300,000,000
MISSISSIPPI CHEMICAL CORPORATION
DEBT SECURITIES
Mississippi Chemical Corporation (the "Company") may from time to time offer
its debt securities ("Securities") up to an aggregate initial offering price
not to exceed $300,000,000, in separate series, in amounts and at prices and
on terms determined by market conditions at the time of the sale. The
Securities may be denominated in U.S. dollars or in any other currency,
currency units or composite currencies as may be designated by the Company.
The designation, aggregate principal amount, maturity date, public offering
price, interest rate or rates (which may be fixed or variable) or the method
by which such rate or rates are determined and timing of payments of interest,
if any, provision for redemption, sinking fund requirements, if any, any other
variable terms and the method of distribution in connection with the offering
of Securities in respect of which this Prospectus is being delivered, will be
set forth in a Prospectus Supplement relating thereto. The Prospectus
Supplement will contain information, where applicable, relating to certain
United States federal income taxes relating to, and any listing on a
securities exchange of, the Securities covered by such 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
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 Company may sell Securities to or through underwriters or groups of
underwriters or dealers, and also may sell Securities to one or more other
purchasers, directly or through agents. See "Plan of Distribution." The
Prospectus Supplement will set forth the names of any underwriters, dealers or
agents involved in the sale of any Securities offered thereunder, the
principal amounts, if any, to be purchased by underwriters and the
compensation of such underwriters, dealers or agents.
----------------
The date of this Prospectus is November 5, 1997.
<PAGE>
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY OR ANY UNDERWRITER, DEALER OR AGENT. NEITHER THE
DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY
CIRCUMSTANCES CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements, information statements, and other
information with the Securities and Exchange Commission (the "Commission").
Such reports, proxy statements, and other information may be inspected and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Room 1024, Washington, D.C. 20549 and at the Commission's
Regional Offices at Seven World Trade Center, 13th Floor, New York, New York
10048; and at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661. Copies of such material may be obtained at prescribed rates
from the Public Reference Room of the Commission at its principal office in
Washington, D.C. The Commission maintains a site on the World Wide Web that
contains documents filed electronically with the Commission. The address of
the Commission's web site is http://www.sec.gov, and the materials filed
electronically by the Company may be inspected at such site. In addition, the
materials filed by the Company at the New York Stock Exchange may be inspected
at the Exchange's offices, 20 Broad Street, New York, New York 10005.
The Company has filed a Registration Statement on Form S-3 with the
Commission under the Securities Act of 1933, as amended (the "Securities
Act"), concerning the Securities. This Prospectus, which constitutes a part of
the Registration Statement, omits certain of the information contained in the
Registration Statement and the exhibits thereto. Statements contained in this
Prospectus, or in any document incorporated by reference herein, as to the
contents of any document are summaries of such documents and are not
necessarily complete, and in each instance reference is made to the copy of
such document filed as an exhibit to the Registration Statement or such other
document, each such statement being hereby qualified in all respects by such
reference. The Registration Statement, including the exhibits thereto, is on
file at the offices of the Commission and may be inspected and copied as
described above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company incorporates by reference herein the following documents, which
have been filed with the Commission pursuant to the Exchange Act:
(a) the Company's Annual Report on Form 10-K for the year ended June 30,
1997; and
(b) the Company's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1997.
All documents and reports filed by the Company pursuant to Sections 13(a),
13(c), 14, or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering relating to this
Prospectus will be deemed to be incorporated by reference into this Prospectus
and to be a part hereof from the dates of filing of such documents or reports.
Any statement contained herein or in a document incorporated by reference
herein shall be deemed to be modified or superseded for purposes of the
Registration Statement and this Prospectus to the extent that a statement
contained herein or in any subsequently filed document which also is
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 the Registration Statement or
this Prospectus.
2
<PAGE>
This Prospectus incorporates documents by reference which are not presented
herein or delivered herewith. Such documents (other than exhibits to such
documents, unless such exhibits are specifically incorporated by reference)
are available, without charge, to any person to whom this Prospectus is
delivered, upon written or oral request to: Rosalyn B. Glascoe, Corporate
Secretary, Mississippi Chemical Corporation, P.O. Box 388, Yazoo City,
Mississippi 39194 (telephone (601) 746-4131).
THE COMPANY
The Company produces and supplies a full product line of fertilizers,
including nitrogen, phosphate and potash fertilizers. The Company's principal
nitrogen products include ammonia, fertilizer-grade ammonium nitrate, UAN
solutions, and urea. The Company currently produces nitrogen fertilizers at
its production facilities in Yazoo City, Mississippi and Donaldsonville,
Louisiana and has entered into a 50-50 joint venture to construct an ammonia
plant in The Republic of Trinidad and Tobago. The Company distributes its
nitrogen fertilizers primarily in the southern farming regions of the United
States. The Company produces diammonium phosphate fertilizer ("DAP") at its
facility in Pascagoula, Mississippi and exports a vast majority of its DAP
production. China, India, and Latin America are currently the Company's
largest DAP export markets. The Company's mines and related facilities near
Carslbad, New Mexico produce the Company's potash fertilizer. A majority of
the Company's agricultural potash sales are in domestic markets in states west
of the Mississippi River and its primary export sales are to Latin American
countries and Japan. The Company also markets some of its nitrogen and potash
products for industrial use.
The Company was incorporated in Mississippi in 1994 and is the successor by
merger, effective July 1, 1994, to a fertilizer cooperative formed in 1948.
The Company's principal executive offices are located at Highway 49 East, P.
O. Box 388, Yazoo City, Mississippi 39194 and its telephone number is (601)
746-4131.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of the Company's earnings to fixed
charges, for the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED SEPTEMBER 30, YEAR ENDED JUNE 30,
------------------- -----------------------------
1997 1996 1997 1996 1995 1994 1994
---- ---------- ---- ----- ----- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
2.1x 27.5x 9.6x 74.3x 33.9x 7.5x(1) 5.0x(1)
========= ========== ==== ===== ===== ==== ====
</TABLE>
- --------
(1) Exclusive of discontinued operations. If the ratio included discontinued
operations, the ratio for 1994 and 1993 would be 2.4 and 2.0,
respectively.
For the purpose of computing the ratios of earnings to fixed charges,
"earnings" consists of earnings from continuing operations before income taxes
and fixed charges and, for periods prior to July 1, 1994, before patronage
refunds. "Fixed charges" consists of interest charges and the portion of
rental expense deemed representative of the interest factor.
USE OF PROCEEDS
Except as otherwise provided in an applicable Prospectus Supplement, the net
proceeds from the sale of the Securities will be added to the Company's funds
to be used for general corporate purposes, including repayment of bank debt,
working capital, capital expenditures and the repayment of other debt
outstanding from time to time. Pending such application, such net proceeds may
be invested in short-term marketable securities. Specific information about
the use of proceeds from the sale of Securities will be set forth in the
applicable Prospectus Supplement. The Company may from time to time incur
additional indebtedness other than through the offering of Securities pursuant
to this Prospectus.
3
<PAGE>
DESCRIPTION OF SECURITIES
The Securities will be issued under an indenture (the "Indenture") between
the Company and Harris Trust and Savings Bank, as trustee (the "Indenture
Trustee"). A form of the Indenture has been filed as an exhibit to the
Registration Statement of which this Prospectus is a part and is available for
inspection at the corporate trust office of the Indenture Trustee at 111 West
Monroe Street, Chicago, Illinois 60603. The Indenture will be subject to and
governed by the Trust Indenture Act of 1939, as amended. The statements made
under this heading relating to the Securities and the Indenture are summaries
of the provisions thereof and do not purport to be complete and are qualified
in their entirety by reference to the Indenture and the Securities. All
Section references herein are to Sections of the Indenture, which are
incorporated herein by reference. Capitalized terms used but not defined have
the respective meanings set forth in the Indenture.
GENERAL
The Securities will be direct unsecured obligations of the Company and will
rank equally with all other unsecured and unsubordinated indebtedness of the
Company and senior to all current and future subordinated indebtedness of the
Company. The Securities may be issued in one or more series, in each case as
established from time to time by the Company by Board Resolution or as
established in the Indenture or in one or more indentures supplemental to the
Indenture. All Securities of one series need not be issued at the same time
and, unless otherwise provided, a series may be reopened, without the consent
of the holders of the Securities of such series, for issuance of additional
Securities of such series (Section 301).
The Indenture provides that there may be more than one Indenture Trustee
thereunder, each with respect to one or more series of Securities. Any
Indenture Trustee under the Indenture may resign or be removed with respect to
one or more series of Securities, and a successor Indenture Trustee may be
appointed to act with respect to such series (Section 608). If two or more
persons are acting as Indenture Trustee with respect to different series of
Securities, each such Indenture Trustee will be an Indenture Trustee of a
trust under the Indenture separate and apart from the trust administered by
any other Indenture Trustee (Section 609). In general, any action to be taken
by an Indenture Trustee may be taken by each such Indenture Trustee with
respect to, and only with respect to, the one or more series of Securities for
which it is Indenture Trustee under the Indenture.
The Prospectus Supplement relating to the series of Securities being offered
will contain the specific terms thereof, including:
(a) The designation of such Securities.
(b) The aggregate principal amount of such Securities.
(c) The percentage of the principal amount at which such Securities will
be issued and, if other than the principal amount thereof, the portion of
the principal amount thereof payable upon declaration of acceleration of
the maturity thereof, or the method by which any such portion will be
determined.
(d) The date or dates, or the method for determining such date or dates,
on which the principal of such Securities will be payable.
(e) The rate or rates (which may be fixed or variable), or the method by
which such rate or rates will be determined, at which such Securities will
bear interest.
(f) The date or dates, or the method for determining such date or dates,
from which any such interest will accrue, the dates on which any such
interest will be payable, the record dates for such interest payment dates,
or the method by which such dates will be determined, the persons to whom
such interest will be payable, and the basis upon which interest will be
calculated if other than that of a 360-day year of twelve 30-day months.
(g) The place or places where the principal of (and premium, if any) and
interest on such Securities will be payable, where such Securities may be
surrendered for registration of transfer or exchange and where notices or
demands to or upon the Company in respect of such Securities and the
Indenture may be served.
4
<PAGE>
(h) The period or periods within which, the price or prices at which and
the other terms and conditions upon which such Securities may be redeemed,
as a whole or in part, at the option of the Company, if the Company is to
have such an option.
(i) The obligation, if any, of the Company to redeem, repay or purchase
such Securities pursuant to any sinking fund or analogous provision or at
the option of a holder thereof, and the period or periods within which, the
price or prices at which and the other terms and conditions upon which such
Securities will be redeemed, repaid or purchased, as a whole or in part,
pursuant to such obligation.
(j) If other than U.S. dollars, the currency or currencies in which such
Securities are denominated and payable, which may be another currency or
units of two or more other currencies or a composite currency or
currencies, and the terms and conditions relating thereto.
(k) Whether the amount of payments of principal of (and premium, if any)
or interest on such Securities may be determined with reference to an
index, formula or other method (which index, formula or method may, but
need not, be based on a currency, currencies, currency unit or units or
composite currency or currencies) and the manner in which such amounts will
be determined.
(l) The Events of Default or covenants of such Securities, to the extent
different from those described herein.
(m) Whether such Securities will be issued in certificated or book-entry
form.
(n) Whether such Securities will be in registered or bearer form and, if
in registered form, the denominations thereof if other than $1,000 and any
integral multiple thereof and, if in bearer form, the denominations thereof
and terms and conditions relating thereto.
(o) The applicability, if any, of the defeasance and covenant defeasance
provisions described herein, or any modification thereof.
(p) Whether and under what circumstances the Company will pay any
additional amounts on such Securities in respect of any tax, assessment or
governmental charge and, if so, whether the Company will have the option to
redeem such Securities in lieu of making such payment.
(q) Any other terms, conditions, rights and preferences of such
Securities (Section 301).
The Securities may provide for less than the entire principal amount thereof
to be payable upon declaration of acceleration of the maturity thereof
("Original Issue Discount Securities"). Special United States federal income
tax, accounting and other considerations applicable to Original Issue Discount
Securities will be described in the applicable Prospectus Supplement.
The Prospectus Supplement for each offering of Securities may add to or
change statements contained in this Prospectus. Except as may be set forth in
any Prospectus Supplement, the Securities will not contain any provisions that
would limit the ability of the Company to incur unsecured indebtedness or that
would afford holders of Securities protection in the event of a decline in the
Company's credit quality, a highly leveraged or similar transaction involving
the Company or a change of control. Reference is made to the applicable
Prospectus Supplement for information with respect to any deletions from,
modifications of or additions to the Events of Default or covenants of the
Company that are described below, including any addition of a covenant or
other provision providing event risk or similar protection.
DENOMINATION, INTEREST, REGISTRATION OR TRANSFER
Unless specified in the applicable Prospectus Supplement, the Securities of
any series will be issuable in denominations of $1,000 and integral multiples
thereof (Section 302).
The principal of (and applicable premium, if any) and interest on any series
of Securities will be payable at the corporate trust office of the Indenture
Trustee, which initially will be Harris Trust and Savings Bank; provided that,
at the option of the Company, payment of interest may be made by check mailed
to the address of
5
<PAGE>
the Person entitled thereto as it appears in the applicable register for such
Securities or by wire transfer of funds to such Person at an account
maintained within the United States (Sections 301, 307 and 1002).
Any interest not punctually paid or duly provided for on any interest
payment date with respect to a Security ("Defaulted Interest") will forthwith
cease to be payable to the holder on the applicable Regular Record Date and
may either be paid to the Person in whose name such Security is registered at
the close of business on a special record date (the "Special Record Date") for
the payment of such Defaulted Interest to be fixed by the Indenture Trustee,
notice whereof will be given to the holder of such Security not less than 10
days prior to such Special Record Date, or may be paid at any time in any
other lawful manner, all as more completely described in the Indenture
(Section 307).
Subject to certain limitations imposed upon Securities issued in book-entry
form, the Securities of any series will be exchangeable for other Securities
of the same series and of a like aggregate principal amount and tenor of
different authorized denominations upon surrender of such Securities at the
corporate office of the Indenture Trustee. In addition, subject to certain
limitations imposed upon Securities issued in book-entry form, the Securities
of any series may be surrendered for registration of transfer or exchange
thereof at the corporate trust office of the Indenture Trustee. Every Security
surrendered for registration of transfer or exchange must be duly endorsed or
accompanied by a written instrument of transfer. No service charge will be
made for any registration of transfer or exchange of any Securities, but the
Company may require payment of a sum sufficient to cover any tax or other
governmental charge payable in connection therewith (Section 305). If the
applicable Prospectus Supplement refers to any transfer agent (in addition to
the Indenture Trustee) initially designated by the Company with respect to any
series of Securities, the Company may at any time rescind the designation of
any such transfer agent or approve a change in the location through which any
such transfer agent acts, except that the Company will be required to maintain
a transfer agent in each place of payment for such series. The Company may at
any time designate additional transfer agents with respect to any series of
Securities (Section 1002).
Neither the Company nor the Indenture Trustee will be required to (a) issue,
register the transfer of or exchange Securities of any series during a period
beginning at the opening of business 15 days before any selection of
Securities of that series to be redeemed and ending at the close of business
on the day of mailing of the relevant notice of redemption, (b) register the
transfer of or exchange any Security, or portion thereof, called for
redemption, except the unredeemed portion of any Security being redeemed in
part, or (c) issue, register the transfer of or exchange any Security that has
been surrendered for repayment at the option of the holder, except the
portion, if any, of such Security not to be so repaid (Section 305).
MERGER, CONSOLIDATION OR SALE
The Company will be permitted to consolidate with, or sell, lease or convey
all or substantially all of its assets to, or merge with or into, any other
entity, provided that (a) either the Company will be the continuing entity, or
the successor entity (if other than the Company) formed by or resulting from
any such consolidation or merger or which will have received the transfer of
such assets expressly assumes payment of the principal of (and premium, if
any) and interest on all of the Securities and the due and punctual
performance and observance of all of the covenants and conditions contained in
the Indenture and (b) immediately after giving effect to such transaction, no
Event of Default under the Indenture, and no event which, after notice or the
lapse of time, or both, would become such an Event of Default, will have
occurred and be continuing (Sections 801 and 804). With respect to the sale of
assets, the phrase "all or substantially all" as used in the Indenture varies
according to the facts and circumstances of the subject transaction, has no
clearly established meaning under New York law (which governs the Indenture)
and is subject to judicial interpretation. Accordingly, in certain
circumstances there may be a degree of uncertainty in ascertaining whether a
particular transaction would involve a disposition of "all or substantially
all" of the assets of a person, and therefore it may be unclear as to whether
a disposition of assets comes within the terms of this provision.
CERTAIN COVENANTS
Limitation on Liens. The Indenture will provide that the Company will not,
and will not permit any Subsidiary of the Company to, incur any Lien on or
with respect to any Principal Property of the Company or
6
<PAGE>
any such Subsidiary (whether such Principal Property is owned on or acquired
after the date of the Indenture) to secure Debt without making, or causing
such Subsidiary to make, effective provision for securing the Securities
equally and ratably with (or prior to) such Debt or, in the event such Debt is
subordinate in right of payment to the Securities, prior to such Debt, as to
such Principal Property for so long as such Debt will be so secured. The
foregoing restrictions will not apply to Liens in respect of Debt existing on
the date of the Indenture, to Liens on or with respect to property that is not
Principal Property, or to (a) Liens securing only Securities; (b) Liens in
favor of the Company or any of its Subsidiaries; (c) Liens on property
existing immediately prior to the time of acquisition thereof (and not created
in anticipation of the financing of such acquisition); (d) Liens to secure
Debt incurred for the purpose of financing all or any part of the purchase
price or the cost of construction or improvement of property used in the
business of the Company or any of its Subsidiaries and subject to such Liens,
provided that (i) the principal amount of any Debt secured by such a Lien does
not exceed 100% of such purchase price or cost, (ii) such Lien does not extend
to or cover any other property other than such property and any such
improvements, and (iii) such Debt is incurred within 360 days of such
purchase, construction or improvement; (e) Liens on property of a Person
existing at the time such Person is merged with or into or consolidated with
the Company or any of its Subsidiaries that were not created in anticipation
of the acquisition of such Person, provided that such Lien does not extend to
or cover any property other than that of the Person so merged or consolidated;
(f) Liens on any Principal Property in favor of a governmental body to secure
partial progress, advance or other payments pursuant to any contract or
statute of such governmental body; and (g) Liens to secure Debt incurred to
extend, renew, refinance, replace or refund (or successive extensions,
renewals, refinancings, replacements or refundings), in whole or in part, (i)
any secured Debt existing on the date of this Indenture, or (ii) any Debt
secured by any Lien referred to in the foregoing clauses, so long as in each
such case the Lien does not extend to any other property and the Debt so
secured is not increased other than for reasonable costs related to such
extension, renewal, refinancing, replacement or refunding.
In addition to the foregoing, the Company and its Subsidiaries may incur a
Lien or Liens to secure Debt (excluding Debt secured by Liens permitted under
the foregoing exceptions) the aggregate amount of which, including
Attributable Debt in respect of Sale and Leaseback Transactions, does not
exceed 15% of Consolidated Net Tangible Assets. The Company and its
Subsidiaries may also incur a Lien or Liens to secure any Debt incurred
pursuant to a Sale and Leaseback Transaction, without securing the Securities
equally and ratably with or prior to such Debt, as applicable, provided that
such Sale and Leaseback Transaction is permitted by the provisions of the
Indenture described below in clauses (b) and (c) under "--Limitation on Sale
and Leaseback Transactions" (Section 1006).
Limitation on Sale and Leaseback Transactions. The Indenture will provide
that the Company will not, and will not permit any Subsidiary of the Company
to, enter into any Sale and Leaseback Transaction with respect to any
Principal Property (except for a period, including renewals, not exceeding 36
months) unless (a) at the time of entering into such Sale and Leaseback
Transaction, the Company or such Subsidiary would be entitled to incur Debt,
in a principal amount equal to the Attributable Debt in respect of such Sale
and Leaseback Transaction, secured by a Lien, without equally and ratably
securing the Securities; (b) the Company or such Subsidiary applies, within 12
months after the sale or transfer, an amount equal to the greater of (i) the
net proceeds of the Principal Property sold pursuant to the Sale and Leaseback
Transaction, or (ii) the fair value (in the opinion of an executive officer of
the Company) of such Principal Property to the acquisition of or construction
on property used or to be used in the ordinary course of business of the
Company or a Subsidiary of the Company, and the Company shall have elected to
designate such amount as a credit against such Sale and Leaseback Transaction
(with any such amount not being so designated to be applied as set forth in
clause (c) below); or (c) the Company or such Subsidiary applies, within 12
months after the sale or transfer, an amount equal to the net proceeds of the
Principal Property sold pursuant to the Sale and Leaseback Transaction to the
voluntary defeasance or retirement of Debt (other than Debt that is held by
the Company or a Subsidiary of the Company or Debt of the Company that is
subordinate in right of payment to the Securities), which amount will not be
less than the fair value (in the opinion of an executive officer of the
Company) of such Principal Property (adjusted to reflect an amount expended by
the Company as set forth in clause (b) above) less an amount equal
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to the principal amount of such Debt voluntarily defeased or retired by the
Company or such Subsidiary within such 12-month period and not designated as a
credit against any other Sale and Leaseback Transaction entered into by the
Company or any Subsidiary of the Company during such period (Section 1007).
EVENTS OF DEFAULT, NOTICE AND WAIVER
The Indenture provides that the following events are "Events of Default"
with respect to any series of Securities issued thereunder: (a) default for 30
days in the payment of any installment of interest on any Security of such
series; (b) default in the payment of principal of (or premium, if any) any
Security of such series either at maturity (or upon any redemption), by
declaration or otherwise; (c) default in making any sinking fund payment as
required for any Security of such series; (d) default in the performance or
breach of any other covenant or warranty of the Company contained in the
Securities of such series or set forth in the Indenture (other than a covenant
added to the Indenture solely for the benefit of a series of Securities other
than such series), continued for 60 days after written notice as provided in
the Indenture; (e) acceleration or failure to pay at final maturity any debt
of the Company or any Subsidiary of the Company in an aggregate amount in
excess of $25 million; (f) certain events of bankruptcy, insolvency or
reorganization, or court appointment of a receiver, liquidator or trustee of
the Company or any Significant Subsidiary of the Company; and (g) any other
Event of Default provided with respect to a particular series of Securities
(Section 501).
If an Event of Default under the Indenture with respect to Securities of any
series at the time outstanding occurs and is continuing, then in every such
case the Indenture Trustee or the holders of not less than 25% in principal
amount of the outstanding Securities of that series will have the right to
declare the principal amount (or, if the Securities of that series are
Original Issue Discount Securities or Indexed Securities, such portion of the
principal amount as may be specified in the terms thereof) of all the
Securities of that series to be due and payable immediately by written notice
thereof to the Company (and to the Indenture Trustee if given by the holders).
However, at any time after such a declaration of acceleration with respect to
Securities of such series (or of all Securities then outstanding under the
Indenture, as the case may be) has been made, but before a judgment or decree
for payment of the money due has been obtained by the Indenture Trustee, the
holders of not less than a majority in principal amount of outstanding
Securities of such series (or of all Securities then outstanding under the
Indenture, as the case may be) may rescind and annul such declaration and its
consequences if (a) the Company deposits with the Indenture Trustee all
required payments of the principal of (and premium, if any) and interest on
the Securities of such series (or of all Securities then outstanding under the
Indenture, as the case may be), plus certain fees, expenses, disbursements and
advances of the Indenture Trustee, and (b) all Events of Default, other than
the non-payment of accelerated principal (or specified portion thereof), with
respect to Securities of such series (or of all Securities then outstanding
under the Indenture, as the case may be) are cured or waived as provided in
the Indenture (Section 502). The Indenture also provides that the holders of
not less than a majority in principal amount of the outstanding Securities of
any series (or of all Securities then outstanding under the Indenture, as the
case may be) may waive any past default with respect to such series and its
consequences, except a default (a) in the payment of the principal of (or
premium, if any) or interest on any Security of such series, or (b) under a
covenant or provision contained in the Indenture that cannot be modified or
amended without the consent of the holder of each outstanding Security
affected thereby (Section 513).
The Indenture Trustee will be required to give notice to the holders of
Securities within 90 days of default under the Indenture unless such default
is cured or waived; provided that such Indenture Trustee may withhold notice
to the holders of any series of Securities of any default with respect to such
series (except a default in the payment of the principal of (or premium, if
any) or interest on any Security of such series or in payment of any sinking
fund installment in respect of any Security of such series) if specified
responsible officers of such Indenture Trustee consider such withholding to be
in the interest of such holders.
The Indenture provides that no holders of Securities of any series may
institute any proceedings, judicial or otherwise, with respect to the
Indenture or for any remedy thereunder, except in the cases of failure of the
Indenture Trustee, for 60 days, to act after it has received a written request
to institute proceedings in respect of
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an Event of Default from the holders of not less than 25% in principal amount
of the outstanding Securities of such series (Section 507). This provision
will not prevent, however, any holder of Securities from instituting suit for
the enforcement of payment of the principal of (and premium, if any) and
interest on such Securities at the due dates thereof.
Subject to provisions in the Indenture relating to its duties in case of
default, the Indenture Trustee will not be under any obligation to exercise
any of its rights or powers under the Indenture at the request of direction of
any holders of any series of Securities then outstanding under such Indenture,
unless such holders offer to the Indenture Trustee reasonable security or
indemnity. The holders of not less than a majority in principal amount of the
outstanding Securities of any series (or of all Securities then outstanding
under the Indenture, as the case may be) will have the right to direct the
time, method and place of conducting any proceeding for any remedy available
to the Indenture Trustee, or of exercising any trust or power conferred upon
such Indenture Trustee. However, an Indenture Trustee may refuse to follow any
direction which is in conflict with any law or the Indenture, which may
involve the Indenture Trustee in personal liability or which may be unduly
prejudicial to the holders of Securities of such series not joining therein
(Section 512).
Within 120 days after the close of each fiscal year, the Company will be
required to deliver to the Indenture Trustee a certificate, signed by one of
several specified officers of the Company, stating whether or not such officer
has knowledge of any default under the Indenture and, if so, specifying each
such default and the nature and status thereof (Section 1005).
MODIFICATION OF THE INDENTURE
Modifications and amendments of the Indenture will be permitted to be made
only with the consent of the holders of not less than a majority in principal
amount of all outstanding Securities issued under the Indenture which are
affected by such modification or amendment; provided that no such modification
or amendment may, without the consent of the holder of each Security affected
thereby, (a) change the stated maturity of the principal of (or premium, if
any), or any installment of interest on any Security; (b) reduce the principal
amount of any Security, or reduce the amount of principal of an Original Issue
Discount Security that would be due and payable upon declaration of
acceleration of the maturity thereof or would be provable in bankruptcy, or
adversely affect any right of repayment of the holder of any such Security;
(c) change the place of payment, or the coin or currency, for payment of
principal of (or premium, if any) or interest on any Security; (d) impair the
right to institute suit for the enforcement of any payment on or with respect
to any Security; (e) reduce the above-stated percentage of outstanding
Securities of any series necessary to modify or amend the Indenture, to waive
compliance with certain provisions thereof or certain defaults and
consequences thereunder or to reduce the quorum or voting requirements set
forth in the Indenture; or (f) modify any of the foregoing provisions or any
of the provisions relating to the waiver of certain past defaults or certain
covenants, except to increase the required percentage to effect such action or
to provide that certain other provisions may not be modified or waived without
the consent of the holder of such Security (Section 902).
The holders of not less than a majority in principal amount of outstanding
Securities issued under the Indenture will have the right to waive compliance
by the Company with certain covenants in the Indenture (Section 1013).
Modifications and amendments of the Indenture will be permitted to be made
by the Company and the Indenture Trustee thereunder without the consent of any
holder of Securities for any of the following purposes: (a) to evidence the
succession of another person to the Company as obligor under the Indenture;
(b) to add to the covenants of the Company for the benefit of the holders of
all or any series of Securities or to surrender any right or power conferred
upon the Company in the Indenture; (c) to add Events of Default for the
benefit of the holders of all or any series of Securities; (d) to add or
change any provisions of the Indenture to facilitate the issuance of, or to
liberalize certain terms of, Securities in bearer form, or to permit or
facilitate the issuance of Securities in uncertificated form, provided that
such action will not adversely affect the interests of holders of the
Securities in any material respect; (e) to change or eliminate any provisions
of the Indenture, provided that
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any such change or elimination will become effective only when there are no
Securities outstanding of any series created prior thereto which are entitled
to the benefit of such provision; (f) to secure the Securities; (g) to
establish the form or terms of Securities of any series; (h) to provide for
the acceptance of appointment by a successor Indenture Trustee or facilitate
the administration of the trusts under the Indenture by more than one
Indenture Trustee; (i) to cure any ambiguity, defect or inconsistency in the
Indenture, provided that such action will not adversely affect the interests
of holders of Securities of any series issued under such Indenture in any
material respect; or (j) to supplement any of the provisions of the Indenture
to the extent necessary to permit or facilitate defeasance and discharge of
any series of such Securities, provided that such action will not adversely
affect the interests of the holders of the Securities of any series in any
material respect (Section 901).
The Indenture will provide that in determining whether the holders of the
requisite principal amount of outstanding Securities of a series have given
any request, demand, authorization, direction, notice, consent or waiver
thereunder or whether a quorum is present at a meeting of holders of
Securities, (a) the principal amount of an Original Issue Discount Security
that is deemed to be outstanding will be the amount of the principal thereof
that would be due and payable as of the date of such determination upon
declaration of acceleration of the maturity thereof, (b) the principal amount
of any Security denominated in a currency other than U.S. dollars that will be
deemed outstanding will be the U.S. dollar equivalent, determined on the issue
date for such Security, of the principal amount (or, in the case of Original
Issue Discount Security, the U.S. dollar equivalent on the issue date of such
Security of the amount determined as provided in (a) above), (c) the principal
amount of an Indexed Security that will be deemed outstanding will be the
principal face amount of such Indexed Security at original issuance, unless
otherwise provided with respect to such Indexed Security in the Indenture, and
(d) Securities owned by the Company or any other obligor upon the Securities
or any Subsidiary of the Company or of such other obligor will be disregarded
(Section 101).
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
The Indenture provides that the Company may elect either (a) to defease and
be discharged from any and all obligations with respect to the Securities of a
series (except for the obligations to register the transfer or exchange of
such Securities, to replace temporary or mutilated, destroyed, lost or stolen
Securities, to maintain an office or agency in respect of such Securities and
to hold moneys for payment in trust) ("defeasance") (Section 1402), or (b) to
be released from its obligations with respect to such Securities under the
restrictions described under "--Certain Covenants" or, if provided pursuant to
the Indenture, its obligations with respect to any other covenant, and any
omission to comply with such obligations will not constitute an Event of
Default with respect to such Securities ("covenant defeasance") (Section
1403), in either case upon the irrevocable deposit by the Company with the
Indenture Trustee, in trust, of an amount, in such currency in which such
Securities are payable at stated maturity, or Government Obligations, or both,
applicable to such Securities which through the scheduled payment of principal
and interest in accordance with their terms will provide money in an amount
sufficient to pay the principal of (and premium, if any) and interest on such
Securities, and any mandatory sinking fund or analogous payments thereon, on
the scheduled due dates therefore (Section 1404).
Such a trust will only be permitted to be established if, among other
things, the Company has delivered to the Indenture Trustee an opinion of
counsel to the effect that the holders of such Securities will not recognize
income, gain or loss for United States federal income tax purposes as a result
of such defeasance or covenant defeasance and will be subject to United States
federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such defeasance or covenant defeasance
had not occurred, and such opinion of counsel, in the case of defeasance, will
be required to refer to and be based upon a ruling of the Internal Revenue
Service or a change in applicable United States federal income tax law
occurring after the date of the Indenture (Section 1404).
If after the Company has deposited funds and/or Government Obligations to
effect defeasance or covenant defeasance with respect to Securities of any
series, (a) the holder of a Security of such series is entitled to, and
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does, elect pursuant to the Indenture or the terms of such Security to receive
payment in a currency, currency unit or composite currency other than that in
which such deposit has been made in respect of such Security, or (b) a
Conversion Event (as defined below) occurs in respect of the currency,
currency unit or composite currency in which such deposit has been made, the
indebtedness represented by such Security will be deemed to have been, and
will be, fully discharged and satisfied though the payment of the principal of
(and premium, if any) and interest on such Security as they become due out of
the proceeds yielded by converting the amount so deposited in respect of such
Security into the currency, currency unit or composite currency in which such
Security becomes payable as a result of such election based on the applicable
market exchange rate. "Conversion Event" means the cessation of use of (a) a
currency, currency unit or composite currency both by the government of the
country which issued such currency and for the settlement of transactions by a
central bank or other public institution of or within the international
banking community, (b) the ECU, both within the European Monetary System and
for the settlement of transactions by public institutions of or within the
European Communities, or (c) any currency unit or composite currency other
than the ECU for the purposes for which it was established. All payments of
principal of (and premium, if any) and interest on any Security that is
payable in a currency other than U.S. dollars that ceases to be used by its
government of issuance will be in U.S. dollars (Section 101).
The Indenture provides that the Company will file with the Trustee copies of
the annual reports and other information, documents and reports which the
Company is required to file with the Commission pursuant to the Exchange Act.
If the Company is not required to file such reports and other information, the
Indenture provides that the Company shall file with the Trustee and cause to
be mailed to the holders of Securities (i) annual reports containing the
information required to be contained in an Annual Report on Form 10-K, (ii)
quarterly reports containing the information required to be contained in a
Quarterly Report on Form 10-Q and (iii) promptly after the occurrence of any
event required to be therein reported, such other reports containing
information required to be contained in a Current Report on Form 8-K. The
Company shall also comply with the requirements of Trust Indenture Act Section
314(a).
GLOBAL SECURITIES
The Securities of a series may be issued in whole or in part in the form of
one or more global securities (the "Global Securities") that will be deposited
with, or on behalf of, a depositary identified in the applicable Prospectus
Supplement relating to such series. The Global Securities may be issued in
either registered or bearer form and in either temporary or permanent form.
The specific terms of the depositary arrangement with respect to a series of
Securities will be described in the applicable Prospectus Supplement relating
to such series.
CERTAIN DEFINITIONS
Set forth below is a summary of certain of the defined terms used in the
Indenture. Reference is made to the Indenture for the full definition of all
such terms, as well as other terms used herein for which no definition is
provided (Section 101).
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Attributable Debt" means, with respect to any Sale and Leaseback
Transaction as of any particular time, the present value (discounted at the
rate of interest implicit in the terms of the lease) of the obligations of the
lessee under such lease for net rental payments during the remaining term of
the lease (including any period for which such lease has been extended). "Net
rental payments" under any lease for any period means the sum of the rental
and other payments required to be paid in such period by the lessee
thereunder, not including, however, any amounts required to be paid by such
lessee (whether or not designated as rental or additional rental) on account
of maintenance and repairs, insurance, taxes, assessments or similar charges.
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"Capital Stock" means, with respect to any Person, any capital stock
(including preferred stock), shares, interests, participations or other
ownership interests (however designated) of such Person and any rights (other
than debt securities convertible or exchangeable for corporate stock),
warrants or options to purchase any thereof.
"Consolidated Net Tangible Assets" of the Company means, at any date, the
gross book value as shown by the accounting books and records of the Company
of all property both real and personal of the Company and its Subsidiaries,
determined on a consolidated basis in accordance with GAAP, (including
appropriate deductions for any minority interests in property of Subsidiaries
of the Company) less (a) the gross book value of all its licenses, patents,
patent applications, copyrights, trademarks, trade names, goodwill, non-
compete agreements or organizational expenses and other like intangibles, (b)
unamortized Debt discount and expense, (c) all reserves for depreciation,
obsolescence, depletion and amortization of its properties, and (d) all other
proper reserves which in accordance with GAAP should be provided in connection
with the business conducted by the Company or its Subsidiaries.
"Debt" of the Company or any Subsidiary means any indebtedness of the
Company or any Subsidiary, whether or not contingent, in respect of (without
duplication) (a) borrowed money, whether or not evidenced by bonds, notes,
debentures or similar instruments, (b) indebtedness secured by any Lien
existing on property owned by the Company or any Subsidiary, (c) the
reimbursement obligations, contingent or otherwise, in connection with any
letters of credit actually issued or amounts representing the balance deferred
and unpaid of the purchase price of any property or services (except any such
balance that constitutes an accrued expense or trade payable or accrued
liabilities arising in the ordinary course of business that are not overdue or
are being contested in good faith) or all conditional sale obligations or
obligations under any title retention agreement, (d) the principal amount of
all obligations of the Company or any Subsidiary with respect to redemption,
repayment or other repurchase of any Disqualified Stock, or (e) any lease of
property by the Company or any Subsidiary as lessee which is reflected on the
Company's consolidated balance sheet as a capitalized lease in accordance with
GAAP to the extent, in the case of items of indebtedness under (a) through (e)
above, that any such items (other than letters of credit) would appear as a
liability on the Company's consolidated balance sheet in accordance with GAAP,
and also includes, to the extent not otherwise included, any obligation by the
Company or any Subsidiary to be liable for, or to pay, as obligor, guarantor
or otherwise (other than for purposes of collection in the ordinary course of
business), Debt of another Person (other than the Company or any Subsidiary).
"Disqualified Stock" means, with respect to any Person, any Capital Stock of
such Person which by the terms of such Capital Stock (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise, (a) matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise,
(b) is convertible into or exchangeable or exercisable for Debt or
Disqualified Stock, or (c) is redeemable at the option of the holder thereof,
in whole or in part, in each case on or prior to the Stated Maturity of the
series of Securities.
"GAAP" means generally accepted accounting principles, as in effect from
time to time, in the United States, applied on a consistent basis.
"Government Obligations" means securities which are (a) direct obligations
of the United States of America or the government which issued the other
currency in which the Securities of a particular series are payable, for the
payment of which its full faith and credit is pledged, or (b) obligations of a
person controlled or supervised by and acting as an agency or instrumentality
of the United States of America or the government which issued the other
currency in which the Securities of such series are payable, the payment of
which is unconditionally guaranteed as a full faith and credit obligation by
the United States of America or such other government, which, in either case,
are not callable or redeemable at the option of the issuer thereof, and will
also include a depository receipt issued by a bank or trust as custodian with
respect to any such Government Obligation or a specific payment of interest on
or principal of any such Government Obligation held by such custodian for the
account of the holder of a depository receipt, provided that (except as
required by law) such custodian is not authorized to make any deduction from
the amount payable to the holder of such depository
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receipt from any amount received by the custodian in respect of the Government
Obligation or the specific payment of interest on or principal of the
Government Obligation evidenced by such depository receipt.
"Issue Date" means the date upon which a series of Securities was first
issued and authenticated under the Indenture.
"Lien" means any mortgage, charge, security interest, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or other) or
preference, priority or other security agreement except: (a) liens for taxes,
assessments, levies and other governmental charges, including utility charges
and vault rentals, (i) which are not yet delinquent, or (ii) which are being
contested in good faith by all appropriate proceedings; (b) carriers',
warehousemen's, mechanics', materialmen's, repairmen's, brokers' or other like
liens (i) which do not remain unsatisfied or undischarged for a period of more
than 90 days, or (ii) which are being contested in good faith by all
appropriate proceedings; (c) attachment or judgment liens not giving rise to
or an Event of Default and which are being contested in good faith by
appropriate proceedings; (d) pledges or deposits in connection with workers
compensation, unemployment insurance and other social security legislation and
deposits securing liability to insurance carriers under insurance or self-
insurance arrangements or to obtain the benefit of, or to comply with, laws;
(e) deposits to secure the performance of bids, trade contracts (other than
for borrowed money), leases, statutory obligations, surety and appeal bonds,
performance bonds and other obligations of a like nature incurred in the
ordinary course of business; (f) any lien incurred in connection with
pollution control, tax-exempt, industrial revenue or similar financing; and
(g) easements, rights of way, restrictions, development orders, plats and
other similar encumbrances.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
"Principal Property" means (a) any real property interest (all such
interests forming an integral part of a single development or operation being
considered as one interest), including any mining claims and leases, and any
plants, buildings or other improvements thereon, and any part thereof, that is
held by the Company or any Subsidiary and has a gross book value (without
deduction of any reserve for depreciation), on the date as of which the
determination is being made, exceeding 5% of Consolidated Net Tangible Assets
of the Company (other than any such interest that the board of directors of
the Company determines by resolution is not material to the business of the
Company and its Subsidiaries taken as a whole), or (b) any of the Capital
Stock or debt securities issued by any Significant Subsidiary.
"Sale and Leaseback Transaction" of any Person means an arrangement with any
lender or investor or to which such lender or investor is a party providing
for the leasing by such Person of any property or asset of such Person which
has been or is being sold or transferred by such Person more than 270 days
after the acquisition thereof or the completion of construction or
commencement of operation thereof to such lender or investor or to any Person
to whom funds have been or are to be advanced by such lender or investor on
the security of such property or asset. The stated maturity of such
arrangement is the date of the last payment of rent or any other amount due
under such arrangement prior to the first date on which such arrangement may
be terminated by the lessee without payment of a penalty.
"Significant Subsidiary" means any Subsidiary which is a "significant
subsidiary" (as defined in Rule 1-02 of Regulation S-X, promulgated by the
Commission) of the Company.
"Stated Maturity," when used with respect to any Security or any installment
of principal thereof or interest thereon, means the date specified in such
Security or a coupon representing such installment of interest as the fixed
date on which the principal of such Security or such installment of principal
or interest is due and payable.
"Subsidiary" means an entity a majority of the partnership interests or a
majority of the outstanding voting stock of which is owned, directly or
indirectly, by the Company and/or one or more other Subsidiaries of the
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Company. For the purposes of this definition, "voting stock" means stock
having voting power for the election of directors, whether at all times or
only so long as no senior class of stock has such voting power by reason of
any contingency.
CERTAIN INCOME TAX CONSIDERATIONS
The applicable Prospectus Supplement also will describe the principal United
States federal income tax considerations applicable to a United States
Investor of acquiring, owning and disposing of Securities, including any such
considerations relating to (a) principal (and premium, if any) and interest
payable with respect to the Securities, in a currency other than the United
States dollar, (b) the issuance of Securities with "original issue discount"
(as defined for United States federal income tax purposes), if applicable, and
(c) the inclusion of any special terms in Securities that may have a material
effect for United States federal income tax purposes.
PLAN OF DISTRIBUTION
GENERAL
The Company may sell the Securities being offered hereby: (i) directly to
purchasers; (ii) through agents; (iii) through dealers; (iv) through
underwriters; or (v) through a combination of any such methods of sale.
The distribution of the Securities may be effected from time to time in one
or more transactions either: (i) at a fixed price or prices which may be
changed; (ii) at market prices prevailing at the time of sale; (iii) at prices
related to such prevailing market prices; or (iv) at negotiated prices.
Offers to purchase Securities may be solicited directly by the Company.
Offers to purchase Securities may also be solicited by agents designated by
the Company from time to time. Any such agent, who may be deemed to be an
"underwriter" as that term is defined in the Securities Act, involved in the
offer or sale of the Securities in respect of which this Prospectus is
delivered will be named, and any commissions payable by the Company to such
agent will be set forth, in the Prospectus Supplement.
If a dealer is utilized in the sale of the Securities in respect of which
this Prospectus is delivered, the Company will sell such Securities to the
dealer, as principal. The dealer, who may be deemed to be an "underwriter" as
that term is defined in the Securities Act may then resell such Securities to
the public at varying prices to be determined by such dealer at the time of
resale.
If an underwriter or underwriters are utilized in the sales, the Company
will execute an underwriting agreement with such underwriters at the time of
sale of them and the name of the underwriters will be set forth in the
Prospectus Supplement, which will be used by the underwriters to make resales
of the Securities in respect of which this Prospectus is delivered to the
public.
Underwriters, dealers, agents and other persons may be entitled, under
agreements that may be entered into with the Company, to indemnification by
the Company against certain civil liabilities, including liabilities under the
Securities Act.
DELAYED DELIVERY ARRANGEMENTS
If so indicated in the Prospectus Supplement, the Company will authorize
underwriters, dealers or other persons to solicit offers by certain
institutions to purchase Securities pursuant to contracts providing for
payment and delivery on a future date or dates. Institutions with which such
contracts may be made include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions and others. The obligations of any purchaser under any such
contract will not be subject to any conditions that (a) the purchase of the
Securities shall not at the time of delivery be prohibited under the laws of
the jurisdiction to which such purchaser is subject and (b) if the Securities
are also being sold to underwriters,
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the Company shall have sold to such underwriters the Securities not sold for
delayed delivery. The underwriters, dealers and such other persons will not
have any responsibility in respect to the validity or performance of such
contracts.
LEGAL MATTERS
The legality of the Securities offered hereby will be passed upon for the
Company by Hughes & Luce, L.L.P.
EXPERTS
The audited consolidated financial statements incorporated by reference in
this Prospectus have been audited by Arthur Andersen LLP, independent public
accountants, as indicated in their report with respect thereto, and are
included in reliance upon the authority of said firm as experts in giving said
report.
15
<PAGE>
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Prospectus includes and incorporates by reference and related
Prospectus Supplements may include certain statements that may constitute
"forward-looking" information (as defined in the Private Securities Litigation
Reform Act of 1995). Words such as "anticipate", "estimate", "project" and
similar expressions are intended to identify such forward-looking statements.
Forward-looking statements may be included in this Prospectus in, among other
places, under "The Company" and "Use of Proceeds" and in certain portions of
the Company's Annual Report on Form 10-K and subsequent reports incorporated
herein by reference. Such forward-looking statements may include, but are not
limited to statements concerning estimates of current and future results of
operations, earnings, the development of new production facilities, future
capacity under the Company's credit arrangements, and future capital
expenditure and liquidity requirements.
Such forward-looking statements are subject to certain risks, uncertainties
and assumptions, including without limitation those discussed under "Outlooks
and Uncertainties" in the Company's Annual Report on Form 10-K incorporated
herein by reference and the following: the volatility of fertilizer demand and
prices, the cyclicality and seasonality of the Company's business, the
Company's dependence on natural gas, the costs of compliance with and the
possibility of additional environmental laws regulating the fertilizer
business, and the competitive nature of the fertilizer business. Should one or
more of these risks materialize, or should any of the underlying assumptions
prove incorrect, actual results of current and future operations may vary
materially from those anticipated, estimated or projected. Prospective
investors are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of their dates. The Company assumes no
obligation to update any such forward-looking statements.
16
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NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS,
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY OF THE UNDERWRITERS. THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR
A SOLICITATION OF AN OFFER TO BUY THE SECURITIES OFFERED HEREBY BY ANYONE IN
ANY JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED, OR IN
WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO
OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
NEITHER THE DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS NOR ANY
SALE MADE HEREUNDER AND THEREUNDER SHALL CREATE ANY IMPLICATION THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
PROSPECTUS SUPPLEMENT
Prospectus Supplement Summary.............................................. S-1
Use of Proceeds............................................................ S-4
Capitalization............................................................. S-4
Summary Financial Data..................................................... S-5
Description of Notes....................................................... S-6
Underwriting............................................................... S-9
Legal Matters.............................................................. S-10
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
The Company................................................................ 3
Ratio of Earnings to Fixed Charges......................................... 3
Use of Proceeds............................................................ 3
Description of Securities.................................................. 4
Certain Income Tax Considerations.......................................... 14
Plan of Distribution....................................................... 14
Legal Matters.............................................................. 15
Experts.................................................................... 15
Special Note Regarding Forward-Looking Statements.......................... 16
</TABLE>
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$200,000,000
MISSISSIPPI CHEMICAL
CORPORATION
% SENIOR NOTES DUE 2007
% SENIOR NOTES DUE 2017
---------------------------
PROSPECTUS SUPPLEMENT
---------------------------
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
NESBITT BURNS SECURITIES INC.
, 1997
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