<PAGE>
RULE NO. 424(b)(2)
REGISTRATION NO. 33-62198
PROSPECTUS SUPPLEMENT
(TO PROSPECTUS DATED JUNE 1, 1993)
$100,000,000
[LOGO CARDINAL HEALTH, INC. APPEARS HERE]
(FORMERLY KNOWN AS CARDINAL DISTRIBUTION, INC.)
6 1/2% NOTES DUE 2004
INTEREST PAYABLE FEBRUARY 15 AND AUGUST 15
----------------
The Notes will bear interest from February 23, 1994, at the rate of 6 1/2%
per annum, payable semiannually on February 15 and August 15, commencing August
15, 1994. The Notes will mature on February 15, 2004. The Notes will not be
redeemable prior to maturity and will not be subject to any sinking fund. See
"Certain Terms of Notes."
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY REPRE-
SENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
----------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRICE TO UNDERWRITING PROCEEDS TO
PUBLIC(1) DISCOUNT(2) COMPANY(1)(3)
- --------------------------------------------------------------------------------
<S> <C> <C> <C>
Per Note................................ 99.787% 0.650% 99.137%
- --------------------------------------------------------------------------------
Total................................... $99,787,000 $650,000 $99,137,000
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(1) Plus accrued interest, if any, from February 23, 1994.
(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 at $180,000. See
"Underwriting."
----------------
The Notes are offered by the several Underwriters when, as and if delivered
to and accepted by them and subject to their right to reject orders in whole or
in part. It is expected that the Notes will be available for delivery at the
offices of Smith Barney Shearson Inc., 388 Greenwich Street, New York, New York
10013, on or about February 23, 1994.
----------------
SMITH BARNEY SHEARSON INC. GOLDMAN, SACHS & CO.
A.G. EDWARDS & SONS, INC.
WILLIAM BLAIR & COMPANY
WHEAT FIRST BUTCHER & SINGER
CAPITAL MARKETS
February 15, 1994
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT LEVELS ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
No person has been authorized to give any information or to make any
representation not contained or incorporated by reference in this Prospectus
Supplement or the accompanying Prospectus and, if given or made, such
information or representation must not be relied upon as having been authorized
by the Company or any underwriter, dealer or agent. Neither the delivery of
this Prospectus Supplement or the accompanying Prospectus nor any sale made
hereunder or thereunder shall, under any circumstances, create any implication
that the information contained herein or in the accompanying Prospectus is
correct as of any date subsequent to the date hereof or thereof or that there
has been no change in the affairs of the Company since the date hereof or
thereof. Neither this Prospectus Supplement nor the accompanying Prospectus
constitutes an offer to sell or a solicitation of an offer to buy Notes 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.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
PROSPECTUS SUPPLEMENT
<S> <C>
Recent Developments........................................................ S-3
Use of Proceeds............................................................ S-3
Capitalization............................................................. S-4
Ratio of Earnings to Fixed Charges......................................... S-4
Certain Terms of Notes..................................................... S-5
Underwriting............................................................... S-5
Experts.................................................................... S-6
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by Reference............................ 2
The Company................................................................ 3
Ratio of Earnings to Fixed Charges......................................... 4
Use of Proceeds............................................................ 4
Selected Consolidated Financial Information................................ 5
Description of Debt Securities............................................. 6
Plan of Distribution....................................................... 10
Legal Matters.............................................................. 11
Experts.................................................................... 11
</TABLE>
S-2
<PAGE>
RECENT DEVELOPMENTS
On February 7, 1994, the Company completed its acquisition of Whitmire
Distribution Corporation ("Whitmire") through the merger of Cardinal Merger
Corp., a wholly owned subsidiary of the Company, with and into Whitmire (the
"Merger"). Whitmire, a Folsom, California-based national distributor of
pharmaceutical products, had revenues of $2.7 billion for the fiscal year ended
July 3, 1993. As a result of the Merger, the holders of outstanding Whitmire
stock (consisting primarily of members of management, Apollo Investment Fund,
L.P., and Chemical Venture Partners) received an aggregate of 5,441,815 of the
Company's common shares, without par value ("Common Shares"), and 1,488,529
shares of the Company's newly authorized Class B common shares in exchange for
all of the previously outstanding stock of Whitmire. In addition, Whitmire
stock options outstanding at the time of the Merger were converted into options
to purchase an aggregate of approximately 1,377,000 additional Common Shares of
the Company.
In conjunction with the Merger, and also effective February 7, 1994, the
Company's name was changed from Cardinal Distribution, Inc. to Cardinal Health,
Inc.
USE OF PROCEEDS
The net proceeds from the sale of the Notes offered hereby are estimated to
be approximately $98,957,000. The net proceeds will be used for general
corporate purposes, including the repayment of bank lines of credit incurred as
part of the Merger described above under "Recent Developments." Notes payable
to banks totaled $143.1 million at February 15, 1994, with a weighted average
interest rate of 3.66%.
S-3
<PAGE>
CAPITALIZATION
The following table sets forth the short-term obligations and capitalization
of the Company at December 31, 1993 (reflecting the Merger described under the
caption "Recent Developments" on a pooling-of-interests basis of accounting),
and as adjusted to reflect the issuance and sale of the Notes offered hereby
and the application of the net proceeds therefrom to reduce bank lines of
credit. See "Use of Proceeds."
<TABLE>
<CAPTION>
DECEMBER 31, 1993
---------------------
ACTUAL AS ADJUSTED
-------- -----------
(IN THOUSANDS)
<S> <C> <C>
Short-term Obligations:
Current portion of long-term obligations............... $ 3,487 $ 3,487
Long-term Obligations:
Other long-term obligations including capital leases... 10,584 10,584
Revolving credit agreement; rates that fluctuate based
on prime or LIBOR, due 1995........................... 100,829 1,872
6 1/2% Notes due 2004 offered hereby................... -- 100,000
8% Notes due 1997...................................... 100,000 100,000
-------- --------
Total Long-term Obligations.......................... 211,413 212,456
Shareholders' Equity:
Common Shares, without par value, authorized 40,000,000
shares; issued 27,925,377 shares...................... 249,855 249,855
Retained earnings...................................... 114,458 114,458
Common Shares in treasury, at cost--173,935 shares..... (3,141) (3,141)
Unamortized restricted stock awards.................... (3,836) (3,836)
-------- --------
Total Shareholders' Equity........................... 357,336 357,336
-------- --------
Total Capitalization..................................... $568,749 $569,792
======== ========
</TABLE>
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
FISCAL YEAR ENDED NINE MONTHS
------------------------------------------------- ENDED
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, DECEMBER 31,
1989 1990 1991 1992 1993 1993
--------- --------- --------- --------- --------- ------------
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to
fixed charges.......... 2.7x 3.9x 3.3x 4.0x 4.5x 6.2x
</TABLE>
The ratio of earnings to fixed charges is computed by dividing fixed charges
of the Company and entities 50% or more owned by the Company (but without
giving effect to the Merger described under the caption "Recent Developments")
into earnings before income taxes plus fixed charges. Fixed charges include
interest expense, amortization of debt offering costs, preferred stock dividend
requirements of subsidiaries, and the portion of rental expense which is deemed
to be representative of the interest factor.
S-4
<PAGE>
CERTAIN TERMS OF NOTES
The following summary of the terms of the Notes offered hereby (included in
the defined term "Debt Securities" in the Prospectus) supplements, and to the
extent inconsistent therewith replaces, the description of the general terms
and provisions of Debt Securities set forth in the Prospectus, to which
description reference is hereby made.
GENERAL
The 6 1/2% Notes due 2004 (the "Notes") offered hereby are an issue of the
Debt Securities described in the Prospectus and will be issued as a separate
series of Debt Securities under the Indenture dated as of May 1, 1993 (the
"Indenture"), entered into between the Company and Bank One, Indianapolis N.A.,
as Trustee (the "Trustee"). The Notes are limited to an aggregate principal
amount of $100,000,000. In addition to the Notes, the Company may issue from
time to time other series of Debt Securities under the Indenture consisting of
debentures, notes or other unsecured evidences of indebtedness, but such other
series will be separate from and independent of the Notes. The Indenture does
not limit the amount of Debt Securities or any other debt which may be incurred
by the Company. In addition, the provisions of the Indenture do not afford
holders of the Notes protection in the event of a highly leveraged transaction,
reorganization, restructuring, merger or similar transaction involving the
Company that may adversely affect holders of the Notes. The Notes are the first
series of Debt Securities to be issued under the Indenture. Reference is made
to the Prospectus for a description of other general terms of the Debt
Securities.
The Notes will mature on February 15, 2004. Interest on the Notes will accrue
from February 23, 1994, and will be payable semiannually on February 15 and
August 15, commencing August 15, 1994, to the persons in whose names the Notes
are registered at the close of business on the February 1 or August 1 prior to
the payment date at the annual rate set forth on the cover page of this
Prospectus Supplement. The Notes will be issued in fully registered form only
in denominations of $1,000 and any multiple thereof.
The Notes will not be subject to redemption at the option of the Company or
through the operation of a sinking fund.
The Notes will not be listed on a securities exchange.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement,
the Company has agreed to sell to Smith Barney Shearson Inc., Goldman, Sachs &
Co., A.G. Edwards & Sons, Inc., William Blair & Company, and Wheat, First
Securities, Inc. (the "Underwriters"), and each of the Underwriters has
severally agreed to purchase, the principal amount of Notes set forth opposite
its name below.
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT
NAME OF NOTES
---- ----------------
<S> <C>
Smith Barney Shearson Inc. .............................. $ 41,000,000
Goldman, Sachs & Co. .................................... $ 41,000,000
A.G. Edwards & Sons, Inc. ............................... $ 6,000,000
William Blair & Company.................................. $ 6,000,000
Wheat, First Securities, Inc. ........................... $ 6,000,000
------------
Total.................................................. $100,000,000
============
</TABLE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to purchase all of the Notes offered hereby if any
are purchased.
S-5
<PAGE>
The Underwriters initially propose to offer the Notes directly to the public
at the public offering price set forth on the cover page of this Prospectus
Supplement and to certain dealers at such price less a concession not in excess
of 0.40% of the principal amount of the Notes. The Underwriters may allow, and
such dealers may reallow, a concession not in excess of 0.25% of the principal
amount of the Notes to certain other dealers. After the Notes are released for
sale to the public, the public offering price and such concessions may be
changed by the Underwriters.
The Company does not intend to apply for listing of the Notes on a securities
exchange, but has been advised by the Underwriters that the Underwriters intend
to make a market in the Notes. Such Underwriters are not obligated, however, to
make a market in the Notes and may discontinue market making at any time
without notice. No assurance can be given as to the liquidity of the trading
markets for the Notes.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933, as
amended.
In the ordinary course of their respective businesses, each of the
Underwriters has engaged and may in the future engage in investment banking or
commercial banking transactions, or both, with the Company and its affiliates.
EXPERTS
The consolidated financial statements and the related financial statement
schedule of the Company incorporated in this Prospectus Supplement by reference
from the Company's Annual Report on Form 10-K, as amended, for the year ended
March 31, 1993 have been audited by Deloitte & Touche, independent auditors, as
stated in their report, which is incorporated herein by reference, and have
been so incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.
The audited financial statements of Whitmire incorporated in this Prospectus
Supplement by reference from the Company's Quarterly Report on Form 10-Q for
the quarter ended December 31, 1993 have been audited by Arthur Andersen & Co.,
independent public accountants, as indicated in their report with respect
thereto, which is incorporated in this Prospectus Supplement by reference, and
have been so incorporated in reliance upon the authority of said firm as
experts in giving said reports.
The supplemental consolidated financial statements of the Company and its
consolidated subsidiaries, except Whitmire, as of March 31, 1993 and 1992 and
for each of the three years in the period ended March 31, 1993, incorporated in
this Prospectus Supplement by reference from the Company's Current Report on
Form 8-K dated February 11, 1994 have been audited by Deloitte & Touche as
stated in their report which is incorporated herein by reference (which report
expresses an unqualified opinion and states that such financial statements are
in conformity with generally accepted accounting principles applicable after
consolidated financial statements are issued for a period which includes the
date of consummation of the business combination of the Company and Whitmire).
The financial statements of Whitmire (consolidated with those of the Company in
the supplemental consolidated financial statements) have been audited by Arthur
Andersen & Co., as stated in their report which is incorporated herein by
reference from the Company's Current Report on Form 8-K dated February 11,
1994. Such supplemental consolidated financial statements of the Company and
its consolidated subsidiaries are incorporated by reference herein in reliance
upon the respective reports of such firms given upon their authority as experts
in accounting and auditing. Both of the foregoing firms are independent
auditors.
S-6
<PAGE>
[LOGO OF CARDINAL DISTRIBUTION, INC. APPEARS HERE]
DEBT SECURITIES
-----------
Cardinal Distribution, Inc. (the "Company" or "Cardinal") may offer and issue
from time to time its unsecured debt securities in one or more series (the
"Debt Securities") with an aggregate initial offering price not to exceed
$150,000,000 (or the equivalent in foreign-denominated currency or currency
units based on or relating to foreign currencies, including European Currency
Units). The Debt Securities will rank equally with all other current and future
unsecured indebtedness of the Company and prior to subordinated indebtedness,
if any. The Debt Securities may be sold for U.S. dollars, foreign-denominated
currency or currency units; principal of and interest on the Debt Securities
may likewise be payable in U.S. dollars, foreign-denominated currency or
currency units, in each case as the Company specifically designates.
The Debt Securities will be offered in amounts, at prices with maturities and
on terms to be determined in light of market conditions at the time of the
offering and set forth in one or more accompanying prospectus supplements (the
"Prospectus Supplement"). The Prospectus Supplement will set forth the specific
designation, aggregate principal amount, authorized denominations and currency
or currency unit in which the Debt Securities may be purchased and in which the
principal and any interest is payable; purchase price, maturity, rate of or
manner of calculating interest, if any; time of payment of interest, if any;
terms, if any, for redemption at the option of the Company or the holder; terms
for sinking fund payments, if any; terms for any mandatory redemption; listing
on a securities exchange, if any; and any other specific terms relating to any
series of the Debt Securities.
-----------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
-----------
The Debt Securities may be offered through dealers, underwriters or agents
designated from time to time, as set forth in the Prospectus Supplement. Net
proceeds to the Company will be the purchase price in the case of a dealer, the
public offering price less discount in the case of an underwriter or the
purchase price less commission in the case of an agent, in each case, less
other attributable expenses of issuance and distribution. The Company may also
sell Debt Securities directly to investors on its own behalf. In the case of
sales made directly by the Company, no commission will be payable. See "Plan of
Distribution" for possible indemnification arrangements for dealers,
underwriters and agents.
-----------
The date of this Prospectus is June 1, 1993
<PAGE>
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS OR AN APPLICABLE PROSPECTUS
SUPPLEMENT 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. THIS PROSPECTUS AND ANY APPLICABLE PROSPECTUS SUPPLEMENT DO
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION. NEITHER THE
DELIVERY OF THIS PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT NOR ANY SALE MADE
HEREUNDER SHALL UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THEREOF.
----------------
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission"). These reports and other information (including
proxy and information statements) filed by the Company can be inspected and
copied at the public reference facilities maintained by the Commission at its
principal office at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549,
and at the following Regional Offices of the Commission: New York Regional
Office, 7 World Trade Center, New York, New York 10048 and Chicago Regional
Office, 500 West Madison, 14th Floor, Chicago, Illinois 60661-2511. Copies of
such material can be obtained at prescribed rates from the Public Reference
Section of the Commission, 450 Fifth Street, N.W., Washington, D.C. 20549.
This Prospectus constitutes a part of a Registration Statement filed by the
Company with the Commission under the Securities Act of 1933, as amended (the
"Securities Act"). This Prospectus does not contain all of the information set
forth in the Registration Statement, certain parts of which are omitted in
accordance with the rules and regulations of the Commission. Reference is
hereby made to the Registration Statement and related exhibits for further
information with respect to the Company and the Debt Securities offered hereby.
Statements contained herein concerning the provisions of any document 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 otherwise
filed with the Commission. Each such statement is qualified in its entirety by
such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission pursuant to
the Exchange Act are hereby incorporated by reference in this Prospectus: (1)
Annual Report on Form 10-K for the fiscal year ended March 31, 1992, (2)
Quarterly Reports on Form 10-Q for the quarters ended June 30, September 30,
and December 31, 1992, and (3) Current Report on Form 8-K dated September 10,
1992.
All reports and other documents filed by the Company pursuant to Sections
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the termination of this offering shall be deemed to be
incorporated by reference herein and to be a part hereof from the respective
dates of filing of said reports and other documents. Any statement contained
herein or in a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for all purposes to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
The Company hereby undertakes to provide without charge to each person to
whom this Prospectus has been delivered, upon the written or oral request of
such person, a copy of any and all documents incorporated herein by reference
(other than exhibits to such documents unless such exhibits are specifically
incorporated
2
<PAGE>
by reference in such documents). Requests for such copies should be submitted
in writing to Cardinal Distribution, Inc., 655 Metro Place South, Suite 925,
Dublin, Ohio 43017, Attn.: David Bearman, Senior Vice President and Chief
Financial Officer, (614) 761-8700.
THE COMPANY
Cardinal is one of the nation's largest wholesale distributors of
pharmaceuticals and related health care products. Its customers include
independent and chain drug stores, hospitals, alternate care centers, and the
pharmacy departments of supermarkets and mass merchandisers located primarily
in the eastern United States. Cardinal operates, through its various
subsidiaries, twelve drug distribution facilities, a specialty wholesale
distribution facility, a drug repackaging facility and a separate promotional
goods warehouse. These automated, high-volume distribution facilities enable
the Company to achieve economies of scale and extend its business into
contiguous markets.
As a full-service wholesale distributor, Cardinal complements its
distribution activities by offering a broad range of value-added support
services to assist the Company's customers and suppliers in maintaining and
improving their market positions and to strengthen Cardinal's role in the chain
of distribution. These support services include computerized order entry and
order confirmation systems, customized invoicing, product movement and
management reports, consultation on store operation and merchandising, design
and production of advertising, employee training, and store design and layout.
Cardinal also maintains promotional and advertising programs and store identity
programs for participating independent drug stores. These support services
foster strong relationships between Cardinal and its customers and suppliers by
positioning the Company as a valuable resource capable of offering centralized
services.
Most customers transmit merchandise orders directly to the Company's data
processing systems through computerized order entry devices. For example,
hospital customers are offered Accunet (R), a proprietary software system
developed by Cardinal which features a customized database specially designed
to help hospitals order more efficiently and to monitor their purchases which
are covered by group purchasing arrangements. Upon receipt of the customer's
order at a distribution center, the Company's warehouse-management system
processes the order and provides customized price information to facilitate the
customer's pricing of items. Customer orders are routinely processed for next-
day delivery, enabling Cardinal's customers to minimize the size and carrying
cost of their own inventories.
In addition to its core drug wholesaling activities, Cardinal operates
several related health care businesses which offer the Company's customers and
suppliers an increased level of value-added services and provide Cardinal with
diversified opportunities for growth and profitability. For example, Cardinal
operates a pharmaceutical repackaging program for both independent and chain
customers and serves as a distributor of therapeutic plasma products and
specialty pharmaceuticals to hospitals and other managed-care facilities on a
nationwide basis. These specialty wholesaling activities are part of the
Company's overall strategy of developing diversified products and services in
order to enhance the profitability of its core business and those of its
customers and suppliers.
The Company's net sales from continuing operations have grown from
approximately $411 million in fiscal year 1987 to approximately $2 billion for
the twelve months ended December 31, 1992, due to both internal sales growth
and acquisitions. The sales growth of the Company, including its acquired
operations, has occurred primarily as a result of an increased reliance on drug
wholesaling by both its customers and pharmaceutical manufacturers; new product
introductions and product price increases; territory expansion; and market
share gain. During the past nine years, the Company has acquired seven regional
drug distributors in contiguous geographic markets in the eastern United
States.
On May 4, 1993, Cardinal acquired Solomons Company in exchange for 849,364
Cardinal common shares. Solomons Company is a Savannah, Georgia-based drug
wholesaler whose customers include
3
<PAGE>
independent and chain drug stores, hospitals, alternate care centers and mass
merchandisers located in Georgia, South Carolina and Florida.
Cardinal's principal operating subsidiaries include: James W. Daly, Inc.
(Boston, Massachusetts); Marmac Distributors, Inc. (Hartford, Connecticut);
Cardinal Syracuse, Inc. (Syracuse, New York); Ellicott Drug Company (Buffalo,
New York); Bailey Drug Company and National PharmPak Services, Inc.
(Zanesville, Ohio); Ohio Valley-Clarksburg, Inc. (Wheeling, West Virginia);
Chapman Drug Company (Knoxville, Tennessee); and Solomons Company (Savannah,
Georgia).
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
FISCAL YEAR ENDED NINE MONTHS ENDED
------------------------------------------------- -----------------
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, DECEMBER 31,
1988 1989 1990 1991 1992 1992
--------- --------- --------- --------- --------- -----------------
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to
fixed charges.......... 2.2x 2.7x 3.9x 3.3x 4.0x 4.2x
</TABLE>
The ratio of earnings to fixed charges is computed by dividing fixed charges
of the Company and entities 50% or more owned by the Company into earnings
before income taxes plus fixed charges. Fixed charges include interest expense,
amortization of debt offering costs, preferred stock dividend requirements of
subsidiaries, and the portion of rental expense which is deemed to be
representative of the interest factor.
USE OF PROCEEDS
Except as otherwise specified in the Prospectus Supplement, the net proceeds
from the sale of the Debt Securities will be used by the Company to finance
working capital growth and for other general corporate purposes, including
possible acquisitions. Although the Company continually evaluates possible
candidates for acquisition and intends to seek opportunities to expand its
health care distribution operations, no acquisition has been agreed upon or
become the subject of a letter of intent or agreement in principle. Pending
application of the proceeds as described above, the proceeds will be invested
in short-term, interest-bearing securities.
4
<PAGE>
SELECTED CONSOLIDATED FINANCIAL INFORMATION
The following selected consolidated financial data concerning the Company as
of and for each of the five years in the period ended March 31, 1992 and as of
and for the nine months ended December 31, 1991 and 1992, should be read in
conjunction with the more detailed information and consolidated financial
statements and related notes and "Management's Discussion and Analysis of
Financial Condition and Results of Operations" incorporated herein by
reference. The information for interim periods is unaudited; however, in the
opinion of management, all adjustments (consisting only of normal recurring
adjustments) necessary for a fair presentation of such information have been
included. The interim results of operations may not be indicative of the
results for the full fiscal year. All per share data have been adjusted to give
retroactive effect to stock dividends and stock splits.
<TABLE>
<CAPTION>
FISCAL YEAR ENDED(1) NINE MONTHS ENDED
------------------------------------------------------- -------------------------
MARCH 31, MARCH 31, MARCH 31, MARCH 31, MARCH 31, DECEMBER 31, DECEMBER 31,
1988 1989 1990 1991 1992 1991 1992
--------- --------- --------- ---------- ---------- ------------ ------------
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
EARNINGS STATEMENT DATA:
Net sales............... $524,636 $700,410 $873,886 $1,184,300 $1,647,611 $1,164,454 $1,467,640
Gross margin............ 35,266 47,556 60,250 82,489 109,892 74,634 91,092
Selling, general and
administrative
expenses............... (22,179) (29,264) (35,418) (47,832) (62,522) (44,028) (51,194)
Unusual Items
Termination fee........ -- -- -- -- -- -- 13,466
Nonrecurring charges... -- -- -- -- -- -- (9,882)
-------- -------- -------- ---------- ---------- ---------- ----------
Operating earnings...... 13,087 18,292 24,832 34,657 47,370 30,606 43,482
Interest expense and
other, net............. (4,902) (4,680) (3,898) (6,137) (6,407) (3,570) (6,378)
-------- -------- -------- ---------- ---------- ---------- ----------
Earnings from continuing
operations before
income taxes........... 8,185 13,612 20,934 28,520 40,963 27,036 37,104
Income taxes............ (3,405) (5,105) (8,164) (11,123) (15,771) (10,409) (14,063)
-------- -------- -------- ---------- ---------- ---------- ----------
Net earnings from
continuing operations.. 4,780 8,507 12,770 17,397 25,192 16,627 23,041
Net earnings from
discontinued
operations............. 1,786 336 -- -- -- -- --
Net gain on sale of
discontinued
operations............. -- 4,409 -- -- -- -- --
-------- -------- -------- ---------- ---------- ---------- ----------
Net earnings............ $ 6,566 $ 13,252 $ 12,770 $ 17,397 $ 25,192 $ 16,627 $ 23,041
======== ======== ======== ========== ========== ========== ==========
Cash dividends per
Common Share........... $ 0.04 $ 0.04 $ 0.05 $ 0.06 $ 0.08 $ 0.06 $ 0.06
BALANCE SHEET DATA(2):
Current assets.......... $161,948 $196,943 $213,313 $ 385,186 $ 503,216 $ 561,759 $ 623,999
Property and equipment-
net.................... 12,157 17,732 19,117 31,037 38,986 37,366 38,760
Other assets............ 16,349 17,533 18,767 30,196 34,383 33,578 37,646
-------- -------- -------- ---------- ---------- ---------- ----------
Total assets........... $190,454 $232,208 $251,197 $ 446,419 $ 576,585 $ 632,703 $ 700,405
======== ======== ======== ========== ========== ========== ==========
Current liabilities..... $ 85,828 $115,082 $120,768 $ 162,975 $ 168,478 $ 332,299 $ 269,096
Long-term obligations... 50,317 49,805 4,666 89,572 188,121 90,254 187,194
Deferred income taxes... 285 -- 816 502 684 380 684
Shareholders' equity.... 54,024 67,321 124,947 193,370 219,302 209,770 243,431
-------- -------- -------- ---------- ---------- ---------- ----------
Total liabilities and
shareholders' equity.. $190,454 $232,208 $251,197 $ 446,419 $ 576,585 $ 632,703 $ 700,405
======== ======== ======== ========== ========== ========== ==========
</TABLE>
- --------
(1) Amounts reflect business acquisitions in fiscal 1988, 1991 and 1992.
(2) At end of period.
5
<PAGE>
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued under an Indenture (hereinafter referred
to as the "Indenture") to be dated as of May 1, 1993 between the Company and
Bank One, Indianapolis, NA, as Trustee (hereinafter referred to as the
"Trustee"). The Indenture will not limit the amount of Debt Securities or any
other debt which may be incurred by the Company. The Indenture will not contain
any covenants or provisions that afford holders of Debt Securities protection
in the event of a highly leveraged transaction. The following statements are
subject to the detailed provisions of the Indenture, a copy of which is filed
as an exhibit to the Registration Statement of which this Prospectus is a part
and which is also available for inspection at the office of the Trustee.
Section references are to the Indenture. Wherever particular provisions of the
Indenture are referred to, such provisions are incorporated by reference as a
part of the statements made and the statements are qualified in their entirety
by such reference.
GENERAL
The Indenture provides that the Debt Securities may be issued from time to
time in one or more series. The Prospectus Supplement which accompanies this
Prospectus will set forth the following terms of and information relating to
the Debt Securities offered thereby: (i) the designation and aggregate
principal amount of the Debt Securities; (ii) the date or dates on which
principal of the Debt Securities is payable; (iii) the rate or rates per annum
at which the Debt Securities shall bear interest, if any, or the method by
which such rate or rates shall be determined; (iv) the dates on which interest
will be payable and the related record dates; (v) any redemption, repayment or
sinking fund provisions; and (vi) any other specific terms of the Debt
Securities.
Unless otherwise specified in the accompanying Prospectus Supplement,
principal and premium, if any, will be payable, and the Debt Securities will be
transferable and exchangeable without service charge, at the office of the
Trustee set forth in the Indenture.
Interest on any series of Debt Securities is to be payable on the interest
payment dates set forth in the accompanying Prospectus Supplement to the
persons in whose names the Debt Securities are registered at the close of
business on the related record dates, and, unless other arrangements are made,
will be paid by checks mailed to such persons. (Sections 2.7 and 3.1)
Debt Securities may be issued as discounted debt securities (bearing no
interest or interest at a rate which at the time of issuance is below market
rates) and sold at a discount (which may be substantial) below their stated
principal amount ("Original Issue Discount Securities"). Federal income tax
consequences and other special considerations applicable to any such Original
Issue Discount Securities will be described in the Prospectus Supplement
relating thereto.
CERTAIN COVENANTS
The following summarizes certain provisions of Articles One and Three of the
Indenture.
Definitions. The term "Attributable Debt" means in connection with a sale and
lease-back transaction the lesser of (a) the fair value of the assets subject
to such transaction or (b) the aggregate of present values (discounted at the
weighted average Yield to Maturity of the Debt Securities of all series then
outstanding and compounded semiannually) of the obligations of the Company and
its Consolidated Subsidiaries for rental payments during the remaining term of
all leases.
The term "Consolidated Net Tangible Assets" means the aggregate amount of
assets after deducting therefrom (a) all current liabilities (excluding any
thereof constituting Funded Indebtedness by reason of being renewable or
extendable) and (b) all goodwill, trade names, trademarks, patents, unamortized
debt discount and expense and other like intangibles, all as set forth on the
most recent balance sheet of the Company and its Consolidated Subsidiaries and
computed in accordance with generally accepted accounting principles.
6
<PAGE>
The term "Consolidated Subsidiary" means any Subsidiary substantially all the
property of which is located, and substantially all the operations of which are
conducted, in the United States of America whose financial statements are
consolidated with those of the Company in accordance with generally accepted
accounting principles.
The term "Exempted Debt" means the sum of the following as of the date of
determination: (a) Indebtedness of the Company and its Consolidated
Subsidiaries incurred after the date of the Indenture and secured by liens not
permitted by the limitation on liens provisions (Section 3.9), and (b)
Attributable Debt of the Company and its Consolidated Subsidiaries in respect
of every sale and lease-back transaction entered into after the date of the
Indenture, other than leases permitted by the limitation on sale and lease-back
provisions. (Section 3.10)
The term "Funded Indebtedness" means all Indebtedness having a maturity of
more than 12 months from the date as of which the amount thereof is to be
determined or having a maturity of less than 12 months but by its terms being
renewable or extendable beyond 12 months from such date at the option of the
borrower.
The term "Indebtedness" means all items classified as indebtedness on the
most recently available balance sheet of the Company and its Consolidated
Subsidiaries, in accordance with generally accepted accounting principles.
The term "Original Issue Discount Security" means any Security that provides
for an amount less than the principal amount thereof to be due and payable upon
a declaration of acceleration thereof following an Event of Default.
The term "Senior Funded Indebtedness" means any Funded Indebtedness of the
Company that is not subordinated in right of payment to any other Indebtedness
of the Company.
The term "Subsidiary" means any corporation of which at least a majority of
the outstanding stock having the voting power (under ordinary circumstances) to
elect a majority of the board of directors of said corporation is at the time
owned by the Company or by the Company and one or more Subsidiaries or by one
or more Subsidiaries.
The term "Yield to Maturity" means the yield to maturity on a series of Debt
Securities, calculated at the time of issuance of such series, or, if
applicable, at the most recent redetermination of interest on such series, and
calculated in accordance with accepted financial practice.
Limitation on Liens. The Indenture provides that, so long as any of the Debt
Securities remain outstanding, the Company will not, nor will it permit any
Consolidated Subsidiary to, create or assume any Indebtedness which is secured
by a lien (as defined) upon any assets, whether now owned or hereafter
acquired, of the Company or any such Consolidated Subsidiary without equally
and ratably securing the Debt Securities by a lien ranking ratably with and
equal to such secured Indebtedness, except that the foregoing restriction shall
not apply to (a) liens existing on the date of the Indenture; (b) liens on
assets of any corporation existing at the time such corporation becomes a
Consolidated Subsidiary; (c) liens on assets existing at the time of
acquisition thereof, or to secure the payment of the purchase price of such
assets, or to secure Indebtedness incurred or guaranteed by the Company or a
Consolidated Subsidiary for the purpose of financing the purchase price of such
assets or improvements or construction thereof, which indebtedness is incurred
or guaranteed prior to, at the time of, or within 360 days after such
acquisition (or in the case of real property, completion of such improvement or
construction or commencement of full operation of such property, whichever is
later); (d) liens securing indebtedness owing by any Consolidated Subsidiary to
the Company or another wholly owned domestic Subsidiary; (e) liens on any
assets of a corporation existing at the time such corporation is merged into or
consolidated with the Company or a Subsidiary or at the time of a purchase,
lease or other acquisition of the assets of a corporation or firm as an
entirety or substantially as
7
<PAGE>
an entirety by the Company or a Subsidiary; (f) liens on any assets of the
Company or a Consolidated Subsidiary in favor of the United States of America
or any State thereof, or in favor of any other country, or political
subdivision thereof, to secure certain payments pursuant to any contract or
statute or to secure any indebtedness incurred or guaranteed for the purpose
of financing all or any part of the purchase price (or, in the case of real
property, the cost of construction) of the assets subject to such liens
(including, but not limited to, liens incurred in connection with pollution
control, industrial revenue or similar financings); (g) any extension, renewal
or replacement (or successive extensions, renewals or replacements) in whole
or in part, of any lien referred to in the foregoing clauses (a) to (f),
inclusive; (h) certain statutory liens or other similar liens arising in the
ordinary course of business by the Company or a Consolidated Subsidiary, or
certain liens arising out of governmental contracts; (i) certain pledges,
deposits or liens made or arising under workers' compensation or similar
legislation or in certain other circumstances; (j) certain liens in connection
with legal proceedings, including certain liens arising out of judgments or
awards; (k) liens for certain taxes or assessments, landlord's liens and liens
and charges incidental to the conduct of the business, or the ownership of the
assets of the Company or of a Consolidated Subsidiary, which were not incurred
in connection with the borrowing of money and which do not, in the opinion of
the Company, materially impair the use of such assets in the operation of the
business of the Company or such Consolidated Subsidiary or the value of such
assets for the purposes thereof. Notwithstanding the above, the Company or any
Consolidated Subsidiary may, without securing the Debt Securities, create or
assume any indebtedness which is secured by a lien which would otherwise be
subject to the foregoing restrictions, provided that after giving effect
thereto the Exempted Debt then outstanding at such time does not exceed 10% of
the Consolidated Net Tangible Assets. (Section 3.9)
Limitation on Sale and Lease-Back Transactions. Sale and lease-back
transactions (except such transactions involving leases for less than three
years) by the Company or any Consolidated Subsidiary of any assets are
prohibited unless (a) the Company or such Consolidated Subsidiary would be
entitled to incur indebtedness secured by a lien on the assets to be leased in
an amount at least equal to the Attributable Debt in respect to such
transaction without equally and ratably securing the Debt Securities, or (b)
the proceeds of the sale of the assets to be leased are at least equal to
their fair value as determined by the Board of Directors of the Company and
the proceeds are applied to the purchase or acquisition (or, in the case of
real property, the construction) of assets or to the retirement of Senior
Funded Indebtedness. The foregoing limitation will not apply, if at the time
the Company or any Consolidated Subsidiary enters into such sale and lease-
back transaction and, after giving effect thereto, Exempted Debt does not
exceed 10% of the Consolidated Net Tangible Assets. (Section 3.10)
Merger, Consolidation, Sale, Lease or Conveyance. The Indenture provides
that the Company will not merge or consolidate with any other corporation and
will not sell, lease or convey all or substantially all its assets to any
person, unless the Company shall be the continuing corporation, or the
successor corporation or person that acquires all or substantially all the
assets of the Company shall be a corporation organized under the laws of the
United States or a State thereof or the District of Columbia and shall
expressly assume all obligations of the Company under the Indenture and the
Debt Securities issued thereunder, and immediately after such merger,
consolidation, sale, lease or conveyance, the Company, such person or such
successor corporation shall not be in default in the performance of the
covenants and conditions of the Indenture to be performed or observed by the
Company. (Section 8.1)
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of not less than 66 2/3% in principal amount
of the Debt Securities at the time outstanding of all series affected (voting
as one class), to modify the Indenture or any supplemental indenture or the
rights of the holders of the Debt Securities except that no such modification
shall (i) extend the final maturity of any of the Debt Securities or reduce
the principal amount thereof, or reduce the rate or extend the time of payment
of interest thereon, or reduce any amount payable on redemption thereof, or
reduce the amount of the principal amount of an Original Issue Discount
Security that would be due and payable upon an acceleration
8
<PAGE>
of the maturity thereof pursuant to Section 4.1 of the Indenture or the amount
thereof provable in bankruptcy pursuant to Section 4.2 of the Indenture, or
impair or affect the right of any holder of the Debt Securities to institute
suit for the payment thereof without the consent of the holder of each of the
Debt Securities so affected, or (ii) reduce the aforesaid percentage of Debt
Securities, the consent of the holders of which is required for any such
modification, without the consent of the holders of all Debt Securities then
outstanding. (Section 7.2)
EVENTS OF DEFAULT
An Event of Default with respect to Debt Securities of any series issued
under the Indenture is defined in the Indenture as being: default for 30 days
in payment of any interest upon any Debt Securities of such series; default in
any payment of principal or premium, if any, upon any Debt Securities of such
series; default in the payment of any sinking fund instalment payable by the
terms of the Debt Securities of such series; default by the Company in
performance of any other of the covenants or agreements in respect of the Debt
Securities of such series or the Indenture which shall not have been remedied
for a period of 90 days after written notice specifying that such notice is a
"Notice of Default" under the Indenture; or certain events involving
bankruptcy, insolvency or reorganization of the Company. (Section 4.1) The
Indenture will provide that the Trustee may withhold notice to the holders of
any series of the Debt Securities of any default (except in payment of
principal of, or interest on, such series of Debt Securities or in the payment
of any sinking or purchase fund instalment with respect to such series of Debt
Securities) if the Trustee considers it in the interest of the holders of such
series of Debt Securities to do so. (Section 4.11)
The Indenture provides that (a) if an Event of Default due to the default in
payment of principal of, premium, if any, or interest on, or any sinking fund
instalment with respect to, any series of Debt Securities issued under such
Indenture or due to the default in the performance or breach of any other
covenant or warranty of the Company applicable to the Debt Securities of such
series but not applicable to all outstanding Debt Securities issued under such
Indenture shall have occurred and be continuing, either the Trustee or the
holders of not less than 25% in principal amount of the Debt Securities of each
affected series issued under such Indenture and then outstanding (each such
series voting as a separate class) may then declare the principal of all Debt
Securities of such affected series and interest accrued thereon to be due and
payable immediately; and (b) if an Event of Default due to a default in the
performance of any other of the covenants or agreements in such Indenture
applicable to all outstanding Debt Securities issued thereunder and then
outstanding or due to certain events of bankruptcy, insolvency and
reorganization of the Company shall have occurred and be continuing, either the
Trustee or the holders of not less than 25% in principal amount of all Debt
Securities issued under such Indenture and then outstanding (treated as one
class) may declare the principal of all such Debt Securities and interest
accrued thereon to be due and payable immediately, but upon certain conditions
such declarations may be annulled and past defaults may be waived (except a
continuing default in payment of principal of (or premium, if any) or interest
on such Debt Securities) by the holders of a majority in principal amount of
the Debt Securities of all such affected series then outstanding. (Sections 4.1
and 4.10)
The holders of a majority in principal amount of the Debt Securities of each
series then outstanding and affected (with each series voting as a separate
class) shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee with respect to the Debt
Securities of such series under the Indenture, subject to certain limitations
specified in the Indenture, provided that the holders of such Debt Securities
shall have offered to the Trustee reasonable indemnity against expenses and
liabilities. (Sections 4.9 and 5.2(d))
The Indenture provides that no holder of Debt Securities may institute any
action against the Company under the Indenture (except actions for payment of
overdue principal or interest) unless such holder previously shall have given
to the Trustee written notice of default and continuance thereof and unless the
holders of not less than 25% in principal amount of the Debt Securities of each
affected series (with each
9
<PAGE>
series voting as a separate class) issued under the Indenture and then
outstanding shall have requested the Trustee to institute such action and shall
have offered the Trustee reasonable indemnity, the Trustee shall not have
instituted such action within 60 days of such request and the Trustee shall not
have received direction inconsistent with such written request by the holders
of a majority in principal amount of the Debt Securities of each affected
series (with each series voting as a separate class) issued under such
Indenture and then outstanding. (Sections 4.6, 4.7 and 4.9)
The Indenture will require the annual filing by the Company with the Trustee
of a written statement as to compliance with the principal covenants contained
in the Indenture. (Section 3.5)
SATISFACTION AND DISCHARGE
The Indenture will cease to be of further effect and the Trustee, on demand
of and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of the Indenture upon compliance with
certain enumerated conditions, including the Company having paid all sums
payable by the Company under the Indenture, when either (a) the Company shall
have delivered to the Trustee for cancellation all Debt Securities theretofore
authenticated or (b) all Debt Securities not theretofore delivered to the
Trustee for cancellation shall have become due and payable or are by their
terms to become due and payable within one year. (Section 9.1)
THE TRUSTEE
Bank One, Indianapolis, NA serves as Trustee under separate Indentures
pertaining to the Company's 8% Notes due 1997 and 7 1/4% Convertible
Subordinated Debentures due 2015, respectively, and serves as transfer agent
for the Company's Common Shares.
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities being offered hereby in any of four
ways: (i) through underwriters, (ii) through dealers, (iii) through agents, or
(iv) directly to purchasers. The Prospectus Supplement will set forth the terms
of any offering of a particular series of Debt Securities and will include,
without limitation, (i) the name or names of any underwriters, dealers or
agents with which the Company has entered into arrangements with respect to the
sale of such Debt Securities; (ii) the initial public offering or purchase
price of such Debt Securities; (iii) the principal amounts of the Debt
Securities to be purchased by any such underwriters, dealers or agents; (iv)
any underwriting discounts, commissions and other items constituting
underwriters' compensation and any other discounts, concessions or commissions
allowed or reallowed or paid by any underwriters to other dealers; (v) any
commissions paid to any agents; (vi) the net proceeds to the Company from the
sale of such Debt Securities; and (vii) the securities exchanges, if any, on
which such Debt Securities will be listed.
If underwriters are used in the offering of Debt Securities, the Debt
Securities being sold will be acquired by the underwriters for their own
account and may be resold from time to time in one or more transactions,
including negotiated transactions, at a fixed public offering price or at
varying prices determined at the time of such resale. Unless otherwise set
forth in an applicable Prospectus Supplement, the obligations of the
underwriters to purchase such Debt Securities will be subject to certain
conditions precedent and each of the underwriters with respect to such Debt
Securities will be obligated to purchase all of the Debt Securities allocated
to it if any such Debt Securities are purchased. Any initial public offering
price and any discounts or concessions allowed or reallowed or paid to dealers
may be changed from time to time.
If dealers are utilized in the sale of the Debt Securities in respect of
which this Prospectus is delivered, the Company will sell such Debt Securities
to such dealers, as principals. The dealers may then resell such Debt
Securities to the public at varying prices to be determined by such dealers at
the time of resale.
10
<PAGE>
Offers to purchase Debt Securities may 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 Debt Securities in respect to which this Prospectus is
delivered will be named, and any commission payable by the Company to such
agent set forth, in the Prospectus Supplement. Unless otherwise indicated in
the Prospectus Supplement, any such agent will be acting on a best-efforts
basis for the period of its appointment.
Offers to purchase Debt Securities may be solicited, and sales thereof may be
made directly by the Company to institutional investors or others, who may be
deemed to be underwriters within the meaning of the Securities Act with respect
to resales thereof.
Underwriters, dealers and agents participating in the distribution of Debt
Securities may be deemed to be "underwriters," as that term is defined under
the Securities Act, and any discounts and commissions received by them and any
profit realized by them on the resale thereof may be deemed to be underwriting
discounts and commissions under the Securities Act. Underwriters, dealers and
agents participating in the distribution of Debt Securities may be entitled
under agreements entered into with the Company to indemnification by the
Company against certain civil liabilities, including liabilities under the
Securities Act. Such underwriters, dealers and agents may be customers of,
engage in transactions with, or perform services for the Company in the
ordinary course of business.
LEGAL MATTERS
Unless otherwise indicated in the Prospectus Supplement relating to the Debt
Securities, certain legal matters in connection with the Debt Securities will
be passed upon for the Company by Baker & Hostetler, Columbus, Ohio. Michael E.
Moritz, a director and Secretary of the Company, is a partner of Baker &
Hostetler and is the beneficial owner of 456,985 Common Shares and options to
purchase 8,592 Common Shares. Certain legal matters in connection with the Debt
Securities offered hereby will be passed upon for the underwriters, if any, by
Davis Polk & Wardwell, New York, New York.
EXPERTS
The consolidated financial statements and the related financial statement
schedule incorporated in this Prospectus by reference from the Company's Annual
Report on Form 10-K for the year ended March 31, 1992 have been audited by
Deloitte & Touche, independent auditors, as stated in their report, which is
incorporated herein by reference, and have been so incorporated in reliance
upon the report of such firm given upon their authority as experts in
accounting and auditing.
11
<PAGE>
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NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMA-
TION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS SUPPLEMENT
OR THE ACCOMPANYING PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REP-
RESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR THE UNDERWRITERS. NEITHER THIS PROSPECTUS SUPPLEMENT NOR THE ACCOMPANYING
PROSPECTUS CONSTITUTES AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY
ANY OF THE SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY
OF THIS PROSPECTUS SUPPLEMENT OR THE ACCOMPANYING PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THE IN-
FORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR
THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE SUCH DATE.
----------------
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
PROSPECTUS SUPPLEMENT
<S> <C>
Recent Developments........................................................ S-3
Use of Proceeds............................................................ S-3
Capitalization............................................................. S-4
Ratio of Earnings to Fixed Charges......................................... S-4
Certain Terms of Notes..................................................... S-5
Underwriting............................................................... S-5
Experts.................................................................... S-6
PROSPECTUS
Available Information...................................................... 2
Incorporation of Certain Documents by
Reference................................................................. 2
The Company................................................................ 3
Ratio of Earnings to Fixed Charges......................................... 4
Use of Proceeds............................................................ 4
Selected Consolidated Financial Information................................ 5
Description of Debt Securities............................................. 6
Plan of Distribution....................................................... 10
Legal Matters.............................................................. 11
Experts.................................................................... 11
</TABLE>
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$100,000,000
[LOGO OF CARDINAL HEALTH, INC. APPEARS HERE]
6 1/2% NOTES DUE 2004
----------------
PROSPECTUS SUPPLEMENT
FEBRUARY 15, 1994
----------------
SMITH BARNEY SHEARSON INC.
GOLDMAN, SACHS & CO.
A. G. EDWARDS & SONS, INC.
WILLIAM BLAIR & COMPANY
WHEAT FIRST BUTCHER & SINGER
CAPITAL MARKETS
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