<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 12, 1995
REGISTRATION NO. 33-57011
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------
ASHLAND OIL, INC.
(Exact name of Registrant as specified in its charter)
KENTUCKY 61-0122250
(State or other jurisdiction (I.R.S. Employer Identification No.)
of incorporation or organization)
1000 ASHLAND DRIVE
RUSSELL, KENTUCKY 41169
(606) 329-3333
(Address, including zip code, and telephone number,
including area code, of Registrants' principal executive offices)
--------------------------
THOMAS L. FEAZELL, ESQ.
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
1000 ASHLAND DRIVE
RUSSELL, KENTUCKY 41169
(606) 329-3333
(Name, address, including zip code and telephone number,
including area code, of agent for service)
--------------------------
COPIES TO:
DAVID G. ORMSBY, ESQ.
CRAVATH, SWAINE & MOORE
825 EIGHTH AVENUE
NEW YORK, NEW YORK 10019
(212) 474-1000
--------------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration Statement.
--------------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act"), other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. /X/
--------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
AMOUNT TO PROPOSED MAXIMUM PROPOSED MAXIMUM AMOUNT OF
TITLE OF EACH CLASS OF BE OFFERING PRICE AGGREGATE OFFERING REGISTRATION
SECURITIES TO BE REGISTERED (1) REGISTERED (2)(3) PER UNIT (3)(4) PRICE (4)(5) FEE
<S> <C> <C> <C> <C>
Debt Securities, Debt Warrants, Preferred
Stock, Depositary Shares, Preferred Stock
Warrants, Common Stock and Common Stock
Warrants.................................... -- -- $600,000,000 $206,898
<FN>
(1) This Registration Statement also covers (i) Debt Securities, Preferred
Stock and Common Stock which may be issued upon exercise of Securities
Warrants and (ii) such indeterminate amount of securities as may be issued
in exchange for, or upon conversion of, as the case may be, the securities
registered hereunder. In addition, any other securities registered
hereunder may be sold separately or as units with other securities
registered hereunder.
(2) In no event will the aggregate initial offering price of Debt Securities,
Debt Warrants, Preferred Stock, Depositary Shares, Preferred Stock
Warrants, Common Stock and Common Stock Warrants issued under this
Registration Statement exceed $600,000,000, or the equivalent thereof in
one or more foreign currencies or composite currencies, including European
Currency Units.
(3) Not specified as to each class of securities to be registered pursuant to
General Instruction II.D of Form S-3 under the Securities Act.
(4) The proposed maximum offering price per unit will be determined from time
to time by the Registrant in connection with, and at the time of, the
issuance by the Registrant of the securities registered hereunder.
(5) Estimated solely for the purposes of computing the registration fee
pursuant to Rule 457(o) of the Securities Act.
</TABLE>
--------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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<PAGE>
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
<PAGE>
PROSPECTUS
SUBJECT TO COMPLETION, DATED JANUARY 12, 1995
ASHLAND OIL, INC.
DEBT SECURITIES
PREFERRED STOCK
DEPOSITARY SHARES
COMMON STOCK
WARRANTS
------------------
Ashland Oil, Inc. ("Ashland" or the "Company") intends to issue from time to
time its (i) unsecured debt securities, which may either be senior (the "Senior
Securities") or subordinated (the "Subordinated Securities"; the Senior
Securities and the Subordinated Securities being referred to collectively as the
"Debt Securities"), (ii) warrants to purchase the Debt Securities (the "Debt
Warrants"), (iii) shares of cumulative preferred stock, without par value (the
"Preferred Stock"), (iv) depositary shares representing entitlement to all
rights and preferences of a fraction of a share of Preferred Stock of a
specified series ("Depositary Shares"), (v) warrants to purchase shares of
Preferred Stock ("Preferred Stock Warrants"), (vi) shares of common stock, par
value $1.00 per share (the "Common Stock") and (vi) warrants to purchase shares
of Common Stock ("Common Stock Warrants"; the Debt Warrants, Preferred Stock
Warrants and Common Stock Warrants being referred to herein collectively as the
"Securities Warrants"), having an aggregate initial public offering price not to
exceed $600,000,000 or the equivalent thereof in one or more foreign currencies
or composite currencies, including European Currency Units, on terms to be
determined at the time of sale. The Debt Securities, Preferred Stock, Depositary
Shares, Common Stock and Securities Warrants offered hereby (collectively, the
"Offered Securities") may be offered separately or as units with other Offered
Securities, in separate series in amounts, at prices and on terms to be
determined at the time of sale and to be set forth in a supplement to this
Prospectus (a "Prospectus Supplement").
The specific terms of the Offered Securities in respect of which this
Prospectus is being delivered, such as, where applicable, (i) in the case of
Debt Securities, the specific designation, aggregate principal amount, currency,
denomination, maturity, priority, interest rate (which may be variable or
fixed), time of payment of interest, terms of redemption at the option of the
Company or repayment at the option of the holder or for sinking fund payments,
the designation of the Trustee acting under the applicable Indenture and the
initial public offering price; (ii) in the case of Preferred Stock, the specific
title and stated value, number of shares or fractional interests therein, and
the dividend, liquidation, redemption, conversion, voting and other rights and
the initial public offering price, and whether the Company has elected to offer
the Preferred Stock in the form of Depositary Shares; (iii) in the case of
Common Stock, the initial public offering price; (iv) in the case of Securities
Warrants, the duration, offering price, exercise price and detachability
thereof; and (v) in the case of all Offered Securities, whether such Offered
Security will be offered separately or as a unit with other Offered Securities,
will be set forth in the accompanying Prospectus Supplement.
The Prospectus Supplement will also contain information, where applicable,
concerning certain United States Federal income tax considerations relating to,
and any listing on a securities exchange of, the Offered Securities covered by
the Prospectus Supplement.
The Offered Securities may be sold directly by the Company, or through
agents, underwriters or dealers. If any agent of the Company, or any
underwriters are involved in the sale of Offered Securities, the names of such
agents or underwriters and any applicable fees or commissions and the net
proceeds to the Company from such sale will be set forth in the applicable
Prospectus Supplement. The Company may also issue the Offered Securities to one
or more persons in exchange for outstanding securities of the Company acquired
by such persons from third parties in open market transactions or in privately
negotiated transactions. The newly issued Offered Securities in such cases may
be offered pursuant to this Prospectus and the applicable Prospectus Supplement
by such persons acting as principal for their own accounts, at market prices
prevailing at the time of sale, at prices otherwise negotiated or at fixed
prices. Unless otherwise indicated in the applicable Prospectus Supplement, the
Company will only receive outstanding securities and will not receive cash
proceeds in connection with such exchanges or sales. See "Plan of Distribution".
This Prospectus may not be used to consummate sales of Offered Securities
unless accompanied by a Prospectus Supplement.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
------------------------
The date of this Prospectus is January , 1995
<PAGE>
NO DEALER, SALESMAN, OR ANY 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 OR THE PROSPECTUS SUPPLEMENT
DELIVERED HEREWITH 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 THE PROSPECTUS SUPPLEMENT DO
NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OFFERED
SECURITIES BY ANYONE IN ANY JURISDICTION IN WHICH THE OFFER OR SOLICITATION IS
NOT AUTHORIZED OR IN WHICH THE PERSON MAKING THE OFFER OR SOLICITATION IS NOT
QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
AVAILABLE INFORMATION
Ashland 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 and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by Ashland with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at
the Regional Offices of the Commission at Suite 1400, Northwestern Atrium
Center, 500 West Madison Street, Chicago, Illinois 60661 and Seven World Trade
Center, Suite 1300, New York, New York 10048. In addition, copies of such
material can be obtained from the Public Reference Section of the Commission at
450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Such
reports, proxy statements and other information concerning Ashland can also be
inspected at the offices of The New York Stock Exchange, 20 Broad Street, New
York, New York 10005, and The Chicago Stock Exchange, 440 South LaSalle Street,
Chicago, Illinois 60605.
Ashland has filed with the Commission a Registration Statement on Form S-3
under the Securities Act of 1933, as amended (the "Securities Act") with respect
to the securities offered hereby. For further information with respect to
Ashland and the Offered Securities, reference is made to such Registration
Statement and to the exhibits thereto. Statements contained herein concerning
the provisions of certain documents are not necessarily complete and, in each
instance, reference is made to the copy of such document filed as an exhibit to
the Registration Statement 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 pursuant to Section 13 or 15(d) of the
Exchange Act (File No. 1-2918) are hereby incorporated by reference into this
Prospectus:
(i) Ashland's Annual Report on Form 10-K for the fiscal year ended
September 30, 1994;
(ii) the description of its Common Stock, par value $1.00 per share, set
forth in the Registration Statement on Form 10, as amended in its entirety
by the Form 8 filed with the Commission on May 1, 1983;
(iii) the description of its Rights to Purchase Cumulative Preferred
Stock, Series of 1987, set forth in the Registration Statement on Form 8-A
dated May 29, 1986 (as amended by the Forms 8 dated February 5, 1987, and
September 21, 1989); and
(iv) the description of its Cumulative Preferred Stock, without par
value, set forth in the Registration Statement on Form 8-A, as amended by
Amendment No. 1 thereto, filed with the Commission on April 30, 1993.
All documents filed by Ashland with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus
and prior to the termination of the offering made hereby shall be deemed to be
incorporated by reference into this Prospectus and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for
2
<PAGE>
purposes of this Prospectus to the extent that a statement contained herein or
in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein or in any Prospectus Supplement 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.
ASHLAND WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM A COPY OF THIS
PROSPECTUS IS DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF SUCH PERSON, A COPY
OF ANY OR ALL OF THE DOCUMENTS REFERRED TO ABOVE WHICH HAVE BEEN OR MAY BE
INCORPORATED BY REFERENCE INTO THIS PROSPECTUS, OTHER THAN CERTAIN EXHIBITS TO
SUCH DOCUMENTS. COPIES OF THE INDENTURES SUMMARIZED BELOW ARE ALSO AVAILABLE
UPON REQUEST. REQUESTS FOR SUCH COPIES SHOULD BE DIRECTED TO THE SECRETARY,
ASHLAND OIL, INC., P.O. BOX 391, ASHLAND, KENTUCKY 41114 (TELEPHONE: (606)
329-3333).
THE COMPANY
Ashland is a worldwide energy and chemical company engaged in petroleum
refining, transportation and wholesale marketing; retail gasoline marketing;
motor oil and lubricant marketing; chemicals; coal; highway construction; and
oil and gas exploration and production. Ashland's businesses are grouped into
six industry segments: Petroleum, SuperAmerica, Valvoline, Chemical,
Construction and Exploration. In addition, Ashland is involved in the coal
industry through its ownership interests in Arch Mineral Corporation ("Arch")
and Ashland Coal, Inc. ("Ashland Coal").
On November 3, 1994, the Board of Directors of Ashland voted, subject to
shareholder approval at the 1995 Annual Meeting of Shareholders, to amend the
Company's Second Restated Articles of Incorporation, as amended, to change the
name of the Company to Ashland Inc. This change of name is believed by the Board
of Directors to be desirable and in the best interests of Ashland in order to
identify the Company in a manner which more clearly reflects its unified network
of refining, energy and chemical businesses and yet retains the historical name
of Ashland.
Ashland Petroleum is one of the nation's largest independent petroleum
refiners and a leading supplier of petroleum products to the transportation and
commercial fleet industries, other industrial customers and independent
marketers, and to SuperAmerica for retail distribution. In addition, Ashland
Petroleum gathers and transports crude oil and petroleum products and
distributes petroleum products under the Ashland-R- brand name. SuperAmerica
operates combination gasoline and merchandise stores under the SuperAmerica-R-
and Rich-R- brand names. Valvoline is a marketer of branded, packaged motor oil
and automotive chemicals, filters, rust preventives and coolants. In addition,
Valvoline is engaged in the "fast oil change" business through outlets operating
under the Valvoline Instant Oil Change-R- and Valvoline Rapid Oil Change-R-
names.
Ashland Chemical distributes industrial chemicals, solvents, thermoplastics
and resins, and fiberglass materials, and manufactures a wide variety of
specialty chemicals and certain petrochemicals. Construction performs contract
construction work, including highway paving and repair, excavation and grading,
and bridge and sewer construction and produces asphaltic and ready-mix concrete,
crushed stone and other aggregate, concrete block and certain specialized
construction materials in the southern United States. Exploration explores for,
develops, produces and sells crude oil and natural gas principally in the
eastern and Gulf Coast areas of the United States, explores for and produces
crude oil in Nigeria for export and explores for oil and gas in other
international areas.
Arch, one of the largest producers of low sulfur coal in the eastern United
States, produces steam and metallurgical coal for sale in the domestic and
international markets. Arch's production comes from surface and deep mines in
Illinois, Kentucky, West Virginia and Wyoming. Ashland Coal produces low-sulfur,
bituminous coal in central Appalachia for sale to domestic and foreign electric
utility and industrial customers. Both Arch and Ashland Coal market coal mined
by independent producers.
Ashland is a Kentucky corporation, organized on October 22, 1936, with its
principal executive offices located at 1000 Ashland Drive, Russell, Kentucky
41169 (Mailing Address: P.O. Box 391, Ashland, Kentucky 41114) (Telephone: (606)
329-3333).
3
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USE OF PROCEEDS
Unless otherwise set forth in the applicable Prospectus Supplement, the net
proceeds from the sale of the Offered Securities will be used for general
corporate purposes, which may include additions to working capital, capital
expenditures, stock and debt repurchases, repayment of indebtedness and
acquisitions.
RATIOS
The following table sets forth the consolidated ratio of earnings to fixed
charges for the Company:
<TABLE>
<CAPTION>
YEAR ENDED SEPTEMBER 30,
----------------------------
1994 1993 1992 1991 1990
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges........... 2.51 1.84 ** 1.96 2.53
<FN>
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**Fixed charges exceeded earnings (as defined) by $174 million as a result of
special charges and the current year impact of accounting charges.
</TABLE>
The ratios of earnings to fixed charges are computed on a total enterprise
basis including Ashland and its consolidated subsidiaries, plus their share of
significant affiliates accounted for on the equity method that are 50% owned or
whose indebtedness has been directly or indirectly guaranteed by Ashland or its
consolidated subsidiaries. Earnings consist of income before income taxes and
the cumulative effect of accounting changes, adjusted to exclude fixed charges
(excluding capitalized interest) and undistributed earnings of equity method
affiliates excluded from the total enterprise. Fixed charges consist of interest
incurred on indebtedness, the portion of operating lease rentals deemed
representative of the interest factor and the amortization of debt expense.
DESCRIPTION OF DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Debt Securities
offered by any Prospectus Supplement and the extent, if any, to which such
general provisions may apply to the Debt Securities so offered will be described
in the Prospectus Supplement relating to such Debt Securities. Accordingly, for
a description of the terms of a particular issue of Debt Securities and the
identity of the Trustee for any Debt Securities, reference must be made to both
the Prospectus Supplement relating thereto and to the following description.
The Debt Securities will be general obligations of the Company and may be
subordinated to "Superior Indebtedness" (as defined below) of the Company to the
extent set forth in the Prospectus Supplement relating thereto. See
"Subordination of Subordinated Securities" below. Unless otherwise set forth in
the applicable Prospectus Supplement, Senior Securities will be issued under an
Indenture dated as of August 15, 1989 as amended and restated as of August 15,
1990 between the Company and Citibank, N.A., as Trustee pursuant to which the
Company has issued an aggregate of $946,363,000 senior debt securities.
Subordinated Securities will be issued under an Indenture between the Company
and a commercial bank to be selected as trustee. A copy of the forms of
Indentures has been filed as exhibits to the Registration Statement filed with
the Commission. The following discussion of certain provisions of the Indentures
is a summary only and does not purport to be a complete description of the terms
and provisions of the Indentures. Accordingly, the following discussion is
qualified in its entirety by reference to the provisions of the Indentures,
including the definition therein of the terms used below with their initial
letters capitalized.
GENERAL
The Indentures do not limit the aggregate principal amount of Debt
Securities which may be issued thereunder. The Debt Securities may be issued in
one or more series as may be authorized from time to time by Ashland. Reference
is made to the applicable Prospectus Supplement for the following terms of the
Debt Securities: (i) the title and the limit on the aggregate principal amount
of the Debt
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Securities; (ii) the date or dates on which the Debt Securities will mature;
(iii) the rate or rates (which may be fixed or variable) per annum, if any, or
the method of determining such rate or rates, at which the Debt Securities will
bear interest; (iv) the date or dates from which such interest shall accrue and
the date or dates on which such interest will be payable; (v) the currency or
currencies or units of two or more currencies in which the Debt Securities are
denominated and principal and interest may be payable, and for which the Debt
Securities may be purchased, which may be in United States dollars, a foreign
currency or currencies or units of two or more foreign currencies; (vi) whether
such Debt Securities are to be Senior Securities or Subordinated Securities;
(vii) any redemption or sinking fund terms or certain other specific terms;
(viii) any Event of Default or covenant with respect to the Debt Securities of a
particular series, if not set forth herein; (ix) whether the Debt Securities
will be issued as Registered Securities (as defined below) or as Bearer
Securities (as defined below); (x) whether the Debt Securities are to be issued
in whole or in part in the form of one or more Global Securities (as defined
below) and, if so, the identity of the depositary for such Global Security or
Securities; and (xi) any other terms of such series (which terms shall not be
inconsistent with the provisions of the Subordinated Indenture or the Senior
Indenture, as the case may be). Unless otherwise indicated in the applicable
Prospectus Supplement, principal, premium, if any, and interest, if any, will be
payable and the Debt Securities will be transferable at the corporate trust
office of the respective Trustee, provided that payment of interest may be made
at the option of Ashland by check mailed to the address of the person entitled
thereto as it appears in the respective Debt Securities register.
The Debt Securities will be unsecured. Senior Securities will rank on a
parity with all other unsecured and unsubordinated indebtedness of Ashland.
Subordinated Securities will be subordinated to certain present and future
superior indebtedness of Ashland. See "Subordination of Subordinated Securities"
below.
The Debt Securities may be issued in fully registered form without coupons
("Registered Securities") or in bearer form with or without coupons ("Bearer
Securities"). The Securities denominated in U.S. dollars will be issued, unless
otherwise set forth in the applicable Prospectus Supplement, in denominations of
$1,000 or an integral multiple thereof for Registered Securities, and in
denominations of $5,000 or an integral multiple thereof for Bearer Securities.
Unless otherwise indicated in the applicable Prospectus Supplement, the Debt
Securities will be only Registered Securities. No service charge will be made
for any transfer or exchange of such Debt Securities, but Ashland may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.
Special Federal income tax and other considerations relating to Debt
Securities denominated in foreign currencies or units of two or more foreign
currencies will be described in the applicable Prospectus Supplement.
Unless otherwise indicated in the applicable Prospectus Supplement, the
covenants contained in the Indentures and the Debt Securities will not afford
holders of Debt Securities protection in the event of a highly leveraged
transaction involving the Company.
GLOBAL SECURITIES
The Debt Securities of a series issued under the Indentures 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 (the
"Depositary") identified in the Prospectus Supplement relating to such series.
Global Securities may be issued in either registered or bearer form and in
either temporary or permanent form. Unless and until it is exchanged in whole or
in part for the individual Debt Securities represented thereby, a Global
Security may not be transferred except as a whole by the Depositary for such
Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by the
Depositary or any nominee to a successor Depositary or any nominee of such
successor.
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The specific terms of the depositary arrangement with respect to a series of
Debt Securities will be described in the Prospectus Supplement relating to such
series. Ashland anticipates that the following provisions will generally apply
to depositary arrangements.
Upon the issuance of a Global Security in registered form, the Depositary
for such Global Security or its nominee will credit, on its book-entry
registration and transfer system, the respective principal amounts of the
individual Debt Securities represented by such Global Security to the accounts
of persons that have accounts with such Depositary. Such accounts shall be
designated by the dealers, underwriters or agents with respect to such Debt
Securities or by Ashland if such Debt Securities are offered and sold directly
by Ashland. Ownership of beneficial interests in a Global Security will be
limited to persons that have accounts with the applicable Depositary
("participants") or persons that may hold interests through participants.
Ownership of beneficial interests in such Global Security will be shown on, and
the transfer of that ownership will be effected only through, records maintained
by the applicable Depositary or its nominee (with respect to interests of
participants) and the records of participants (with respect to interests of
persons other than participants). The laws of some states require that certain
purchasers of securities take physical delivery of such securities in definitive
form. Such limits and such laws may impair the ability to transfer beneficial
interests in a Global Security.
So long as the Depositary for a Global Security, or its nominee, is the
registered owner of such Global Security, such Depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the Debt
Securities represented by such Global Security for all purposes under the
Indenture governing such Debt Securities. Except as provided below, owners of
beneficial interests in a Global Security will not be entitled to have any of
the individual Debt Securities of the series represented by such Global Security
registered in their names, will not receive or be entitled to receive physical
delivery of any such Debt Securities of such series in definitive form and will
not be considered the owners or holders thereof under the Indenture governing
such Debt Securities.
Payments of principal of, premium, if any, and interest, if any, on
individual Debt Securities represented by a Global Security registered in the
name of a Depositary or its nominee will be made to the Depositary or its
nominee, as the case may be, as the registered owner of the Global Security
representing such Debt Securities. Neither Ashland, the Trustee for such Debt
Securities, any paying agent (a "Paying Agent"), nor the Registrar for such Debt
Securities will have any responsibility or liability for any aspect of the
records relating to or payments made by the Depositary or any participants on
account of beneficial ownership interests of the Global Security for such Debt
Securities or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
Ashland expects that the Depositary for a series of Debt Securities or its
nominee, upon receipt of any payment of principal, premium or interest in
respect of a permanent Global Security representing any of such Debt Securities,
immediately will credit participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal amount
of such Global Security for such Debt Securities as shown on the records of such
Depositary or its nominee. Ashland also expects that payments by participants to
owners of beneficial interests in such Global Security held through such
participants will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of customers in bearer
form or registered in "street name". Such payments will be the responsibility of
such participants.
If the Depositary for a series of Debt Securities is at any time unwilling,
unable or ineligible to continue as Depositary and a successor Depositary is not
appointed by Ashland within 90 days, Ashland will issue individual Debt
Securities of such series in exchange for the Global Security or Securities
representing such series of Debt Securities. In addition, Ashland may at any
time in its sole discretion, subject to any limitations described in the
Prospectus Supplement relating to such Debt Securities, determine not to have
any Debt Securities of a series represented by one or more Global Securities
and, in such event, will issue individual Debt Securities of such series in
exchange for the Global Security or Securities representing such series of Debt
Securities. Further, if Ashland so
6
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specifies with respect to the Debt Securities of a series, an owner of a
beneficial interest in a Global Security representing Debt Securities of such
series may, on terms acceptable to Ashland, the Trustee, and the Depositary for
such Global Security, receive individual Debt Securities of such series in
exchange for such beneficial interests, subject to any limitations described in
the Prospectus Supplement relating to such Debt Securities. In any such
instance, an owner of a beneficial interest in a Global Security will be
entitled to physical delivery of individual Debt Securities of the series
represented by such Global Security equal in principal amount to such beneficial
interest and to have such Debt Securities registered in its name. Individual
Debt Securities of such series so issued will be issued in denominations, unless
otherwise specified by Ashland, of $1,000 and integral multiples thereof.
If so specified in an applicable Prospectus Supplement, all or any portion
of the Debt Securities of a series that are issuable as Bearer Securities
initially will be represented by one or more temporary Global Securities, with
or without interest coupons, to be deposited with a Common Depositary in London
for Morgan Guaranty Trust Company of New York, Brussels Office, as operator of
the Euroclear System ("Euroclear") and Centrale de Livraison de Valeurs
Mobilieres S.A. ("CEDEL") for credit to the respective accounts of the
beneficial owners of such Debt Securities (or to such other accounts as they may
direct). On and after the exchange date determined as provided in any such
temporary Global Security and described in an applicable Prospectus Supplement,
each such temporary Global Security will be exchangeable for definitive Debt
Securities in bearer form, registered form, or definitive global form
(registered or bearer), or any combination thereof, as specified in an
applicable Prospectus Supplement. No Bearer Security (including a Debt Security
in definitive global bearer form) delivered in exchange for a portion of a
temporary Global Security shall be mailed or otherwise delivered to any location
in the United States in connection with such exchange.
Unless otherwise specified in an applicable Prospectus Supplement, Ashland
or its agent must receive a certificate signed by Euroclear or CEDEL, as the
case may be, prior to the delivery of a definitive Bearer Security, and prior to
the actual payment of interest in respect of the applicable portion of the
temporary Global Security payable in respect of an Interest Payment Date
occurring prior to the delivery of a definitive Debt Security. Such certificate
must be based on statements provided to Euroclear or CEDEL by its member
organizations. Such certificate must be dated on the date of the earlier of the
first actual payment of interest on the Debt Security and the date of delivery
of the Debt Security in definitive form, and must state that on such date the
Debt Security is owned by (i) a person that is not a United States person and is
not a financial institution holding the obligation for purposes of resale during
the Restricted Period, (ii) a United States person that is either (A) the
foreign branch of a United States financial institution purchasing for its own
account and not for resale during the Restricted Period or (B) a United States
person who acquired its interest through the foreign branch of a United States
financial institution and who holds the obligation through such financial
institution, provided that in either case (A) or (B) the United States financial
institution either provides a certificate stating that it agrees to comply with
the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue
Code of 1986, as amended, and the regulations thereunder or has provided a valid
blanket certificate stating that the financial institution will comply with such
requirements or (iii) a financial institution holding for purposes of resale
during the Restricted Period, and such financial institution certifies in
addition that it has not acquired the obligation for purposes of resale directly
or indirectly to a United States person or to a person within the United States
or its possessions. As used herein, the term "Restricted Period" means (i) the
period from the closing date until 40 days thereafter or (ii) any time if the
obligation is held as part of an unsold allotment or subscription.
Each of Euroclear and CEDEL will in such circumstances credit the interest
received by it in respect of such temporary Global Security to the accounts of
the beneficial owners thereof (or to such other accounts as they may direct).
The beneficial owner of a Debt Security represented by a definitive Global
Security in bearer form may, upon not less than 30 days' written notice to the
Trustee, given by it through either Euroclear or
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CEDEL, exchange its interest in such definitive Global Security for a definitive
Bearer Security or Securities, or a definitive Registered Security or Securities
of any authorized denomination. No individual definitive Bearer Security will be
delivered in or to the United States.
CERTAIN COVENANTS OF ASHLAND WITH RESPECT TO SENIOR SECURITIES
LIMITATIONS ON LIENS. Unless otherwise provided in the applicable Prospectus
Supplement, Ashland will agree that neither it nor any Subsidiary (as defined in
the Senior Indenture) will issue, assume or guarantee any notes, bonds,
debentures or other similar evidences of indebtedness for money borrowed
("Debt") secured by a mortgage, lien, pledge or other encumbrance ("Mortgages")
upon any of its property or any property of such Subsidiary, real or personal,
located in the continental United States of America without effectively
providing that the Senior Securities (together with, if Ashland so determines,
any other indebtedness or obligation then existing and any other indebtedness or
obligation, thereafter created, ranking equally with the Senior Securities)
shall be secured equally and ratably with (or, at the option of Ashland, prior
to) such Debt so long as such Debt shall be so secured, except that the
foregoing provisions shall not apply to: (a) Mortgages existing on the date of
the Senior Indenture, (b) Mortgages affecting property of a corporation existing
at the time it becomes a Subsidiary or at the time it is merged into or
consolidated with Ashland or a Subsidiary, (c) Mortgages on property (i)
existing at the time of acquisition thereof, or (ii) to secure payment of all or
part of the purchase price thereof, or (iii) to secure Debt incurred prior to,
at the time of or within 24 months after acquisition thereof for the purpose of
financing all or part of the purchase price thereof, or (iv) assumed or incurred
in connection with the acquisition thereof, (d) Mortgages on property to secure
all or part of the cost of repairing, altering, constructing, improving,
exploring, drilling or developing such property, or to secure Debt incurred to
provide funds for any such purpose, (e) Mortgages on (i) pipelines, gathering
systems, pumping or compressor stations, pipeline storage facilities or other
related facilities, (ii) tank cars, tank trucks, tank vessels, barges, tow boats
or other vessels or boats, drilling barges, drilling platforms, or other movable
railway, automotive, aeronautic or marine facilities, (iii) office buildings,
laboratory and research facilities, retail service stations, retail or wholesale
sales facilities, terminals, bulk plants, warehouses or storage or distribution
facilities, (iv) manufacturing facilities other than units for the refining of
crude oil, (v) the equipment of any of the foregoing or (vi) any "margin stock"
or "margin security" within the meaning of Regulation U or Regulation G of the
Board of Governors of the Federal Reserve System as amended from time to time,
(f) Mortgages on current assets or other personal property (other than shares of
stock or indebtedness of Subsidiaries) to secure loans maturing not more than
one year from the date of the creation thereof or to secure any renewal thereof
for not more than one year at any one time, (g) Mortgages which secure
indebtedness owing by a Subsidiary to Ashland or a Subsidiary, (h) Mortgages on
property of any Subsidiary principally engaged in a financing or leasing
business, (i) Mortgages upon the oil, gas or other minerals produced or to be
produced (or proceeds thereof) from properties which shall have been acquired or
shall have become producing subsequent to August 15, 1977, if, in respect to
each such Mortgage it shall have been given to secure indebtedness incurred to
pay or to reimburse the cost (incurred subsequent to the date of the acquisition
of such property or August 15, 1977, whichever shall be later) of drilling or
equipping such property, and (j) any extension, renewal or replacement (or
successive extensions, renewals or replacements), in whole or in part, of any
Mortgage referred to in the foregoing clauses (a) to (i) inclusive or of any
Debt secured thereby, PROVIDED that the principal amount of Debt secured thereby
shall not exceed the principal amount of Debt so secured at the time of such
extension, renewal or replacement, and that such extension, renewal or
replacement Mortgage shall be limited to all or part of substantially the same
property which secured the Mortgage extended, renewed or replaced (plus
improvements on such property). Notwithstanding the above, Ashland and any one
or more Subsidiaries may issue, assume or guarantee Debt secured by Mortgages
which would otherwise be subject to the foregoing restrictions in an aggregate
principal amount which, together with the aggregate outstanding principal amount
of all other Debt of Ashland and its Subsidiaries which would otherwise be
subject to the foregoing restrictions, does not at any one time exceed 5% of the
stockholders' equity in Ashland and its consolidated subsidiary companies as
shown on the audited consolidated balance sheet contained in the latest
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annual report to stockholders of Ashland. The following types of transactions,
among others, shall not be deemed to create Debt secured by Mortgages: (1) the
sale or other transfer of oil, gas or other minerals in place for a period of
time until, or in an amount such that, the transferee will realize therefrom a
specified amount (however determined) of money or such minerals, or the sale or
other transfer of any other interest in property of the character commonly
referred to as an oil payment or a production payment, and (2) Mortgages
required by any contract or statute in order to permit Ashland or a Subsidiary
to perform any contract or subcontract made by it with or at the request of the
United States, any State or any department, agency or instrumentality of either.
LIMITATIONS ON SALE AND LEASE-BACK. Unless otherwise provided in the
applicable Prospectus Supplement, Ashland will agree that neither it nor any
Subsidiary will enter into any arrangement with any bank, insurance company or
other lender or investor, or to which any such lender or investor is a party,
providing for the leasing to Ashland or a Subsidiary for a period of more than
three years of any real property located in the continental United States
(except a lease for a temporary period not to exceed three years by the end of
which it is intended that the use of such real property by the lessee will be
discontinued) which has been or is to be sold or transferred by Ashland or a
Subsidiary to such lender or investor or to any Person or organization to which
funds have been or are to be advanced by such lender or investor on the security
of the leased property ("Sale and Lease-Back Transactions") unless either: (a)
Ashland or such Subsidiary would be entitled to create Debt secured by a
Mortgage on the property to be leased, without equally and ratably securing the
Securities, or (b) Ashland (and in any such case Ashland covenants and agrees
that it will do so), within four months after the effective date of such Sale
and Lease-Back Transaction (whether made by Ashland or a Subsidiary), applies to
the retirement of Debt of Ashland maturing by the terms thereof more than one
year after the original creation thereof ("Funded Debt"), an amount equal to the
greater of (i) the net proceeds of the sale of the real property leased pursuant
to such arrangement or (ii) the fair value of the real property so leased at the
time of entering into such arrangement (as determined by the Board of
Directors); PROVIDED that the amount to be applied to the retirement of Funded
Debt shall be reduced by an amount equal to the sum of (a) the principal amount
of Securities delivered, within four months after the effective date of such
arrangement, to the Trustee for retirement and cancellation and (b) the
principal amount of other Funded Debt voluntarily retired by Ashland within such
four-month period, excluding retirements of Senior Securities and other Funded
Debt pursuant to mandatory sinking fund or prepayment provisions or by payment
at maturity.
LIMITATION ON CONSOLIDATIONS AND MERGERS. The Senior Indenture provides
that Ashland will not consolidate with or merge into any other corporation or
convey or transfer its properties and assets substantially as an entirety to any
entity (other than a wholly owned subsidiary of Ashland, except in the event
that such a subsidiary is the surviving corporation in a consolidation or
merger) unless the successor or transferee is a domestic corporation that
assumes Ashland's obligations under the Senior Securities and the Senior
Indenture and certain other conditions are met.
SUBORDINATION OF SUBORDINATED SECURITIES
The payment of the principal of, premium, if any, and interest on the
Subordinated Securities, including sinking fund payments, if any, will be
subordinated in right of payment, as set forth in the Subordinated Indenture, to
the prior payment in full of all Superior Indebtedness of Ashland. Superior
Indebtedness is defined as (a) the principal of, premium, if any, and accrued
and unpaid interest on (whether outstanding on the date of execution of the
Subordinated Indenture or thereafter created, incurred or assumed) (i)
indebtedness of Ashland for money borrowed (other than the Subordinated
Securities), (ii) guarantees by Ashland of indebtedness for money borrowed of
any other person, (iii) indebtedness evidenced by notes, debentures, bonds or
other instruments of indebtedness for the payment of which Ashland is
responsible or liable, by guarantees or otherwise, (iv) obligations of Ashland
under any agreement relating to any interest rate or currency swap, interest
rate cap, interest rate collar, interest rate future, currency exchange or
forward currency transaction, or any similar interest rate or currency hedging
transaction, and (v) obligations of Ashland under any agreement to lease, or any
lease of, any real or personal property which, in accordance with generally
accepted accounting principles, is classified on Ashland's balance sheet as a
liability, and
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(b) modifications, renewals, extensions and refundings of any such indebtedness,
liability, obligation or guarantee; unless, in the instrument created or
evidencing the same or pursuant to which the same is outstanding, it is provided
that such indebtedness, liability, obligation or guarantee, or such
modification, renewal, extension or refunding thereof, is not superior in right
of payment to the Subordinated Securities; PROVIDED, HOWEVER, that Superior
Indebtedness shall not be deemed to include (i) any obligations of Ashland to
any subsidiary and (ii) any other indebtedness, guarantee or obligation of
Ashland of the type set forth above which is subordinate or junior in ranking in
any respect to any other indebtedness, guarantee or obligation of Ashland.
No payment by Ashland on account of principal of, premium, if any, or
interest on the Subordinated Securities, including sinking fund payments, if
any, may be made if any default or event of default with respect to any Superior
Indebtedness shall have occurred and be continuing and (unless such default or
event of default is the failure by Ashland to pay principal or interest on any
instrument constituting Superior Indebtedness) written notice thereof shall have
been given to the Trustee by Ashland or to Ashland and the Trustee by the
holders of at least 10% in principal amount of any kind or category of any
Superior Indebtedness (or a representative or trustee on their behalf). Ashland
may resume payments on the Subordinated Securities (unless otherwise prohibited
by the related Indenture) if (i) such default is cured or waived or (ii) unless
such default is the failure of Ashland to pay principal or interest on any
Superior Indebtedness, 120 days pass after the notice is given if such default
is not the subject of judicial proceedings. In the event that any Subordinated
Security is declared due and payable before the date specified therein as the
fixed date on which the principal thereof is due and payable, or upon any
payment or distribution of assets of Ashland to creditors upon any dissolution,
winding up, liquidation or reorganization, whether voluntary or involuntary or
in bankruptcy, insolvency, receivership or other proceedings, all principal of
(and premium, if any) and interest due or to become due on all Superior
Indebtedness must be paid in full before the holders of Subordinated Securities
are entitled to receive or take any payment (other than shares of stock or
subordinated indebtedness provided by a plan of reorganization or adjustment
which does not alter the rights of holders of Superior Indebtedness without such
holder's consent). Subject to the payment in full of all Superior Indebtedness,
the holders of the Subordinated Securities are to be subrogated to the rights of
the holders of Superior Indebtedness to receive payments or distribution of
assets of Ashland applicable to Superior Indebtedness until the Subordinated
Securities are paid in full.
By reason of such subordination, in the event of insolvency, creditors of
Ashland who are holders of Superior Indebtedness, as well as certain general
creditors of Ashland, may recover more, ratably, than the holders of the
Subordinated Securities.
The Subordinated Indenture will not limit the amount of Superior
Indebtedness or Debt Securities which may be issued by Ashland or any of its
subsidiaries.
MODIFICATION OF THE INDENTURES
The Indentures provide that the Company and the Trustee thereunder may,
without the consent of any Holders of Debt Securities, enter into supplemental
indentures for the purposes, among other things, of adding to the Company's
covenants, adding additional Events of Default, establishing the form or terms
of the Debt Securities as permitted under the Indentures or, provided such
action shall not adversely affect the interests of the Holders of Debt
Securities in any material respect, curing ambiguities or inconsistencies in
such Indentures or making other provisions.
The Indentures contain provisions permitting the Company, with the consent
of the Holders of not less than 66 2/3% in principal amount of the Outstanding
Securities (as defined in the Indentures) of each affected series, to execute
supplemental indentures adding any provisions to or changing or eliminating any
of the provisions of the Indentures or modifying the rights of the Holders of
Debt Securities of such series, except that no such supplemental indenture may,
without the consent of the Holders of all of the Outstanding Securities affected
thereby, among other things: (i) change the maturity of the principal of, or any
installment of principal of or interest on, any of the Debt Securities; (ii)
reduce the principal amount thereof (or any premium thereon) or the rate of
interest thereon; (iii) change the currency, currencies or currency unit or
units in which, any of the Debt
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Securities or any premium or interest thereon is payable; (iv) change any
obligation of the Company to maintain an office or agency in the places and for
the purposes required by such Indentures; (v) impair the right to institute suit
for the enforcement of any such payment on or after the applicable maturity
date; (vi) reduce the percentage in principal amount of the Outstanding
Securities of any series, the consent of the Holders of which is required for
any such supplemental indenture or for any waiver of compliance with certain
provisions of, or of certain defaults under, such Indentures; or (vii) with
certain exceptions, modify the provisions for the waiver of certain covenants
and defaults and any of the foregoing provisions.
WAIVER OF CERTAIN COVENANTS
The Indentures provide that the Company will not be required to comply with
certain restrictive covenants (including those described above under "Certain
Restrictive Provisions") if the Holders of not less than 66 2/3% in principal
amount of each series of Outstanding Securities affected thereby waive
compliance with such restrictive covenants.
EVENTS OF DEFAULT, NOTICE AND WAIVER
An Event of Default in respect of any series of Debt Securities (unless it
is either inapplicable to a particular series or has been modified or deleted
with respect to any particular series) is defined in the Indentures to be: (i) a
default for 30 days in the payment of any installment of interest upon any of
the Debt Securities of such series when due; (ii) a default in the payment of
principal of (or premium, if any, on) any of the Debt Securities of such series
when due; (iii) a default for 30 days in the deposit of any sinking fund payment
when the same becomes due by the terms of the Debt Securities of such series;
(iv) a default by the Company in the performance, or breach, of any of its other
covenants or warranties in the applicable Indentures which shall not have been
remedied for a period of 60 days after notice from the Trustee thereunder or the
Holders of not less than 25% in principal amount of the Outstanding Securities
of such series; (v) certain events of bankruptcy, insolvency or reorganization
of the Company; and (vi) any other Event of Default provided with respect to
Debt Securities of that series.
The Indentures provide that if an Event of Default specified therein in
respect of any series of Outstanding Securities issued under such Indentures
shall have happened and be continuing, either the Trustee thereunder or the
Holders of not less than 25% in principal amount of the Outstanding Securities
of such series may declare the principal of all of the Outstanding Securities of
such series to be immediately due and payable.
The Indentures provide that the Holders of not less than a majority in
principal amount of the Outstanding Securities of any series may direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee thereunder, or exercising any trust or power conferred on such
Trustee, with respect to the Debt Securities of such series, provided that such
Trustee may act in any way that is not inconsistent with such directions and may
decline to act if any such direction is contrary to law or to such Indentures or
would involve such Trustee in personal liability.
The Indentures provide that the Holders of not less than a majority in
principal amount of the Outstanding Securities of any series may on behalf of
the Holders of all of the Outstanding Securities of such series waive any past
default under the Indentures with respect to such series and its consequences,
except a default (i) in the payment of the principal of (or premium, if any) or
interest on any of the Debt Securities of such series or (ii) in respect of a
covenant or provision of such Indentures which, under the terms of such
Indentures, cannot be modified or amended without the consent of the Holders of
all of the Outstanding Securities of such series affected thereby.
The Indentures contain provisions entitling the Trustee, subject to the duty
of the Trustee during an Event of Default in respect of any series of Debt
Securities to act with the required standard of care, to be indemnified by the
Holders of the Debt Securities of such series before proceeding to exercise any
right or power under such Indentures at the request of the Holders of the Debt
Securities of such series.
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The Indentures provide that the Trustee will, within 90 days after the
occurrence of a default in respect of any series of Debt Securities, give to the
Holders of the Debt Securities of such series notice of such uncured and
unwaived default known to it; PROVIDED, HOWEVER, that, except in the case of a
default in the payment of the principal of (or premium, if any) or interest on,
or any sinking fund installment with respect to, any of the Debt Securities of
such series, such Trustee will be protected in withholding such notice if it in
good faith determines that the withholding of such notice is in the interest of
the Holders of the Debt Securities of such series; and PROVIDED FURTHER, that
such notice shall not be given until at least 30 days after the occurrence of an
Event of Default regarding the performance, or breach, of any covenant or
warranty of the Company under such Indentures other than for the payment of the
principal of (or premium, if any) or interest on, or any sinking fund
installment with respect to, any of the Debt Securities of such series. The term
"default" for the purpose of this provision only means any event that is, or
after notice or lapse of time, or both, would become, an Event of Default with
respect to the Debt Securities of such series.
The Indentures require the Company to file annually with the Trustee
thereunder a certificate, executed by an officer of the Company, indicating
whether such officer has knowledge of any default under such Indentures.
MEETINGS
The Indentures contain provisions for convening meetings of the Holders of
Debt Securities of a series if Debt Securities of that series are issuable as
Bearer Securities. A meeting may be called at any time by the Trustee, and, if
the Trustee fails to call a meeting within 21 days after receipt of a request
from the Company or the Holders of at least 10% in principal amount of the
Outstanding Securities of such series, the Company or such Holders may call a
meeting upon notice given in accordance with "Notices" below. Persons entitled
to vote a majority in principal amount of the Outstanding Securities of a series
shall constitute a quorum at a meeting of the Holders of Debt Securities of such
series; PROVIDED, HOWEVER, that if any action is to be taken at such meeting
with respect to a consent or waiver which is required to be given by the Holders
of not less than 66 2/3% in principal amount of the Outstanding Securities of a
series, the persons entitled to vote 66 2/3% in principal amount of the
Outstanding Securities of such series shall constitute a quorum. In the absence
of a quorum, a meeting called by the Company or the Trustee shall be adjourned
for a period of not less than 10 days, and in the absence of a quorum at any
such adjourned meeting, the meeting shall be further adjourned for a period of
not less than 10 days. Any resolution with respect to any request, demand,
authorization, direction, notice, consent, waiver or other action which may be
made, given or taken by the Holders of a specified percentage in principal
amount of Outstanding Securities of a series may be adopted at a meeting or
adjourned meeting duly reconvened at which a quorum is present by the
affirmative vote of the Holders of such specified percentage in principal amount
of the Outstanding Securities of that series. Any resolution passed or decision
taken at any meeting of Holders of Debt Securities of any series duly held in
accordance with the Indentures will be binding on all Holders of Securities of
that series and the related coupons. With respect to any consent, waiver or
other action which the Indentures expressly provide may be given by the Holders
of a specified percentage of Outstanding Securities of any series affected
thereby (acting as one class), only the principal amount of Outstanding
Securities of any series represented at a meeting or adjourned meeting duly
reconvened at which a quorum is present as aforesaid and voting in favor of such
action shall be counted for purposes of calculating the aggregate principal
amount of Outstanding Securities of all series affected thereby favoring such
action.
NOTICES
Except as otherwise provided in the applicable Prospectus Supplement,
notices to Holders of Bearer Securities will be given by publication at least
once in a daily newspaper in The City of New York and London and in such other
city or cities as may be specified in such Bearer Securities and will be mailed
to such Persons whose names and addresses were previously filed with the Trustee
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within the last two years under the Indentures, within the time prescribed for
the giving of such notice. Notices to Holders of Registered Securities will be
given by mail to the addresses of such Holders as they appear in the Security
Register.
TITLE
Title to any Bearer Securities (including Bearer Securities in temporary or
definitive global bearer form) and any coupons appertaining thereto will pass by
delivery. The Company, the appropriate Trustee and any agent of the Company or
such Trustee may treat the bearer of any Bearer Security and the bearer of any
coupon and registered owner of any Registered Security as the absolute owner
thereof (whether or not such security or coupon shall be overdue and
notwithstanding any notice to the contrary) for the purpose of making payment
and for all other purposes.
REPLACEMENT OF SECURITIES AND COUPONS
Any mutilated Debt Security and any Debt Security with a mutilated coupon
appertaining thereto will be replaced by the Company at the expense of the
Holder upon surrender of such mutilated Debt Security or Debt Security with a
mutilated coupon to the appropriate Trustee. Debt Securities or coupons that
become destroyed, stolen or lost will be replaced by the Company at the expense
of the Holder upon delivery to the appropriate Trustee of evidence of the
destruction, loss or theft thereof satisfactory to the Company and such Trustee;
in the case of any coupon which becomes destroyed, stolen or lost, such coupon
will be replaced (upon surrender to the appropriate Trustee of the Debt Security
with all appurtenant coupons not destroyed, stolen or lost) by issuance of a new
Debt Security in exchange for the Debt Security to which such coupon appertains.
In the case of a destroyed, lost or stolen Debt Security or coupon an indemnity
satisfactory to the appropriate Trustee and the Company may be required at the
expense of the Holder of such Debt Security or coupon before a replacement Debt
Security will be issued.
DEFEASANCE
Unless the Prospectus Supplement relating to the Offered Securities provides
otherwise, the Company at its option (a) will be Discharged (as such term is
defined in the Indentures) from any and all obligations in respect of the
Offered Securities (except for certain obligations to register the transfer or
exchange of Debt Securities, replace stolen, lost or mutilated securities and
coupons, maintain paying agencies and hold moneys for payment in trust) or (b)
need not comply with certain restrictive covenants of the Indentures (including
those described above under "Certain Restrictive Provisions"), if there are
deposited with the Trustee, in the case of Debt Securities and coupons
denominated in U.S. dollars, U.S. Government Obligations (as defined in the
Indentures) or, in the case of Debt Securities and coupons denominated in a
foreign currency, Foreign Government Securities (as defined in the Indentures),
which through the payment of interest thereon and principal thereof in
accordance with their terms will provide money or a combination of money and
U.S. Government Obligations or Foreign Government Securities, as the case may
be, in an amount sufficient to pay in the currency, currencies or currency unit
or units in which the Offered Securities are payable all the principal of, and
interest on, the Offered Securities on the dates such payments are due in
accordance with the terms of the Offered Securities. As a condition to the
Company's exercise of either such option, the Company is required to deliver to
the Trustee an opinion of counsel to the effect that Holders of the Offered
Securities will not recognize income, gain or loss for Federal income tax
purposes as a result of the deposit and related defeasance and will be subject
to Federal income tax in the same amount, in the same manner and at the same
times as would have been the case if such deposit and related defeasance had not
occurred. The deposit and the Discharge or release from compliance with certain
covenants described in the preceding sentence may result in the Holders of the
Offered Securities recognizing income, gain or loss for Federal income tax
purposes as a result of such deposit and Discharge or release, and may result in
the Holders recognizing income in a manner or at times different than would have
been the case if such deposit and Discharge or release had not occurred.
CERTAIN RIGHTS TO REQUIRE PURCHASE OF SECURITIES BY ASHLAND UPON UNAPPROVED
CHANGE IN CONTROL AND DECLINE IN DEBT RATING
In the event that (a) there occurs any Change in Control (as hereinafter
defined) of Ashland and (b) the prevailing rating of any series of the Debt
Securities issued under the Indentures on a date within 90 days following public
notice of such Change in Control shall be less than the rating on a
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specified earlier date by the equivalent of at least one full rating category
(as defined in the Indentures), each Holder of Debt Securities of such series
shall have the right, at the Holder's option, to require Ashland to purchase all
or any part of the Holder's Debt Securities on the date (the "Repurchase Date")
that is 100 days after the last to occur of (i) public notice of such Change in
Control and (ii) the rating decline, at 100% of the principal amount on the
Repurchase Date, plus accrued and unpaid interest to the Repurchase Date.
Notwithstanding the foregoing, if such a rating decline applies to less than all
series of the Debt Securities, the repurchase rights described above will apply
only to those series with respect to which there has been a rating decline.
On or before the twenty-eighth day after the last to occur of public notice
of the Change in Control and the decrease in the rating of such Debt Securities,
Ashland is obligated to mail or cause to be mailed to all Holders of record of
such Debt Securities a notice regarding the Change in Control, the decrease in
the rating of the Debt Securities and the repurchase right. The notice shall
state the Repurchase Date, the date by which the repurchase right must be
exercised, the applicable price for such Debt Securities and the procedure which
the Holder must follow to exercise this right. Ashland shall cause a copy of
such notice to be published in a newspaper of general circulation in the Borough
of Manhattan, The City of New York. To exercise this right, the Holder of a Debt
Security must deliver on or before the tenth day before the Repurchase Date
written notice to Ashland (or an agent designated by Ashland for such purpose)
of the Holder's exercise of such right, together with the Debt Security with
respect to which the right is being exercised, duly endorsed for transfer. The
Company will comply with Rules 13e-4 and 14e-1 under the Exchange Act and any
other applicable securities laws in connection with any such repurchase of Debt
Securities.
As used herein, a "Change in Control" shall be deemed to have occurred at
such time as (i) a "person" or "group" (within the meaning of Section 13(d) and
14(d)(2) of the Exchange Act) becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act) of more than 50% of the then outstanding voting
stock of Ashland, otherwise than through a transaction consummated with the
prior approval of the Board of Directors of Ashland, or (ii) during any period
of two consecutive years, individuals who at the beginning of such period
constitute Ashland's Board of Directors (together with any new director whose
election by Ashland's Board of Directors or whose nomination for election by
Ashland's shareholders was approved by a vote of at least two-thirds of the
Directors then still in office who either were Directors at the beginning of
such period or whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Directors then in
office. In considering whether to approve a transaction which might otherwise
constitute a Change in Control, the Board of Directors of Ashland will be
required to consider the interests of stockholders, employees and other
creditors of Ashland which may not necessarily be consistent with the interests
of Holders of Debt Securities. In considering whether to pursue a transaction
which might otherwise constitute a Change in Control, a potential acquirer of
the Company will be required to consider that, to the extent the repurchase
right becomes exercisable and is exercised by Holders of Debt Securities of any
series, sufficient funds must be made available to make payment to such Holders.
The Company cannot presently predict the source of such funds, but expects that
the source would be determined in the context of the overall consideration of
such a transaction.
GOVERNING LAW
The Indentures, the Debt Securities and the coupons will be governed by, and
construed in accordance with, the laws of the State of New York.
THE TRUSTEE
Citibank, N.A. is Trustee under the Senior Indenture and one other indenture
pursuant to which unsecured debt obligations of the Company are outstanding and
has other customary banking relationships with the Company and its affiliates.
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DESCRIPTION OF CAPITAL STOCK
GENERAL
The authorized stock of the Company consists of 150,000,000 shares of Common
Stock, and 30,000,000 shares of Preferred Stock, issuable in series. On December
9, 1994, there were approximately 60,758,849 shares of Common Stock and
6,000,000 shares of Preferred Stock outstanding. 10,000,000 shares of Preferred
Stock designated as Cumulative Preferred Stock, Series of 1987, are reserved for
issuance upon exercise of rights issued pursuant to the Rights Agreement dated
as of May 15, 1986, as amended (the "Rights Agreement"). An aggregate of
20,672,795 additional shares of Common Stock are reserved for issuance upon
conversion of the Company's 6 3/4% Convertible Subordinated Debentures, the
Company's $3.125 Cumulative Convertible Preferred Stock and issuance under the
Company's various stock and compensation incentive plans.
The following statements with respect to the capital stock of the Company
are subject to the detailed provisions of the Company's Second Restated Articles
of Incorporation, as amended (the "Restated Articles"), and By-laws, as amended
(the "By-laws") as currently in effect. These statements do not purport to be
complete, or to give full effect to the terms of the provisions of statutory or
common law, and are subject to, and are qualified in their entirety by reference
to, the terms of the Restated Articles, By-laws and the Rights Agreement, which
are filed as Exhibits to the Registration Statement of which this Prospectus is
a part.
PREFERRED STOCK
The following description of the terms of the Preferred Stock sets forth
certain general terms and provisions of the Preferred Stock to which a
Prospectus Supplement may relate. Specific terms of any series of the Preferred
Stock offered by a Prospectus Supplement will be described in the Prospectus
Supplement relating to such series of the Preferred Stock. The description set
forth below is subject to and qualified in its entirety by reference to the
Articles of Amendment to the Restated Articles establishing a particular series
of the Preferred Stock which will be filed with the Commission in connection
with the offering of such series of Preferred Stock.
GENERAL. Under the Restated Articles, the Board of Directors of the Company
(the "Board of Directors") is authorized, without further shareholder action, to
provide for the issuance of up to 30,000,000 shares of Preferred Stock, in one
or more series, and to fix the designations, terms, and relative rights and
preferences, including the dividend rate, voting rights, conversion rights,
redemption and sinking fund provisions and liquidation values of each such
series. The Company may amend from time to time its Restated Articles to
increase the number of authorized shares of Preferred Stock. Any such amendment
would require the approval of the holders of 66 2/3% of the outstanding shares
of all series of Preferred Stock voting together as a single class without
regard to series. As of the date of this Prospectus, the Company has one series
of preferred stock outstanding.
The Preferred Stock will have the dividend, liquidation, redemption,
conversion and voting rights set forth below unless otherwise provided in the
Prospectus Supplement relating to a particular series of the Preferred Stock.
Reference is made to the Prospectus Supplement relating to the particular series
of the Preferred Stock offered thereby for specific terms, including: (i) the
title and liquidation preference per share of such Preferred Stock and the
number of shares offered; (ii) the price at which such Preferred Stock will be
issued; (iii) the dividend rate (or method of calculation), the dates on which
dividends shall be payable and the dates from which dividends shall commence to
accumulate; (iv) any redemption or sinking fund provisions of such Preferred
Stock; (v) any conversion provisions of such Preferred Stock; (vi) the voting
rights, if any, of such Preferred Stock; and (vii) any additional dividend,
liquidation, redemption, sinking fund and other rights, preferences, privileges,
limitations and restrictions of such Preferred Stock.
The Preferred Stock will, when issued, be fully paid and nonassessable.
DIVIDEND RIGHTS. The Preferred Stock will be preferred over the Common
Stock as to payment of dividends. Before any dividends or distributions (other
than dividends or distributions payable in
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Common Stock) on the Common Stock shall be declared and set apart for payment or
paid, the holders of shares of each series of Preferred Stock shall be entitled
to receive dividends (either in cash, shares of Common Stock or Preferred Stock,
or otherwise) when, as and if declared by the Board of Directors, at the rate
and on the date or dates as set forth in the Prospectus Supplement. With respect
to each series of Preferred Stock, the dividends on each share of such series
shall be cumulative from the date of issue of such share unless some other date
is set forth in the Prospectus Supplement relating to any such series. Accruals
of dividends shall not bear interest.
RIGHTS UPON LIQUIDATION. The Preferred Stock shall be preferred over the
Common Stock as to assets so that the holders of each series of Preferred Stock
shall be entitled to be paid, upon the voluntary or involuntary liquidation,
dissolution or winding up of the Company and before any distribution is made to
the holders of Common Stock, the amount set forth in the Prospectus Supplement
relating to any such series, but in such case the holders of such series of
Preferred Stock shall not be entitled to any other or further payment. If upon
any such liquidation, dissolution or winding up of the Company its net assets
shall be insufficient to permit the payment in full of the respective amounts to
which the holders of all outstanding Preferred Stock are entitled, the entire
remaining net assets of the Company shall be distributed among the holders of
each series of Preferred Stock in amounts proportionate to the full amounts to
which the holders of each such series are respectively so entitled.
REDEMPTION. All shares of any series of Preferred Stock shall be redeemable
to the extent set forth in the Prospectus Supplement relating to any such
series. All shares of any series of Preferred Stock shall be convertible into
shares of Common Stock or into shares of any other series of Preferred Stock to
the extent set forth in the Prospectus Supplement relating to any such series.
VOTING RIGHTS. Unless otherwise provided in the Prospectus Supplement, the
holders of shares of Preferred Stock shall be entitled to one vote for each
share of Preferred Stock held by them on all matters properly presented to
shareholders, the holders of Common Stock and the holders of all series of
Preferred Stock voting together as one class.
$3.125 CUMULATIVE PREFERRED STOCK
In May 1993, the Company issued 6,000,000 shares of $3.125 Cumulative
Convertible Preferred Stock (the "$3.125 Preferred Stock") of which all such
shares are currently outstanding. Annual cumulative dividends of $3.125 per
share are payable quarterly as and if declared by the Board of Directors. Each
share of $3.125 Preferred Stock is convertible at any time at the option of the
holder thereof into 1.546 shares of Common Stock, equivalent to an initial
conversion price of $32.343 for each share of Common Stock, subject to
adjustment in certain circumstances. The $3.125 Preferred Stock is not
redeemable prior to March 25, 1997. On and after such date, the $3.125 Preferred
Stock is redeemable, in whole or in part, at the option of the Company, at
$51.88 per share during the period from March 25, 1997 to March 14, 1998, and
declining ratably annually to $50.31 per share on or after March 15, 2003, plus
in each case accrued and unpaid dividends to the redemption date. The holders of
$3.125 Preferred Stock generally have no voting rights, but have the right to
elect two additional directors of the Company if the equivalent of six quarterly
dividends payable on the $3.125 Preferred Stock are in arrears. In the case of
the voluntary or involuntary liquidation, dissolution or winding up of the
Company, holders of shares of $3.125 Preferred Stock are entitled to receive the
liquidation preference of $50 per share, plus an amount equal to any accrued and
unpaid dividends to the payment date.
DEPOSITARY SHARES
GENERAL. The Company may, at its option, elect to offer fractional shares
of Preferred Stock, rather than full shares of Preferred Stock. In the event
such option is exercised, the Company will issue to the public receipts for
Depositary Shares, each of which will represent a fraction (to be set forth in
the Prospectus Supplement relating to a particular series of Preferred Stock) of
a share of a particular series of Preferred Stock as described below.
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The shares of any series of Preferred Stock represented by Depositary Shares
will be deposited under a Deposit Agreement (the "Deposit Agreement") between
the Company and a bank or trust company selected by the Company having its
principal office in the United States and having a combined capital and surplus
of at least $50,000,000 (the "Depositary"). Subject to the terms of the Deposit
Agreement, each owner of a Depositary Share will be entitled, in proportion to
the applicable fraction of a share of Preferred Stock represented by such
Depositary Share, to all the rights and preferences of the Preferred Stock
represented thereby (including dividend, voting, redemption and liquidation
rights).
The Depositary Shares will be evidenced by depositary receipts issued
pursuant to the Deposit Agreement ("Depositary Receipts"). Depositary Receipts
will be distributed to those persons purchasing the fractional shares of
Preferred Stock in accordance with the terms of the offering. Copies of the
forms of Deposit Agreement and Depositary Receipt are filed as exhibits to the
Registration Statement of which this Prospectus is a part and the following
summary is qualified in its entirety by reference to such exhibits.
Pending the preparation of definitive engraved Depositary Receipts, the
Depositary may, upon the written order of the Company, issue temporary
Depositary Receipts substantially identical to (and entitling the holders
thereof to all the rights pertaining to) the definitive Depositary Receipts but
not in definitive form. Definitive Depositary Receipts will be prepared
thereafter without unreasonable delay, and temporary Depositary Receipts will be
exchangeable for definitive Depositary Receipts at the Company's expense.
DIVIDENDS AND OTHER DISTRIBUTIONS. The Depositary will distribute all cash
dividends or other cash distributions received in respect of the Preferred Stock
to the record holders of Depositary Shares relating to such Preferred Stock in
proportion to the number of such Depositary Shares owned by such holders.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary may, with the approval of
the Company, sell such property and distribute the net proceeds from such sale
to such holders.
REDEMPTION OF DEPOSITARY SHARES. If a series of Preferred Stock represented
by Depositary Shares is subject to redemption, the Depositary Shares will be
redeemed from the proceeds received by the Depositary resulting from the
redemption, in whole or in part, of such series of Preferred Stock held by the
Depositary. The redemption price per Depositary Share will be equal to the
applicable fraction of the redemption price per share payable with respect to
such series of the Preferred Stock. Whenever the Company redeems shares of
Preferred Stock held by the Depositary, the Depositary will redeem as of the
same redemption date the number of Depositary Shares representing the shares of
Preferred Stock so redeemed. If fewer than all the Depositary Shares are to be
redeemed, the Depositary Shares to be redeemed will be selected by lot or pro
rata as may be determined by the Depositary.
VOTING THE PREFERRED STOCK. Upon receipt of notice of any meeting at which
the holders of the Preferred Stock are entitled to vote, the Depositary will
mail the information contained in such notice of meeting to the record holders
of the Depositary Shares relating to such Preferred Stock. Each record holder of
such Depositary Shares on the record date (which will be the same date as the
record date for the Preferred Stock) will be entitled to instruct the Depositary
as to the exercise of the voting rights pertaining to the amount of the
Preferred Stock represented by such holder's Depositary Shares. The Depositary
will endeavor, insofar as practicable, to vote the amount of the Preferred Stock
represented by such Depositary Shares in accordance with such instructions, and
the Company will agree to take all actions which may be deemed necessary by the
Depositary in order to enable the Depositary to do so. The Depositary will
abstain from voting shares of the Preferred Stock to the extent it does not
receive specific instructions from the holders of Depositary Shares representing
such Preferred Stock.
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AMENDMENT AND TERMINATION OF THE DEPOSITARY AGREEMENT. The form of
Depositary Receipt evidencing the Depositary Shares and any provision of the
Deposit Agreement may at any time be amended by agreement between the Company
and the Depositary. However, any amendment which materially and adversely alters
the rights of the holders of Depositary Shares will not be effective unless such
amendment has been approved by the holders of at least a majority of the
Depositary Shares then outstanding. The Deposit Agreement may be terminated by
the Company or the Depositary only if (i) all outstanding Depositary Shares have
been redeemed or (ii) there has been a final distribution in respect of the
Preferred Stock in connection with any liquidation, dissolution or winding up of
the Company and such distribution has been distributed to the holders of
Depositary Receipts.
CHARGES OF DEPOSITARY. The Company will pay all transfer and other taxes
and governmental charges arising solely from the existence of the depositary
arrangements. The Company will pay charges of the Depositary in connection with
the initial deposit of the Preferred Stock and any redemption of the Preferred
Stock. Holders of Depositary Receipts will pay other transfer and other taxes
and governmental charges and such other charges, including a fee for the
withdrawal of shares of Preferred Stock upon surrender of Depositary Receipts,
as are expressly provided in the Deposit Agreement to be for their accounts.
MISCELLANEOUS. The Depositary will forward to holders of Depositary
Receipts all reports and communications from the Company which are delivered to
the Depositary and which the Company is required to furnish to the holders of
the Preferred Stock.
Neither the Depositary nor the Company will be liable if it is prevented or
delayed by law or any circumstance beyond its control in performing its
obligations under the Deposit Agreement. The obligations of the Company and the
Depositary under the Deposit Agreement will be limited to performance in good
faith of their duties thereunder and they will not be obligated to prosecute or
defend any legal proceeding in respect of any Depositary Shares or Preferred
Stock unless satisfactory indemnity is furnished. They may rely upon written
advice of counsel or accountants, or upon information provided by persons
presenting Preferred Stock for deposit, holders of Depositary Receipts or other
persons believed to be competent and on documents believed to be genuine.
RESIGNATION AND REMOVAL OF DEPOSITARY. The Depositary may resign at any
time by delivering to the Company notice of its election to do so, and the
Company may at any time remove the Depositary, any such resignation or removal
to take effect upon the appointment of a successor Depositary and its acceptance
of such appointment. Such successor Depositary must be appointed within 60 days
after delivery of the notice of resignation or removal and must be a bank or
trust company having its principal office in the United States and having a
combined capital and surplus of at least $50,000,000.
COMMON STOCK
The holders of Common Stock are entitled to receive dividends as may be
declared from time to time by the Board of Directors out of funds legally
available therefor. The holders of Common Stock are entitled to one vote per
share on all matters submitted to a vote of shareholders and have cumulative
voting rights. Under cumulative voting, a shareholder may multiply the number of
shares owned by the number of directors to be elected and cast this total number
of votes for any one nominee or distribute the total number of votes, in any
proportion, among as many nominees as the shareholder desires. Holders of Common
Stock are entitled to receive, upon any liquidation of the Company, all
remaining assets available for distribution to shareholders after satisfaction
of the Company's liabilities and the preferential rights of any Preferred Stock
that may then be issued and outstanding. The outstanding shares of Common Stock
are, and the shares of Common Stock issuable upon conversion of the $3.125
Preferred Stock and the 6 3/4% Convertible Subordinated Debentures will be,
fully paid and nonassessable. The holders of Common Stock have no preemptive,
conversion or redemption rights. The Transfer Agent and Registrar of Ashland's
Common Stock is Harris Trust and Savings Bank, Chicago, Illinois.
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PREFERRED STOCK PURCHASE RIGHTS
The Board of Directors has authorized the distribution of one-half a Right
(a "Right") for each outstanding share of Common Stock. Each Right entitles the
holder thereof to buy one-tenth of a share of Cumulative Preferred Stock, Series
of 1987, at a price of $120.
Currently, the Rights trade together with the Common Stock. They may be
exercised or traded separately only after the earlier to occur of (i) 10 days
following a public announcement that a person or group of persons has obtained
the right to acquire 15% or more of the outstanding Common Stock, or (ii) 10
business days (or such later date as may be determined by action of the Board of
Directors) following the commencement or announcement of an intent to make a
tender offer or exchange offer which would result in beneficial ownership by a
person or group of persons of 20% or more of the Company's outstanding Common
Stock. If the acquiring person or group of persons acquires 20% or more of the
Common Stock, each Right (other than those held by the acquiror) will entitle
its holder to purchase, at the Right's exercise price, shares of Common Stock
having a market value of twice the Right's exercise price. Additionally, if the
Company is acquired in a merger or other business combination, each Right (other
than those held by the surviving or acquiring company) will entitle its holder
to purchase, at the Right's exercise price, shares of the acquiring company's
common stock (or stock of the Company if it is the surviving corporation) having
a market value of twice the Right's exercise price. Each one-tenth share of
Cumulative Preferred Stock, Series of 1987, will be entitled to dividends and to
vote on an equivalent basis with two shares of Common Stock.
Rights may be redeemed at the option of the Board of Directors for $.05 per
Right at any time before the earliest of 10 calendar days after the first public
disclosure of a person or group's acquisition of beneficial ownership of 15% or
more of the Company's Common Stock or the acquisition by a person of 20% of such
outstanding Common Stock. The Board of Directors may amend the Rights at any
time without shareholder approval. The Rights will expire by their terms on May
15, 1996.
CERTAIN PROVISIONS OF ASHLAND'S RESTATED ARTICLES
In the event of a proposed merger or tender offer, proxy contest or other
attempt to gain control of Ashland not approved by the Board of Directors, it
would be possible, subject to any limitations imposed by applicable law, the
Restated Articles and the applicable rules of the stock exchanges upon which the
Common Stock is listed, for the Board of Directors to authorize the issuance of
one or more series of preferred stock with voting rights or other rights and
preferences which would impede the success of the proposed merger, tender offer,
proxy contest or other attempt to gain control of Ashland. The consent of the
holders of Common Stock would not be required for any such issuance of preferred
stock.
The Restated Articles incorporate in substance certain provisions of the
Kentucky Business Corporation Act to require approval of the holders of at least
80% of Ashland's voting stock, plus two-thirds of the voting stock other than
voting stock owned by a 10% shareholder, as a condition to mergers and certain
other business combinations involving Ashland and such 10% shareholder unless
(a) the transaction is approved by a majority of the continuing directors (as
defined) of Ashland or (b) certain minimum price and procedural requirements are
met. In addition, the Kentucky Business Corporation Act includes a standstill
provision which precludes a business combination from occurring with a 10%
shareholder, notwithstanding any vote of shareholders or price paid, for a
period of five years after the date such 10% shareholder becomes a 10%
shareholder, unless a majority of the independent directors (as defined) of
Ashland approves such combination before the date such shareholder becomes a 10%
shareholder.
The Restated Articles also provide that (i) the Board of Directors is
classified into three classes, (ii) a director may be removed from office
without "cause" (as defined) only by the affirmative vote of the holders of at
least 80% of the voting power of the then outstanding voting stock of Ashland,
(iii) the Board of Directors may adopt By-laws concerning the conduct of, and
matters considered at, meetings of shareholders, including special meetings,
(iv) the By-laws and certain provisions of the Restated Articles may be amended
only by the affirmative vote of the holders of at least 80% of the voting power
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of the then outstanding voting stock of Ashland; and (v) the By-laws may be
adopted or amended by the Board of Directors, subject to amendment or repeal
only by affirmative vote of the holders of at least 80% of the voting power of
the then outstanding voting stock of Ashland.
DESCRIPTION OF SECURITIES WARRANTS
The Company may issue Securities Warrants for the purchase of Debt
Securities, Preferred Stock or Common Stock. Securities Warrants may be issued
independently or together with Debt Securities, Preferred Stock or Common Stock
offered by any Prospectus Supplement and may be attached to or separate from any
such Offered Securities. Each series of Securities Warrants will be issued under
a separate warrant agreement (a "Securities Warrant Agreement") to be entered
into between the Company and a bank or trust company, as warrant agent (the
"Securities Warrant Agent"), all as set forth in the Prospectus Supplement
relating to the particular issue of Offered Securities Warrants. The Securities
Warrant Agent will act solely as an agent of the Company in connection with the
Securities Warrants and will not assume any obligation or relationship of agency
or trust for or with any holders of Securities Warrants or beneficial owners of
Securities Warrants. The following summary of certain provisions of the
Securities Warrants does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, all the provisions of the Securities
Warrant Agreements.
Reference is made to the Prospectus Supplement relating to the particular
issue of Securities Warrants offered thereby for the terms of such Securities
Warrants, including, where applicable: (i) the designation, aggregate principal
amount, currencies, denominations and terms of the series of Debt Securities
purchasable upon exercise of Securities Warrants to purchase Debt Securities and
the price at which such Debt Securities may be purchased upon such exercise;
(ii) the designation, number of shares, stated value and terms (including,
without limitation, liquidation, dividend, conversion and voting rights) of the
series of Preferred Stock purchasable upon exercise of Securities Warrants to
purchase shares of Preferred Stock and the price at which such number of shares
of Preferred Stock of such series may be purchased upon such exercise; (iii) the
number of shares of Common Stock purchasable upon the exercise of Securities
Warrants to purchase shares of Common Stock and the price at which such number
of shares of Common Stock may be purchased upon such exercise; (iv) the date on
which the right to exercise such Securities Warrants shall commence and the date
on which such right shall expire (the "Expiration Date"); (v) United States
Federal income tax consequences applicable to such Securities Warrants; and (vi)
any other terms of such Securities Warrants. Securities Warrants for the
purchase of Preferred Stock and Common Stock will be offered and exercisable for
U.S. dollars only. Securities Warrants will be issued in registered form only.
The exercise price for Securities Warrants will be subject to adjustment in
accordance with the applicable Prospectus Supplement.
Each Securities Warrant will entitle the holder thereof to purchase such
principal amount of Debt Securities or such number of shares of Preferred Stock
or Common Stock at such exercise price as shall in each case be set forth in, or
calculable from, the Prospectus Supplement relating to the Offered Securities
Warrants, which exercise price may be subject to adjustment upon the occurrence
of certain events as set forth in such Prospectus Supplement. After the close of
business on the Expiration Date (or such later date to which such Expiration
Date may be extended by the Company), unexercised Securities Warrants will
become void. The place or places where, and the manner in which, Securities
Warrants may be exercised shall be specified in the Prospectus Supplement
relating to such Securities Warrants.
Prior to the exercise of any Securities Warrants to purchase Debt
Securities, Preferred Stock or Common Stock, holders of such Securities Warrants
will not have any of the rights of holders of the Debt Securities, Preferred
Stock or Common Stock, as the case may be, purchasable upon such exercise,
including the right to receive payments of principal of, premium, if any, or
interest, if any, on the Debt Securities purchasable upon such exercise or to
enforce covenants in the applicable Indenture, or to receive payments of
dividends, if any, on the Preferred Stock or Common Stock purchasable upon such
exercise or to exercise any applicable right to vote.
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PLAN OF DISTRIBUTION
Ashland may sell the Offered Securities in any of three ways: (i) through
underwriters or dealers; (ii) directly to one or a limited number of
institutional purchasers; or (iii) through agents. The Prospectus Supplement
with respect to the Offered Securities will set forth the terms of the offering
of the Offered Securities, which may include the name or names of any
underwriters, dealers or agents, the price of the Offered Securities and the net
proceeds to Ashland from such sale, any underwriting discounts or other items
constituting underwriters' compensation, any discounts or concessions allowed or
reallowed or paid to dealers and any securities exchanges on which the Offered
Securities may be listed.
If underwriters are used in the sale, the Offered Securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The Offered Securities may be offered to the public either through underwriting
syndicates represented by managing underwriters or directly by one or more
investment banking firms or others, as designated. Unless otherwise set forth in
the Prospectus Supplement, the obligations of the underwriters or agents to
purchase the Offered Securities will be subject to certain conditions precedent
and the underwriters will be obligated to purchase all the Offered Securities if
any 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 a dealer is utilized in the sale of any Offered Securities in respect of
which this Prospectus is delivered, the Company will sell such Offered
Securities to the dealer, as principal. The dealer may then resell such Offered
Securities to the public at varying prices to be determined by such dealer at
the time of resale. The name of the dealer and the terms of the transaction will
be set forth in the Prospectus Supplement.
Offered Securities may be sold directly by Ashland to one or more
institutional purchasers, or through agents at a fixed price or prices, which
may be changed, or at varying prices determined at the time of sale. Unless
otherwise indicated in the Prospectus Supplement, any such agent will be acting
on a best efforts basis for the period of its appointment.
If so indicated in the Prospectus Supplement, Ashland will authorize agents,
underwriters or dealers to solicit offers by certain specified institutions to
purchase Offered Securities from Ashland at the public offering price set forth
in the Prospectus Supplement pursuant to delayed delivery contracts providing
for payment and delivery on a specified date in the future. Such contracts will
be subject only to those conditions set forth in the Prospectus Supplement and
the Prospectus Supplement will set forth the commission payable for solicitation
of such contracts.
Agents and underwriters may be entitled under agreements entered into with
Ashland to indemnification by Ashland against certain civil liabilities,
including liabilities under the Securities Act, or to contribution with respect
to payments which the agents or underwriters may be required to make in respect
thereof. Agents and underwriters may be customers of, engage in transactions
with or perform services for Ashland in the ordinary course of business.
LEGAL MATTERS
The validity of the issuance of the Offered Securities will be passed upon
for Ashland by Cravath, Swaine & Moore, New York, New York, who will rely as to
matters of Kentucky law upon the opinion of Thomas L. Feazell, Esq., Senior Vice
President, General Counsel and Secretary of Ashland. Cravath, Swaine & Moore has
in the past represented and continues to represent the Company in other matters
on a regular basis. Samuel C. Butler is a director of Ashland and a partner in
the law firm of Cravath, Swaine & Moore and owns beneficially 36,229 shares of
Common Stock of Ashland. Thomas L. Feazell owns beneficially 73,467 shares of
Common Stock and 200 shares of $3.125 Preferred Stock of Ashland.
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EXPERTS
The consolidated financial statements and schedules of Ashland appearing or
incorporated by reference in Ashland's Annual Report (Form 10-K) for the year
ended September 30, 1994 have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and incorporated
herein by reference. Such consolidated financial statements and schedules are
incorporated herein by reference in reliance upon such report given upon the
authority of such firm as experts in accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSE OF ISSUANCE AND DISTRIBUTION.
The expenses in connection with the issuance and distribution of the
securities being registered, other than underwriting compensation, are:
<TABLE>
<S> <C>
Filing Fee for Registration Statement............................ $ 206,898
Legal Fees and Expenses.......................................... 50,000
Accounting Fees and Expenses..................................... 30,000
Trustee's Fees and Expenses...................................... 25,000
Blue Sky Fees and Expenses....................................... 15,000
Printing and Engraving Fees...................................... 20,000
Miscellaneous.................................................... 15,000
Total...................................................... $ 361,898
---------
</TABLE>
All of the above amounts, other than the Commission filing fee, are
estimates only.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 271B.8-500 through 580 of the Kentucky Business Corporation Act
contain detailed provisions for indemnification of directors and officers of
Kentucky corporations against judgments, penalties, fines, settlements and
reasonable expenses in connection with litigation. Under Kentucky law, the
provisions of a company's articles and by-laws may govern the indemnification of
officers and directors in lieu of the indemnification provided for by statute.
The Registrant has elected to indemnify its officers and directors pursuant to
its Restated Articles, its By-laws and by contract rather than to have such
indemnification governed by the statutory provisions.
Article X of the Restated Articles permits, but does not require, the
Registrant to indemnify its directors, officers and employees to the fullest
extent permitted by law. The Registrant's By-laws require indemnification of
officers and employees of the Registrant and its subsidiaries under certain
circumstances. The Registrant has entered into indemnification contracts with
each of its directors that require indemnification to the fullest extent
permitted by law, subject to certain exceptions and limitations.
The Registrant has purchased insurance which insures (subject to certain
terms and conditions, exclusions and deductibles) the Registrant against certain
costs which it might be required to pay by way of indemnification to its
directors or officers under its Restated Articles or By-laws, indemnification
agreements or otherwise and protects individual directors and officers from
certain losses for which they might not be indemnified by the Registrant. In
addition, the Registrant has purchased insurance which provides liability
coverage (subject to certain terms and conditions, exclusions and deductibles)
for amounts which the Registrant, or the fiduciaries under its employee benefit
plans, which may include its directors, officers and employees, might be
required to pay as a result of a breach of fiduciary duty.
ITEM 16. EXHIBITS.
The following Exhibits are filed as part of this Registration Statement:
<TABLE>
<C> <S>
**1.1 -- Form of Underwriting Agreement.
**1.2 -- Form of Distribution Agreement.
3.1 -- Second Restated Articles of Incorporation of the Company, as amended
effective May 18, 1993 (incorporated by reference to Exhibit 3.1 to
Registrant's Form 10-K for the year ended September 30, 1994).
3.2 -- By-laws of the Company, as amended effective March 17, 1994
(incorporated by reference to Exhibit 3.2 to Registrant's Form 10-K
for the year ended September 30, 1994).
</TABLE>
II-1
<PAGE>
<TABLE>
<C> <S>
4.1 -- Indenture, dated as of August 15, 1989 as amended and restated as of
August 15, 1990 between the Company and Citibank, N.A., as Trustee
(incorporated by reference to Exhibit 4(a) to Registration Statement
No. 33-39359, filed with the Commission on March 11, 1991).
4.2 -- Form of Senior Security (incorporated by reference to Exhibit 4(a) to
Registration Statement No. 33-39359, filed with the Commission on
March 11, 1991).
*4.3 -- Form of Indenture for Subordinated Securities.
*4.4 -- Form of Subordinated Security.
*4.5 -- Rights Agreement dated as of May 15, 1986, between the Company and
Mellon Bank N.A., as amended.
**4.6 -- Form of Warrant Agreement for Debt Securities.
**4.7 -- Form of Warrant Certificate for Debt Securities.
**4.8 -- Form of Warrant Agreement for Preferred Stock.
**4.9 -- Form of Warrant Certificate for Preferred Stock.
**4.10 -- Form of Warrant Agreement for Common Stock.
**4.11 -- Form of Warrant Certificate for Common Stock.
**4.12 -- Form of Deposit Agreement for Depositary Shares.
**4.13 -- Form of Depositary Receipt.
4.14 -- Form of Certificate of Common Stock, par value $1.00 per share, of
the Company (incorporated by reference to Exhibit 4(e) to
Registration No. 33-60040, filed with the Commission on March 26,
1993).
*5 -- Opinion of Thomas L. Feazell, Esq.
*12 -- Computation of Ratios of Earnings to Fixed Charges.
*23.1 -- Consent of Ernst & Young LLP.
23.2 -- Consent of Thomas L. Feazell, Esq. (included as part of Exhibit 5).
*24 -- Power of Attorney, including resolutions of the Board of Directors.
*26 -- Form T-1 Statement of Eligibility and Qualification of Trustee under
the Trust Indenture Act of 1939 for Citibank, N.A.
<FN>
- ------------------------
* Previously filed
** To be filed
</TABLE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act unless the information required to be included in such
post-effective amendment is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Exchange Act
that are incorporated by reference in the registration statement;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the registration statement unless the information required to be included
in such post-effective amendment is contained in periodic reports filed
by the Registrant pursuant to Section 13 or Section 15(d) of the Exchange
Act that are incorporated by reference in the registration statement; and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
II-2
<PAGE>
(2) For the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Exchange Act that is incorporated by reference in the registration statement
shall be deemed to be a new registration statement relating to the securities
offered herein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Act, and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy, as expressed in the Act and
will be governed by the final adjudication of such issue.
The undersigned Registrant hereby, undertakes that:
(1) For purposes of determining any liability under the Securities Act,
the information omitted from the form of prospectus filed as part of this
Registration Statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) or
497(h) under the Securities Act shall be deemed to be part of this
Registration Statement as of the time it was declared effective.
(2) For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
The undersigned Registrant hereby undertakes to file an application for the
purpose of determining the eligibility of the Trustee to act under subsection
(a) of Section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Act.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, the Registrant certifies
that it has reasonable grounds to believe that it meets all the requirements for
filing on Form S-3 and has duly caused this Amendment No. 1 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Russell, Commonwealth of Kentucky, on January 12,
1995.
ASHLAND OIL, INC.,
by /s/ THOMAS L. FEAZELL
------------------------------------
Thomas L. Feazell
Senior Vice President, General
Counsel
and Secretary
Pursuant to the requirements of the Securities Act, this Amendment No. 1 to
the Registration Statement has been signed below by the following persons in the
capacities indicated on January 12, 1995.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------------ ------------------------------------
<C> <S>
JOHN R. HALL* Chairman of the Board and Chief
- ------------------------------------ Executive Officer (Principal
Executive Officer)
PAUL W. CHELLGREN* President, Chief Operating Officer
- ------------------------------------ and Director
J. MARVIN QUIN* Senior Vice President and Chief
- ------------------------------------ Financial Officer (Principal
Financial Officer)
KENNETH L. AULEN* Administrative Vice President and
- ------------------------------------ Controller (Principal Accounting
Officer)
THOMAS E. BOLGER* Director
- ------------------------------------
SAMUEL C. BUTLER* Director
- ------------------------------------
FRANK C. CARLUCCI* Director
- ------------------------------------
JAMES B. FARLEY* Director
- ------------------------------------
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
- ------------------------------------ ------------------------------------
<C> <S>
EDMUND B. FITZGERALD* Director
- ------------------------------------
RALPH E. GOMORY* Director
- ------------------------------------
MANNIE L. JACKSON* Director
- ------------------------------------
PATRICK F. NOONAN* Director
- ------------------------------------
JANE C. PFEIFFER* Director
- ------------------------------------
MICHAEL D. ROSE* Director
- ------------------------------------
WILLIAM L. ROUSE, JR.* Director
- ------------------------------------
ROBERT B. STOBAUGH* Director
- ------------------------------------
JAMES W. VANDEVEER* Director
- ------------------------------------
*by /s/ THOMAS L.
FEAZELL
- ------------------------------------
Thomas L. Feazell
Attorney-in-fact
</TABLE>
* Original powers of attorney authorizing John R. Hall, Paul W. Chellgren,
Thomas L. Feazell, James G. Stephenson and David L. Hausrath and each of them to
sign the Registration Statement and amendments thereto on behalf of the
above-mentioned directors and officers of the Registrant have been filed with
the Commission as Exhibit 24 to the Registration Statement.
II-5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT
NO. DESCRIPTION
- ------- ---------------------------------------------------------
<C> <S> <C>
**1.1 Form of Underwriting Agreement.
**1.2 Form of Distribution Agreement.
3.1 Second Restated Articles of Incorporation of the Company,
as amended effective May 18, 1993 (incorporated by
reference to Exhibit 3.1 to Registrant's Form 10-K for
the year ended September 30, 1994).
3.2 By-laws of the Company, as amended effective March 17,
1994 (incorporated by reference to Exhibit 3.2 to
Registrant's Form 10-K for the year ended September 30,
1994).
4.1 Indenture, dated as of August 15, 1989 as amended and
restated as of August 15, 1990 between the Company and
Citibank, N.A., as Trustee (incorporated by reference to
Exhibit 4(a) to Registration Statement No. 33-39359,
filed with the Commission on March 11, 1991).
4.2 Form of Senior Security (incorporated by reference to
Exhibit 4(a) to Registration Statement No. 33-39359,
filed with the Commission on March 11, 1991).
*4.3 Form of Indenture for the Subordinated Securities.
*4.4 Form of Subordinated Security.
*4.5 Rights Agreement dated as of May 15, 1986, between the
Company and Mellon Bank N.A., as amended.
**4.6 Form of Warrant Agreement for Debt Securities.
**4.7 Form of Warrant Certificate for Debt Securities.
**4.8 Form of Warrant Agreement for Preferred Stock.
**4.9 Form of Warrant Certificate for Preferred Stock.
**4.10 Form of Warrant Agreement for Common Stock.
**4.11 Form of Warrant Certificate for Common Stock.
**4.12 Form of Deposit Agreement for Depositary Shares.
**4.13 Form of Depositary Receipt.
4.14 Form of Certificate of Common Stock, par value $1.00 per
share, of the Company (incorporated by reference to
Exhibit 4(e) to Registration No. 33-60040, filed with
the Commission on March 26, 1993).
*5 Opinion of Thomas L. Feazell, Esq.
*12 Computation of Ratios of Earnings to Fixed Charges.
*23.1 Consent of Ernst & Young LLP.
23.2 Consent of Thomas L. Feazell, Esq. (included as part of
Exhibit 5).
*24 Power of Attorney, including resolutions of the Board of
Directors.
*26 Form T-1 Statement of Eligibility and Qualification of
Trustee under the Trust Indenture Act of 1939 for
Citibank, N.A.
<FN>
- ------------------------
* Previously filed
** To be filed
</TABLE>
