<PAGE>
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED NOVEMBER 14, 1988
$100,000,000
[LOGO]
6.75% NOTES DUE AUGUST 15, 2000
------------------------
Interest on the Notes is payable on February 15 and August 15 of each year,
commencing February 15, 1996. The Notes will not be redeemable prior to
maturity. The Notes will be represented by one or more Global Notes registered
in the name of the nominee of The Depository Trust Company ('DTC'). Except as
described herein, Notes in definitive form will not be issued. The Notes will
trade in DTC's Same-Day Funds Settlement System until maturity, and secondary
market trading activity for the Notes will therefore settle in immediately
available funds. All payments of principal and interest will be made by the
Company in immediately available funds. See 'Certain Terms of the Notes -- Book
Entry System'. The Notes will not be listed on any securities exchange.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY
OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
<TABLE>
<CAPTION>
INITIAL PUBLIC UNDERWRITING PROCEEDS TO
OFFERING PRICE(1) DISCOUNT(2) COMPANY(1)(3)
------------------- ------------ -------------
<S> <C> <C> <C>
Per Note...................................................... 99.953% 0.550% 99.403%
Total......................................................... $99,953,000 $550,000 $99,403,000
</TABLE>
---------------
(1) Plus accrued interest from August 15, 1995.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deducting estimated expenses of $110,000 payable by the Company.
------------------------
The Notes are offered severally by the Underwriters, as specified herein,
subject to receipt and acceptance by them and subject to their right to reject
any order in whole or in part. It is expected that the Global Note will be ready
for delivery in book-entry form only through the facilities of The Depository
Trust Company on or about August 18, 1995.
GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES INC.
SALOMON BROTHERS INC
------------------------
The date of this Prospectus Supplement is August 15, 1995.
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
------------------------
AVAILABLE INFORMATION
AlliedSignal Inc. (the 'Company') is subject to the informational
requirements of the Securities Exchange Act of 1934 (the 'Exchange Act') and in
accordance therewith files reports and other information with the Securities and
Exchange Commission (the 'Commission'). Reports, proxy statements and other
information filed by the Company with the Commission can be inspected and copied
at the public reference facilities maintained by the Commission at Judiciary
Plaza, Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the
Commission's Regional Offices, 7 World Trade Center, 13th Floor, New York, New
York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, IL
60661. Copies of such material can be obtained by mail from the Public Reference
Section of the Commission, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549, at prescribed rates. Such information of the Company should also be
available for inspection at the offices of the New York Stock Exchange, 20 Broad
Street, New York, New York 10005; the Chicago Stock Exchange, One Financial
Place, 440 South LaSalle Street, Chicago, Illinois 60605; and the Pacific Stock
Exchange, 301 Pine Street, San Francisco, California 94104.
------------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the Company are
incorporated by reference in this Prospectus Supplement:
(1) the Company's Annual Report on Form 10-K for the year ended
December 31, 1994; and
(2) the Company's Quarterly Reports on Form 10-Q for the quarters
ended March 31 and June 30, 1995.
All reports and other documents filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this Prospectus
Supplement and prior to the filing of a post-effective amendment which indicates
that all securities offered hereby have been issued or which deregisters all
securities then remaining unissued shall be deemed to be incorporated by
reference in this Prospectus Supplement and to be part hereof from the date of
filing of such documents. Any statement contained in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be modified or
superseded for purposes of this Prospectus Supplement to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any such statement so modified or superseded shall
not be deemed, except as so modified or superseded, to constitute a part of this
Prospectus Supplement.
A copy of the documents incorporated by reference (other than exhibits
thereto) will be forwarded without charge to each person to whom this Prospectus
Supplement is delivered, upon such person's written or oral request to
AlliedSignal Inc., Shareholder Relations Department, P.O. Box 50000, Morristown,
New Jersey 07962-2499, telephone number (800) 255-4332.
S-2
<PAGE>
SUMMARY OF SELECTED FINANCIAL INFORMATION
The following table sets forth selected financial information for the
Company for the years ended December 31, 1994, 1993, 1992, 1991 and 1990 and for
the six-month periods ended June 30, 1995 and 1994. This summary of selected
financial information is qualified by reference to the financial statements and
other information and data contained or incorporated by reference in the
Company's Annual Report on Form 10-K for the year ended December 31, 1994, and
its Quarterly Report on Form 10-Q for the three- and six-month periods ended
June 30, 1995.
SELECTED FINANCIAL INFORMATION
(DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
JUNE 30, YEAR ENDED DECEMBER 31,
----------------- -----------------------------------------------------
1995 1994 1994 1993 1992 1991 1990
------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Net sales..................... $ 7,049 $ 6,173 $12,817 $11,827 $12,042 $11,831 $12,343
Income (loss) before
cumulative effect of
changes in accounting
principles................. 425 365 759 656 535(b) (273)(d) 462
Net income (loss)............. 425 365 759 411(a) (712)(b,c) (273)(d) 462
PER SHARE OF COMMON STOCK:
Income (loss) before
cumulative effect of
changes in accounting
principles................. 1.50 1.29 2.68 2.31 1.90 (1.00) 1.67
Net earnings (loss)........... 1.50 1.29 2.68 1.45 (2.52) (1.00) 1.67
BALANCE SHEET DATA (AT END OF
PERIOD):
Total assets.................. 12,045 10,788 11,321 10,829 10,756 10,382 10,456
Long-term debt................ 1,304 1,531 1,424 1,602 1,777 1,914 2,051
Total debt.................... 2,009 1,757 1,687 1,960 2,113 2,795 2,748
Shareowners' equity........... 3,345 2,627 2,982 2,390 2,251 2,983 3,380
Total debt as a percent of
total capital.............. 35.4 37.7 34.1 42.7 44.7 43.9 40.4
RATIO OF EARNINGS TO FIXED
CHARGES(e)...................... 6.00 5.84 6.02 4.71 3.27(b) (0.31)(d) 2.56
</TABLE>
------------
(a) Includes the cumulative after-tax provision for the adoption of FASB No.
112 of $245 million, or $0.86 a share.
(b) Includes the effect of a provision for Streamlining and Restructuring
charges as well as a gain on the sale of common stock of Union Texas
resulting in a net charge of $11 million (after-tax $6 million, or $0.02 a
share).
(c) Includes the cumulative after-tax provision for the adoption of FASB Nos.
106 and 109 of $1,247 million, or $4.42 a share.
(d) Includes the effect of a provision for Streamlining and Restructuring
charges as well as gains on asset sales by Union Texas resulting in a net
charge of $838 million (after-tax $615 million, or $2.25 a share).
(e) The ratio of earnings to fixed charges is generally computed by dividing
the sum of net income (excluding the cumulative effect of accounting
changes in 1992 and 1993), income taxes and fixed charges (net of
capitalized interest) less undistributed equity income by fixed charges.
Fixed charges represent gross interest and amortization of debt discount
and expense and the interest factor of all rentals, consisting of an
appropriate interest factor on operating leases. The ratio also includes
the Company's share of the earnings and fixed charges of significant joint
ventures.
USE OF PROCEEDS
The Company intends to use the net proceeds from the sale of the Notes to
repay certain outstanding commercial paper of the Company, which commercial
paper has a current average yield of approximately 5.8% and will mature on or
prior to August 18, 1995. The proceeds of such commercial paper were used for
general corporate purposes, including acquisitions and working capital.
S-3
<PAGE>
CERTAIN TERMS OF THE NOTES
The following description of the particular terms of the Notes offered
hereby (which represent a series of, and are referred to in the Prospectus as,
'Debt Securities') supplements, and to the extent inconsistent therewith
replaces, the description of the general terms and provisions of Debt Securities
set forth in the Prospectus, to which reference is hereby made.
GENERAL
The Notes offered hereby will mature on August 15, 2000, and will bear
interest at the rate of 6.75% per annum from August 15, 1995, payable
semiannually on February 15 and August 15 of each year (an 'Interest Payment
Date'), commencing February 15, 1996, to the persons in whose names the Notes
are registered at the close of business on the January 31 and July 31, as the
case may be, next preceding such Interest Payment Date. The interest payable on
each Interest Payment Date will include interest accrued from and including the
later of August 15, 1995, or the most recent Interest Payment Date to which
interest has been paid or duly provided for, but excluding the relevant Interest
Payment Date. The Notes offered hereby will be issued under the Indenture
referred to in the Prospectus, and are limited to $100,000,000 aggregate
principal amount. The Notes offered hereby are referred to in the Indenture as
'Debentures.'
Principal and interest initially will be payable, and the Notes initially
will be transferable and exchangeable, at the office or agency of the Company
designated for that purpose in New York City, which initially will be the office
of The Chase Manhattan Bank (National Association), the Trustee under the
Indenture, located at One New York Plaza, New York, New York ('Chase');
provided, however, that payments of interest may be made, in the event the Notes
are issued in certificated form, at the option of the Company, by check mailed
to the Registered Holders (as defined in the Indenture) of the Notes. See
'Book-Entry System' below.
All Debt Securities, including the Notes, issued and to be issued under the
Indenture will be unsecured and will rank pari passu with all other Debt
Securities issued or to be issued under the Indenture and all other unsecured
and unsubordinated indebtedness of the Company from time to time outstanding.
The Company has issued Debt Securities in the principal amount of
$925,500,000 under the Indenture. The Indenture does not limit the amount of
Debt Securities which may be issued thereunder.
SINKING FUND
The Notes are not entitled to a sinking fund.
REDEMPTION
The Notes are not redeemable prior to maturity.
BOOK-ENTRY SYSTEM
Upon issuance, the Notes will be represented by a single Global Note
(defined in the Indenture as the 'Global Debenture') (the 'Book-Entry Notes').
The Global Note representing Book-Entry Notes will be deposited with, or on
behalf of, The Depository Trust Company, as Depository (the 'Depository'), and
registered in the name of a nominee of the Depository. Except as set forth
below, the Global Note may not be transferred except as a whole by the
Depository to a nominee of the Depository or by a nominee of the Depository to
the Depository or another nominee of the Depository or by the Depository or any
nominee to a successor of the Depository or a nominee of such successor.
The Depository has advised the Company and the Underwriters that it is a
limited-purpose trust company organized under the laws of the State of New York,
a member of the Federal Reserve System, a 'clearing corporation' within the
meaning of the Uniform Commercial Code and a 'clearing agency', registered
pursuant to the provisions of Section 17A of the Exchange Act. The Depository
was created to hold securities for its participants and to facilitate the
clearance and settlement of securities transactions among its participants in
such securities through electronic book-entry changes in accounts of the
participants, thereby eliminating the need for physical movement of securities
certificates. The Depository's participants include securities brokers and
dealers (including the Underwriters), banks, trust companies, clearing
corporations and certain other organizations, some of
S-4
<PAGE>
which (and/or their representatives) own the Depository. Access to the
Depository's book-entry system is also available to others, such as banks,
brokers, dealers and trust companies that clear through or maintain a custodial
relationship with a participant, either directly or indirectly. Persons who are
not participants may beneficially own securities held by the Depository only
through participants.
Upon the issuance of Notes by the Company represented by a Global Note, the
Depository will credit, on its book-entry registration and transfer system, the
respective principal amounts of the Notes represented by such Global Note to the
accounts of participants. The accounts to be credited shall be designated by the
Underwriters.
Payments of the principal of and any premium and interest on such Global
Note will be made by the Company through the Paying Agent (as defined in the
Indenture) to the Depository or its nominee, as the case may be, as the
registered owner of such Global Note. Neither the Company, the Trustee, any
Paying Agent nor the registrar for the Notes will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests in such Global Note or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
The Company has been advised that the Depository, upon receipt of any
payment of principal, premium or interest in respect of such Global Note, will
credit immediately the accounts of the related participants with payments in
amounts proportionate to their respective holdings in principal amount of
beneficial interest in such Global Note as shown on the records of the
Depository. The Company expects that payments by participants to owners of
beneficial interests in such Global Note will be governed by standing customer
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.
Book-Entry Notes will not be exchangeable at the option of the holder or
holders thereof for Notes issued in certificated form. If the Depository is at
any time unwilling or unable to continue as depository and a successor
depository is not appointed by the Company within 90 days, the Company will
issue Notes in certificated form in exchange for such Global Note. In addition,
the Company may at any time determine that the Notes shall no longer be
represented by such Global Note, and, in such event, will issue Notes in
certificated form in exchange for such Global Note. In any such instance, an
owner of a beneficial interest in such Global Note will be entitled to physical
delivery in certificated form of Notes equal in principal amount to such
beneficial interest and to have such Notes registered in its name. Notes so
issued in certificated form will be issued in denominations of $1,000 or any
integral multiple thereof, and will be issued in fully registered form only.
INFORMATION CONCERNING THE TRUSTEE
Chase is also the trustee under the indenture under which the Company's
Serial Zero Coupon Bonds Due 1997-2009 are outstanding, and is fiscal agent for
the Company's 8% Bonds Due May 15, 2006. The Company has a credit agreement with
a group of banks including Chase under which Chase has a commitment of $34
million. The Company maintains deposit accounts and conducts other banking
transactions with Chase.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting
Agreement, dated August 15, 1995 (the 'Underwriting Agreement'), the Company has
agreed to sell to each of the Underwriters named below (the 'Underwriters'), and
each of the Underwriters has severally agreed to purchase, the principal amount
of Notes set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
UNDERWRITER OF NOTES
----------- ------------
<S> <C>
Goldman, Sachs & Co. ....................................................... $ 33,400,000
J.P. Morgan Securities Inc. ................................................ 33,300,000
Salomon Brothers Inc........................................................ 33,300,000
------------
Total............................................................. $100,000,000
------------
------------
</TABLE>
S-5
<PAGE>
Under the terms and conditions of the Underwriting Agreement, the
Underwriters are committed to take and pay for all the Notes offered hereby, if
any are taken.
The Underwriters propose to offer the Notes in part directly to retail
purchasers at the initial public offering price set forth on the cover page of
this Prospectus Supplement and in part to certain securities dealers at such
price less a concession of 0.350% of the principal amount of the Notes. The
Underwriters may allow, and such dealers may reallow, a concession not to exceed
0.250% of the principal amount of the Notes to certain brokers and dealers.
After the Notes are released for sale to the public, the offering price and
other selling terms may from time to time be varied by the Underwriters.
The Notes are a new issue of securities with no established trading market.
The Company has been advised by the Underwriters that they intend to make a
market in the Notes, but are not obligated to do so and may discontinue market
making at any time without notice. No assurance can be given as to the liquidity
of the trading market for the Notes.
The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
Each of the Underwriters may from time to time provide investment banking
services to the Company and receive fees therefor. In addition, in the ordinary
course of their respective businesses, affiliates of J.P. Morgan Securities Inc.
have engaged, and will in the future engage, in commercial banking transactions
with the Company.
EXPERTS
The Company's consolidated financial statements incorporated by reference
in this Prospectus Supplement by reference to the Company's Annual Report on
Form 10-K for the year ended December 31, 1994 have been so incorporated in
reliance on the report of Price Waterhouse LLP ('Price Waterhouse'), independent
accountants, given on the authority of said firm as experts in auditing and
accounting.
With respect to the unaudited consolidated financial information of the
Company for the three-month periods ended March 31, 1995 and 1994, and the
three- and six-month periods ended June 30, 1995 and 1994, incorporated by
reference in this Prospectus Supplement, Price Waterhouse reported that they
have applied limited procedures in accordance with professional standards for a
review of such information. However, their separate reports dated April 21, 1995
and July 25, 1995 incorporated by reference herein, state that they did not
audit and they do not express an opinion on that unaudited consolidated
financial information. Price Waterhouse has not carried out any significant or
additional audit tests beyond those which would have been necessary if their
reports had not been included. Accordingly, the degree of reliance on their
reports on such information should be restricted in light of the limited nature
of the review procedures applied. Price Waterhouse is not subject to the
liability provisions of section 11 of the Securities Act of 1933 for their
reports on the unaudited consolidated financial information because each report
is not a 'report' or a 'part' of the registration statement prepared or
certified by Price Waterhouse within the meaning of sections 7 and 11 of the
Act.
LEGAL OPINIONS
The legality of the Notes offered hereby will be passed upon by Victor P.
Patrick, Assistant General Counsel of the Company. At the date of this
Prospectus Supplement, Mr. Patrick had no beneficial ownership interest in any
shares of the Company's Common Stock and had no right to acquire shares through
the exercise of vested options granted under option plans of the Company.
VALIDITY OF THE NOTES
The validity of the Notes offered hereby will be passed upon for the
Underwriters by Cravath, Swaine & Moore, New York, New York.
S-6
<PAGE>
PROSPECTUS
$460,000,000
[LOGO]
DEBT SECURITIES AND WARRANTS
------------------------
This Prospectus covers debt securities (the 'Debt Securities') and warrants
to purchase Debt Securities ('Warrants') to be issued for proceeds of up to
$460,000,000 (or the equivalent in foreign denominated currency or European
Currency Units ('ECU')) which Allied-Signal Inc. (the 'Company') may issue from
time to time in one or more series. The Debt Securities and Warrants will be
offered directly, or through agents designated from time to time, or through
broker-dealers or underwriters also to be designated. The Debt Securities and
Warrants will be offered to the public on terms determined by market conditions
at the time of sale. The Debt Securities and Warrants may be sold for U.S
dollars, foreign denominated currency or ECU, and principal of and any interest
on the Debt Securities may likewise be payable in U.S dollars, foreign
denominated currency or ECU. The currency for which the Debt Securities and
Warrants may be purchased and the currency in which principal of and any
interest on the Debt Securities may be payable may be specifically designated by
the Company.
The designation, principal amount, offering price, maturity, interest rate,
and redemption provisions, if any, of the Debt Securities, the duration,
offering price, exercise price and detachability of any Warrants, and the name
of each agent, broker-dealer or underwriter, if any, in connection with the sale
of the Debt Securities and Warrants are set forth in the accompanying Prospectus
Supplement (the 'Prospectus Supplement').
If an agent of the Company or a broker-dealer or underwriter is involved in
the sale of the Debt Securities and Warrants in respect of which this Prospectus
is being delivered, the agent's commission or broker-dealer's or underwriter's
discount will be set forth in, or may be calculated from, the Prospectus
Supplement. The proceeds to the Company will be the purchase price in the case
of sale through an agent or a broker-dealer, the public offering price in the
case of sale through an underwriter and the exercise price if Warrants are
exercised. Net proceeds to the Company will be the purchase price less
commission in the case of an agent, the purchase price in the case of a
broker-dealer, the public offering price less discount in the case of an
underwriter and the exercise price in the case of Warrants being exercised,
less, in each case, other issuance expenses. See 'Plan of Distribution' for
possible indemnification arrangements for agents, broker-dealers and
underwriters.
This Prospectus relates to Debt Securities and any Warrants which may be
issued under Registration Statement No. 33-13211 with proceeds of approximately
$250 million and under Registration Statements No. 33-14071 and 33-00761 with
proceeds of approximately $110 million and $100 million, respectively.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION NOR HAS THE COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
------------------------
NO DEALER, SALESMAN OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR MAKE ANY REPRESENTATION, OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS, INCLUDING THE PROSPECTUS SUPPLEMENT, IN CONNECTION WITH THE OFFER
MADE BY THIS PROSPECTUS, AND, IF GIVEN OR MADE, ANY SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR THE AGENTS, BROKER-DEALERS OR UNDERWRITERS. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE AN
IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE
THE DATE HEREOF. THIS PROSPECTUS, INCLUDING THE PROSPECTUS SUPPLEMENT, DOES NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH
OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER
OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.
------------------------
The date of this Prospectus is November 14, 1988.
<PAGE>
IN CONNECTION WITH THIS OFFERING PURSUANT TO THIS PROSPECTUS, THE
UNDERWRITERS, IF ANY, MAY OVERALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR
MAINTAIN THE MARKET PRICE OF THE DEBT SECURITIES AND ANY WARRANTS OFFERED HEREBY
AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
------------------------
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the 'Exchange Act') and in accordance therewith files
reports and other information with the Securities and Exchange Commission (the
'Commission'). Reports, proxy statements and other information filed by the
Company with the Commission can be inspected and copied at the public reference
facilities maintained by the Commission at Judiciary Plaza, Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549 and at the Commission's Regional Offices,
14th floor, 75 Park Place, New York, New York 10007 and Room 3190, 230 South
Dearborn Street, Chicago, Illinois 60604. Copies of such material can be
obtained from the Public Reference Section of the Commission, Judiciary Plaza,
450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. Such
information of the Company should also be available for inspection at the
offices of the New York Stock Exchange, 20 Broad Street, New York, New York
10005; the Midwest Stock Exchange, One Financial Place, 440 South LaSalle
Street, Chicago, Illinois, 60605; and the Pacific Stock Exchange, 301 Pine
Street, San Francisco, California 94104.
------------------------
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the Company are
incorporated by reference in this Prospectus:
(1) the Company's Annual Report on Form 10-K for the year ended
December 31, 1987;
(2) the Company's Quarterly Reports on Form 10-Q for the quarters
ended March 31 and June 30, 1988; and
(3) the Company's Current Reports on Form 8-K dated February 26 and
March 28, 1988.
All reports and other documents filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this Prospectus
and prior to the filing of a post-effective amendment which indicates that all
securities offered hereby have been issued or which deregisters all securities
then remaining unissued shall be deemed to be incorporated by reference in this
Prospectus and to be part hereof from the date of filing of such documents.
A copy of the documents incorporated by reference (other than exhibits
thereto) will be forwarded without charge to each person to whom this Prospectus
is delivered, upon such person's written or oral request to Allied-Signal Inc.,
Office of the Secretary, P.O. Box 4000, Morristown, New Jersey 07962, telephone
number (201) 455-4188.
2
<PAGE>
THE COMPANY
The Company's operations are conducted under three business segments:
aerospace; automotive; and engineered materials. The Company's products are used
by many major industries, including textiles, construction, plastics,
electronics, automotive, chemicals, housing, telecommunications, utilities,
packaging, military and commercial aviation and aerospace and in agriculture and
the space program.
The principal executive offices of the Company are located at 101 Columbia
Road, Morris Township, New Jersey 07962. The telephone number is 201/455-2000.
RATIO OF EARNINGS TO FIXED CHARGES (1)
<TABLE>
<CAPTION>
SIX MONTHS
ENDED YEARS ENDED DECEMBER 31,
JUNE 30, --------------------------------------
1988 1987 1986 1985 1984 1983
---------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges........................ 2.55 3.16 3.30 1.28(2) 3.94 4.30
</TABLE>
------------
(1) The ratio of earnings to fixed charges represents the historical ratio of
the Company on a continuing operations basis and is calculated on a total
enterprise basis, including amounts relating to The Henley Group, Inc.
('Henley') and its unconsolidated equipment leasing and finance subsidiaries
prior to 1986. The ratio of earnings to fixed charges is generally computed
by dividing the sum of income from continuing operations (excluding the
effect of an extraordinary item in 1987 and the cumulative effect of an
accounting change in 1983), income taxes and fixed charges (excluding
capitalized interest) less undistributed equity income by fixed charges.
Fixed charges represent interest (including capitalized interest) and
amortization of debt discount and expense and the interest factor of all
rentals, consisting of an appropriate interest factor on operating leases.
The Company's results reflect the discontinuance of the former electronics
and instrumentation sector as well as some other smaller units (effective
March 31, 1987), the sale of 50% of Union Texas Petroleum Holdings, Inc.
('Union Texas') (effective June 30, 1985), and the consolidation of The
Signal Companies, Inc. (effective October 1, 1985).
(2) Reflects the impact of after-tax provisions for streamlining and
restructuring and nonrecurring items aggregating $676 million for the
spin-off of Henley, the write-down to net realizable value of certain
operations disposed of, the rationalization of facilities, medical benefits
for retirees of disposed operations and certain environmental liabilities,
partly offset by a gain resulting from the sale of 50% of Union Texas.
USE OF PROCEEDS
The net proceeds to be received by the Company from sales of the Debt
Securities and Warrants and the exercise of Warrants will be used for general
corporate purposes which may include working capital, capital expenditures,
stock repurchases and repayment of borrowings. Further information with respect
to use of the net proceeds of the sale of the Debt Securities and Warrants to
which this Prospectus relates will be set forth in Prospectus Supplements.
DESCRIPTION OF DEBT SECURITIES
The following statements are subject to the detailed provisions of the
Indenture dated as of October 1, 1985 (the 'Indenture') between the Company and
the Chase Manhattan Bank (National Association, as trustee (the 'Trustee').
References to particular sections of the Indenture are noted below.
GENERAL
The Company has issued debt securities in the principal amount of
$672,500,000 under the Indenture. The Indenture does not limit the amount of
debt securities which may be issued thereunder. The Debt Securities and Warrants
to which this Prospectus relates will be issued from time to time with aggregate
proceeds of up to $460,000,000 or the equivalent thereof in foreign denominated
currency or ECU, and will be offered to the public on terms determined by market
conditions at the time of sale. The Debt Securities may be issued in one or more
series with the same or various maturities and may
3
<PAGE>
be sold at par or at an original issue discount. Debt Securities sold at an
original issue discount may bear no interest or interest at a rate which is
below market rates. The Debt Securities will be unsecured and issued in fully
registered form without coupons or in bearer form with coupons (Sections 301 and
302).
Reference is made to the Prospectus Supplement for the following terms to
the extent they are applicable to the Debt Securities offered hereby: (i)
designation, aggregate principal amount, denomination and currency; (ii) date of
maturity; (iii) currency or currencies for which Debt Securities may be
purchased and currency or currencies in which principal of and any interest may
be payable; (iv) if the currency for which Debt Securities may be purchased or
in which principal of and any interest may be payable is at the purchaser's
election, the manner in which such an election may be made; (v) interest rate;
(vi) the times at which interest will be payable; (vii) redemption date and
redemption price; (viii) federal income tax consequences; and (ix) any other
specific terms of the Debt Securities.
COVENANTS CONTAINED IN INDENTURE
The Company will covenant not to issue, assume or guarantee any
indebtedness for borrowed money secured by liens on (a) any property located in
the United States which is (i) in the opinion of the Board of Directors, a
principal manufacturing property or (ii) an oil, gas or mineral producing
property, or (b) any shares of capital stock or indebtedness of any subsidiary
owning such property, without equally and ratably securing the Debt Securities,
subject to certain exceptions specified in the Indenture. Exceptions include:
(1) existing liens on property of the Company or liens on property of
corporations at the time such corporations become subsidiaries of or are merged
with the Company; (2) liens existing on property when acquired, or incurred to
finance the purchase price thereof; (3) certain liens on property to secure the
cost of exploration, drilling or development of, or improvements on, such
property; (4) certain liens in favor of or required by contracts with
governmental entities; and (5) indebtedness secured by liens otherwise
prohibited by such covenant not exceeding 10% of the consolidated net tangible
assets of the Company and its consolidated subsidiaries. Transfers of oil, gas
or other minerals in place for a period of time until the transferee receives a
specified amount of money or of such minerals or any other transfers commonly
referred to as 'production payments,' are outside the scope of this covenant and
are thus permitted without restriction. The Company will also covenant not to
enter into any sale and lease-back transaction covering any property located in
the United States which is (i) in the opinion of the Board of Directors, a
principal manufacturing property or (ii) an oil, gas or mineral producing
property, unless (1) the Company would be entitled under the provisions
described above in this paragraph to incur debt equal to the value of such sale
and lease-back transactions, secured by liens on the property to be leased,
without equally securing the outstanding Debt Securities, or (2) the Company,
during the four months following the effective date of such sale and lease-back
transaction, applies an amount equal to the value of such sale and lease-back
transaction to the voluntary retirement of long-term indebtedness of the Company
or a subsidiary (Sections 101, 1005 and 1006).
MODIFICATION AND WAIVER
Other than modifications and amendments not adverse to holders of the Debt
Securities, modifications and amendments of the Indenture and waivers of
compliance with Indenture covenants may be made only with the consent of the
holders of a majority in aggregate principal amount at maturity of the Debt
Securities of each series to be affected outstanding at that time (voting as a
class); provided, however, that the consent of all holders of each outstanding
series of Debt Securities affected thereby will be required, among other things,
to (a) change the stated maturity of such Debt Securities; (b) reduce the
principal amount thereof; (c) reduce the rate or extend the time of payment of
interest, if any, thereon; or (d) impair the right to institute suit for the
enforcement of any such payment on or after the respective due dates thereof
(Section 902). The holders of not less than a majority in aggregate principal
amount at maturity of outstanding Debt Securities of each series affected
thereby may waive any past default under the Indenture and its consequences,
except a default (a) in the payment of the principal of, premium, if any, or
interest, if any, on such Debt Securities, or (b) in respect of a covenant or
provision which cannot be modified or amended without the consent of all the
holders of each outstanding series of Debt Securities affected thereby (Section
507).
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<PAGE>
INFORMATION CONCERNING THE TRUSTEE
The Chase Manhattan Bank (National Association) ('Chase') is also the
trustee under the indenture under which the Company's Serial Zero Coupon Bonds
Due 1987-2009 are outstanding and a Note Facility Agreement pursuant to which
approximately $96,000,000 of variable rate notes are outstanding, and is fiscal
agent for the Company's 8% Bonds Due May 15, 2006. The Company has a credit
agreement with a group of banks including Chase under which Chase has a
commitment of $125 million, and a subsidiary of Chase is acting as marketing,
placement and indexing agent for the above-referenced variable rate notes. The
Company maintains deposit accounts and conducts other banking transactions with
Chase.
EVENTS OF DEFAULT
Events of Default with respect to any series of Debt Securities under the
Indenture will include: (a) default in payment of any principal on such series,
except for principal due upon sinking fund redemptions; (b) default in the
payment of any installment of interest, if any, or sinking fund redemption, if
any, on such series and continuance of such default for a period of 30 days; (c)
default for 90 days after notice in the performance of any other covenant in the
Indenture; or (d) certain events of bankruptcy, insolvency or reorganization in
respect of the Company (Section 501). The Trustee may withhold notice to the
holders of Debt Securities of any default (except in the payment of principal of
or interest, if any, on such series of Debt Securities) if it considers such
withholding to be in the interest of holders of Debt Securities (Section 508).
No Event of Default with respect to a particular series of Debt Securities
issued under the Indenture necessarily constitutes an Event of Default with
respect to any other series of Debt Securities.
On the occurrence of an Event of Default, the Trustee or the holders of at
least 25% in principal amount at maturity of Debt Securities of each such series
then outstanding may declare the principal (or in the case of Debt Securities
sold at an original issue discount, the amount specified in the terms thereof)
to be due and payable immediately (Section 501). Upon payment of such amount,
together with any premium or interest due thereon, if any, all the Company's
obligations in respect to payment of indebtedness on such Debt Securities will
terminate (Sections 401, 501 and 502).
Within 120 days after the end of each fiscal year, certain officers of the
Company are required to inform the Trustee whether they know of any default,
specifying any such default and the nature and status thereof (Section 1004).
Subject to provisions relating to its duties in case of default, the Trustee is
under no obligation to exercise any of its rights or powers under the Indenture
at the request, order or direction of any holders of Debt Securities unless such
holders of Debt Securities shall have offered to the Trustee reasonable
indemnity (Section 603).
DEFEASANCE OF THE INDENTURE AND DEBT SECURITIES
If the Company deposits or causes to be deposited with the Trustee in trust
an amount in money or the equivalent in securities of the government which
issued the currency in which the Debt Securities are denominated or government
agencies backed by the full faith and credit of such government sufficient to
pay and discharge the principal at maturity of, and interest, if any, to the
date of maturity on, a then outstanding series of Debt Securities, and if the
Company has paid or caused to be paid all other sums payable by it under the
Indenture with respect to such series, then the Indenture will cease to be of
further effect with respect to such series (except as to the Company's
obligations to compensate, reimburse and indemnify the Trustee pursuant to the
Indenture with respect to such series), and the Company will be deemed to have
satisfied and discharged the Indenture with respect to such series (Section
401). In the event of any such defeasance, holders of such Debt Securities would
be able to look only to such trust fund for payment of principal and premium, if
any, and interest, if any, on their Debt Securities until maturity.
Such defeasance may be treated as a taxable exchange of the related Debt
Securities for an issue of obligations of the trust or a direct interest in the
cash and securities held in the trust. In that case holders of such Debt
Securities would recognize gain or loss as if the trust obligations or the cash
or securities deposited, as the case may be, had actually been received by them
in exchange for their Debt Securities. Such holders thereafter might be required
to include in income a different amount than
5
<PAGE>
would be includable in the absence of defeasance. Prospective investors are
urged to consult their own tax advisors as to the specific consequences of
defeasance.
DESCRIPTION OF WARRANTS
The Company repurchased in 1988 warrants to purchase $100,000,000 of its
10.48% Notes Due November 1, 1995 which it issued in 1985 and may issue other
Warrants for the purchase of Debt Securities. Warrants may be issued
independently or together with any Debt Securities offered by any Prospectus
Supplement and may be attached to or separate from such Debt Securities. The
Warrants are to be issued under Warrant Agreements to be entered into between
the Company and a bank or trust company, as Warrant Agent, all as set forth in
the Prospectus Supplement relating to the particular issue of Warrants. The
Warrant Agent will act solely as an agent of the Company in connection with the
Warrant Certificates and will not assume any obligation or relationship of
agency or trust for or with any holders of Warrant Certificates or beneficial
owners of Warrants. A copy of the form of Warrant Agreement, including the form
of Warrant Certificate representing the Warrants, is filed with the Commission
as an exhibit to the Registration Statement to which this Prospectus pertains.
The following summaries of certain provisions of the form of Warrant Agreement
and Warrant Certificate do not purport to be complete and are subject to, and
are qualified in their entirety by reference to, all the provisions of the
Warrant Agreement and the Warrant Certificate.
GENERAL
If Warrants are offered, the Prospectus Supplement will describe the terms
of the Warrants, including the following: (i) the offering price; (ii) the
currency for which Warrants may be purchased; (iii) the designation, aggregate
principal amount, currency and terms of the Debt Securities purchasable upon
exercise of the Warrants; (iv) if applicable, the designation and terms of the
Debt Securities with which the Warrants are issued and the number of Warrants
issued with each such Debt Security; (v) if applicable, the date on and after
which the Warrants and the related Debt Securities will be separately
transferable; (vi) the principal amount of Debt Securities purchasable upon
exercise of one Warrant and the price and currency at which such principal
amount of Debt Securities may be purchased upon such exercise; (vii) the date on
which the right to exercise the Warrants shall commence and the date (the
'Expiration Date') on which such right shall expire; (viii) federal income tax
consequences; (ix) whether the Warrants represented by the Warrant Certificates
will be issued in registered or bearer form; and (x) any other terms of the
Warrants.
Warrant Certificates may be exchanged for new Warrant Certificates of
different denominations, may (if in registered form) be presented for
registration of transfer, and may be exercised at the corporate trust office of
the Warrant Agent or any other office indicated in the Prospectus Supplement.
Prior to the exercise of their Warrants, holders of Warrants will not have any
of the rights of holders of the Debt Securities purchasable upon such exercise,
including any 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 Indenture.
EXERCISE OF WARRANTS
Each Warrant will entitle the holder to purchase such principal amount of
Debt Securities at such exercise price as shall in each case be set forth in, or
calculable from, the Prospectus Supplement relating to the Warrants. Warrants
may be exercised at any time up to 5:00 P.M. New York time on the Expiration
Date set forth in the Prospectus Supplement relating to such Warrants. 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 Warrants will
become void.
Warrants may be exercised by delivery to the Warrant Agent of payment as
provided in the Prospectus Supplement of the amount required to purchase the
Debt Securities purchasable upon such exercise together with certain information
set forth on the reverse side of the Warrant Certificate. Warrants will be
deemed to have been exercised upon receipt of the exercise price, subject to the
receipt within five business days of the Warrant Certificate evidencing such
Warrants. Upon receipt of such payment and the Warrant Certificate properly
completed and duly executed at the corporate trust office of the Warrant Agent
or any other office indicated in the Prospectus Supplement, the Company
6
<PAGE>
will, as soon as practicable, issue and deliver the Debt Securities purchasable
upon such exercise. If fewer than all of the Warrants represented by such
Warrant Certificate are exercised, a new Warrant Certificate will be issued for
the remaining amount of Warrants.
PLAN OF DISTRIBUTION
The Company may sell the Debt Securities and Warrants being offered hereby:
(i) directly to purchasers; (ii) through agents; (iii) to broker-dealers as
principals; and (iv) through underwriters.
Offers to purchase Debt Securities and Warrants may be solicited directly
by the Company or by agents designated by the Company from time to time. Any
such agent, who may be deemed to be an underwriter as that term is defined in
the Securities Act of 1933 (the 'Act'), involved in the offer or sale of the
Debt Securities and Warrants in respect of which this Prospectus is delivered
will be named, and any commissions payable by the Company to such agent set
forth, in a Prospectus Supplement. Unless otherwise indicated in such Prospectus
Supplement, any such agent will be acting on a best efforts basis.
If a broker-dealer is utilized in the sale of the Debt Securities and
Warrants in respect of which this Prospectus is delivered or if Warrants are
exercised by a broker-dealer, the Company will sell such Debt Securities and
Warrants to the dealer, as principal. The dealer may then resell such Debt
Securities and Warrants to the public at varying prices to be determined by such
dealer at the time of resale.
If an underwriter or underwriters are utilized in the sale, the Company
will enter into an underwriting agreement with such underwriters at the time of
sale to them and the names of the underwriters and the terms of the transaction
will be set forth in a Prospectus Supplement, which will be used by the
underwriters to make resales of the Debt Securities and Warrants in respect of
which this Prospectus is delivered to the public.
Agents, broker-dealers or underwriters may be entitled under agreements
which may be entered into with the Company to indemnification by the Company
against certain civil liabilities, including liabilities under the Act, and may
be customers of, engage in transactions with or perform services for the Company
in the ordinary course of business.
The place and time of delivery for the Debt Securities and Warrants in
respect of which this Prospectus is delivered are set forth in the accompanying
Prospectus Supplement.
EXPERTS
The consolidated financial statements of the Company incorporated by
reference to the Company's Annual Report on Form 10-K for the year ended
December 31, 1987 have been so incorporated in reliance on the report of Price
Waterhouse, independent accountants, given on their authority as experts in
auditing and accounting.
With respect to the unaudited interim consolidated financial information
included in the Company's Quarterly Reports on Form 10-Q incorporated by
reference herein, Price Waterhouse performs reviews based on procedures adopted
by the American Institute of Certified Public Accountants. However, as stated in
their separate reports included in such Form 10-Q's, they do not audit and they
do not express an opinion on the unaudited interim consolidated financial
information. Price Waterhouse does not carry out any significant or additional
audit tests beyond those which would have been necessary if their reports had
not been included in such Form 10-Q's. Accordingly, each such report is not a
'report' or 'part of a registration statement' within the meaning of Sections 7
and 11 of the Securities Act of 1933, and the liability provisions of Section 11
of such Act do not apply.
LEGAL OPINIONS
The legality of the Debt Securities and Warrants offered hereby will be
passed upon by Martin B. Cohen, Assistant General Counsel of the Company. At the
date of this Prospectus, Mr. Cohen beneficially owned 994 shares of the
Company's Common Stock and had the right to acquire 2,379 shares through the
exercise of vested options granted under option plans of the Company.
7
<PAGE>
________________________________________________________________________________
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY REPRESENTATIONS
OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS, AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED. NEITHER THIS PROSPECTUS SUPPLEMENT NOR THE PROSPECTUS
CONSTITUTES AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY ANY
SECURITIES OTHER THAN THE SECURITIES DESCRIBED IN THIS PROSPECTUS SUPPLEMENT OR
AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY SUCH SECURITIES IN ANY
JURISDICTION TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS PROSPECTUS
SUPPLEMENT OR THE PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
AFFAIRS OF THE COMPANY SINCE THE DATE OF THE PROSPECTUS OR THIS PROSPECTUS
SUPPLEMENT OR THAT THE INFORMATION HEREIN OR THEREIN IS CORRECT AS OF ANY TIME
SINCE SUCH DATE.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PROSPECTUS SUPPLEMENT
Available Information................................ S-2
Incorporation of Certain Documents by Reference...... S-2
Summary of Selected Financial Information............ S-3
Use of Proceeds...................................... S-3
Certain Terms of the Notes........................... S-4
Underwriting......................................... S-5
Experts.............................................. S-6
Legal Opinions....................................... S-6
Validity of the Notes................................ S-6
PROSPECTUS
Available Information................................ 2
Incorporation of Certain Documents by Reference...... 2
The Company.......................................... 3
Ratio of Earnings to Fixed Charges................... 3
Use of Proceeds...................................... 3
Description of Debt Securities....................... 3
Description of Warrants.............................. 6
Plan of Distribution................................. 7
Experts.............................................. 7
Legal Opinions....................................... 7
</TABLE>
$100,000,000
[LOGO]
6.75% NOTES
DUE AUGUST 15, 2000
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PROSPECTUS SUPPLEMENT
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GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES INC.
SALOMON BROTHERS INC
________________________________________________________________________________
