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As filed with the Securities and Exchange Commission on January 27, 1994
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-3
Registration Statement
Under the
Securities Act of 1933
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BEAR STEARNS FINANCE LLC THE BEAR STEARNS COMPANIES
INC.
(Exact name of registrant as (Exact name of guarantor as
specified in its charter) specified in its charter)
Cayman Islands Delaware
(State or other jurisdiction of (State or other jurisdiction of
incorporation or organization) incorporation or organization)
Applied for 13-3286161
(I.R.S. Employer Identification No.) (I.R.S. Employer Identification No.)
c/o William J. Montgoris William J. Montgoris
Chief Operating Officer Chief Operating Officer
and Chief Financial Officer and Chief Financial Officer
The Bear Stearns Companies Inc. The Bear Stearns Companies Inc.
245 Park Avenue 245 Park Avenue
New York, New York 10167 New York, New York 10167
(212) 272-2000 (212) 272-2000
(Name, address, including zip code, and (Name and address, including zip
telephone number, including area code, code, and telephone number,
of principal executive offices and agent including area code, of
for service) principal executive offices and
agent for service)
Copies to:
Dennis J. Block, Esq. Michael Q. Rosenwasser, Esq.
Weil, Gotshal & Manges Andrews & Kurth L.L.P.
767 Fifth Avenue 425 Lexington Avenue
New York, New York 10153 New York, New York 10017
(212) 310-8000 (212) 850-2800
APPROXIMATE DATE OF COMMENCEMENT OF THE PROPOSED SALE OF THE SECURITIES TO THE
PUBLIC: FROM TIME TO TIME AFTER THIS REGISTRATION STATEMENT BECOMES EFFECTIVE.
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, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [x]
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CALCULATION OF REGISTRATION FEE
Proposed Maximum Proposed Maximum
Title of Each Class of Securities to Amount to be Offering Price Per Aggregate Offering Amount of
be Registered Registered(1) Unit(2) Price(2) Registration Fee
<S> <C> <C> <C> <C>
Guaranteed Exchangeable Preferred 20,000,000 shares $25 $500,000,000 $172,414
Shares of Bear Stearns Finance LLC
Backup Undertakings by The Bear ___ ___ ___ ___
Stearns Companies Inc. (3)
Preferred Stock of The Bear Stearns ___ ___ ___ ___
Companies Inc. (3)(4)
Depositary Shares (3)(4) ___ ___ ___ ___
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<FN>
(1) The number of Preferred Shares being registered hereby in such number of Preferred Shares, not to exceed 20,000,000,
as may from time to time be issued by Bear Stearns Finance LLC.
(2) Estimated solely for the purpose of calculating the registration fee.
(3) No additional consideration will be received for the Backup Undertakings, Preferred Stock or Depositary Shares.
(4) There are also being registered hereunder such indeterminate number of (i) shares of Preferred Stock of The Bear
Stearns Companies Inc. issuable in exchange for the Guaranteed Exchangeable Preferred Shares of Bear Stearns Finance
LLC and (ii) Depositary Shares representing shares of that Preferred Stock.
The registrants hereby amend this registration statement on such date or dates as may be necessary to delay
its effective date until the registrants 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 Securities and Exchange Commission, acting pursuant to said
Section 8(a), may determine.
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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.
SUBJECT TO COMPLETION, DATED JANUARY 27, 1994
PROSPECTUS
BEAR STEARNS FINANCE LLC
Guaranteed Exchangeable Preferred Shares
guaranteed to the extent set forth herein by
THE BEAR STEARNS COMPANIES INC.
Bear Stearns Finance LLC (the "Company"), an exempted company
with limited duration incorporated under the laws of the Cayman
Islands and a wholly owned subsidiary of The Bear Stearns Companies
Inc. (the "Guarantor"), may offer from time to time, in one or more
series, its authorized but unissued Guaranteed Exchangeable Preferred
Shares, par value $.01 per share (the "Preferred Shares"). Subject to
certain conditions, all, but not less than all, of the Preferred
Shares of any series may be exchanged for Depositary Shares (the
"Depositary Shares"), each representing a fractional interest in a
share of a series of Preferred Stock, par value $1.00 per share (the
"Guarantor Preferred Stock"), of the Guarantor. See "Description of
Preferred Shares -- Exchange Right." The total number of Preferred
Shares of all series to be issued under this Prospectus will not
exceed 20,000,000.
The payment of dividends, if and to the extent declared out of
moneys held by the Company and lawfully available therefor, and
payments on liquidation or redemption with respect to the Preferred
Shares will be guaranteed (the "Guarantee") by the Guarantor to the
extent set forth herein. The Guarantee will rank junior to all
liabilities of the Guarantor and pari passu with the most senior
preferred or preference stock issued by the Guarantor. See "Bear
Stearns Finance LLC", "Description of Preferred Shares - Mandatory
Redemption" and "Description of the Guarantee" for a description of
various contractual backup obligations of the Guarantor.
The Preferred Shares may be issued in amounts, at prices and on
other terms to be determined in light of market conditions at the time
of sale. Information relating to the specific number of shares,
title, stated value and liquidation preference of each share, issuance
price, dividend rate or method of calculation, dividend periods,
dividend payment dates, any redemption or sinking fund provisions, any
national securities exchange or other trading market on which the
Preferred Shares may be listed or registered, the terms of any
Depositary Shares representing shares in a series of Guarantor
Preferred Stock that may be issuable in exchange for the Preferred
Shares and other specific terms of each series of Preferred Shares in
respect of which this Prospectus is being delivered shall be set forth
in the applicable Prospectus Supplement (the "Prospectus Supplement").
_________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
_________________________
The Preferred Shares may be offered through dealers, through
underwriters or through agents designated from time to time, as set
forth in the applicable Prospectus Supplement. The net proceeds to
the Company will be, in the case of a dealer, the sales price to such
dealer, in the case of an underwriter, the public offering price less
the applicable underwriting discount or commission, and, in the case
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of an agent, the public offering price less the applicable agency
commission, in each case less other expenses attributable to issuance
and distribution. See "Plan of Distribution" for possible
indemnification arrangements for dealers, underwriters and agents.
This Prospectus and the applicable Prospectus Supplement may be
used by Bear, Stearns & Co. Inc. in connection with offers and sales
of Preferred Shares and Depositary Shares in market-making
transactions at negotiated prices related to prevailing market prices
at the time of sale or otherwise. Bear, Stearns & Co. Inc. may act as
a principal or agent in such transactions.
BEAR, STEARNS & CO. INC.
The date of this Prospectus is February __, 1994
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IN CONNECTION WITH THE OFFERING OF PREFERRED SHARES HEREUNDER,
THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE
OR MAINTAIN THE MARKET PRICES OF THOSE SECURITIES, OR OTHER SECURITIES
OF THE COMPANY, AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN
THE OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK
STOCK EXCHANGE OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
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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 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 DOES NOT CONSTITUTE AN OFFER TO SELL
OR A SOLICITATION OF AN OFFER TO BUY SECURITIES BY ANYONE IN ANY
JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR
IN WHICH THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED
TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR
SOLICITATION.
AVAILABLE INFORMATION
The Guarantor is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
in accordance therewith files reports and other information with the
Securities and Exchange Commission (the "Commission"). Reports, proxy
statements and other information filed by the Guarantor 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 or at its Regional Offices
located at the Northwestern Atrium Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661-2511 and 7 World Trade Center,
13th Floor, New York, New York 10048, and 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.
Reports, proxy statements and other information concerning the
Guarantor can also be inspected at the offices of the New York Stock
Exchange, Inc., 20 Broad Street, New York, New York 10005.
This Prospectus constitutes a part of a joint Registration
Statement filed by the Company and the Guarantor with the Commission
under the Securities Act of 1933, as amended (the "Securities Act").
This Prospectus omits certain of the information contained in the
Registration Statement in accordance with the rules and regulations of
the Commission. Reference is hereby made to the Registration
Statement and related exhibits for further information with respect to
the Company and the Guarantor. Statements contained herein concerning
the provisions of any document are not necessarily complete and, in
each instance, reference is made to the copy of such document filed as
an exhibit to the Registration Statement or otherwise filed with the
Commission. Each such statement is qualified in its entirety by such
reference.
No separate financial statements of the Company have been
included herein. The Company and the Guarantor do not consider that
such financial statements would be material to holders of the
Preferred Shares because the Company is a newly organized special
purpose entity, has no operating history and no independent operations
and is not engaged in any activity other than the issuance of the
Preferred Shares and its common shares, and the lending of the net
proceeds thereof to the Guarantor or its subsidiaries. The Company is
an exempted company with limited duration incorporated under the laws
of the Cayman Islands and will be managed by the Guarantor which
directly or indirectly owns all of the Company's common shares, which
shares are nontransferable. The Company has no physical assets
located within the United States. As a result, it may not be possible
for investors to effect service of process within the United States
upon the Company or to enforce against it in the United States courts
judgments obtained in such courts predicated upon civil liability
provisions of the federal securities laws of the United States. The
Company has been advised by its Cayman Islands legal counsel, Maples
and Calder, that there may be doubt as to the enforceability, in the
Cayman
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Islands in original actions or in actions for enforcement of
judgments of United States courts, of liabilities predicated solely
upon the federal securities laws of the United States.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Guarantor with the
Commission pursuant to Section 13 of the Exchange Act (File No. 1-
8989), are incorporated herein by reference: (i) the Annual Report on
Form 10-K (including the portions of the Guarantor's Annual Report to
Stockholders incorporated by reference therein) for the fiscal year
ended June 30, 1993 (the "1993 Form 10-K"), (ii) the Quarterly Report
on Form 10-Q for the quarterly period ended September 24, 1993 and
(iii) the Current Report on Form 8-K dated January 13, 1994. All
documents filed by the Guarantor pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of the offering of the securities offered
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 herein or in a document incorporated or
deemed to be incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Prospectus to the extent
that a statement contained herein or in any 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.
The Guarantor will provide without charge to each person to whom
a copy of this Prospectus is delivered, upon the written or oral
request of such person, a copy of any or all documents incorporated by
reference into this Prospectus except the exhibits to such documents
(unless such exhibits are specifically incorporated by reference in
such documents). Requests for such copies should be directed to
Corporate Communications Department, The Bear Stearns Companies Inc.,
245 Park Avenue, New York, New York 10167; telephone number (212) 272-
2000.
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THE BEAR STEARNS COMPANIES INC.
The Guarantor is a holding company that, through its
subsidiaries, principally Bear, Stearns & Co. Inc. ("Bear Stearns")
and Bear, Stearns Securities Corp. ("BSSC") is a leading United States
investment banking, securities trading and brokerage firm serving
United States and foreign corporations, governments and institutional
and individual investors. The business of the Guarantor and its
subsidiaries includes market-making and trading in corporate, United
States government and agency, mortgage-related, asset-backed and
municipal securities and trading in options, futures, foreign
currencies, interest rate swaps and other derivative products;
securities and commodities arbitrage; securities, options and
commodities brokerage for domestic and international institutional and
individual clients; underwriting and distribution of securities,
arranging for the private placement of securities, assisting in
mergers and acquisitions and restructuring and providing other
financial advisory services, including advising on, and participating
in principal investments in, leveraged acquisitions; providing
securities clearance services; specialist activities in securities on
the floors of the New York Stock Exchange (the "NYSE"); customer
financing activities; securities lending activities; fiduciary
services; and providing other services, including real estate
brokerage, investment management and advisory activities, and
securities research.
The Guarantor's operations are conducted from its principal
offices in New York City, from domestic regional offices in Atlanta,
Boston, Chicago, Dallas, Los Angeles and San Francisco, from
representative offices in Geneva, Hong Kong and Shanghai, through
international subsidiaries in Frankfurt, Hong Kong, London and Paris,
through a branch office in Tokyo and through joint ventures with other
firms in Karachi, Madrid and Paris. The Guarantor's foreign offices
provide services and engage in investment activities involving foreign
clients and international transactions. The Guarantor's trust company
subsidiary, Custodial Trust Company, operates from offices in
Princeton, New Jersey.
Bear Stearns and BSSC are broker-dealers registered with the
Commission, futures commission merchants registered with the Commodity
Futures Trading Commission, members of the NYSE and all other
principal United States securities and commodities exchanges and
members of the National Association of Securities Dealers, Inc. (the
"NASD") and the National Futures Association. Bear Stearns is also
recognized as a "primary dealer" in United States government
securities designated by the Federal Reserve Bank of New York.
The Guarantor is incorporated in Delaware. The principal
executive office of the Guarantor is located at 245 Park Avenue, New
York, New York 10167; its telephone number is (212) 272-2000.
RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS
The ratio of earnings to combined fixed charges and preferred
dividends of the Guarantor was 1.9 for the six months ended December
31, 1993 and 1.8, 1.6, 1.2, 1.2 and 1.3 for the fiscal years ended
June 30, 1993, 1992, 1991, 1990 and 1989, respectively. These ratios
were calculated by dividing the sum of fixed charges and preferred
dividends into the sum of earnings before taxes and fixed charges.
Fixed charges for these purposes consist of all interest expense and
certain other immaterial expenses. Preferred dividends represent the
pretax earnings necessary to cover the dividends on the Guarantor's
preferred stock assuming such earnings are taxed at the Guarantor's
consolidated effective tax rate.
BEAR STEARNS FINANCE LLC
The Company, a wholly owned subsidiary of the Guarantor, is an
exempted company with limited duration incorporated under the laws of
the Cayman Islands. The Company's registered offices are located at
c/o Maples and Calder, Ugland House, P.O. Box 309, George Town, Grand
Cayman, Cayman Islands, British West Indies, telephone:
(809) 949-8066. The principal executive offices of the Guarantor,
which directly or indirectly owns all of the Company's common shares,
are located at 245 Park Avenue, New York, New York 10167, telephone:
(212) 272-2000. The Guarantor directly owns all of the common shares
of the Company,
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which shares are nontransferable. The Company exists solely for the
purpose of issuing preferred and common shares and lending the net
proceeds thereof to the Guarantor or its subsidiaries.
Pursuant to the Company's Memorandum of Association (the
"Memorandum") and the applicable provisions of the Companies Law
(Revised) of the Cayman Islands, the Guarantor, as direct or indirect
owner of all of the common shares of the Company, has unlimited
liability for the debts and obligations of the Company, to the extent
not fully satisfied and discharged by the Company. That liability on
the part of the Guarantor is for the benefit of, and is enforceable by
the liquidator of the Company in the event of its insolvent liquidation
for the benefit of third parties to whom the Company owes such debts
and obligations.
USE OF PROCEEDS
Unless otherwise specified in the applicable Prospectus
Supplement, the Company intends to loan the net proceeds from the sale
of the Preferred Shares to the Guarantor to be used by the Guarantor
for general corporate purposes, which may include additions to working
capital, repayment of short-term indebtedness and investments in, or
extensions of credit to, subsidiaries of the Guarantor.
DESCRIPTION OF PREFERRED SHARES
The following description of terms of the Preferred Shares sets
forth certain general terms and provisions of the Preferred Shares to
which any Prospectus Supplement may relate. The particular terms of
the Preferred Shares of a series and the extent, if any, to which such
general terms do not apply to such series of Preferred Shares will be
described in such Prospectus Supplement. The Prospectus Supplement
does not purport to be complete and is subject to, and qualified in
its entirety by reference to, the Memorandum, the Articles of
Association of the Company (the "Articles") and the resolutions
adopted, or to be adopted, by the Guarantor, which directly or
indirectly owns all of the Company's common shares (the "Common
Shareholder"), as designated in the Articles and the resolutions
providing for the issuance thereof adopted by the Common Shareholder
establishing the rights, preferences, privileges, limitations and
restrictions relating to the Preferred Shares of any series or of a
particular series. Copies of the Memorandum and the Articles are
filed as exhibits to the Registration Statement of which this
Prospectus forms a part.
GENERAL
The Company is authorized to issue up to 20,000,000 preference
shares, in one or more series or classes, with such dividend rights,
liquidation preference per share, redemption provisions, voting rights
and other rights, preferences, privileges, limitations and
restrictions as shall be set forth in the Articles and the resolutions
providing for the issuance thereof adopted by the Common Shareholder.
All of the Preferred Shares, to be issued in one or more series or
classes, will rank pari passu with each other with respect to
participation in profits and assets. The Articles as currently in
effect do not permit the issuance of any preference shares ranking, as
to participation in the profits or the assets of the Company, senior
to the Preferred Shares.
The Preferred Shares of any series will be issued in registered
form only without dividend coupons. Registration of, and registration
of transfers of, the Preferred Shares of any series will be by book
entry only. The Preferred Shares shall have the dividend, liquidation,
redemption and voting rights set forth below unless otherwise
specified in the applicable Prospectus Supplement. Reference is made
to the Prospectus Supplement relating to the particular series of
Preferred Shares offered thereby for specific terms, including: (i)
the designation, stated value and liquidation preference of such
Preferred Shares and the number of shares offered; (ii) the dividend
rate or rates (or method of calculation) and the date or dates from
which dividends shall accrue; (iii) any redemption or sinking fund
provisions; (iv) the amount that shares of such series shall be
entitled to receive in the event of any liquidation, dissolution or
winding up of the Company; (v) the terms and conditions, if any, on
which shares of such series shall be exchangeable for shares of stock
of any other class or classes, or other series of the same class, of
the Company or the Guarantor; (vi) the voting rights, if any, of
shares of such series; (vii) the conditions and restrictions, if any,
on the payment of dividends or on the making of other
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distributions on, or the purchase, redemption or other acquisition by
the Company of a class of stock of the Company ranking junior to the
shares of such series as to dividends or upon liquidation; (viii)
any additional dividend, liquidation, redemption, sinking or
retirement fund and other rights, preferences, privileges, limitations
and restrictions of such Preferred Shares; and (ix) the terms upon which
the proceeds from the sale of the Preferred Shares of such series will
be lent to the Guarantor or its subsidiaries.
DIVIDENDS
Cumulative dividends on any series of Preferred Shares will
accrue from the date of original issue thereof and will be payable in
arrears at the dates specified in the Prospectus Supplement relating
to each such series. Payment of dividends is limited in relation to
the amount of funds held by the Company and legally available therefor.
See "Description of the Loan" in the Prospectus Supplement and
"Description of the Guarantee--General" below.
Dividends declared on the Preferred Shares of any series will be
payable to the record holders thereof as they appear on the register
for the Preferred Shares of such series on the relevant record dates,
which will be, unless otherwise specified in the Prospectus Supplement
relating to each such series, the relevant payment dates. Subject to
any applicable fiscal or other laws and regulations, each such payment
will be made as described under "Book-Entry Procedures and Settlement"
below. In the event that any date on which dividends are payable on
the Preferred Shares of any series is not a day on which banks in The
City of New York are open for business and on which foreign exchange
dealings may be conducted in The City of New York (a "Business Day"),
then payment of the dividend payable on such date will be made on the
next succeeding day which is a Business Day (and without any interest
or other payment in respect of any such delay) except that, if such
Business Day is in the next succeeding calendar year, such payment
shall be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date.
Dividends on the Preferred Shares of any series will be
cumulative. Dividends on the Preferred Shares of such series will be
declared by the Common Shareholder in any calendar year or portion
thereof to the extent that the Common Shareholder reasonably
anticipates that at the time of payment it will have, and will be paid
by the Company to the extent that at the time of proposed payment it
has, (x) earnings legally available for the payment of such dividends
and (y) cash in hand sufficient to permit such payments.
If dividends can be paid only in part on the Preferred Shares of
a particular series in any calendar year or portion thereof as a
result of the lack of sufficient funds legally available for the
payment of dividends, then such partial dividends shall be paid on the
respective dividend payment dates on a pro rata basis to holders of
such Preferred Shares.
If at any time dividends on Preferred Shares are in arrears for
any dividend period, any dividend payments in respect thereof must be
applied in respect of all dividend periods in arrears, pro rata in
accordance with the respective amounts in arrears for each such period
in equal amounts for each such period.
Except as described herein and in the Prospectus Supplement
relating to the Preferred Shares of a particular series, holders of
the Preferred Shares of any series will have no other right to
participate in the profits of the Company.
CERTAIN RESTRICTIONS ON THE COMPANY
If dividends have not been paid in full on the Preferred Shares
of any series, the Company shall not:
(i) pay, or declare and set aside for payment, any
dividends on any other preferred or preference shares of the
Company ranking pari passu with the Preferred Shares of such
series as regards participation in profits of the Company
("Company Dividend Parity Shares"), unless the amount of any
dividends declared on any Company Dividend Parity Shares is
paid
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on the Company Dividend Parity Shares and the Preferred
Shares of such series on a pro rata basis on the date such
dividends are paid on such Company Dividend Parity Shares,
so that
(x) (A) the aggregate amount of dividends paid on
the Preferred Shares of such series bears to (B) the
aggregate amount of dividends paid on such Company
Dividend Parity Shares the same ratio as
(y) (A) the aggregate of all accumulated arrears
of unpaid dividends in respect of the Preferred Shares
of such series bears to (B) the aggregate of all
accumulated arrears of unpaid dividends in respect of
such Company Dividend Parity Shares;
(ii) pay, or declare and set aside for payment, any
dividends on any shares of the Company ranking junior to the
Preferred Shares of such series as to dividends ("Company
Dividend Junior Shares"); or
(iii) redeem, purchase or otherwise acquire any
Company Dividend Parity Shares or Company Dividend Junior
Shares;
until, in each case, such time as all accumulated arrears of unpaid
dividends on the Preferred Shares of such series shall have been paid
in full for all dividend periods terminating on or prior to, in the
case of clauses (i) and (ii), such payment, and in the case of clause
(iii), the date of such redemption, purchase or acquisition. As of
the date of this Prospectus there are no Company Dividend Parity
Shares outstanding.
MANDATORY REDEMPTION
The proceeds from any prepayment or payment of principal on a
loan to the Guarantor of the proceeds from the issuance of any series
of Preferred Shares must be applied to redeem the Preferred Shares of
such series; provided that amounts repaid at maturity may be lent to
the Guarantor if at the time of such loan, and as determined in the
judgment of the Guarantor, as Common Shareholder, and its financial
advisor (which may be an affiliate of the Guarantor), (a) the
Guarantor is not in bankruptcy, (b) the Guarantor is not in default on
any loan pertaining to Preferred Shares of any series, (c) the
Guarantor has made monthly payments on the repaid loan for the
immediately prior 18 months, (d) the Company is not in arrearage on
payments of dividends on the Preferred Shares of such series, (e) the
Guarantor is expected to be able to make timely payment of principal
and interest on the loan, (f) such loan is being made on terms, and
under circumstances, that are no less favorable to the Company than a
lender would require for a loan to an unrelated party, (g) such loan
is being made at a rate sufficient to provide payments equal to or
greater than the amount of dividend payments required under the
Preferred Shares of such series and (h) such loan is being made for a
fixed term that is consistent with market circumstances and the
Guarantor's financial condition.
Unless otherwise set forth in the applicable Prospectus
Supplement, a series of Preferred Shares will also be redeemable by
the Company in connection with the prepayment or payment of a loan to
the Guarantor with Depositary Shares representing a series of
Guarantor Preferred Stock and the Company will be obligated to redeem
such series of Preferred Shares out of Depositary Shares received by
the Guarantor under the terms and conditions described in the
applicable Prospectus Supplement.
OPTIONAL REDEMPTION
The Preferred Shares of any series will be redeemable, if at all,
as specified in the Prospectus Supplement relating to such series.
Notice of any redemption of the Preferred Shares of any series
will be given by the Company by mail to each record holder to be
redeemed not fewer than 30 nor more than 60 days prior to the date
fixed for redemption thereof.
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In the event that fewer than all the outstanding Preferred Shares
of a particular series are to be redeemed, the Preferred Shares of
such series to be redeemed will be selected as described under "Book-
Entry Procedures and Settlement" below. The Company will not redeem
fewer than all the outstanding Preferred Shares of a particular series
unless all accumulated arrears of unpaid dividends have been paid on
all Preferred Shares of such series for all monthly dividend periods
terminating on or prior to the date of redemption.
If the Company gives a notice of redemption in respect of
Preferred Shares of a particular series, then, by 12:00 noon, New York
time, on the redemption date, the Company will irrevocably deposit
with The Depository Trust Company ("DTC", which term as used herein,
includes any successor or alternate depository selected by the Company
or the Guarantor) funds sufficient to pay the applicable redemption
price, including an amount equal to all accumulated arrears and
accruals of unpaid dividends (whether or not declared) to the date
fixed for redemption, and will give DTC irrevocable instructions and
authority to pay the redemption price to the holders thereof. See
"Book-Entry Procedures and Settlement". If notice of redemption shall
have been given and funds deposited as required, then upon the date of
such deposit, all rights of holders of such Preferred Shares of a
series so called for redemption will cease, except the right of the
holders of such shares to receive the redemption price, plus
accumulated arrears and accruals of unpaid dividends, if any, but
without interest, and such shares will cease to be outstanding. In the
event that any date on which any payment in respect of the redemption
of Preferred Shares of any series is not a Business Day, then payment
of the redemption price payable on such date will be made on the next
succeeding day which is a Business Day (and without any interest or
other payment in respect of any such delay), except that, if such
Business Day falls in the next calendar year, such payment will
be made on the immediately preceding Business Day. In the event
that payment of the redemption price in respect of Preferred Shares
of any series is improperly withheld or refused and not paid either
by the Company or by the Guarantor pursuant to the Guarantee,
dividends on such shares will continue to accrue, at the then
applicable rate, from the redemption date to the date of payment of
such redemption price.
Subject to the foregoing and applicable law (including, without
limitation, U.S. federal securities laws) the Guarantor or its
subsidiaries may at any time and from time to time purchase
outstanding Preferred Shares of any series by tender, in the open
market or by private agreement.
EXCHANGE RIGHT
Unless otherwise set forth in the applicable Prospectus
Supplement, subject to certain conditions stated below, all, but not
less than all, of the then outstanding Preferred Shares of any series
may be exchanged for Depositary Shares, each representing a fractional
interest in a share of a series of Guarantor Preferred Stock, on the
terms set forth in the Prospectus Supplement. See "Mandatory
Redemption" above and "Description of Guarantor Preferred Stock" and
"Description of Depositary Shares" below. Notice of any exchange of
the Preferred Shares of any series will be given by the Company by
mail to each record holder of Preferred Shares not fewer than 30 nor
more than 60 days prior to the date fixed for exchange.
Notwithstanding the foregoing, such exchange may be made only if, on
the date that notice of the exchange is mailed to holders of Preferred
Shares, (i) the Guarantor is not in default on any loan made by the
Company to the Guarantor, (ii) the Guarantor is not in default under
any mortgage, indenture or other instrument in respect of indebtedness
for borrowed money in excess of $10,000,000 that has been or could be
declared due and payable prior to maturity or (iii) there have not
occurred certain events of bankruptcy, insolvency or reorganization.
REGISTRAR, TRANSFER AGENT AND PAYING AGENT
Chemical Bank will act as registrar, transfer agent and paying
agent for the Preferred Shares (the "Paying Agent").
Registration of transfers of Preferred Shares of any series will
be effected without charge by or on behalf of the Company, but upon
payment (with the giving of such indemnity as the Company or the
Guarantor may require) in respect of any tax or other governmental
charges which may be imposed in relation to it.
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The Company will not be required to register or cause to be
registered the transfer of Preferred Shares of a particular series
after such Preferred Shares have been called for redemption.
MISCELLANEOUS
Holders of Preferred Shares of any series have no preemptive
rights.
DESCRIPTION OF THE GUARANTEE
Set forth below is condensed information concerning the guarantee
(the "Guarantee"), which will be executed and delivered by the
Guarantor for the benefit of the holders from time to time of
Preferred Shares. This summary contains all material information
concerning the Guarantee but does not purport to be complete.
References to provisions of the Guarantee are qualified in their
entirety by reference to the text of the Guarantee, a copy of which
has been filed as an exhibit to the Registration Statement of which
this Prospectus forms a part.
GENERAL
The Guarantor will irrevocably and unconditionally agree, to the
extent set forth herein, to pay in full, to the holders of the
Preferred Shares of any series, the Guarantee Payments (as defined
below) (except to the extent paid by the Company), as and when due,
regardless of any defense, right of set-off or counterclaim which the
Company may have or assert. The following payments to the extent not
paid by the Company (the "Guarantee Payments") will be subject to the
Guarantee (without duplication): (i) any accumulated arrears and
accruals of unpaid dividends which have been theretofore declared on
the Preferred Shares of such series out of moneys legally available
therefor, (ii) the redemption price (including all accumulated arrears
and accruals of unpaid dividends) payable with respect to Preferred
Shares of any series called for redemption by the Company as an optional
redemption or otherwise out of funds available to the Company, (iii)
the lesser of (a) the aggregate of the liquidation preference
and all accumulated arrears and accruals of unpaid dividends (whether
or not declared) to the date of payment and (b) the amount of
remaining assets of the Company and (iv) any Additional Amounts
payable by the Company (as described in the applicable Prospectus
Supplement). The Guarantor's obligation to make a Guarantee Payment may
be satisfied by direct payment of the required amounts by the Guarantor
to the holders of Preferred Shares of any series or by causing the
Company to pay any such amounts to such holders.
CERTAIN COVENANTS
If, at any time that the Guarantor fails to comply with its
obligations under the Guarantee, any proposal by the management of the
Guarantor is made to declare dividends on any shares of the Guarantor
ranking junior to the Guarantor's obligations under the Guarantee as
to participation in profits, the Guarantor shall, or shall cause the
Company to, set aside for payment in a segregated account at the
office of the Paying Agent an amount equal to all accumulated arrears
of dividends payable on the Preferred Shares of such series out of
moneys held and legally available therefor and irrevocably instruct
the Paying Agent to pay such amounts as dividends payable on the
Preferred Shares of such series on the day following the date on which
such proposal is approved by all necessary persons. The Paying Agent
shall make such payment on such day unless it shall have received,
prior to 10:00 a.m., New York time, on such day, a certificate from
the Guarantor certifying that such proposal has not been approved by
all necessary persons. In such case, the amounts deposited in such
account shall be remitted forthwith to the Guarantor or the Company,
as the case may be. In all cases, any interest accrued on the amounts
deposited in such account shall be remitted by the Paying Agent to the
Guarantor or the Company, as the case may be.
In addition, if, at any time that the Guarantor fails to comply
with its obligations under the Guarantee, the Guarantor (or any
subsidiary of the Guarantor using funds provided by the Guarantor)
redeems or purchases or otherwise acquires any shares of the Guarantor
ranking junior to the Guarantor's obligations under the<PAGE>
<PAGE>
Guarantee as to participation in assets of the Guarantor upon
liquidation, all accumulated arrears of dividends payable on the
Preferred Shares of such series out of moneys held and legally
available therefor shall immediately become due and payable under
the Guarantee; provided, however, that no such payment shall be
required if any such shares of the Guarantor are redeemed, purchased
or otherwise acquired pursuant to any employee stock option plan of
the Guarantor.
Neither the Guarantor, nor any subsidiary of the Guarantor using
funds provided by the Guarantor, shall redeem, purchase or acquire, or
pay a liquidation preference with respect to, any preferred or
preference stock of the Guarantor ranking pari passu with the
Guarantee, any preferred or preference stock of affiliates of the
Guarantor (including the Company) entitled to the benefits of a
guarantee of the Guarantor ranking pari passu with the Guarantee or
any preferred or preference stock of affiliates of the Guarantor
entitled to the benefits of a guarantee ranking junior to the
Guarantee as to participation in assets of the Guarantor upon
liquidation if at such time the Guarantor shall be in default with
respect to its obligations under the Guarantee.
Neither the Guarantor, nor any subsidiary of the Guarantor using
funds provided by the Guarantor, shall pay dividends, or make
guarantee payments with respect to dividends, on any preferred or
preference stock of affiliates of the Guarantor entitled to the
benefits of a guarantee ranking junior to the Guarantee as to
participation in profits of the Guarantor if at such time the
Guarantor shall be in default with respect to its obligations under
the Guarantee.
Pursuant to the Guarantee, the Guarantor will agree (i) to
maintain direct 100% ownership of the common shares of the Company and
(ii) not to voluntarily dissolve, wind-up or liquidate the Company so
long as any Preferred Shares are outstanding.
If the Guarantor issues, following the date of this Prospectus,
any preferred or preference shares ranking senior to its obligations
under the Guarantee or enters into any guarantee in respect of any
preferred or preference shares of any affiliate of the Guarantor,
which guarantee would rank junior to all liabilities of the Guarantor
but senior to the Guarantee as regards rights in respect of dividends,
liquidation preference and distributions, and rights upon redemption,
then the Guarantee will be deemed to give the holders of Preferred
Shares such rights and entitlements as are contained in or attached to
such other preferred or preference stock or guarantee such that the
Guarantee ranks pari passu as to such rights and entitlements with any
such preferred or preference stock or other guarantee.
ADDITIONAL AMOUNTS
All Guarantee Payments will be made without withholding or
deduction for or on account of any present or future taxes, duties,
assessments or governmental charges of whatever nature imposed or
levied upon or as a result of such payment by or on behalf of the
Cayman Islands, or any authority therein or thereof having power to
tax, unless the withholding or deduction of such taxes, duties,
assessments or governmental charges is required by law. In that event,
the Guarantor will pay such additional amounts as may be necessary in
order that the net amounts received by the holders of the Preferred
Shares after such withholding or deduction will equal the amount which
would have been receivable in respect of the Preferred Shares in the
absence of such withholding or deduction (the "Additional Amounts"),
except that no such Additional Amounts will be payable to a holder of
the Preferred Shares (or a third party on his behalf) with respect to
any of the Preferred Shares:
(a) if such holder is liable for such taxes, duties,
assessments or governmental charges for which the withholding or
deduction was imposed in respect of the income from the Preferred
Shares by reason of such holder's having some connection with the
Cayman Islands, other than being a holder of the Preferred
Shares; or
(b) if the Company or the Guarantor has notified such holder
of the obligation to withhold taxes and requested but not
received from such holder a declaration of non-residence or other
similar claim for exemption, and such withholding or deduction
would not have been required had such declaration or similar
claim been received.
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AMENDMENTS AND ASSIGNMENT
Except with respect to any changes which do not adversely affect
the rights of holders of Preferred Shares (in which case no vote will
be required), the Guarantee may be changed only with the prior
approval of the holders of not less than 66-2/3% of the outstanding
Preferred Shares given either in writing or by vote at a duly
constituted meeting of such holders. All guarantees and agreements
contained in the Guarantee shall bind the successors, assigns,
receivers, trustees and representatives of the Guarantor and shall
inure to the benefit of the holders of the Preferred Shares. The
quorum for any such meeting and the determination of the Preferred
Shares entitled to vote shall be as set forth under "Description of
Preferred Shares-Voting Rights" in the Prospectus Supplement relating
to Preferred Shares of a particular series.
TERMINATION OF THE GUARANTEE
The Guarantee will terminate and be of no further force and
effect upon full payment of the redemption price (including all
accumulated arrears and accruals of unpaid dividends and including
redemption in connection with any exchange of a series of Preferred
Shares representing a series of Guarantor Preferred Stock) of all
Preferred Shares or upon full payment of the amounts payable upon
liquidation of the Company. The Guarantee will continue to be
effective or will be reinstated, as the case may be, if at any time
any holder of Preferred Shares of any series must restore payment of
any sums paid under the Preferred Shares of such series or the
Guarantee.
STATUS OF THE GUARANTEE
The Guarantee will constitute an unsecured obligation of the
Guarantor and will rank (i) junior to all liabilities of the
Guarantor, (ii) pari passu with the most senior preferred or
preference stock issued by the Guarantor and with any guarantee
entered into by the Guarantor in respect of any preferred or
preference stock of any affiliate of the Guarantor and (iii) senior to
the Guarantor's common shares.
The Guarantee will constitute a guarantee of payment and not of
collection. A holder of Preferred Shares may enforce the Guarantee
directly against the Guarantor, and the Guarantor will waive any right
or remedy to require that any action be brought against the Company or
any other person or entity before proceeding against the Guarantor.
The Guarantee will not be discharged except by payment of the
Guarantee Payments in full to the extent not paid by the Company and
by complete performance of all obligations under the Guarantee.
GOVERNING LAW
The Guarantee will be governed and construed in accordance with
the laws of the State of New York.
DESCRIPTION OF GUARANTOR PREFERRED STOCK
The following description of the terms of the Guarantor Preferred
Stock sets forth certain general terms and provisions of the Guarantor
Preferred Stock to which any Prospectus Supplement may relate. The
particular terms of the Guarantor Preferred Stock and the extent, if
any, to which such general terms do not apply to such Guarantor
Preferred Stock will be described in such Prospectus Supplement. The
description of the terms of the Guarantor Preferred Stock set forth
below and in any Prospectus Supplement does not purport to be complete
and is subject to and qualified in its entirety by reference to the
Guarantor's Certificate of Incorporation, as amended (the "Certificate
of Incorporation"), including the Certificate of Designations (the
"Certificate of Designations") relating to the applicable series of
Guarantor Preferred Stock. The Certificate of Incorporation and any
such Certificate of Designations are filed as exhibits to or will be
incorporated by reference in the Registration Statement of which this
Prospectus forms a part.
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<PAGE>
GENERAL
The Guarantor is authorized by its Certificate of Incorporation
to issue 10,000,000 shares of Guarantor Preferred Stock which may be
issued from time to time in one or more series and, subject to the
provisions of the Certificate of Incorporation applicable to all
series of Guarantor Preferred Stock, shall have such designations,
voting powers, preferences and relative, participating, optional or
other special rights, and qualifications, limitations or restrictions
thereof, as shall be stated in the resolution or resolutions providing
for the issue thereof adopted by the Guarantor's Board of Directors
(the "Board of Directors") or a duly authorized committee thereof.
The Guarantor Preferred Stock shall have the dividend,
liquidation, redemption and voting rights set forth below unless
otherwise specified in the applicable Prospectus Supplement.
Reference is made to the Prospectus Supplement relating to the
particular series of Guarantor Preferred Stock offered thereby for
specific terms, including: (i) the designation, stated value and
liquidation preference of such Guarantor Preferred Stock and the
number of shares offered; (ii) the dividend rate or rates (or method
of calculation), the date or dates from which dividends shall accrue,
and whether such dividends shall be cumulative or noncumulative and,
if cumulative, the dates from which dividends shall commence to
cumulate; (iii) any redemption or sinking fund provisions; (iv) the
amount that shares of such series shall be entitled to receive in the
event of any liquidation, dissolution or winding up of the Guarantor;
(v) the terms and conditions, if any, on which shares of such series
shall be exchangeable for shares of stock of any other class or
classes, or other series of the same class, of the Guarantor; (vi) the
voting rights, if any, of shares of such series in addition to those
set forth in "Voting Rights" below; (vii) the conditions and
restrictions, if any, on the payment of dividends or on the making of
other distributions on, or the purchase, redemption or other
acquisition by the Guarantor or any subsidiary, of the common stock or
of any other class of stock of the Guarantor ranking junior to the
shares of such series as to dividends or upon liquidation; (viii) the
conditions and restrictions, if any, on the creation of indebtedness
of the Guarantor, or any subsidiary, or on the issue of any additional
stock ranking on a parity with or prior to the shares of such series
as to dividends or upon liquidation; and (ix) any additional dividend,
liquidation, redemption, sinking or retirement fund and other rights,
preferences, privileges, limitations and restrictions of such
Guarantor Preferred Stock.
The Guarantor Preferred Stock will, when issued, be fully paid
and nonassessable. Unless otherwise specified in the applicable
Prospectus Supplement, the shares of each series of Guarantor
Preferred Stock will upon issuance rank on a parity in all respects
with the outstanding shares of the Guarantor's Adjustable Rate
Cumulative Preferred Stock, Series A, 7.88% Cumulative Preferred
Stock, Series B and 7.60% Cumulative Preferred Stock, Series C. As of
January 25, 1994, there were 881,450 shares of Adjustable Rate
Cumulative Preferred Stock, Series A, 937,500 shares of 7.88%
Cumulative Preferred Stock, Series B, and 500,000 shares of 7.60%
Cumulative Preferred Stock, Series C of the Guarantor outstanding with
an aggregate liquidation preference of $331,573,000. The Guarantor
Preferred Stock will have no preemptive rights to subscribe for any
additional securities that may be issued by the Guarantor.
DIVIDENDS
Unless otherwise set forth in the applicable Prospectus
Supplement, before any dividends may be declared or paid to the
holders of shares of the Common Stock, par value $1.00 per share, of
the Guarantor (the "Common Stock") or of any other capital stock of
the Guarantor ranking junior to any series of the Guarantor Preferred
Stock as to the payment of dividends, the holders of the Guarantor
Preferred Stock of that series will be entitled to receive, when and
as declared by the Board of Directors or a duly authorized committee
thereof, out of the net profits or net assets of the Guarantor legally
available therefor, dividends payable quarterly on such dates and at
such rates as will be specified in the applicable Prospectus
Supplement. Such rates may be fixed or variable or both. If
variable, the formula used for determining the dividend rate for each
dividend period will be specified in the applicable Prospectus
Supplement. Dividends will be payable to the holders of record as
they appear on the stock transfer records of the Guarantor on such
dates (not less than 15 days nor more than 60 days prior to a dividend
payment date) as will be fixed by the Board of Directors or a duly
authorized committee thereof.
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<PAGE>
Dividends on any series of Guarantor Preferred Stock may be
cumulative or noncumulative, as specified in the applicable Prospectus
Supplement. If the Board of Directors fails to declare a dividend
payable on a dividend payment date on any series of Guarantor
Preferred Stock for which dividends are noncumulative ("Noncumulative
Guarantor Preferred Stock"), then the holders of the Guarantor
Preferred Stock of that series will have no right to receive a
dividend in respect of the dividend period relating to such dividend
payment date, and the Guarantor will have no obligation to pay the
dividend accrued for such period, whether or not dividends on that
series are declared or paid on any future dividend payment dates. If
dividends on any series of Guarantor Preferred Stock are not paid in
full or declared in full and sums set apart for the payment thereof,
then no dividends shall be declared and paid on that series unless
declared and paid ratably on all shares of every series of Guarantor
Preferred Stock then outstanding, including dividends accrued or in
arrears, if any, in proportion to the respective amounts that would be
payable per share if all such dividends were declared and paid in
full.
The Prospectus Supplement relating to a series of Guarantor
Preferred Stock will specify the conditions and restrictions, if any,
on the payment of dividends or on the making of other distributions
on, or the purchase, redemption or other acquisition by the Guarantor
or any subsidiary thereof, the Common Stock or of any other class of
stock of the Guarantor ranking junior to the shares of that series as
to dividends or upon liquidation and any other preferences, rights,
restrictions and qualifications that are not inconsistent with the
Certificate of Incorporation.
LIQUIDATION RIGHTS
Unless otherwise set forth in the applicable Prospectus
Supplement, upon any liquidation, dissolution or winding up of the
Guarantor (whether voluntary or involuntary), the holders of Guarantor
Preferred Stock of that series will be entitled to receive out of the
assets of the Guarantor available for distribution to its
stockholders, whether from capital, surplus or earnings, the amount
specified in the applicable Prospectus Supplement for that series,
together with all dividends accrued and unpaid, before any
distribution of the assets will be made to the holders of Common Stock
or any other class or series of shares ranking junior to that series
of Guarantor Preferred Stock upon liquidation, dissolution or winding
up, and will be entitled to no other or further distribution. If,
upon any liquidation, dissolution or winding up of the Guarantor, the
assets distributable among the holders of a series of Guarantor
Preferred Stock shall be insufficient to permit the payment in full to
the holders of that series of Guarantor Preferred Stock of all amounts
payable to those holders, then the entire assets of the Guarantor thus
distributable will be distributed ratably among the holders of that
series of in proportion to the respective amounts that would be
payable per share if those assets were sufficient to permit payment in
full.
Neither the consolidation, merger or other business combination
of the Guarantor with or into any other individual, firm, corporation
or other entity nor the sale, lease, exchange or conveyance of all or
any part of the property, assets or business of the Guarantor will be
deemed to be a liquidation, dissolution or winding up of the
Guarantor.
REDEMPTION
If so specified in the applicable Prospectus Supplement, any
series of Guarantor Preferred Stock may be redeemable, in whole or in
part, at the option of the Guarantor or pursuant to a retirement or
sinking fund or otherwise, on terms and at the times and the
redemption prices specified in that Prospectus Supplement. If less
than all shares of the series at the time outstanding are to be
redeemed, the shares to be redeemed will be selected pro rata or by
lot, in such manner as may be prescribed by resolution of the Board of
Directors.
Notice of any redemption of a series of Guarantor Preferred Stock
will be given by publication in a newspaper of general circulation in
the Borough of Manhattan, The City of New York, such publication to be
made not less than 30 nor more than 60 days prior to the redemption
date. A similar notice will be mailed by the Guarantor, postage
prepaid, not less than 30 nor more than 60 days prior to the
redemption date, addressed to the respective holders of record of
shares of that series at the addresses shown on the stock transfer
records<PAGE>
<PAGE>
of the Guarantor, but the mailing of such notice will not be a
condition of such redemption. In order to facilitate the redemption
of shares of Guarantor Preferred Stock, the Board of Directors may fix
a record date for the determination of the shares to be redeemed, and
such record date will be not more than 60 days nor less than 30 days
prior to the redemption date.
Prior to the redemption date, the Guarantor will deposit money
for the payment of the redemption price with a bank or trust company
doing business in the Borough of Manhattan, The City of New York, and
having a capital and surplus of at least $10,000,000. Unless the
Guarantor fails to make such deposit, on the redemption date, all
dividends on the series of Guarantor Preferred Stock called for
redemption will cease to accrue and all rights of the holders of
shares of that series as stockholders of the Guarantor shall cease,
except the right to receive the redemption price (but without
interest). Unless otherwise specified in the applicable Prospectus
Supplement, any monies so deposited which remain unclaimed by the
holders of the shares of that series at the end of six years after the
redemption date will become the property of, and will be paid by the
bank or trust company with which it has been so deposited to, the
Guarantor.
CONVERSION RIGHTS
Guarantor Preferred Stock will not be convertible into Common
Stock.
VOTING RIGHTS
Unless otherwise determined by the Board of Directors of the
Guarantor and set forth in the Prospectus Supplement applicable to a
particular series of Guarantor Preferred Stock, holders of the
Guarantor Preferred Stock of that series will not have any voting
rights except as set forth below or as otherwise from time to time
required by law. Whenever dividends on any series of Guarantor
Preferred Stock or any other class or series of stock ranking on a
parity with that series with respect to the payment of dividends shall
be in arrears for dividend periods, whether or not consecutive,
containing in the aggregate a number of days equivalent to six
calendar quarters, the holders of shares of that series (voting
separately as a class with all other series of Guarantor Preferred
Stock upon which like voting rights have been conferred and are
exercisable) will be entitled to vote for the election of two of the
authorized number of directors of the Guarantor at the next annual
meeting of stockholders and at each subsequent meeting until all
dividends accumulated on that series have been fully paid or set apart
for payment. The term of office of all directors elected by the
holders of a series of Guarantor Preferred Stock shall terminate
immediately upon the termination of the right of the holders of that
series to vote for directors. Whenever the shares of a series are or
become entitled to vote, each holder of shares of that series will
have one vote for each share held.
So long as shares of any series of Guarantor Preferred Stock
remain outstanding, the Guarantor shall not, without the consent of
the holders of at least two-thirds of the shares of that series
outstanding at the time (voting separately as a class with all other
series of Guarantor Preferred Stock upon which like voting rights have
been conferred and are exercisable), (i) issue or increase the
authorized amount of any class or series of stock ranking senior to
the shares of that series as to dividends or upon liquidation or (ii)
amend, alter or repeal the provisions of the Guarantor's Certificate
of Incorporation or of the resolutions contained in the Certificate of
Designations, whether by merger, consolidation or otherwise, so as to
materially and adversely affect any power, preference or special right
of the outstanding shares of that series or the holders thereof;
provided, however, that any increase in the amount of the authorized
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Common Stock or authorized Guarantor Preferred Stock or the creation and
issuance of Common Stock or any other series of Guarantor Preferred
Stock ranking on a parity with or junior to a series of Guarantor
Preferred Stock as to dividends and upon liquidation shall not be
deemed to materially and adversely affect the powers, preferences or
special rights of the shares of that series.
Unless otherwise indicated in the applicable Prospectus
Supplement, the transfer agent, dividend disbursing agent and
registrar for each series of Guarantor Preferred Stock will be
Security Trust Company, N.A.
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DESCRIPTION OF DEPOSITARY SHARES
The following summary and the summary in any Prospectus
Supplement of the terms and provisions of the Depositary Shares and
Depositary Receipts does not purport to be complete and is subject to
and qualified in its entirety by reference to the Deposit Agreement
relating to the applicable series of Guarantor Preferred Stock, which
will be filed as an exhibit to or incorporated by reference in the
Registration Statement of which this Prospectus forms a part.
GENERAL
The Guarantor, at its option, may elect to offer fractional
interests in shares of a series of Guarantor Preferred Stock, rather
than whole shares. If the option is exercised, the Guarantor will
provide for the issuance by a depositary of depositary receipts
("Depositary Receipts") evidencing depositary shares ("Depositary
Shares"), each of which will represent a fractional interest (to be
specified in the applicable Prospectus Supplement) in a share of a
particular series of the Guarantor Preferred Stock as more fully
described below.
If the Guarantor offers fractional shares of any series of
Guarantor Preferred Stock, those shares will be deposited under a
separate deposit agreement (a "Deposit Agreement") among the
Guarantor, a bank or trust company selected by the Guarantor and
having its principal office in the United States and having a combined
capital and surplus of at least $50,000,000 (the "Depositary") and the
holders from time to time of the Depositary Receipts issued thereunder
by that Depositary. The applicable Prospectus Supplement will set
forth the name and address of the Depositary. Subject to the terms of
the Deposit Agreement, each owner of a Depositary Share will be
entitled, in proportion to the applicable fractional interest in a
share of Guarantor Preferred Stock underlying such Depositary Share,
to all the rights and preferences of the fractional share of Guarantor
Preferred Stock underlying such Depositary Share (including dividend,
voting, redemption and liquidation rights).
Pending the preparation of definitive engraved Depositary
Receipts, upon the written order of the Guarantor, the Depositary may
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 Guarantor's expense.
DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute to the holders of Depositary
Receipts evidencing Depositary Shares all cash dividends or other cash
distributions received in respect of the underlying fractional shares
of Guarantor Preferred Stock in proportion to their respective
holdings of the Depositary Shares on the relevant record date.
However, the Depositary will distribute only the amount that can be
distributed without attributing to any holder of Depositary Shares a
fraction of one cent, and any balance not so distributed will be held
by the Depositary (without liability for interest thereon) and will be
added to and treated as part of the next sum received by the
Depositary for distribution to holders of Depositary Receipts then
outstanding.
If the Guarantor distributes property other than cash in respect
of shares of Guarantor Preferred Stock deposited under a Deposit
Agreement, the Depositary will distribute the property received by it
to the record holders of Depositary Receipts evidencing the Depositary
Shares relating to those shares of Guarantor Preferred Stock, in
proportion, as nearly as may be practicable, to their respective
holdings of the Depositary Shares on the relevant record date, unless
the Depositary determines that it is not feasible to make such a
distribution, in which case the Depositary may, with the approval of
the Guarantor, adopt such method as it deems equitable and practicable
to give effect to the distribution, including the sale of the property
so received and distribution of the net proceeds from such sale to the
holders of the Depositary Receipts.
<PAGE>
<PAGE>
Each Deposit Agreement will also contain provisions relating to
the manner in which any subscription or similar rights offered by the
Guarantor to holders of the Guarantor Preferred Stock deposited under
such Deposit Agreement will be made available to holders of Depositary
Shares.
REDEMPTION OF DEPOSITARY SHARES
If the shares of Guarantor Preferred Stock deposited under a
Deposit Agreement are subject to redemption, in whole or in part,
then, upon any such redemption, the Depositary Shares relating to
those deposited shares will be redeemed from the proceeds received by
the Depositary as a result of the redemption. Whenever the Guarantor
redeems shares of Guarantor Preferred Stock held by a Depositary, the
Depositary will redeem as of the same redemption date the number of
Depositary Shares representing the shares of Guarantor Preferred Stock
so redeemed. The Depositary will mail the notice of redemption not
less than 20 and not more than 50 days prior to the date fixed for
redemption to the record holders of the Depositary Shares to be so
redeemed. The redemption price per Depositary Share will be equal to
the applicable fraction of the per share redemption price of the
Guarantor Preferred Stock underlying such Depositary Share. If less
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.
If notice of redemption shall have been given as described above,
from and after the date fixed for redemption, unless the Guarantor
shall have failed to redeem the shares of Guarantor Preferred Stock so
called for redemption, the Depositary Shares so called for redemption
will no longer be deemed to be outstanding, and all rights of the
holders of such Depositary Shares will cease, except for the right to
receive the monies payable upon such redemption and any money or other
property to which the holders of such Depositary Shares were entitled
upon such redemption, upon surrender to the Depositary of the
Depositary Receipts evidencing such Depositary Shares.
VOTING RIGHTS
As soon as practicable after receipt of notice of any meeting at
which the holders of shares of Guarantor Preferred Stock deposited
under a Deposit Agreement are entitled to vote, the Depositary will
mail the information contained in that notice of meeting (and any
accompanying proxy materials) to the holders of the Depositary Shares
relating to such Guarantor Preferred Stock as of the record date for
such meeting. Each such holder will be entitled, subject to any
applicable restrictions, to instruct the Depositary as to the exercise
of the voting rights of the Guarantor Preferred Stock represented by
such holder's Depositary Shares. The Depositary will endeavor,
insofar as practicable, to vote the Guarantor Preferred Stock
represented by those Depositary Shares in accordance with the holder's
instructions, and the Guarantor will agree to take all action deemed
necessary by the Depositary to enable the Depositary to do so. The
Depositary will abstain from voting shares of Guarantor Preferred
Stock deposited under a Deposit Agreement as to which it has not
received specific instructions from the holders of the Depositary
Shares representing those shares.
WITHDRAWAL OF STOCK
Upon surrender of Depositary Receipts at the principal office of
the relevant Depositary (unless the Depositary Shares evidenced
thereby have previously been called for redemption), and subject to
the terms of the related Deposit Agreement, the owner of the
Depositary Shares evidenced thereby shall be entitled to delivery of
whole shares of Guarantor Preferred Stock and all money and other
property, if any, represented by those Depositary Shares. Fractional
shares of Guarantor Preferred Stock will not be delivered. If the
Depositary Receipts surrendered by the holder evidence Depositary
Shares in excess of those representing the number of whole shares of
Guarantor Preferred Stock to be withdrawn, the Depositary will deliver
to the holder at the same time a new Depositary Receipt evidencing the
Depositary Shares. Holders of shares of Guarantor Preferred Stock
thus withdrawn will not thereafter be entitled to deposit such shares
under a Deposit Agreement or to receive Depositary Shares therefor.
The Guarantor does not expect that there will be any public trading
market for the Guarantor Preferred Stock, except as represented by
Depositary Shares.
<PAGE>
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing any Depositary Shares
and any provision of a Deposit Agreement may at any time and from time
to time be amended by agreement between the Guarantor and the
Depositary. However, any amendment that materially and adversely
alters the rights of the existing holders of Depositary Shares will
not be effective unless and until approved by the holders of at least
a majority of the Depositary Shares then outstanding under that
Deposit Agreement. Each Deposit Agreement will provide that each
holder of Depositary Shares at the time an amendment becomes effective
who continues to hold those Depositary Shares will be deemed to have
consented to the amendment and will be bound thereby. Except as may
be necessary to comply with any mandatory provisions of applicable
law, no amendment may impair the right, subject to the terms of the
related Deposit Agreement, of any holder of any Depositary Shares
to surrender the Depositary Receipt evidencing those Depositary
Shares to the Depositary together with instructions to deliver to
the holder the whole shares of Guarantor Preferred Stock represented
by the surrendered Depositary Shares and all money and other property,
if any, represented thereby. A Deposit Agreement may be terminated by
the Guarantor or the Depositary only if (i) all outstanding Depositary
Shares issued thereunder have been redeemed or (ii) there has been a
final distribution in respect of the Guarantor Preferred Stock relating
to those Depositary Shares in connection with any liquidation,
dissolution or winding up of the Guarantor and the amount received
by the Depositary as a result of that distribution has been
distributed by the Depositary to the holders of those Depositary
Shares.
CHARGES OF DEPOSITARY
The Guarantor will pay all transfer and other taxes and
governmental charges arising solely from the existence of the
depositary arrangements. The Guarantor will pay charges of any
Depositary in connection with the initial deposit of Guarantor
Preferred Stock and the initial issuance of the relevant Depositary
Shares and any redemption of such Guarantor Preferred Stock. Holders
of Depositary Shares will pay any other taxes and charges incurred for
their accounts as are provided in the relevant Deposit Agreement.
MISCELLANEOUS
Each Depositary will forward to the holders of Depositary Shares
issued by that Depositary all reports and communications from the
Guarantor that are delivered to the Depositary and that the Guarantor
is required to furnish to the holders of the Guarantor Preferred Stock
held by the Depositary. In addition, each Depositary will make
available for inspection by the holders of those Depositary Shares, at
the principal office of such Depositary and at such other places as it
may from time to time deem advisable, all reports and communications
received from the Guarantor that are received by such Depositary as
the holder of Guarantor Preferred Stock.
Neither any Depositary nor the Guarantor will assume any
obligation or will be subject to any liability under a Deposit
Agreement to holders of the Depositary Shares other than for its
negligence or willful misconduct. Neither any Depositary nor the
Guarantor will be liable if it is prevented or delayed by law or any
circumstance beyond its control in performing its obligations under a
Deposit Agreement. The obligations of the Guarantor and any
Depositary under a 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 Guarantor Preferred Stock unless satisfactory
indemnity is furnished. The Guarantor and any Depositary may rely on
written advice of counsel or accountants, on information provided by
persons presenting Guarantor Preferred Stock for deposit, holders of
Depositary Shares or other persons believed in good faith to be
competent to give such information and on documents believed to be
genuine and to have been signed or presented by the proper party or
parties.
RESIGNATION AND REMOVAL OF DEPOSITARY
A Depositary may resign at any time by delivering to the
Guarantor notice of its election to do so, and the Guarantor may at
any time remove any 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<PAGE>
<PAGE>
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 of America and having a combined capital
and surplus of at least $50,000,000.
FEDERAL INCOME TAX CONSEQUENCES
Owners of the Depositary Shares will be treated for Federal
income tax purposes as if they were owners of the Guarantor Preferred
Stock represented by such Depositary Shares.
BOOK-ENTRY PROCEDURES AND SETTLEMENT
Any series of Preferred Shares, Guarantor Preferred Stock or
Depositary Shares (each series, the "Securities") may be issued in
certificated or book-entry form, as specified in the applicable
Prospectus Supplement. The Securities issued in book-entry form from
the perspective of the beneficial owners thereof (the "Securityholders")
will be issued in the form of a single global stock certificate or a
single global Depositary Receipt (as the case may be) registered in
the name of the nominee of DTC.
DTC is a limited-purpose trust company created to hold securities
for its participating organizations (the "Participants") and to
facilitate the clearance and settlement of transactions in those
securities between Participants through electronic book-entry changes
in the accounts of the Participants. Participants include securities
brokers and dealers, banks and trust companies, clearing corporations
and certain other organizations. Access to DTC's 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 ("Indirect
Participants"). Persons who are not Participants or Indirect
Participants may beneficially own securities held by DTC only through
Participants or Indirect Participants.
DTC's nominee for all purposes will be considered the sole owner
or holder of the securities held in book-entry form. Owners of
beneficial interests in the global stock certificate or Depositary
Receipt will not be entitled to have the Securities registered in
their names, will not receive or be entitled to receive physical
delivery of the Securities in definitive form, and will not be
considered the holders thereof under the Memorandum, Certificate of
Incorporation or any Deposit Agreement.
Neither the Guarantor nor the Depositary will have any
responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests in the
global stock certificate or Depositary Receipt, or for maintaining,
supervising or reviewing any records relating to such beneficial
ownership interests.
A Securityholder's ownership of the Securities issued in book-
entry form will be recorded on or through the records of the brokerage
firm or other entity that maintains that Securityholder's account. In
turn, the total number of shares of the Securities held by an
individual brokerage firm or other entity for its clients will be
maintained on the records of DTC in the name of that brokerage firm or
other entity (or in the name of a Participant that acts as agent for
the Securityholder's brokerage firm or other entity if it is not a
Participant). Therefore, a Securityholder must rely upon the records
of the Securityholder's brokerage firm or other entity to evidence the
Securityholder's ownership of the Securities and transfer of ownership
of those Securities may be effected only through the brokerage firm or
other entity that maintains the Securityholder's account.
Dividends or other distributions payable in respect of the
Securities will be paid by the Guarantor or the Depositary, as the
case may be, to DTC. DTC will be responsible for crediting the amount
of payments that it receives to the accounts of the Participants in
accordance with their respective standard procedures, which currently
provide for payment in next-day funds. Each Participant will be
responsible for disbursing the payments for which it is so credited to
the Securityholders that it represents and to each brokerage firm or
other entity for which it acts as agent. Each such brokerage firm or
other entity will be responsible for disbursing funds to the
Securityholders that it represents. It is suggested that any
purchaser of the Securities with accounts<PAGE>
<PAGE>
at more than one brokerage firm or other entity effect transactions
in the Securities only through the brokerage firm or firms or other
entity or entities that hold such purchaser's Securities.
If DTC is at any time unwilling or unable to continue as
depository in respect of a global certificate or global Depositary
Receipt and a successor depository is not appointed by the Guarantor
or the Depositary, as the case may be, within 90 days, the Guarantor
will issue Securities, as the case may be, in definitive form in
exchange for the global stock certificate or global Depositary
Receipt. In addition, the Guarantor may determine at any time not to
have the Securities represented by a global stock certificate or
global Depositary Receipt (as the case may be), and, in such event,
will issue the Securities in definitive form in exchange for such
global stock certificate or global Depositary Receipt. In either
instance, an owner of a beneficial interest in the global stock
certificate or global Depositary Receipt will be entitled to have the
Securities equal in aggregate amount to that beneficial interest
registered in its name and will be entitled to physical delivery of a
definitive certificate or other instrument evidencing such Securities.
The registered holder of the Securities will be entitled to receive
the dividends or other distributions or, if applicable, the redemption
price payable in respect of such Securities, upon surrender of the
certificate (or Depositary Receipt) evidencing such Securities to the
Guarantor or the Depositary (as the case may be), in accordance with
the procedures set forth in the Memorandum, Certificate of
Incorporation or Deposit Agreement (as the case may be).
LIMITATIONS AFFECTING SECURITIES HOLDERS
There are no exchange control laws or regulations in effect under
current Cayman Islands legislation.
TAXATION
UNITED STATES
The following is a summary of the principal U.S. federal income
tax consequences, based on the advice of Weil, Gotshal & Manges, of
the purchase, ownership, and disposition of the Preferred Shares, to a
holder that is a citizen or resident of the United States, a
corporation, partnership, or other entity created or organized under
the laws of the United States, an estate or trust the income of which
is subject to U.S. federal income taxation regardless of source, or a
person that is otherwise subject to U.S. federal income tax on a net
income basis with respect to the Preferred Shares (a "U.S. Holder").
This summary does not address the U.S. federal income tax consequences
to persons other than U.S. Holders.
This summary is based on the U.S. federal income tax laws,
regulations, and ruling and decisions now in effect, all of which are
subject to change, possibly on a retroactive basis. This summary
considers only initial U.S. Holders that hold the Preferred Shares as
capital assets, and does not address the tax consequences applicable
to investors that may be subject to special tax rules such as banks,
insurance companies, dealers in stocks, tax exempt persons, persons
that will hold the Preferred Shares as a position in a "straddle," as
part of a "synthetic security" or "hedge," or as part of a "conversion
transaction" or other integrated investment. This summary also does
not address the tax consequences to persons that have a functional
currency other than the U.S. dollar. It does not include any
description of the tax laws of any state or local government or of any
foreign government that may be applicable to the Preferred Shares or
the holders thereof. For a description of certain consequences with
respect to the tax laws of the Cayman Islands, see the discussion
below under the heading "Cayman Island Tax Consequences."
INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISORS IN DETERMINING
THE U.S. FEDERAL INCOME TAX CONSEQUENCES OF HOLDING THE PREFERRED
SHARES AS WELL AS THE APPLICATION OF ANY STATE, LOCAL OR FOREIGN TAX
LAWS.
ANY INVESTORS THAT ARE PERSONS OTHER THAN U.S. PERSONS SHOULD
CONSULT THEIR TAX ADVISORS CONCERNING POSSIBLE ADVERSE U.S. TAX
CONSEQUENCES OF HOLDING THE PREFERRED SHARES.
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<PAGE>
Income from the Preferred Shares
In the opinion of Weil, Gotshal & Manges, the Company will be
treated as a partnership for U.S. federal income tax purposes. Each
holder of the "Preferred Shares" (a "Shareholder") will be required to
include in income its distributive share of the Company's net income.
Any amount so included in a Shareholder's income will increase his tax
basis in the Preferred Shares and the amount of cash distributions to
the Shareholder will reduce his tax basis in the Preferred Shares. A
Shareholder's distributive share of such income should not exceed
distributions on the Preferred Shares, except in the limited
circumstances described below under "Potential Extension of the
Payment Period" and "Use of Convention." No portion of such income
will be eligible for the dividends received deduction. A Shareholder
generally will not be taxable on cash distributions from the Company
so long as the amount of distributions do not exceed the Shareholder's
tax basis in the Preferred Shares.
Disposition of the Preferred Shares
Except as described below under "Exchange of the Preferred Shares
for Guarantor Preferred Stock," gain or loss will be recognized on a
sale, exchange or other disposition of the Preferred Shares (including
a distribution of cash in redemption of the Preferred Shares) equal to
the difference between the amount realized and the Shareholder's tax
basis in the Preferred Shares. Gain or loss recognized by a
Shareholder on the sale or exchange (or on a distribution of cash in
redemption of the Preferred Shares) of a Preferred Share held for more
than one year will generally be long-term capital gain or loss.
Exchange of the Preferred Shares for Guarantor Preferred Stock
In certain limited circumstances, the Guarantor has the right to
repay the note of the Guarantor held by the Company pursuant to the
loan of the proceeds of the Preferred Shares to the Guarantor (the
"Guarantor's Note") in Guarantor Preferred Stock. In those same
circumstances, the Company is obligated to exchange the Preferred
Shares for Guarantor Preferred Stock, which should not cause the
Company to recognize taxable gain. In addition, the distribution of
Guarantor Preferred Stock to a Shareholder in liquidation of the
Company generally should not result in the recognition of gain to the
Shareholder; however, such distribution may cause the Shareholder to
recognize a loss (or expense item) in an amount equal to the
difference between the excess, if any, of the Shareholder's basis in
the Preferred Shares over the fair market value of the Guarantor
Preferred Stock received in exchange therefor. If such a loss (or
expense item) is recognized, its deductibility by a Shareholder may be
subject to limitations (such as the limitation on deductibility of
capital losses) whose application will depend upon the Shareholder's
personal tax situation. A Shareholder's aggregate tax basis in the
Guarantor Preferred Stock received as a liquidating distribution
should be equal to such Shareholder's aggregate tax basis in its
Preferred Shares reduced by its loss (or expense item) referred to
above, if any, recognized upon the distribution.
It is possible that the Internal Revenue Service could take the
position that the Company should be disregarded and that each
Shareholder should be treated as holding an interest in the
Guarantor's Note held by the Company, rather than the Preferred
Shares. In that event, upon the Company's exchange of Preferred
Shares for Guarantor Preferred Stock in exercise of the Guarantor's
option to repay the Guarantor's Note with Guarantor Preferred Stock,
each Shareholder should be treated as exchanging debt of the Guarantor
for stock in the Guarantor. Such an exchange should be treated as a
non-taxable exchange to each Shareholder (except to the extent any
stock received is allocable to accrued but unpaid interest) and should
result in the Shareholder receiving an aggregate tax basis in the
Guarantor Preferred Stock (other than such stock allocable to accrued
but unpaid interest) which should be equal to such Shareholder's
aggregate tax basis in its Preferred Shares. Any Guarantor Preferred
Stock received by a Shareholder which is allocable to accrued but
unpaid interest would be taxable to such Shareholder as a payment of
such interest in accordance with such Shareholder's federal income tax
accounting method and the Shareholder would take a fair market value
tax basis in such stock.
<PAGE>
If the Preferred Shares are exchanged for Guarantor Preferred
Stock, any distributions paid on the Guarantor Preferred Stock will be
taxable to a U.S. Holder as ordinary dividend income to the extent of
the<PAGE>
<PAGE>
Guarantor's current and accumulated earnings and profits. To the
extent that the amount of distributions paid on the Guarantor
Preferred Stock exceeds the Guarantor's current and accumulated
earnings and profits (as determined for U.S. federal income tax
purposes), such excess distributions will be treated first as a return
of capital (reducing the U.S. Holder's adjusted tax basis in the
Guarantor's Preferred Stock), and then as capital gain. Such capital
gain would be long-term capital gain if the U.S. Holder's holding
period for the Guarantor Preferred Stock exceeds one year. To the
extent that distributions on the Guarantor Preferred Stock are treated
as dividends, a U.S. Holder that is a corporation may be eligible for
the 70% dividends received deduction, subject to certain limitations
and certain holding period requirements (although the benefit of such
deduction may be reduced or eliminated by the alternative minimum
tax). The dividends-received deduction may also be reduced if the
Guarantor Preferred Stock is considered "debt financed."
A U.S. Holder of Guarantor Preferred Stock will recognize gain or
loss on the sale or other disposition of such shares equal to the
difference between the amount realized and the U.S. Holder's tax basis
for the shares. Gain or loss recognized by a U.S. Holder on the sale
or exchange of Guarantor Preferred Stock held for more than one year
generally will be capital gain or loss. A redemption of the Guarantor
Preferred Stock for cash will generally be treated as a sale or
exchange unless the U.S. Holder owns other shares of stock of the
Guarantor and certain other conditions apply.
Potential Extension of the Payment Period
Under the terms of the Guarantor's Note representing the loan to
the Guarantor of the proceeds of the issue of the Preferred Shares,
the Guarantor may be permitted to extend the payment period. In the
event that the Guarantor exercises that right, the Guarantor may not
declare dividends on any shares of its preferred or common stock, and
therefore, the extension of the payment period is, in the view of the
Guarantor, remote. In the event that the payment period is extended,
the Company will continue to accrue income equal to the amount of the
interest payment due at the end of the extended payment period over
the term of the extended payment period.
Accrued income will be allocated but not distributed to holders
of record of the Preferred Shares on the last day of each calendar
month. As a result, U.S. Holders of record during an extended
interest payment period will include interest in gross income in
advance of the receipt of cash. The tax basis of the Preferred Shares
will be increased by the amount of any interest that is included in
income without a receipt of cash, and will be decreased by the amount
of cash subsequently received from the Company.
Use of Convention
The Company will adopt a convention under which all of the income
accrued by the Company in any calendar month will be allocated to
Shareholders of record on the last day of the month. This convention
may not be respected for federal income tax purposes. In such event,
all or part of the distributions received by a Shareholder in respect
of the calendar month in which he acquires his shares may be taxable
to the seller of such shares. Any such amount so taxed to the seller
would increase the seller's tax basis in the Preferred Shares and
would not increase the purchaser's tax basis in the Preferred Shares.
Company Information Returns and Audit Procedures
The Guarantor as Common Shareholder of the Company will furnish
each holder with a Schedule K-1 setting forth each holder's allocable
share of the income of the Company. The Schedule K-1 will be
furnished within 90 days after the close of the Company's taxable
year.
Any person who holds Preferred Shares as a nominee for another
person is required to furnish to the Company: (a) the name, address,
and taxpayer identification number of the beneficial owners and the
nominee; (b) whether the beneficial owner is (i) a person that is not
a United States person, (ii) a foreign government, an international
organization, or any wholly owned agency or instrumentality of either
of the foregoing, or (iii) a tax-exempt entity; (c) the amount and
description of Preferred Shares held, acquired, or transferred for the
<PAGE>
<PAGE>
beneficial owners; and (d) certain information including the dates of
acquisitions and transfers, means of acquisitions and transfers, and
acquisition cost for purchases, as well as the amount of net proceeds
from sales. Brokers and financial institutions are required to
furnish additional information, including certain information on
Preferred Shares that they acquire, hold, or transfer for their own
account. A penalty of $50 per failure (up to a maximum of $100,000
per calendar year) is imposed by the Internal Revenue Code for failure
to report such information to the Company. The nominee is required to
supply the beneficial owner of the Preferred Shares with the
information furnished to the Company.
CAYMAN ISLANDS
The following discussion is a summary of certain Cayman Islands
tax consequences, based on the advice of Maples & Calder, of the
purchase, disposition or ownership of the Preferred Shares.
Payment of dividends on the Preferred Shares will not be subject
to any withholding under the tax laws of the Cayman Islands. There
are no taxes in the Cayman Islands on income, profits, capital gains
or turnover, nor are there any inheritance, estate, or gift taxes or
duties in the Cayman Islands. There is no applicable stamp duty on
the issuance of any shares, and no stamp duty is payable on the
transfer or redemption of shares in the Company. The Company has
applied for and will be issued an undertaking by the Governor of the
Cayman Islands stating that the Company is exempt, for a period of
twenty years from the date of its incorporation, January 27, 1994,
from the payment of any taxes or duties which may be imposed in the
future on profits, income, capital gains, assets or appreciations and
any such tax or duty or tax in the nature of estate duty or
inheritance tax payable on the shares, debentures or other obligations
of the Company.
PLAN OF DISTRIBUTION
The Company may sell the Preferred Shares in any of three ways:
(i) to underwriters (including Bear Stearns) or dealers, who may act
directly or through a syndicate represented by one or more managing
underwriters (including Bear Stearns); (ii) through broker-dealers
(including Bear Stearns) designated by the Company to act on its
behalf as agents; or (iii) directly to one or more purchasers. Each
Prospectus Supplement will set forth the manner and terms of the
offering of the Preferred Shares covered thereby, including (i)
whether that offering is being made to underwriters or through agents;
(ii) any underwriting discounts, dealer concessions, agency
commissions and any other items that may be deemed to constitute
underwriters', dealers' or agents' compensation, and (iii) the purchase
price or initial public offering price of the Preferred Shares and
the anticipated proceeds to the Company from the sale of the Preferred
Shares.
When Preferred Shares are to be sold to underwriters, unless
otherwise set forth in the applicable Prospectus Supplement, the
obligations of the underwriters to purchase those Preferred Shares
will be subject to certain conditions precedent but the underwriters
will be obligated to purchase all of the Preferred Shares if any are
purchased. The Preferred Shares will be acquired by the underwriters
for their own account and may be resold by the underwriters, either
directly to the public or to securities dealers, from time to time in
one or more transactions, including negotiated transactions, either at
a fixed public offering price or at varying prices determined at the
time of sale. The initial public offering price, if any, and any
concessions allowed or reallowed to dealers, may be changed from time
to time.
To the extent that any Preferred Shares underwritten by Bear
Stearns are not resold by Bear Stearns for an amount at least equal to
the public offering price thereof, the proceeds from the offering of
those Preferred Shares will be reduced. Bear Stearns intends to
resell any of those Preferred Shares from time to time following
termination of the offering at varying prices related to prevailing
market prices at the time of sale, subject to applicable prospectus
delivery requirements.
Unless otherwise indicated in the applicable Prospectus
Supplement, when Preferred Shares are sold through an agent, the
designated agent will agree, for the period of its appointment as
agent, to use its best efforts to sell the Preferred Shares for the
Company's account and will receive commissions from the Company as set
forth in the applicable Prospectus Supplement.
<PAGE>
<PAGE>
Underwriters and agents participating in any distribution of
Preferred Shares may be deemed "underwriters" within the meaning of
the Securities Act and any discounts or commissions they receive in
connection therewith may be deemed to be underwriting compensation for
the purposes of the Securities Act. Those underwriters and agents may
be entitled, under their agreements with the Company and the
Guarantor, to indemnification by the Company and the Guarantor against
certain civil liabilities, including liabilities under the Securities
Act, or to contribution by the Company and the Guarantor to payments
that they may be required to make in respect of those civil
liabilities. Various of those underwriters or agents may be customers
of, engage in transactions with or perform services for the Guarantor
or its affiliates in the ordinary course of business.
Following the initial distribution of any series of Preferred
Shares, Bear Stearns may offer and sell previously issued Preferred
Shares of that series from time to time in the course of its business
as a broker-dealer. Bear Stearns may act as principal or agent in
those transactions. This Prospectus and the Prospectus Supplement
applicable to those Preferred Shares will be used by Bear Stearns in
connection with those transactions. Sales will be made at prices
related to prevailing prices at the time of sale.
Each distribution of Preferred Shares will conform to the
requirements set forth in the applicable sections of Schedule E to the
By-laws of the NASD.
ERISA CONSIDERATIONS
Section 4975 of the Internal Revenue Code of 1986, as amended
(the "Code"), prohibits the borrowing of money, the sale of property
and certain other transactions involving the assets of plans that are
qualified under the Code ("Qualified Plans") or individual retirement
accounts ("IRAs") and persons who have certain specified relationships
to them. Section 406 of the Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), prohibits similar transactions
involving employee benefit plans that are subject to ERISA ("ERISA
Plans"). Qualified Plans, IRAs and ERISA Plans are hereinafter
collectively referred to as "Plans."
Persons who have such specified relationships are referred to as
"parties in interest" under ERISA and as "disqualified persons" under
the Code. "Parties in interest" and "disqualified persons" encompass
a wide range of persons, including any fiduciary (e.g., investment
----
manager, trustee or custodian), any person providing services (e.g., a
----
broker), the Plan sponsor, an employee organization any of whose
members are covered by the Plan, and certain persons related to or
affiliated with any of the foregoing.
The Guarantor, Bear Stearns and/or BSSC each is considered a
"party in interest" or "disqualified person" with respect to many
Plans, including IRAs established with any of them. The purchase
and/or holding of Preferred Shares or Depositary Shares representing a
series of Guarantor Preferred Stock by a Plan with respect to which
the Guarantor, Bear Stearns and/or BSSC is a fiduciary and/or a
service provider (or otherwise is a "party in interest" or
"disqualified person") would constitute or result in a prohibited
transaction under Section 406 of ERISA or Section 4975 of the Code,
unless such Preferred Shares or Depositary Shares representing a
series of Guarantor Preferred Stock are acquired or held pursuant to
and in accordance with an applicable statutory or administrative
exemption. An IRA that engages in a non-exempt prohibited transaction
could forfeit its tax-exempt status under Section 408 of the Code.
Applicable exemptions may include the exemption for services
under Section 408(b)(2) of ERISA and certain prohibited transaction
class exemptions (e.g., Prohibited Transaction Class Exemption 84-14
----
relating to qualified professional asset managers and Prohibited
Transaction Class Exemptions 75-1 and 86-128 relating to securities
transactions involving employee benefit plans and broker-dealers).
In accordance with ERISA's general fiduciary requirement, a
fiduciary with respect to any ERISA Plan who is considering the
purchase of Preferred Shares on behalf of such plan should determine
whether such purchase is permitted under the governing plan document
and is prudent and appropriate for the ERISA Plan in view of its
overall investment policy and the composition and diversification of
its portfolio. No IRA established with the Guarantor, Bear Stearns,
and/or BSSC should acquire any Preferred Shares or Depositary<PAGE>
<PAGE>
Shares representing a series of Guarantor Preferred Stock and other Plans
established with the Guarantor, Bear Stearns and/or BSSC should
consult with counsel prior to making any such acquisition.
EXPERTS
The consolidated financial statements and the related financial
statement schedules incorporated by reference from the Company's 1993
Form 10-K have been audited by Deloitte & Touche, independent
auditors, as stated in their reports, which are incorporated herein by
reference, and have been so incorporated in reliance upon the reports
of such firm given upon their authority as experts in accounting and
auditing.
VALIDITY OF SECURITIES
The validity of the Preferred Shares will be passed upon by
Maples and Calder, Cayman Islands counsel to the Company. The
validity of the Guarantee relating to the Preferred Shares and the
Guarantor Preferred Stock will be passed upon on behalf of the Company
and the Guarantor by Weil, Gotshal & Manges (a partnership including
professional corporations), New York, New York, and on behalf of any
underwriters or agents by Andrews & Kurth L.L.P., New York, New York.
As to all matters of Cayman Islands law, Weil, Gotshal & Manges and
Andrews & Kurth L.L.P. will rely upon the opinion of Maples and
Calder.
<PAGE>
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the estimated expenses in
connection with the issuance and distribution of the securities being
registered.
SEC registration fee . . . . . . . . . . . . . . $172,414
Accounting fees . . . . . . . . . . . . . . . . . *
Legal fees and expenses . . . . . . . . . . . . . *
Blue Sky fees and expenses (including legal fees) *
Printing and engraving fees . . . . . . . . . . . *
NASD filing fee . . . . . . . . . . . . . . . . . 30,500
Miscellaneous . . . . . . . . . . . . . . . . . . *
--------
Total . . . . . . . . . . . . . . . . . . . $ *
=======
___________________
* To be provided by amendment.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Reference is made to section 145 of the Delaware General
Corporation Law which provides for indemnification of directors and
officers in certain circumstances.
Article VIII of the Restated Certificate of Incorporation of The
Bear Stearns Companies Inc. provides for indemnification of directors
and officers of The Bear Stearns Companies, Inc. against certain
liabilities incurred as a result of their duties as such and also
provides for the elimination of the monetary liability of directors
for certain actions as such, which Restated Certificate of
Incorporation is filed as Exhibit 4(a) to the Registration Statement
Form S-8 (No. 33-49979) filed August 13, 1993.
The Bear Stearns Companies Inc. has in effect reimbursement
insurance for directors' and officers' liability claims and directors'
and officers' liability insurance indemnifying, respectively, the
directors and officers of The Bear Stearns Companies Inc. within
specific limits for certain liabilities incurred by them, subject to
the conditions and exclusions and deductible provisions of the
policies.
For the undertaking with respect to indemnification, see Item 17
herein.
ITEM 16. EXHIBITS.
1 - Form of Underwriting Agreement.*
3.1 - Memorandum of Association of Bear Stearns Finance LLC.*
3.2 - Articles of Association of Bear Stearns Finance LLC.*
4.1 - Form of Guarantee Agreement between Bear Stearns
Finance LLC and The Bear Stearns Companies Inc.*
4.2 - Form of Loan Agreement between Bear Stearns Finance LLC
and The Bear Stearns Companies Inc.*
4.3 - Restated Certificate of Incorporation, as amended, of
The Bear Stearns Companies Inc. (incorporated by
reference to Exhibit 4(a) to its Registration Statement
on Form S-8 (No. 33-49979)).
4.4 - Certification of Designation relating to the preferred
stock of The Bear Stearns Companies Inc. (incorporated
by reference to Exhibit 2.4 to its Registration
Statement on Form 8-A dated March 15, 1993).
II-1
<PAGE>
<PAGE>
4.5 - Amended and Restated By-Laws of The Bear Stearns
Companies Inc. (incorporated by reference to Exhibit
3(b) to its Annual Report on Form 10-K for the fiscal
year ended June 30, 1991).
4.6 - Form of Deposit Agreement (incorporated by reference to
Exhibit 4(d) to the Registration Statement on Form S-3
(No. 33-59140)).
5.1 - Opinion of Maples and Calder as to legality of the
Preferred Shares.*
5.2 - Opinion of Weil, Gotshal & Manges as to legality of the
Guarantee and the Guarantor Preferred Stock.*
8.1 - Opinion of Maples and Calder as to tax matters
(included in Exhibit 5.1).*
8.2 - Opinion of Weil, Gotshal & Manges at to tax matters.*
12 - Computation of Ratio of Earnings to Combined Fixed
Charges and Preferred Stock Dividends.
23.1 - Consent of Deloitte & Touche.
23.2 - Consent of Maples and Calder (included in Exhibit
5.1).*
23.3 - Consents of Weil, Gotshal & Manges (included in
Exhibits 5.2 and 8.2).*
24.1 - Powers of attorney (included in the signature pages to
the Registration Statement).
--------------------
* To be filed by amendment.
ITEM 17. UNDERTAKINGS.
Each of the Bear Stearns Finance LLC and The Bear Stearns
Companies Inc. hereby undertakes:
(1) To file, during any period in which offers or sales are
being made of the Securities registered hereby, a post-effective
amendment to this Registration Statement:
(i) to include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(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 this
Registration Statement;
(iii) to include any material information with respect
to the plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in this Registration Statement;
provided, however, that the undertakings set forth in paragraphs
-------- -------
(1)(i) and (1)(ii) above do not apply if the information required to be
included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by The Bear Stearns Companies Inc.
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act
of 1934 that are incorporated by reference in this Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, 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.
II-2
<PAGE>
<PAGE>
(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.
(4) That, for the purposes of determining any liability under the
Securities Act of 1933, each filing of The Bear Stearns Companies
Inc.'s annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of
an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference
in the Registration Statement 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.
(5) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the registrants pursuant to the provisions referred to in
Item 15 of this registration statement, or otherwise, the registrants
have been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed
in such Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the
payment by the registrants 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 hereby, the registrants 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 such Act and will be governed by the final adjudication
of such issue.
II-3
<PAGE>
<PAGE>
SIGNATURES OF BEAR STEARNS FINANCE LLC
Pursuant to the requirements of the Securities Act of 1933, Bear
Stearns Finance LLC hereby certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-3
and has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
New York, State of New York, on the 27th day of January, 1994.
BEAR STEARNS FINANCE LLC
Attest: By: THE BEAR STEARNS COMPANIES INC., as
Common Shareholder
By: /s/Kenneth Edlow By: /s/William J. Montgoris
---------------- ---------------------------------
Kenneth Edlow William J. Montgoris
Secretary of Common Shareholder Chief Operating Officer and
Chief Financial Officer of
Common Shareholder
We, the undersigned officers of Bear Stearns Finance LLC, hereby
severally constitute William J. Montgoris, Michael Minikes and Samuel
L. Molinaro, Jr., and any of them singly, our true and lawful
attorneys with full power to them, and each of them singly, to sign
for us and in our name in the capacities indicated below, any and all
amendments to this registration statement with the Securities and
Exchange Commission, and generally to do all such things in our name
and behalf in such capacities to enable Bear Stearns Finance LLC to
comply with the provisions of the Securities Act of 1933, as amended,
and all requirements of the Securities and Exchange Commission, and we
hereby ratify and confirm our signatures as they may be signed by our
said attorneys, or any of them, to any and all such amendments.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/William J. Montgoris Chief Operating Officer January 27, 1994
------------------------
William J. Montgoris and Chief Financial Officer
of Common Shareholder
(Principal Executive
Officer of Bear Stearns
Finance LLC)
/s/Michael Minikes Treasurer of January 27, 1994
-----------------------
Michael Minikes Common Shareholder
(Principal Financial
Officer of Bear Stearns
Finance LLC)
II-4
<PAGE>
<PAGE>
SIGNATURE TITLE DATE
--------- ----- ----
/s/Samuel L. Molinaro, Jr. Senior Vice President- January 27, 1994
--------------------------
Samuel L. Molinaro, Jr. Finance of Common
Shareholder (Principal
Accounting Officer of
Bear Stearns Finance LLC)
Authorized Representative
in the United States:
/s/William J. Montgoris Chief Operating Officer January 27, 1994
------------------------
William J. Montgoris and Chief Financial Officer
of Common Shareholder
II-5
<PAGE>
<PAGE>
SIGNATURES OF THE BEAR STEARNS COMPANIES INC.
Pursuant to the requirements of the Securities Act of 1933,
The Bear Stearns Companies Inc. hereby certifies that it has
reasonable grounds to believe that it meets all of the requirements
for filing on Form S-3 and has duly caused this registration statement
to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, State of New York, on the 25th
day of January, 1994.
THE BEAR STEARNS COMPANIES INC.
By: /s/William J. Montgoris
----------------------------
William J. Montgoris
Chief Operating Officer and
Chief Financial Officer
We, the undersigned officers and directors of The Bear Stearns
Companies Inc., hereby severally constitute Alan C. Greenberg, James
E. Cayne and William J. Montgoris, and any of them singly, our true
and lawful attorneys with full power to them, and each of them singly,
to sign for us and in our name in the capacities indicated below, any
and all amendments to this registration statement on Form S-3 with the
Securities and Exchange Commission, and generally to do all such
things in our name and behalf in such capacities to enable The Bear
Stearns Companies Inc. to comply with the provisions of the Securities
Act of 1933, as amended, and all requirements of the Securities and
Exchange Commission, and we hereby ratify and confirm our signatures
as they may be signed by our said attorneys, or any of them, to any
and all such amendments.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
SIGNATURE TITLE DATE
--------- ----- ----
/s/Alan C. Greenberg Chairman of the Board January 25, 1994
-----------------------
Alan C. Greenberg and Director
/s/James E. Cayne President and Chief Executive January 25, 1994
------------------------
James E. Cayne Officer (Principal Executive
Officer); Director
/s/Michael L. Tarnopol Executive Vice President; January 25, 1994
------------------------
Michael L. Tarnopol Director
/s/Vincent J. Mattone Executive Vice President; January 25, 1994
------------------------
Vincent J. Mattone Director
Executive Vice President; January __, 1994
------------------------
John C. Sites, Jr. Director
II-6
<PAGE>
<PAGE>
SIGNATURE TITLE DATE
--------- ----- ----
/s/Alan D. Schwartz Executive Vice President; January 25, 1994
-------------------------
Alan D. Schwartz Director
/s/Warren J. Spector Executive Vice President; January 25, 1994
-------------------------
Warren J. Spector Director
/s/William J. Montgoris Chief Operating Officer January 25, 1994
-------------------------
William J. Montgoris and Chief Financial Officer
(Principal Financial
Officer)
/s/Michael Minikes Treasurer; Director January 25, 1994
-------------------------
Michael Minikes
/s/E. Garrett Bewkes, III Director January 25, 1994
--------------------------
E. Garrett Bewkes, III
/s/Denis A. Bovin Director January 25, 1994
-------------------------
Denis A. Bovin
Director January __, 1994
-------------------------
Peter Cherasia
/s/Michael R. Dabney Director January 25, 1994
-------------------------
Michael R. Dabney
/s/Kevin Finnerty Director January 25, 1994
-------------------------
Kevin Finnerty
Director January __, 1994
--------------------
Grace J. Fippinger
II-7<PAGE>
<PAGE>
SIGNATURE TITLE DATE
--------- ----- ----
/s/Carl D. Glickman Director January 25, 1994
-------------------------
Carl D. Glickman
Director January __, 1994
-------------------------
Thomas R. Green
Director January __, 1994
-------------------------
Donald J. Harrington, C.M.
/s/Richard Harriton Director January 25, 1994
--------------------------
Richard Harriton
/s/Nancy E. Havens-Hasty Director January 25, 1994
-------------------------
Nancy E. Havens-Hasty
/s/Jonathan Ilany Director January 25, 1994
-------------------------
Jonathan Ilany
/s/Daniel L. Keating Director January 25, 1994
-------------------------
Daniel L. Keating
Director January __, 1994
-------------------------
John W. Kluge
/s/David A. Liebowitz Director January 25, 1994
-------------------------
David A. Liebowitz
/s/Bruce M. Lisman Director January 25, 1994
-------------------------
Bruce M. Lisman
Director January __, 1994
--------------------
Matthew J. Mancuso
II-8<PAGE>
<PAGE>
SIGNATURE TITLE DATE
--------- ----- ----
/s/Donald Mullen Director January 25, 1994
--------------------
Donald Mullen
Director January __, 1994
--------------------
Frank T. Nickell
/s/R. Blaine Roberts Director January 25, 1994
----------------------
R. Blaine Roberts
/s/E. John Rosenwald, Jr. Director January 25, 1994
-------------------------
E. John Rosenwald, Jr.
Director January __, 1994
-------------------------
Frederic V. Salerno
/s/Robert M. Steinberg Director January 25, 1994
-------------------------
Robert M. Steinberg
Director January __, 1994
--------------------
Fred Wilpon
/s/Uzi Zucker Director January 25, 1994
--------------------
Uzi Zucker
/s/Michael J. Abatemarco Controller January 25, 1994
------------------------
Michael J. Abatemarco
/s/Samuel L. Molinaro, Jr. Senior Vice President- January 25, 1994
--------------------------
Samuel L. Molinaro, Jr. Finance (Principal
Accounting Officer)
II-9
<PAGE>
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
1 - Form of Underwriting Agreement.*
3.1 - Memorandum of Association of Bear Stearns Finance LLC.*
3.2 - Articles of Association of Bear Stearns Finance LLC.*
4.1 - Form of Guarantee Agreement between Bear Stearns
Finance LLC and The Bear Stearns Companies Inc.*
4.2 - Form of Loan Agreement between Bear Stearns Finance LLC
and The Bear Stearns Companies Inc.*
4.3 - Restated Certificate of Incorporation, as amended, of
The Bear Stearns Companies Inc. (incorporated by
reference to Exhibit 4(a) to its Registration Statement
on Form S-8 (No. 33-49979)).
4.4 - Certification of Designation relating to the preferred
stock of The Bear Stearns Companies Inc. (incorporated
by reference to Exhibit 2.4 to its Registration
Statement on Form 8-A dated March 15, 1993).
4.5 - Amended and Restated By-Laws of The Bear Stearns
Companies Inc. (incorporated by reference to Exhibit
3(b) to its Annual Report on Form 10-K for the fiscal
year ended June 30, 1991).
4.6 - Form of Deposit Agreement (incorporated by reference to
Exhibit 4(d) to the Registration Statement on Form S-3
(No. 33-59140)).
5.1 - Opinion of Maples and Calder as to legality of the
Preferred Shares.*
5.2 - Opinion of Weil, Gotshal & Manges as to legality of the
Guarantee and the Guarantor Preferred Stock.*
8.1 - Opinion of Maples and Calder as to tax matters
(included in Exhibit 5.1).*
8.2 - Opinion of Weil, Gotshal & Manges at to tax matters.*
12 - Computation of Ratio of Earnings to Combined Fixed
Charges and Preferred Stock Dividends.
23.1 - Consent of Deloitte & Touche.
23.2 - Consent of Maples and Calder (included in Exhibit
5.1).*
23.3 - Consents of Weil, Gotshal & Manges (included in
Exhibits 5.2 and 8.2).*
24.1 - Powers of attorney (included in the signature pages to
the Registration Statement).
--------------------
* To be filed by amendment.
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT 12
THE BEAR STEARNS COMPANIES INC.
STATEMENT RE COMPUTATION OF RATIO OF EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(In thousands, except for ratio)
Six Months Ended Fiscal Year Ended
--------------------------- -------------------------------------------------------------------
December 31, December 31, June 30, June 30, June 30, June 30, June 30,
1993 1992 1993 1992 1991 1990 1989
------------ ------------ ---------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings before
taxes on income $ 409,906 $ 219,397 $ 614,398 $ 507,625 $ 229,501 $ 192,532 $ 287,383
------------ ------------ --------- ---------- ----------- ----------- -----------
Add: Fixed Charges
Interest 434,458 343,058 710,086 834,859 1,141,029 1,217,212 1,089,879
Interest factor
in rent 10,624 10,066 20,084 20,874 18,715 18,999 18,798
Preferred stock
dividends 20,616 2,429 12,245 5,566 6,169 7,244 14,923
------------ ------------ ---------- ---------- ----------- ----------- -----------
Total fixed
charges and
Preferred stock
dividends 465,697 355,553 742,415 861,299 1,165,913 1,243,455 1,123,600
------------ ------------ ---------- ---------- ----------- ----------- -----------
Earnings before
fixed charges,
Preferred stock
dividends and
taxes on income $ 875,603 $ 574,950 $1,356,813 $ 1,368,924 $ 1,395,414 $ 1,435,987 $ 1,410,983
============ ============ ========== ========== =========== =========== ===========
Ratio of earnings
to combined fixed
charges and
preferred stock
dividends 1.9 1.6 1.8 1.6 1.2 1.2 1.3
============ ============ ========== ========== =========== =========== ===========
</TABLE>
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration
Statement of The Bear Stearns Companies Inc. on Form S-3 of our
reports dated August 13, 1993, appearing in the Annual Report on Form
10-K of The Bear Stearns Companies Inc. and Subsidiaries for the year
ended June 30, 1993 and to the reference to us under the heading
"Experts" in the Prospectus, which is a part of this Registration
Statement.
DELOITTE & TOUCHE
New York, New York
January 25, 1994
