<PAGE>
As filed with the Securities and Exchange Commission on September 1, 1999
Registration Statement No. 333-76371
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Amendment No. 3
to
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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Fortune Brands, Inc.
(Exact name of registrant as specified in its charter)
Delaware 1700 East Putnam Avenue, 13-3295276
(State or other Old Greenwich, Connecticut 06870-0811 (I.R.S. Employer
jurisdiction of (203) 698-5000 Identification
incorporation or (Address, including zip code, and No.)
organization) telephone number,
including area code, of registrant's
principal executive offices)
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LOUIS F. FERNOUS, JR., Vice President and Secretary
Fortune Brands, Inc.
1700 East Putnam Avenue,
Old Greenwich, Connecticut 06870-0811
(203) 698-5000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
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Copies to:
EDWARD P. SMITH, Esq. FRANCIS J. MORISON, Esq.
Chadbourne & Parke LLP Davis Polk & Wardwell
30 Rockefeller Plaza 450 Lexington Avenue
New York, New York 10112 New York, New York 10017
(212) 408-5100 -------------- (212) 450-4000
Approximate date of commencement of proposed sale 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, as amended (the "Securities Act"), other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
Proposed
Proposed maximum
Title of each class of maximum aggregate Amount of
securities to be Amount to be offering price offering registration
registered registered(1) per unit(1) price(1) fee(4)
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<S> <C> <C> <C> <C>
Debt Securities and War-
rants to Purchase Debt
Securities............. $550,000,000(2) 100% $550,000,000 $152,900
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Common Stock, par value
$3.125 per share, and
associated Preferred
Share Purchase Rights.. (3)
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</TABLE>
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(1) Estimated solely for purposes of calculating the amount of the registration
fee. Excludes an aggregate of $450,000,000 of unsold securities previously
registered pursuant to Registration Statement No. 33-50832, which are
covered by the prospectus included in this registration statement.
(2) Or, if any such Debt Securities are issued (i) at an original issue
discount, such greater amount as shall result in aggregate net proceeds not
in excess of $550,000,000 to the Registrant or (ii) with a principal amount
denominated in a foreign currency or composite currency, such amount as
shall result in an aggregate principal amount equivalent to $550,000,000 at
the time of initial offering.
(3) Such indeterminate number of shares of Common Stock of the Registrant and
accompanying Preferred Share Purchase Rights, if any (i) as shall be
issuable or deliverable upon conversion of any Debt Securities registered
hereby which are convertible into such Common Stock and (ii) as may be
required for delivery upon conversion of any such convertible debt
securities as a result of anti-dilution provisions thereof.
(4) The registration fee of $152,900 was previously paid in connection with the
original filing of the registration statement.
The Registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this 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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Pursuant to Rule 429 of the General Rules and Regulations under the
Securities Act of 1933, the prospectus included as part of this registration
statement will be used in connection with the offer and sale of Debt Securities
and Warrants to Purchase Debt Securities of the Registrant in the principal
amount of $450,000,000 previously registered under the Registrant's
Registration Statement on Form S-3 bearing Registration No. 33-50832, in
respect of which Registrant paid a filing fee of $140,625.
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<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED SEPTEMBER 1, 1999
PROSPECTUS
[LOGO OF FORTUNE BRANDS]
$1,000,000,000
Debt Securities
Warrants to Purchase Debt Securities
-----------
We will provide specific terms of these securities in supplements to this
prospectus. You should read this prospectus and any supplement carefully before
you invest.
-----------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
The date of this prospectus is , 1999.
<PAGE>
FORTUNE BRANDS, INC.
We are a holding company with subsidiaries engaged in various businesses.
Our subsidiaries manufacture and sell home and office products, golf products,
spirits and wine.
We are a legal entity separate and distinct from our subsidiaries. Our
rights, and the rights of our creditors and stockholders, to participate in any
distribution of the assets or earnings of any subsidiary is subject to the
claims of creditors of the subsidiary, except to the extent that our claims as
a creditor of our subsidiaries may be recognized. Our claims may be subordinate
to claims of other creditors. Our principal source of unconsolidated revenues
and funds is dividends and other payments from our subsidiaries. Our principal
subsidiaries currently are not limited by long-term debt or other agreements in
their abilities to pay cash dividends or to make other distributions with
respect to their capital stock or other payments to us.
Our principal executive offices are currently located at 1700 East Putnam
Avenue, Old Greenwich, Connecticut 06870-0811 and our telephone number is (203)
698-5000.
USE OF PROCEEDS
We intend to use the net proceeds we receive from the sale of securities
offered by this prospectus and the accompanying prospectus supplement for
general corporate purposes, unless we specify otherwise in the applicable
prospectus supplement. General corporate purposes may include the repayment of
existing indebtedness, additions to working capital, capital expenditures or
the financing of possible acquisitions.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges for
Fortune Brands, Inc.:
<TABLE>
<CAPTION>
Years Ended December 31,
------------------------
1994 1995 1996 1997 1998
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges.................. 1.22 3.23 2.81 2.06 5.22
</TABLE>
For the purpose of computing the ratio of earnings to fixed charges,
earnings means:
. income from continuing operations before income taxes and minority
interest;
. plus fixed charges;
. less capitalized interest; and
. less excess of earnings over dividends of less-than-fifty-percent-owned
companies.
Fixed charges means the sum of the following:
. interest (including capitalized interest) on all indebtedness;
. amortization of debt discount and expense; and
. that portion of rental expense which we believe to be representative
of an interest factor.
1
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DESCRIPTION OF DEBT SECURITIES
The prospectus supplement will state the particular terms of the debt
securities it covers.
We will issue debt securities in one or more series under an indenture dated
as of April 15, 1999 between us and The Chase Manhattan Bank, as trustee. The
indenture may be supplemented from time to time. We have filed a copy of the
indenture as an exhibit to the registration statement. In addition to the
following summary, you should refer to the specific terms of the indenture for
more detailed information. Some of the capitalized terms used in the following
discussion are defined in the indenture, and their definitions are incorporated
by reference into this prospectus. When we use italics, we are referring to
sections in the indenture. Wherever we refer to particular provisions of the
indenture, such provisions are incorporated by reference in our summary, which
is qualified by such reference.
Determination of Terms
The indenture does not limit the amount of securities we may issue. Debt
securities may be issued in one or more series as we may authorize at various
times. (Section 3.01). The prospectus supplement relating to the particular
series of debt securities we are offering will specify the amounts, prices and
terms of those debt securities. These terms may include:
. the title and aggregate principal amount of the debt securities;
. the percentage of the principal amount at which we will issue the debt
securities;
. the date or dates on which the debt securities will mature;
. any annual rate or rates, or the method of determining the rate or rates,
at which the debt securities will bear interest;
. the date or dates from which interest shall accrue and the date or dates
on which interest will be payable;
. redemption and sinking fund terms;
. whether the debt securities are convertible into our common stock and, if
so, the initial conversion price or rate, the conversion period and the
other terms and conditions relating to the conversion, including whether
any preferred share purchase rights of Fortune Brands, Inc. will be
delivered with shares of our common stock issued upon conversion;
. if the debt securities are not denominated in U.S. dollars, the foreign
currency or currencies or composite currency or currencies in which the
debt securities are denominated and, if any payment of principal of or
premium or interest on or any other amount for the debt securities is not
payable in U.S. dollars, the foreign currency or currencies or composite
currency or currencies in which the payment shall be payable and the
particular provisions applicable to the debt securities;
. whether the debt securities are issuable as registered securities or as
bearer securities, or both;
. whether the debt securities will be issued in whole or in part in the
form of one or more global securities and the depositary for the global
security or securities;
. any events of default or covenants that will apply to the debt
securities; and
. any other terms of the debt securities, which will not conflict with the
terms of the indenture. (Section 3.01).
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<PAGE>
The debt securities will be our direct, unsecured and unsubordinated
obligations. The debt securities will rank equally with any of our other
unsecured and unsubordinated obligations for borrowed money.
The indenture does not limit other indebtedness or securities which we may
incur or issue. The indenture does not contain financial or similar
restrictions on us, except as described under "Certain Covenants". Other than
the protections which may otherwise be afforded holders of debt securities as a
result of the operation of the covenants described in the indenture, there are
no covenants or other provisions which may afford holders of debt securities
protection if there is a leveraged buyout or other highly leveraged transaction
involving us or any similar occurrence.
We will describe the restrictions, elections, tax consequences, specific
terms and other information relating to any debt securities denominated in a
foreign currency or composite currency in the prospectus supplement.
We will describe the Federal income tax consequences and other special
considerations applicable to any debt securities issued as original issue
discount securities in the prospectus supplement. Original issue discount
securities are securities which bear no interest or interest at a rate which at
the time of issuance is below market rates.
Form, Denominations, Exchange and Transfer
Unless we provide otherwise in an applicable prospectus supplement with
respect to a series of debt securities, we will issue the debt securities in
definitive form solely as registered securities, solely as bearer securities or
as both registered securities and bearer securities. Unless otherwise provided
in an applicable prospectus supplement, interest coupons will be attached to
bearer securities. (Section 2.01). The indenture also provides that we may
issue debt securities of a series in temporary or permanent global form.
(Section 3.01).
Unless we specify otherwise in the applicable prospectus supplement, we will
issue registered securities in denominations of multiples of $1,000 and bearer
securities in denominations of $1,000 or $10,000. (Section 3.02). We will issue
debt securities denominated in a foreign currency or in a composite currency in
the denominations we specify in the prospectus supplement.
You may surrender debt securities for exchange and registered securities for
registration of transfer in the manner, at the places and subject to the
restrictions set forth in the prospectus supplement. This may be done without
service charge but we may require payment of related taxes or other
governmental charges. (Section 3.05). Bearer securities and the attached
coupons will be transferable by delivery.
In connection with their sale during the "restricted period" as defined in
Section 1.163-5(c)(2)(i)(D)(7) of the U.S. Treasury regulations, bearer
securities may not be delivered within the U.S. or its possessions and may be
delivered only upon certification as to the beneficial ownership of the bearer
securities. "Restricted period" generally means, the first 40 days after the
closing date for the sale of the debt securities or, with respect to unsold
allotments, until the debt securities are sold. In the case of debt securities
issuable on exercise of debt warrants "restricted period" means, the first 40
days after the date of exercise of such debt warrants. See "Limitations on
Issuance of Bearer Debt Securities and Bearer Debt Warrants".
In the event of any redemption, we will not be required to:
. issue, register the transfer of or exchange debt securities of any series
during a period beginning at the opening of business 15 days before:
--if debt securities of the series are issuable only as registered
securities, the day the relevant notice of redemption is mailed and
ending at the close of business on the day of such mailing; and
--if debt securities of the series are issuable only as bearer
securities, the day the relevant notice of redemption is first
published, or, if earlier, and if debt securities of the series are
also issuable as registered securities and there is no publication,
the day of mailing of the relevant notice of redemption, and in either
case, ending at the close of business on the date of such publication
or mailing; or
3
<PAGE>
. register the transfer or exchange of any portion of a registered security
called for redemption, except the unredeemed portion of any registered
security being redeemed in part; or
. exchange any bearer security called for redemption, except to exchange
such bearer security for a registered security of that series and like
tenor which is immediately surrendered for redemption.
Payment and Paying Agents
Unless we indicate otherwise in an applicable prospectus supplement, we will
pay principal of and any premium and any interest on registered securities at
the office of the paying agent or paying agents as we may designate at various
times. However, at our option, we may make interest payments on registered
securities by check mailed to the address, as it appears on the security
register, of the person entitled to the payments. Unless we specify otherwise
in the applicable prospectus supplement, we will make payment of any
installment of interest on registered securities to the person in whose name
the registered security is registered at the close of business on the record
date for such interest. (Sections 3.07 and 10.02).
Unless we indicate otherwise in an applicable prospectus supplement, we will
pay principal, any premium and any interest on bearer securities, subject to
any applicable laws and regulations, at the offices of those paying agents
outside the U.S. that we may designate at various times. However, at our
option, we may make interest payments by check or by transfer to an account
maintained by the payee with a bank located outside the U.S. (Sections 3.07 and
10.02). Unless we indicate otherwise in an applicable prospectus supplement, we
will pay any interest on bearer securities on any interest payment date only
upon presentation and surrender of the coupon relating to the interest payment
date. (Section 10.01). We will not pay principal, any premium or any interest
for any bearer security at any paying agency maintained by us in the U.S. or by
check mailed to any address in the U.S. or by transfer to an account maintained
with a bank located in the U.S. except as may be permitted without detriment to
us under U.S. tax laws and regulations in effect at the time of such payment.
Notwithstanding the foregoing,
. any payment in respect of bearer securities to be made in U.S. dollars
may be made at the office of a paying agent in the U.S. if payment at all
paying agencies outside the U.S. is illegal or effectively precluded by
exchange controls or other similar restrictions, and
. any payment in respect of bearer securities to be made in a foreign
currency or composite currency may be made at the office of a paying
agent in the U.S. in U.S. dollars in an amount equal to the sum otherwise
due in such foreign currency or composite currency as converted into U.S.
dollars at the rate of exchange as set forth in the indenture if payment
at all paying agencies outside the U.S. in such foreign currency or
composite currency and in U.S. dollars in such amount is illegal or
effectively precluded by exchange controls or other similar restrictions.
(Section 10.02).
We will name the paying agents outside the U.S. initially appointed by us
for a series of debt securities in the applicable prospectus supplement. We may
terminate the appointment of any of the paying agents at various times, but we
will maintain in the Borough of Manhattan, The City of New York, at least one
paying agency where the registered securities of each series may be presented
for payment. We will maintain one or more paying agencies in a city or cities
located outside the U.S. (including any city in which a paying agency is
required to be maintained under the rules of any stock exchange on which the
debt securities of such series are listed) where the bearer securities may be
presented for payment. (Section 10.02).
All monies we pay to a paying agent for the payment of principal of, any
premium or any interest on any debt securities that remain unclaimed at the end
of two years after becoming due and payable will be repaid to us. After that
time, the holder of the debt securities or coupon will look only to us for
payment. (Section 10.03).
4
<PAGE>
Global Securities
The debt securities of a series may be issued in whole or in part in the
form of one or more fully registered global securities that we will deposit
with a depositary identified in the applicable prospectus supplement.
Registered global securities will be issued in a denomination or aggregate
denominations equal to the portion of the aggregate principal amount of
outstanding debt securities of the series to be represented by the registered
global security or securities. Unless and until it is exchanged in whole or in
part for the individual debt securities it represents, a registered global
security may not be transferred or exchanged except as a whole:
. by the applicable depositary to a nominee of the depositary;
. by any nominee to the depositary itself or another nominee; or
. by the depositary or any nominee to a successor depositary or any nominee
of the successor depositary and except in the circumstances described in
the applicable prospectus supplement. (Section 3.05).
We will describe the specific terms of the depositary arrangement with
respect to any portion of a series of debt securities in the applicable
prospectus supplement. We anticipate that the following provisions will
generally apply to depositary arrangements.
Ownership of beneficial interests in a registered global security will be
limited to institutions that have accounts with the depositary, and to persons
that may hold interests through institutions. Such institutions are often
referred to as "participants" of the depositary. For interests of participants,
ownership of beneficial interests in the registered global security will be
shown on the records maintained by the applicable depositary. For interests of
persons other than participants, ownership of beneficial interests in the
registered global security will be shown on the records of participants.
Transfer of that ownership will be effected only through those records.
We expect that upon the issuance of a registered global security, and the
deposit of the registered global security with or on behalf of the depositary,
the depositary will immediately credit, on its book-entry registration and
transfer system, the respective principal amounts of the debt securities
represented by the registered global security to the accounts of participants.
The accounts to be credited shall be designated by the underwriters or agents
engaging in the distribution of such debt securities or by us if those debt
securities are offered and sold directly by us.
Unless we specify otherwise in the applicable prospectus supplement, payment
of principal of and premium, and any interest on debt securities represented by
any registered global security will be made to the depositary or its nominee,
as the sole registered owner and the sole holder of the debt securities.
Neither we, the trustee, nor any agents will be responsible for any aspect of
the depositary's records or any participant's records relating to or payments
made by the depositary or any participants on account of beneficial ownership
interests in a registered global security representing any debt securities.
Neither we, the trustee nor any agents will be responsible or liable for
maintaining, supervising or reviewing any of the depositary's records or any
participant's records relating to beneficial ownership interests.
We expect that the depositary or its nominee, upon receipt of any payment of
principal of or any premium or any interest on any registered global security,
immediately will credit, on its book-entry registration and transfer system,
the participant's accounts with the payments. Those payments will be credited
in amounts proportionate to the respective beneficial interests of the
participants in the principal amount of the registered global security as shown
on the records of the depositary or its nominee. We also expect that payments
by participants to owners of beneficial interests in a registered global
security held through those participants will be governed by standing
instructions and customary practices. This is now the case with securities held
for customer accounts in bearer form or registered in "street name". Those
payments will be the sole responsibility of those participants.
5
<PAGE>
Except as otherwise set forth in the applicable prospectus supplement, we
will issue certificated debt securities in exchange for each registered global
security only if:
. the depositary notifies us that it is unwilling or unable to continue as
depositary for the registered global security or if at any time the
depositary ceases to be a clearing agency registered under the Securities
Exchange Act of 1934, and we have not appointed a successor of the
depositary within 90 calendar days;
. we determine that the registered global security shall be exchangeable
for definitive debt securities in registered form; or
. an Event of Default (as defined below under "Defaults and Certain Rights
on Default") for the debt securities represented by such registered
global security has occurred and is continuing.
Any registered global security that is exchangeable pursuant to the
preceding sentence shall be exchangeable in whole for definitive debt
securities in registered form, of like tenor and of an equal aggregate
principal amount, in denominations of $100,000 and any larger amount that is an
integral multiple of $1,000. Such definitive debt securities will be registered
in the name or names of the owners of such person or persons as the depositary
shall instruct the trustee. It is expected that the instructions may be based
upon directions received by the depositary from its participants regarding
ownership of beneficial interests in the registered global security.
Unless we specify otherwise in the applicable prospectus supplement and
except as provided above, owners of beneficial interests in the registered
global security will not be entitled to receive physical delivery of debt
securities in definitive form and will not be considered the holders for any
purpose under the indenture. No registered global security representing debt
securities will be exchangeable except for another permanent registered global
security of like denomination and tenor to be registered in the name of the
depositary or its nominee. Each person owning a beneficial interest in the
registered global security must rely on the procedures of the depositary.
Persons who are not participants must rely on the procedures of the participant
through which such person owns its interest, to exercise any rights of a holder
under the indenture. The laws of some jurisdictions require that certain
purchasers of securities take physical delivery of the securities in definitive
form. Such limits and such laws may impair the ability to transfer beneficial
interests in a registered global security.
The indenture permits the depositary, as a holder, to authorize participants
as its agents to make, give or take any request, demand, authorization,
direction, notice, consent, waiver or other action which a holder is entitled
to make, give or take under the indenture. We understand that under existing
industry practices, in the event that we request any action of holders or an
owner of a beneficial interest in the registered global security desires to
make, give or take any request, demand, authorization, direction, notice,
consent, waiver or other action which a holder is entitled to make, give or
take under the indenture, the depositary would authorize the participants
holding the relevant beneficial interests to make, give or take such action.
The participants would authorize beneficial owners owning through them to make,
give or take such action or would otherwise act upon the instructions of
beneficial owners owning through them.
We may also issue the debt securities of a series in whole or in part in the
form of one or more bearer global securities that we will deposit with a common
depositary for Morgan Guaranty Trust Company of New York, Brussels office, as
operator of the Euroclear System, and for Cedelbank, or with a nominee for such
common depositary, identified in the applicable prospectus supplement. We may
issue the bearer global securities in temporary or permanent form. The specific
terms and procedures, including the specific terms of the depositary
arrangement, for any portion of a series of debt securities to be represented
by one or more bearer global securities, will be described in the applicable
prospectus supplement. See "Limitations on Issuance of Bearer Debt Securities
and Bearer Debt Warrants".
6
<PAGE>
Convertible Debt Securities
The terms and conditions upon which any convertible debt securities of a
series may be converted into shares of common stock, including the initial
conversion price or rate and the conversion period, and other provisions, will
be set forth in the prospectus supplement. See "Description of Capital Stock".
Certain Covenants
Definitions. The following is a summary of certain defined terms used in the
restrictive covenants contained in the indenture:
. "Consolidated Net Tangible Assets" means the excess over current
liabilities of all assets as set forth in our consolidated balance sheet
after deducting goodwill, trademarks, patents, other like intangibles and
minority interests of others.
. "Funded Debt" includes: (1) indebtedness for borrowed money maturing
more than one year from the date of creation or extension thereof, (2)
guarantees of funded debt or of dividends, other than guarantees arising
in connection with the sale or pledge of customers' paper or otherwise
arising in the ordinary course of business and (3) any funded debt
secured by a mortgage on our property or any Restricted Subsidiary
whether or not assumed.
. "Restricted Subsidiary" is defined to exclude a Subsidiary organized
under foreign laws or operating outside the U.S., a Subsidiary involved
primarily in the business of finance, banking, credit, leasing,
insurance, financial services, real estate, petroleum or gas,
transportation or overseas financing, and Subsidiaries of the foregoing.
A Subsidiary required to be disposed of by court order and determined by
our board of directors not to be a Restricted Subsidiary is also excluded
from the definition of Restricted Subsidiary.
. "Secured Debt" includes indebtedness for money borrowed secured by a
mortgage upon any of our assets or a Restricted Subsidiary; "mortgage"
includes any mortgage, pledge or security interest.
. "Subsidiary" is defined as any corporation of which we or any one or
more Subsidiaries directly or indirectly own outstanding stock having
voting power sufficient to elect, under ordinary circumstances, a
majority of the directors. (Section 1.01).
Restrictions on Secured Debt. The indenture provides that, except as
described below, neither we nor any Restricted Subsidiary may incur any Secured
Debt without securing the debt securities, and, if we so elect, any
indebtedness ranking equally with the debt securities, equally and ratably
with, or prior to, such Secured Debt. This restriction does not apply to
indebtedness secured by:
. mortgages existing at the time a corporation becomes a Restricted
Subsidiary;
. mortgages assumed in connection with a merger with, or an acquisition of
substantially all of the properties of, a corporation, if any such
mortgage existed prior to such merger or acquisition and did not apply to
any property owned by us or a Restricted Subsidiary immediately prior to
such merger or acquisition;
. mortgages on property existing at the time of acquisition or mortgages on
certain property to finance the cost of acquisition, construction or
improvement;
. mortgages securing indebtedness owing to us or a Restricted Subsidiary;
. mortgages in favor of the U.S. or any State or any instrumentality of
either to secure partial, progress, advance or other payments pursuant to
any contract or statute;
. mortgages incurred under industrial revenue bond or similar financings;
or
. extensions, renewals or refundings of any of the foregoing.
7
<PAGE>
Notwithstanding the above provisions, we and our Restricted Subsidiaries may
incur Secured Debt without equally and ratably securing the debt securities if
after giving effect thereto the sum of:
. the total of all of our Secured Debt and the Secured Debt of Restricted
Subsidiaries, except Secured Debt of the types described in the paragraph
immediately above as not restricted;
. the value of all sale and lease back transactions; and
. the aggregate of all unsecured Funded Debt of Restricted Subsidiaries
which, if it were secured debt, would be permitted by this paragraph,
does not exceed 10% of Consolidated Net Tangible Assets. (Section 10.06).
Restrictions on Borrowing by Restricted Subsidiaries. The indenture provides
that Restricted Subsidiaries may not incur any Funded Debt, except:
. Funded Debt owed to us or a Restricted Subsidiary;
. Funded Debt which is Secured Debt that could under the preceding
paragraphs of "Restrictions on Secured Debt" be incurred without ratably
securing the debt securities;
. unsecured Funded Debt which represents an extension, renewal or refunding
of Secured Debt described in the second sentence of the first paragraph
of "Restrictions on Secured Debt" above;
. unsecured Funded Debt, which, if it were Secured Debt, would be permitted
by the last paragraph of "Restrictions on Secured Debt" above;
. existing unsecured Funded Debt assumed by a Restricted Subsidiary in
connection with its merger with, or acquisition of all or a substantial
part of the assets of any corporation;
. unsecured Funded Debt of any corporation existing when it becomes a
Restricted Subsidiary;
. Funded Debt incurred in connection with industrial revenue bond or
similar financings; or
. extensions, renewals or refundings of any of the foregoing. (Section
10.05).
Restrictions on Sale and Lease Back Transactions. The indenture provides
that neither we nor any Restricted Subsidiary may sell and lease back for
periods exceeding five years any major facility owned as of the date of the
indenture unless:
. fair value is received for the facility sold; and
. an amount equal to the net proceeds of such sale is applied to the
retirement of Funded Debt which is not subordinated in right of payment
to the debt securities, provided that the amount of such required
retirement shall be reduced by:
--the amount of any Secured Debt which we or such Restricted Subsidiary
could then incur under the last paragraph of "Restrictions on Secured
Debt" above, and
--the principal amount of any instruments evidencing Funded Debt,
including the debt securities, delivered within 120 days after the sale
to the applicable trustee for retirement and cancellation, other than
instruments retired by payment at maturity or pursuant to mandatory
sinking fund or prepayment provisions. (Section 10.07).
Restrictions on Transfers of Property. Neither we nor any Restricted
Subsidiary may transfer or lease any major facility to any Subsidiary not
considered a "Restricted Subsidiary" for any of the reasons described in the
first sentence of the Restricted Subsidiary definition in the "Definitions"
paragraph above. (Section 10.08).
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Limitations on Merger
The indenture provides that if we merge or consolidate with or into any
other corporation or we transfer substantially all of our assets to any other
corporation, and as a result any of our property or the property of a
Restricted Subsidiary would become subject to any mortgage, we will
simultaneously with or prior to such transaction secure the debt securities by
a prior lien on such property. (Section 8.03). If we merge or consolidate with
any other corporation or we transfer substantially all of our assets to any
other corporation, the successor corporation shall be substituted as obligor
under the indenture. (Sections 8.01 and 8.02).
Modification of Indenture
In general, our rights and obligations and the rights of holders of debt
securities under the indenture may be modified if holders of a majority in
aggregate principal amount of the outstanding debt securities of each series
affected by the modification consent to it. However, the indenture provides
that, unless each affected holder agrees, we cannot
. make any adverse change to any payment term of a debt security such as:
. extending the maturity date;
. extending the date on which we have to pay interest;
. reducing the interest rate;
. reducing the amount of principal we have to repay;
. changing the currency in which we have to make any payment of
principal, premium or interest;
. modifying any redemption or repurchase right to the detriment of the
holder;
. modifying any right to convert the debt securities for another
security to the detriment of the holder;
. impairing any right of a holder to bring suit for payment;
. reducing the percentage of the aggregate principal amount of debt
securities needed to make any amendment to the indenture or to waive
any covenant or default; or
. make any change to this provision of the indenture. (Section 9.02).
However, if the trustee and we agree, we can amend the indenture without
notifying any holders or seeking their consent if the amendment does not
materially and adversely affect any holder.
Defaults and Certain Rights on Default
An "Event of Default" is defined under the indenture as any of the
following:
. default for 30 days in payment of any interest;
. default in payment of principal;
. default for 60 days after notice in performance of any other covenant in
the indenture; and
. certain events of bankruptcy, insolvency, receivership or reorganization.
We will furnish to the trustee annually a written statement as to the
fulfillment of our obligations under the indenture. In case an Event of
Default with respect to debt securities of any series at the time outstanding
occurs and is continuing, the trustee or the holders of at least 25% in
principal amount of the debt securities of such series then outstanding may
declare the principal of all the debt securities of such series to be due and
payable. The indenture permits such declaration, under certain circumstances,
to be rescinded by the holders of a majority in principal amount of the debt
securities of the series at the time outstanding. (Sections 5.01, 5.02 and
10.04).
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Subject to the provisions of the indenture relating to the duties of the
trustee in case an Event of Default occurs and is continuing, the indenture
provides that the trustee is not obligated to exercise any of the rights or
powers under the indenture at the request or direction of any of the holders of
debt securities, unless the holders have offered to the trustee reasonable
security or indemnity.
Subject to the provisions for indemnification and certain limitations
contained in the indenture, the holders of a majority in principal amount of
the debt securities of any series at the time outstanding and so affected have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the trustee or exercising any trust or power conferred
on the trustee with respect to the debt securities of such series.
The holders may, in certain cases, waive any default except a default in
payment of principal of or premium, if any, or interest, if any, on the debt
securities of such series. (Sections 5.12, 5.13 and 6.03).
Defeasance
The prospectus supplement will state if any defeasance provision will apply
to the debt securities.
The indenture contains a provision that, if made applicable to any series of
debt securities, permits us to elect (a) to defease and be discharged from most
of our obligations with respect to any series of debt securities then
outstanding (Section 4.03), or (b) to be released from our obligations under
most of our restrictive covenants, including those described above under
"Certain Covenants" (Section 10.10). We call the first election "legal
defeasance" and the second election "covenant defeasance". To make either
election, we must:
. deposit in trust with the trustee (a) in the case of debt securities and
coupons denominated in U.S. dollars, U.S. government obligations and (b)
in the case of debt securities and coupons denominated in a foreign
currency, foreign government securities denominated in such foreign
currency, which through the payment of principal and interest in
accordance with their terms and, together with any additional currency
deposited, will provide sufficient money, without reinvestment, to repay
in full those debt securities; and
. deliver to the trustee an opinion of counsel that holders of the debt
securities will not recognize income, gain or loss for Federal income tax
purposes as a result of the deposit and related defeasance and will be
subject to Federal income tax in the same amount, in the same manner and
at the same times as would have been the case if such deposit and related
defeasance had not occurred. In the case of legal defeasance only, such
opinion of counsel is to be based on a ruling of the IRS to such effect,
unless we indicate otherwise in the prospectus supplement.
Governing Law
The indenture, the debt securities and any coupons will be governed by, and
construed in accordance with, the laws of the State of New York. (Section
1.12).
Concerning the Trustee
The Chase Manhattan Bank is one of a number of banks with which we maintain
ordinary banking relationships and with which we maintain credit facilities. As
of the date of this prospectus, The Chase Manhattan Bank is a trustee under one
other indenture under which unsecured debt obligations of ours are outstanding.
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DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock includes a summary of certain
provisions of our restated certificate of incorporation and our by-laws, as
amended. This description is not complete and is qualified by reference to the
restated certificate of incorporation and the by-laws. We have filed copies of
the restated certificate of incorporation and by-laws as exhibits to the
registration statement of which this prospectus is a part.
Capital Stock Generally
We have authorized 810 million shares, of which 750 million are common
stock, par value $3.125 per share, and 60 million are preferred stock, without
par value.
Apart from the $2.67 convertible preferred stock described below under
"Outstanding Preferred Stock", the rights, preferences and limitations of which
are set forth in the restated certificate of incorporation, our board of
directors is empowered to provide for any series of preferred stock and, in
general, to determine the relative rights, preferences and limitations of such
series. The restated certificate of incorporation provides that no holder of
common stock or preferred stock shall have any preemptive rights.
The outstanding shares of common stock and $2.67 preferred are, and any
shares of common stock issued upon conversion of any convertible debt
securities will be, validly issued, fully paid and nonassessable.
Common Stock
Holders of common stock are entitled to receive such dividends as are
declared by our board of directors. Holders of common stock are entitled to
cast one vote for each share on all matters voted upon by stockholders, except
where holders of preferred stock are entitled to vote separately in certain
cases. Upon liquidation of Fortune Brands, Inc., holders of common stock are
entitled to share equally and ratably in any assets available for distribution
to them.
No dividend may be paid or declared on the common stock or any other junior
stock, other than a dividend payable in common stock or other junior stock, nor
may any shares of common stock or any junior stock be acquired for a
consideration by us or any subsidiary, unless all dividends on the $2.67
preferred accrued for all past quarterly dividend periods have been paid and
unless, in the case of dividends on the common stock or any other junior stock,
the full dividends on the $2.67 preferred for the then current quarterly
dividend period have been then paid or declared. Subject to the foregoing, the
restated certificate of incorporation does not restrict us from purchasing
shares of common stock.
The co-transfer agent and registrar for shares of the common stock is
Continental Stock Transfer & Trust Company. We also serve as the co-transfer
agent for shares of the common stock.
Outstanding Preferred Stock
Holders of $2.67 preferred are entitled to cumulative dividends at an annual
rate of $2.67 per share, payable quarterly on the 10th day of March, June,
September and December, as and when declared by our board of directors. Holders
are also entitled to preference in liquidation of $30.50 per share plus accrued
dividends then unpaid and to three-tenths of a vote per share on all matters
voted upon by stockholders and effective June 2, 1997 have the right to convert
each share of $2.67 preferred into 6.205 (6205/1000) shares of common stock. In
certain events, the factor for converting the $2.67 preferred into common stock
will be adjusted to prevent dilution of the conversion right. Holders of $2.67
preferred are not, except in certain cases, entitled to vote as a class. We may
redeem all or any part of the $2.67 preferred at a price of $30.50 per share,
plus accrued dividends then unpaid.
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Preferred Share Purchase Rights
Each outstanding share of common stock also evidences one preferred share
purchase right. Unless otherwise specified in the prospectus supplement
applicable to any convertible debt securities, as long as the rights are
attached to the common stock, we presently intend to deliver one right with
each new share of common stock issued, including shares issued upon conversion
of such debt securities, prior to the expiration or earlier redemption or
exchange of the rights. All shares of common stock will have attached rights.
The description and terms of the rights are set forth in a rights agreement
dated as of November 19, 1997, as amended, between us and First Chicago Trust
Company of New York, as rights agent, and the following is qualified by
reference to the rights agreement. We have filed a copy of the rights agreement
as an exhibit to the registration statement of which this prospectus is a part.
Each right entitles its registered holder until December 24, 2007 or, if
earlier, the redemption or exchange of the rights, to purchase from us one one-
hundredth ( 1/100) of a share of Series A Junior Participating Preferred Stock,
without par value, of Fortune Brands, Inc. at a purchase price of $150 per one
one-hundredth of a preferred share, subject to certain adjustments.
The rights will not be exercisable or transferable apart from the common
stock, until the earlier of (1) the tenth day after the public announcement
that a person or group has acquired, or obtained the right to acquire,
beneficial ownership of 15% or more of the common stock, other than a person or
group that becomes such a 15% beneficial owner by means of share acquisitions
by us or a person or group that our board of directors determines in good faith
has become such a 15% beneficial owner inadvertently, so long as such person or
group as promptly as possible divests enough common stock so as no longer to be
such a 15% beneficial owner, or (2) the tenth business day, or such later date
as may be determined by our board of directors prior to a person or group
becoming such a 15% beneficial owner, after the commencement of, or the
announcement of an intention to commence, a tender or exchange offer the
consummation of which would result in beneficial ownership by a person or group
of 15% or more of the common stock. The rights will not have any voting rights
or be entitled to dividends.
In the event that we are acquired in a merger or other business combination
transaction or 50% or more of our assets or earning power and the assets or
earning power of our subsidiaries, taken as a whole, are sold, each right will
entitle its holder to purchase, at the purchase price referred to above, that
number of shares of common stock of the acquiring company which at the time of
such transaction would have a market value of two times the purchase price.
Alternatively, if a person or group has become a 15% beneficial owner as
described in clause (1) of the first sentence of the preceding paragraph, each
right, other than rights beneficially owned by the 15% holder, which will
thereafter be void, will become exercisable for the number of shares of common
stock which, at that time, would have a market value of two times the purchase
price. If such beneficial ownership is less than 50% of the outstanding common
stock, our board of directors alternatively may elect to exchange each right,
in whole or in part, for shares of common stock at an exchange ratio of one
share of common stock for each right, subject to adjustment.
The rights are redeemable at a redemption price of $.01 per right, subject
to adjustment, at any time prior to the time that a person or group has
acquired, or obtained the right to acquire, beneficial ownership of 15% or more
of the common stock. Immediately upon any redemption of the rights, the right
to exercise the rights will terminate and the only right of the holders of
rights will be to receive the redemption price. Unless earlier redeemed or
exchanged, the rights will expire on December 24, 2007.
In the event that we are not able to authorize a sufficient number of
additional shares of common stock to satisfy the exercise or exchange of a
right pursuant to its terms, we will be required to substitute preferred
shares, or a fraction thereof, for the shares of common stock that would
otherwise be issuable upon exercise or exchange of such right at a rate such
that the preferred shares substituted would have the same market value as the
shares of common stock that would otherwise have been issued upon such exercise
or exchange.
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Election of Directors, Other Voting Provisions and Related Matters
Pursuant to the restated certificate of incorporation, our board of
directors is divided into three classes of directors serving staggered three-
year terms. The exact number of directors will be determined from time to time
by or pursuant to the by-laws, provided that their number shall not exceed 20.
The board of directors is currently comprised of 14 directors. The restated
certificate of incorporation also provides a procedure requiring that we
receive advance written notice of stockholder nominations of directors.
The restated certificate of incorporation requires, in addition to any
affirmative vote required by law, the restated certificate of incorporation or
the by-laws, the affirmative vote of two-thirds of the votes cast by our
stockholders entitled to vote in order to obtain stockholder approval of
amendments to the restated certificate of incorporation, mergers,
consolidations and sales or leases of substantially all of our assets.
Currently, Delaware law generally requires the affirmative vote of the holders
of a majority of the outstanding shares of our capital stock entitled to vote
thereon. Notwithstanding the foregoing, the restated certificate of
incorporation further provides that the affirmative vote of at least 80 percent
of the votes entitled to be cast by the holders of all the then outstanding
shares of stock of Fortune Brands, Inc. entitled to be voted generally in the
election of directors, voting together as a single class, shall be required for
the amendment or repeal of, or the adoption of provisions inconsistent with,
the above-described provisions of the restated certificate of incorporation
relating to classification and stockholder nomination of directors unless such
amendment, repeal or adoption has been approved by three-fourths of the
directors then in office.
The by-laws require that the annual meeting of our stockholders for the
election of directors and other proper business be held at such place as may
from time to time be designated by the directors on the first Wednesday of May
or on such other day as the directors may designate. If the day fixed for the
meeting is a legal holiday, the meeting will be held on the next business day
which is not a legal holiday. The by-laws further provide that special meetings
of the stockholders may be called only by the Chairman of the Board, the
President or the directors, by resolution adopted by a majority of the entire
board of directors. In addition, the restated certificate of incorporation
provides that any action to be taken by the stockholders must be effected at a
duly called annual or special meeting and may not be effected by written
consent. The by-laws require that, except as otherwise provided by law, at
least ten days' prior notice of each annual or special meeting shall be given
by written notice signed by the Secretary or an Assistant Secretary and mailed
to each stockholder of record entitled to vote. The by-laws also provide a
procedure requiring that advance written notice be given to us of the proposal
by stockholders of business other than the nomination of directors and then
only such business as is stated in a notice of a special meeting shall be
transacted at such meeting.
Certain of the provisions described under this section entitled "Description
of Capital Stock", including the right to issue additional shares of preferred
stock, could have the effect of discouraging transactions that might lead to a
change in control of Fortune Brands, Inc.
DESCRIPTION OF DEBT WARRANTS
We may issue, together with debt securities or separately, debt warrants for
the purchase of debt securities. If we issue the debt warrants together with
any debt securities, they may be attached to or separate from the debt
securities. We will issue the debt warrants under a debt warrant agreement to
be entered into between us and a bank or trust company, as debt warrant agent,
as set forth in the prospectus supplement. We are summarizing certain
provisions of the debt warrant agreement. In addition to the following summary,
we have filed copies of the debt warrant agreements as an exhibit to the
registration statement of which this prospectus is a part. You should read the
debt warrant agreement for more detailed information. When we use italics we
are referring to sections in the debt warrant agreement. Wherever we refer to
particular provisions of the debt warrant agreement, such provisions are
incorporated by reference in our summary, which is qualified by such reference.
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Determination of Terms
The prospectus supplement will describe the particular terms of the debt
warrants it covers. These terms may include:
. the price at which the debt warrants will be issued;
. the currency or composite currency for which the debt warrants may be
purchased;
. the designation, aggregate principal amount, currency or composite
currency and terms of the debt securities which may be purchased upon
exercise of the debt warrants;
. if applicable, the designation and terms of the debt securities with
which the debt warrants are issued and the number of debt warrants issued
with each of such debt securities;
. if applicable, the date on and after which the debt warrants and the
related debt securities will be separately transferable;
. the principal amount of debt securities purchasable upon exercise of each
debt warrant and the price at which and the currency or composite
currency in which such principal amount of debt securities may be
purchased upon such exercise;
. the date on which the right to exercise the debt warrants will commence
and the date on which the right will expire and, if the debt warrants are
not continuously exercisable throughout such period, the specific date or
dates on which they will be exercisable;
. whether the debt warrant certificates representing the debt warrants will
be in registered form or bearer form, or both;
. any applicable Federal income tax consequences;
. the identity of the debt warrants agent for the debt warrants; and
. any other terms of the debt warrants which will not conflict with the
debt warrant agreement.
Registered warrants of each series will be evidenced by debt warrant
certificates in registered form and bearer warrants of each series will be
evidenced by a permanent global debt warrant certificate in bearer form. The
global debt warrant certificate will be deposited with a common depositary for
Euroclear and Cedelbank, for credit to the accounts of the subscribers for the
bearer warrants on the related date of issue. Bearer warrants will not be
issued in definitive form.
At the option of the holder upon request confirmed in writing, and subject
to the terms of the relevant debt warrant agreement, registered warrants of any
series will be exchangeable for registered warrants of the same series
representing in the aggregate the number of debt warrants surrendered for
exchange. Registered warrants may be presented for exchange and for
registration of transfer, with the form of transfer endorsed thereon duly
executed, at the corporate trust office of the debt warrant agent for such
series of debt warrants or any other office indicated in the prospectus
supplement relating to such series of debt warrants. This may be done without
service charge and upon payment of any taxes and other governmental charges as
described in the relevant debt warrant agreement. Such transfer or exchange
will be effected upon the debt warrant agent for such series of debt warrants
being satisfied with the documents of title and identity of the person making
the request. (Section 4.01).
We will not offer, sell or deliver bearer warrants at any time to persons
within the U.S. or to U.S. persons, except to the extent permitted under U.S.
Treasury regulations. See "Limitations on Issuance of Bearer Debt Securities
and Bearer Debt Warrants".
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Exercise of Debt Warrants
Each debt warrant will entitle the holder to purchase for cash the principal
amount of debt securities at the exercise price set forth in the prospectus
supplement. Debt warrants may be exercised at any time up to the close of
business on the debt warrant expiration date set forth in the prospectus
supplement. After the close of business on the debt warrant expiration date, or
such later date to which the debt warrant expiration date may be extended by
us, unexercised debt warrants will become void. (Section 2.02).
Subject to any restrictions and additional requirements that may be set
forth in the prospectus supplement, registered warrants may be exercised by
delivering to the debt warrant agent the debt warrant certificate evidencing
the registered warrants properly completed and duly executed and by delivering
payment as provided in the prospectus supplement of the amount required to
purchase the debt securities purchasable upon exercise. (Section 2.03).
Subject to any such restrictions and additional requirements, bearer
warrants may be exercised by delivering to Euroclear or Cedelbank a duly
completed exercise letter or tested telex, in the form obtainable from
Euroclear or Cedelbank or the debt warrant agent. The exercise letter will set
forth, among other things, instructions for payment as provided in the
prospectus supplement on the date of exercise of the amount required to
purchase the debt securities purchasable upon exercise of bearer warrants.
Purchasers of bearer securities to be delivered upon exercise of the bearer
warrants will be subject to certification requirements as to beneficial
ownership thereof. See "Limitations on Issuance of Bearer Debt Securities and
Bearer Debt Warrants".
The procedures to be followed in connection with the delivery of the
exercise letter will be set forth in the prospectus supplement. The exercise
price of debt warrants will be that price applicable on the date of receipt of
payment in full of the requisite amount of funds, determined as set forth in
the prospectus supplement. Upon receipt of such payment, plus payment under
certain circumstances of accrued interest on the debt securities being
purchased, and upon either (1) surrender of such debt warrant certificate at
the corporate trust office of the debt warrant agent or any other office
indicated in the prospectus supplement, in the case of registered warrants, or
(2) satisfaction of the certification requirements referred to above, in the
case of bearer warrants, we will, as soon as practicable, forward the debt
securities purchasable upon such exercise.
Only registered securities will be deliverable upon exercise of registered
warrants. Registered securities or, subject to the certification procedures
referred to above, bearer securities will be delivered upon exercise of bearer
warrants, as may be specified in the exercise letter. If fewer than all of the
registered warrants represented by a debt warrant certificate are exercised, a
new debt warrant certificate will be issued representing the remaining number
of registered warrants. (Section 2.03).
Modifications
The debt warrant agreement and the terms of the debt warrants and the debt
warrant certificates may be amended by us and the debt warrant agent, without
the consent of the holders, for the purpose of curing any ambiguity, or of
curing, correcting or supplementing any defective or inconsistent provision or
in any other manner which we may deem necessary or desirable and which will not
adversely affect the interests of the holders in any material respect. (Section
6.01).
Merger, Consolidation, Sale or Other Disposition
If at any time we should merge or consolidate or transfer substantially all
of our assets as permitted under the indenture, the successor corporation shall
succeed to and assume all of our obligations under the debt warrant agreement
and the debt warrant certificates. (Section 3.04).
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Enforceability of Rights of Debt Warrants Holders; Governing Law
The debt warrant agent will act solely as our agent in connection with the
debt warrant certificates and will not assume any obligation or relationship of
agency or trust for or with any holders of debt warrants certificates or
beneficial owners of debt warrants. (Section 5.02). Any holder of debt warrant
certificates evidencing registered warrants and any beneficial owner of bearer
warrants may, without the consent of the debt warrant agent, any other holder,
the trustee, the holder of any debt securities issued upon exercise of debt
warrants or, if applicable, the common depositary for Euroclear and Cedelbank,
enforce by appropriate legal action, on its own behalf, its right to exercise
the debt warrants evidenced by such debt warrant certificates or the global
debt warrant certificates evidencing such bearer warrants, as the case may be,
in the manner provided therein and in the debt warrant agreement. (Section
3.03).
Prior to the exercise of the debt warrants, a record or beneficial owner of
debt warrants will not have any rights of a holder of the debt securities
purchasable upon exercise, including the right to receive payments of principal
of, any premium or interest on such debt securities or to enforce any of the
covenants in the indenture. (Section 3.01). The debt warrants and each debt
warrant agreement will be governed by, and construed in accordance with, the
laws of the State of New York. (Section 6.04).
LIMITATIONS ON ISSUANCE OF BEARER DEBT SECURITIES AND BEARER DEBT WARRANTS
Except as may otherwise be provided in the prospectus supplement, in
compliance with U.S. federal tax laws and regulations:
. debt securities that are bearer securities, including debt securities in
global form, may not be offered or sold during the restricted period, as
defined under "Description of Debt Securities--Form, Denominations,
Exchange and Transfer", to persons within the U.S. or its possessions or
to U.S. persons,
. bearer securities sold during the restricted period may not be delivered
within the U.S., and
. bearer warrants may not be offered, sold or delivered to persons within
the U.S. or to U.S. persons at any time, except to the extent permitted
under Section 1.163-5(c)(2)(i)(D) of the U.S. Treasury regulations.
Any underwriters, agents and dealers participating in the offering of bearer
securities or bearer warrants must agree that, except to the extent permitted
under the applicable Treasury regulations, they will not offer or sell bearer
securities to persons within the U.S. or to U.S. persons during the restricted
period, will not deliver within the U.S. bearer securities sold during the
restricted period, and will not offer, sell or deliver bearer warrants to
persons within the U.S. or to U.S. persons at any time. In addition, any
underwriters, agents and dealers must have in effect procedures reasonably
designed to ensure that their employees or agents who are directly engaged in
selling bearer securities or bearer warrants are aware that bearer securities
and bearer warrants cannot be offered or sold, during the applicable period, to
persons within the U.S. or to U.S. persons.
Bearer securities, other than temporary global debt securities, will be
delivered in definitive form only upon certification, as provided in the
applicable Treasury regulations, that the beneficial owners thereof are not
U.S. persons, or other certification as to ownership permissible under the
applicable Treasury regulations.
Bearer securities, other than temporary global debt securities, and any
related coupons will bear a legend substantially to the following effect: "Any
U.S. person who holds this obligation will be subject to limitations under the
U.S. income tax laws, including the limitations provided in Sections 165(j) and
1287(a) of the U.S. Internal Revenue Code". The sections referred to in such
legend provide that a U.S. person, other than a U.S. financial institution
described above or U.S. person holding through such a financial institution,
who holds a bearer security or coupon will not be allowed to deduct any loss
realized on the sale, exchange or redemption
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of such bearer security and any gain, which might otherwise be characterized as
capital gain, recognized on such sale, exchange or redemption will be treated
as ordinary income.
As used herein, "U.S. person" means a citizen, national or resident of the
U.S., a corporation, partnership or other entity created or organized in or
under the laws of the U.S. or any political subdivision thereof, or an estate
or trust the income of which is subject to U.S. Federal income taxation
regardless of its source.
PLAN OF DISTRIBUTION
We may sell the debt securities and the debt warrants in any of three ways
(or in any combination thereof):
. through underwriters or dealers;
. directly to a limited number of purchasers or to a single purchaser; or
. through agents.
The prospectus supplement with respect to the debt securities and the debt
warrants will set forth the terms of the offering, including:
. the name or names of any underwriters and the amounts of the debt
securities;
. the debt warrants underwritten or purchased by each of them;
. the purchase price of the debt securities;
. the debt warrants and the proceeds to us from such sale, any discounts,
commissions or other items constituting compensation from us;
. any initial public offering price and any discounts, commissions or
concessions allowed or reallowed or paid to dealers;
. any restrictions or limitations on persons to whom, jurisdictions in
which or the manner in which the debt securities and the debt warrants
may be offered, sold, resold or delivered; and
. any securities exchanges on which the debt securities and the debt
warrants may initially be listed.
Only underwriters named in the prospectus supplement are deemed to be
underwriters in connection with the debt securities and the debt warrants.
If underwriters or dealers are used in the sale, the debt securities and the
debt warrants will be acquired by underwriters and dealers for their own
account and may be resold at various times in one or more transactions,
including negotiated transactions, at a fixed public offering price or at
varying prices determined at the time of sale. The debt securities and the debt
warrants may be offered to the public either through underwriting syndicates
represented by managing underwriters or directly by the managing underwriter or
underwriters. Unless otherwise set forth in the prospectus supplement, the
obligations of the underwriters to purchase the debt securities and the debt
warrants will be subject to certain conditions precedent and the underwriters
will be obligated to purchase all the debt securities and the debt warrants if
any are purchased. Any initial public offering price and any discounts or
concessions allowed or reallowed or paid to dealers may be changed at various
times.
We may sell debt securities and debt warrants directly through agents
designated by us. The prospectus supplement will name any agent involved in the
offer or sale in respect of which this prospectus is delivered and will set
forth any commissions payable by us to such agent. Unless otherwise indicated
in the prospectus supplement, any agent will be acting on a best efforts basis
for the period of its appointment.
If an applicable prospectus supplement indicates, we will authorize agents,
underwriters or dealers to solicit offers by certain purchasers to purchase
debt securities and debt warrants from us at the public offering
17
<PAGE>
price set forth in the prospectus supplement under delayed delivery contracts
providing for payment and delivery on a specified date in the future. These
contracts will be subject to only those conditions set forth in the prospectus
supplement, and the prospectus supplement will set forth the commission payable
for solicitation of the contracts.
Agents, dealers and underwriters may be entitled under agreements entered
into with us to indemnification by us against certain civil liabilities,
including liabilities under the Securities Act of 1933, or to contribution with
respect to payments which the agents or underwriters may be required to make.
Agents and underwriters may be customers of, engage in transactions with or
perform services for us in the ordinary course of business.
LEGAL OPINION
The legality and enforceability of the debt securities and debt warrants and
the legality of the common stock issuable upon conversion of any convertible
debt securities will be passed upon for us by Chadbourne & Parke LLP, New York,
New York, and, if debt securities, debt warrants and common stock issuable upon
conversion of any convertible debt securities are being distributed in an
underwritten offering, the legality and enforceability of such debt securities
and debt warrants and legality of such common stock will be passed upon for the
underwriters by Davis Polk & Wardwell, New York, New York.
EXPERTS
The consolidated financial statements and financial statement schedule
incorporated in this prospectus by reference to Fortune Brands, Inc.'s Annual
Report on Form 10-K for the year ended December 31, 1998, have been so
incorporated in reliance on the reports of PricewaterhouseCoopers LLP,
independent accountants, given on the authority of said firm as experts in
accounting and auditing.
With respect to our unaudited interim consolidated financial information for
the three-month periods ended March 31, 1999 and March 31, 1998 and the three-
month and six-month periods ended June 30, 1999 and June 30, 1998, incorporated
by reference in this prospectus, PricewaterhouseCoopers LLP reported that they
have applied limited procedures in accordance with professional standards for a
review of such information. However, their separate reports included in our
quarterly reports on Form 10-Q for the quarters ended March 31, 1999 and June
30, 1999, and incorporated by reference herein, state that they did not audit
and they do not express an opinion on that interim financial information.
Accordingly, the degree of reliance on their reports on such information should
be restricted in light of the limited nature of the review procedures applied.
PricewaterhouseCoopers LLP is not subject to the liability provisions of
Section 11 of the Securities Act of 1933 for their reports on the unaudited
interim financial information because neither of those reports is a "report" or
a "part" of the registration statement prepared or certified by
PricewaterhouseCoopers LLP within the meaning of Sections 7 and 11 of the
Securities Act of 1933.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and current reports, proxy statements and other
information with the SEC, which the SEC maintains in the SEC's File No. 1-9076.
You can read and copy any document we file at the SEC's public reference rooms
in Washington, D.C., New York, New York and Chicago, Illinois. Please call the
SEC at 1-800-SEC-0330 for further information on the public reference rooms.
Our SEC filings are also available to the public at the SEC's web site at
http://www.sec.gov.
The SEC allows us to "incorporate by reference" into this prospectus the
information we file with it, which means that we can disclose important
information to you by referring you to those documents. The information
incorporated by reference is considered to be a part of this prospectus, and
later information filed with the SEC will update and supersede this
information. We incorporate by reference the documents listed below and any
future filings made with the SEC under Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until our offering is completed:
. Annual Report on Form 10-K for the year ended December 31, 1998;
. Quarterly Reports on Form 10-Q for the quarters ended March 31, 1999 and
June 30, 1999;
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. Current Reports on Form 8-K dated January 13, 1999, January 22, 1999,
February 18, 1999, April 23, 1999, May 3, 1999 and July 23, 1999;
. The description of our common stock, par value $3.125 per share, set
forth under the headings "Description of Fortune Brands Capital Stock"
and "Comparative Rights of Shareholders" on pages 94-105 of our Proxy
Statement for the 1997 Annual Meeting of Stockholders of Fortune Brands,
Inc.; and
. The description of our preferred share purchase rights, set forth on Form
8-A dated December 22, 1997.
You may request a copy of these filings, at no cost other than for exhibits
of such filings, by writing to or telephoning us at the following address (or
by visiting our web site at http://www.fortunebrands.com):
FORTUNE BRANDS, INC.
Office of the Secretary
1700 East Putnam Avenue
Old Greenwich, Connecticut 06870-0811
(telephone number (203) 698-5000)
We have filed with the SEC a registration statement to register the debt
securities and warrants to purchase such debt securities under the Securities
Act of 1933. This prospectus omits certain information contained in the
registration statement, as permitted by SEC rules. You may obtain copies of the
registration statement, including exhibits, as noted in the paragraph above.
You should rely only on the information incorporated by reference or
provided in this prospectus or the prospectus supplement. We have authorized no
one to provide you with different information. We are not making an offer of
these securities in any state where the offer is not permitted. You should not
assume that the information in this prospectus or the prospectus supplement is
accurate as of any date other than the date on the front of the document.
19
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The expenses in connection with the issuance and distribution of the
securities being registered hereby, other than underwriting discounts and
commissions, are as follows:
<TABLE>
<S> <C>
Securities and Exchange Commission Registration Fee................ $152,900
*Legal Fees and Expenses........................................... 100,000
*Accountants' Fees and Expenses.................................... 20,000
*Trustee's Fees and Expenses....................................... 40,000
*Printing and Engraving Expenses................................... 20,000
*Rating Agency Fees................................................ 100,000
*State Qualification Expenses (including legal fees)............... 4,000
*Miscellaneous..................................................... 4,000
--------
Total............................................................ $440,900
========
</TABLE>
- --------
* Estimated
Item 15. Indemnification of Directors and Officers.
Section 145 of the General Corporation Law of Delaware provides in part as
follows:
"(a) A corporation shall have power to indemnify any person who was or
is a party or is threatened to be made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by the
person in connection with such action, suit or proceeding if the person
acted in good faith and in a manner the person reasonably believed to be in
or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe
the person's conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which
the person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that the person's conduct was
unlawful.
"(b) A corporation may indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of the corporation to procure a judgment
in its favor by reason of the fact that the person is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise
against expenses (including attorneys' fees) actually and reasonably
incurred by the person in connection with the defense or settlement of such
action or suit if the person acted in good faith and in a manner the person
reasonably believed to be in or not opposed to the best interests of the
corporation and except that no indemnification shall be made in respect of
any claim, issue or matter as to which such person shall have been adjudged
to be liable to the corporation unless and only to the extent that the
Court of Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of
liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
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"(c) To the extent that a present or former director or officer of a
corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsections (a) and (b) of
this section, or in defense of any claim, issue or matter therein, such
person shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by such person in connection therewith.
"(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification
of the present or former director, officer, employee or agent is proper in
the circumstances because the person has met the applicable standard of
conduct set forth in subsections (a) and (b) of this section. Such
determination shall be made, with respect to a person who is a director or
officer at the time of such determination, (1) by a majority vote of the
directors who are not parties to such action, suit or proceeding, even
though less than a quorum, or (2) by a committee of such directors
designated by majority vote of such directors, even though less than a
quorum, or (3) if there are no such directors, or if such directors so
direct, by independent legal counsel in a written opinion, or (4) by the
stockholders.
"(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that such person is not
entitled to be indemnified by the corporation as authorized in this
section. Such expenses (including attorneys' fees) incurred by former
directors or officers or other employees and agents may be so paid upon
such terms and conditions, if any, as the corporation deems appropriate.
"(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any bylaw, agreement, vote
of stockholders or disinterested directors or otherwise, both as to action
in such person's official capacity and as to action in another capacity
while holding such office.
"(g) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
any liability asserted against such person and incurred by such person in
any such capacity, or arising out of such person's status as such, whether
or not the corporation would have the power to indemnify such person
against such liability under this section.
"(h) For purposes of this section, references to 'the corporation' shall
include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers,
and employees or agents, so that any person who is or was a director,
officer, employee or agent of such constituent corporation, or is or was
serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same position under
this section with respect to the resulting or surviving corporation as such
person would have with respect to such constituent corporation if its
separate existence had continued.
"(i) For purposes of this section, references to 'other enterprises'
shall include employee benefit plans; references to 'fines' shall include
any excise taxes assessed on a person with respect to any employee benefit
plan; and references to 'serving at the request of the corporation' shall
include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such
director, officer, employee, or agent with respect to an employee benefit
plan, its participants or beneficiaries; and a person who acted in good
faith and in a manner such person reasonably believed to be in the interest
of the participants and beneficiaries of an employee benefit plan shall be
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<PAGE>
deemed to have acted in a manner 'not opposed to the best interests of the
corporation' as referred to in this section.
"(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
"(k) The Court of Chancery is hereby vested with exclusive jurisdiction
to hear and determine all actions for advancement of expenses or
indemnification brought under this section or under any bylaw, agreement,
vote of stockholders or disinterested directors, or otherwise. The Court of
Chancery may summarily determine a corporation's obligation to advance
expenses (including attorney's fees)."
Article XIII of Registrant's by-laws provides as follows:
"Section 1. (A) Each person (an 'indemnitee') who was or is made or
threatened to be made a party to or was or is involved (as a witness or
otherwise) in any action, suit or proceeding, whether civil, criminal,
administrative or investigative (hereinafter a 'proceeding'), by reason of the
fact that he or she or a person of whom he or she is the legal representative
was or is a director, officer or employee of the Company or was or is serving
at the request of the Company as a director, officer, employee or agent of
another corporation or of a partnership, joint venture, trust or other
enterprise, including service with respect to employee benefit plans, whether
the basis of such proceeding was or is alleged action in an official capacity
as a director, officer, employee or agent or in any other capacity while
serving as a director, officer, employee or agent, shall be indemnified and
held harmless by the Company to the fullest extent permitted by the General
Corporation Law of the State of Delaware as the same exists or may hereafter be
amended (but, in the case of any such amendment, only to the extent that such
amendment permits the Company to provide broader indemnification rights than
said law permitted the Company to provide prior to such amendment), against all
expense, liability and loss (including attorneys' fees and retainers therefor,
judgments, fines, excise taxes or penalties under the Employee Retirement
Income Security Act of 1974, as amended, and amounts paid in settlement)
reasonably incurred or suffered by such person in connection therewith and such
indemnification shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of his or her heirs,
executors and administrators; provided, however, that except as provided in
Section 3 of this Article XIII with respect to proceedings seeking to enforce
rights to indemnification, the Company shall indemnify any such person seeking
indemnification in connection with a proceeding (or part thereof) initiated by
such person only if such proceeding (or part thereof) was authorized by the
board of directors of the Company.
(B) The right to indemnification conferred in this Article XIII is and shall
be a contract right. The right to indemnification conferred in this Article
XIII shall include the right to be paid by the Company the expenses (including
attorneys' fees and retainers therefor) reasonably incurred in connection with
any such proceeding in advance of its final disposition, such advances to be
paid by the Company within 20 days after the receipt by the Company of a
statement or statements from the indemnitee requesting such advance or advances
from time to time; provided, however, that if the General Corporation Law of
the State of Delaware requires, the payment of such expenses incurred by a
director or officer in his or her capacity as a director of officer (and not in
any other capacity in which service was or is rendered by such person while a
director or officer, including, without limitation, service to an employee
benefit plan) in advance of the final disposition of a proceeding, shall be
made only upon delivery to the Company of an undertaking by or on behalf of
such director or officer, to repay all amounts so advanced if it shall
ultimately be determined that such director or officer is not entitled to be
indemnified under this Article XIII or otherwise.
"Section 2. (A) To obtain indemnification under this Article XIII, an
indemnitee shall submit to the Company a written request, including therein or
therewith such documentation and information as is reasonably available to the
indemnitee and is reasonably necessary to determine whether and to what extent
the indemnitee is entitled to indemnification. Upon written request by an
indemnitee for indemnification pursuant to the first
II-3
<PAGE>
sentence of this Section 2(A), a determination, if required by applicable law,
with respect to the indemnitee's entitlement thereto shall be made as follows:
(1) if requested by the indemnitee, by Independent Counsel (as hereinafter
defined), or (2) if no request is made by the indemnitee for a determination by
Independent Counsel, (a) by the board of directors by a majority vote of a
quorum consisting of Disinterested directors (as hereinafter defined), or (b)
if a quorum of the board of directors consisting of Disinterested directors is
not obtainable or, even if obtainable, such quorum of Disinterested directors
so directs, by Independent Counsel in a written opinion to the board of
directors, a copy of which shall be delivered to the indemnitee, or (c) by the
stockholders of the Company. In the event the determination of entitlement to
indemnification is to be made by Independent Counsel at the request of the
indemnitee, the Independent Counsel shall be selected by the indemnitee unless
the indemnitee shall request that such selection be made by the board of
directors, in which event the Independent Counsel shall be selected by the
board of directors. If it is so determined that the indemnitee is entitled to
indemnification, payment to the indemnitee shall be made within 10 days after
such determination.
(B) In making a determination with respect to entitlement to indemnification
hereunder, the person, persons or entity making such determination shall
presume that the indemnitee is entitled to indemnification under this Article
XIII, and the Company shall have the burden of proof to overcome that
presumption in connection with the making by any person, persons or entity of
any determination contrary to that presumption.
"Section 3. (A) If a claim under Section 1 of this Article XIII is not paid
in full by the Company within 30 days after a written claim pursuant to Section
2(A) of this Article XIII has been received by the Company, or if an advance is
not made within 20 days after a request therefor pursuant to Section 1(B) of
this Article XIII has been received by the Company, the indemnitee may at any
time thereafter bring suit (or, at the indemnitee's option, an arbitration
proceeding before a single arbitrator pursuant to the rules of the American
Arbitration Association) against the Company to recover the unpaid amount of
the claim or the advance and, if successful in whole or in part, the indemnitee
shall be entitled to be paid also the expense of prosecuting such claim. It
shall be a defense to any such suit or proceeding (other than a suit or
proceeding brought to enforce a claim for expenses incurred in connection with
any proceeding in advance of its final disposition where the required
undertaking, if any is required, has been tendered to the Company) that the
indemnitee has not met the standards of conduct which make it permissible under
the General Corporation Law of the State of Delaware for the Company to
indemnify the indemnitee for the amount claimed or that such indemnification
otherwise is not permitted under the General Corporation Law of the State of
Delaware, but the burden of proving such defense shall be on the Company.
(B) Neither the failure of the Company (including its board of directors,
Independent Counsel or stockholders) to have made a determination prior to the
commencement of such action that indemnification of the indemnitee is proper in
the circumstances because he or she has met the applicable standard of conduct
set forth in the General Corporation Law of the State of Delaware, nor an
actual determination by the Company (including its board of directors,
Independent Counsel or stockholders) that the indemnitee has not met such
applicable standard of conduct, shall be a defense to the action or create a
presumption that the indemnitee has not met the applicable standard of conduct.
(C) If a determination shall have been made pursuant to Section 2(A) of this
Article XIII that the indemnitee is entitled to indemnification, the Company
shall be bound by such determination in any judicial proceeding or arbitration
commenced pursuant to paragraph (A) of this Section 3.
(D) The Company shall be precluded from asserting in any judicial proceeding
or arbitration commenced pursuant to paragraph (A) of this Section 3 that the
procedures and presumptions of this Article XIII are not valid, binding and
enforceable and shall stipulate in any such court or before any such arbitrator
that the Company is bound by all the provisions of this Article XIII.
"Section 4. The right to indemnification and the payment of expenses
incurred in connection with a proceeding in advance of its final disposition
conferred in this Article XIII shall not be exclusive of any other
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<PAGE>
right which any person may have or hereafter acquire under any statute,
provision of the Certificate of Incorporation, by-laws, agreement, vote of
stockholders or Disinterested directors or otherwise.
"Section 5. The Company may maintain insurance, at its expense, to protect
itself and any director, officer, employee or agent of the Company or another
corporation, partnership, joint venture, trust or other enterprise against any
expense, liability or loss, whether or not the Company would have the power to
indemnify such person against such expense, liability or loss under the General
Corporation Law of the State of Delaware. To the extent that the Company
maintains any policy or policies providing such insurance, each such director,
officer or employee, and each such agent to which rights to indemnification
have been granted as provided in Section 6 of this Article XIII, shall be
covered by such policy or policies in accordance with its or their terms to the
maximum extent of the coverage thereunder for any such director, officer,
employee or agent.
"Section 6. The Company may, to the extent authorized from time to time by
the Board of Directors, grant rights to indemnification, and rights to be paid
by the Company the expenses incurred in connection with any proceeding in
advance of its final disposition, to any agent of the Company to the fullest
extent of the provisions of this Article XIII with respect to the
indemnification and advancement of expenses of directors, officers and
employees of the Company.
"Section 7. If any provision or provisions of this Article XIII shall be
held to be invalid, illegal or unenforceable for any reason whatsoever: (A) the
validity, legality and enforceability of the remaining provisions of this
Article XIII (including without limitation, each portion of any Section of this
Article XIII containing any such provision held to be invalid, illegal or
unenforceable, that is not itself invalid, illegal or unenforceable) shall not
in any way be affected or impaired thereby; and (B) to the fullest extent
possible, the provisions of this Article XIII (including, without limitation,
each portion of any Section of this Article XIII containing any such provision
held to be invalid, illegal or unenforceable) shall be construed so as to give
effect to the intent manifested by the provision held invalid, illegal or
unenforceable.
"Section 8. For purposes of this Article XIII:
(A) 'Disinterested director' means a director of the Company who is not
and was not a party to the matter in respect of which indemnification is
sought by the indemnitee.
(B) 'Independent Counsel' means a law firm, or a member of a law firm,
that is experienced in matters of corporation law and neither presently is,
nor in the past five years has been, retained to represent: (1) the Company
or the indemnitee in any matter material to either such party, or (2) any
other party to the matter giving rise to a claim for indemnification.
Notwithstanding the foregoing, the term 'Independent Counsel' shall not
include any person who, under the applicable standards of professional
conduct then prevailing, would have a conflict of interest in representing
either the Company or the indemnitee in an action to determine the
indemnitee's rights under this Article XIII.
"Section 9. Any notice, request or other communication required or permitted
to be given to the Company under this Article XIII shall be in writing and
either delivered in person or sent by telecopy, telex, telegram or certified or
registered mail, postage prepaid, return receipt requested, to the Secretary of
the Company and shall be effective only upon receipt by the Secretary."
Registrant has procured insurance protecting it under its obligation to
indemnify officers and directors against certain types of liabilities
(including certain liabilities under the Securities Act of 1933) that may be
incurred by them in the performance of their duties and affording protection to
such officers and directors in certain areas to which the corporate indemnity
does not extend, all within specified limits and subject to specified
deductions.
In addition, Registrant and certain other persons may be entitled under
agreements entered into with agents or underwriters to indemnification by such
agents or underwriters against certain liabilities, including liabilities under
the Securities Act of 1933, or to contribution with respect to payments which
Registrant or such persons may be required to make in respect thereof.
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Item 16. List of Exhibits.
<TABLE>
<C> <S>
*1a1 --Forms of proposed Underwriting Agreement, Underwriting Agreement
Standard Provisions (Debt Securities and Warrants to Purchase Debt
Securities) and Delayed Delivery Contract.
*4a1 --Indenture, to be dated as of April 15, 1999, between Registrant and
The Chase Manhattan Bank, as Trustee.
*4b1 --Restated Certificate of Incorporation of Registrant is incorporated
herein by reference to Exhibit 3(i) to the Annual Report on Form 10-K
of Registrant for the Fiscal Year ended December 31, 1998.
*4c1 --By-laws of Registrant, as amended, are incorporated herein by
reference to Exhibit 3(ii)b to the Annual Report on Form 10-K of
Registrant for the Fiscal Year ended December 31, 1998.
*4d1 --Rights Agreement, dated as of November 19, 1997, between Registrant
and First Chicago Trust Company of New York, as Rights Agent, is
incorporated herein by reference to Exhibit 4a to the Current Report
on Form 8-K of Registrant dated December 2, 1997.
*4e1 --Forms of Debt Securities.
*4f1 --Forms of Debt Warrant Agreements, including forms of Debt Warrant
Certificates.
*5 --Opinion of Chadbourne & Parke LLP as to the legality of the
securities being registered.
*12 --Statement re Computation of Ratio of Earnings to Fixed Charges for
the five years ended December 31, 1998 is incorporated herein by
reference to Exhibit 12 to the Annual Report on Form 10-K of
Registrant for the Fiscal Year ended December 31, 1998.
*15 --Letter from PricewaterhouseCoopers LLP re unaudited interim financial
information.
23a --Consent of PricewaterhouseCoopers LLP, independent accountants.
*23b --Consent of Chadbourne & Parke LLP is contained in their opinion filed
as Exhibit 5 to this registration statement.
*24 --Power of Attorney authorizing certain persons to sign this
registration statement on behalf of certain directors and officers of
Registrant.
*25 --Form T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of The Chase Manhattan Bank, the Trustee under
the Indenture constituting Exhibit 4a1 hereto.
</TABLE>
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* Previously filed
Item 17. Undertakings.
The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement: (i) to include any
prospectus required by Section 10(a)(3) of the Securities Act 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 the registration statement;
notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement; and (iii) to include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement; provided, however, that clauses (i)
and (ii) do not apply if the information required to be included in a post-
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effective amendment by those clauses is contained in periodic reports filed by
the Registrant pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934 that are incorporated by reference in the 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.
(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 purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant's annual report pursuant to Section
13(a) or 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 herein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) To file an application for the purpose of determining the eligibility of
the trustee to act under subsection (a) of Section 310 of the Trust Indenture
Act of 1939 in accordance with the rules and regulations prescribed by the
Commission under Section 305(b)(2) of the Trust Indenture Act of 1939.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of
Registrant pursuant to the foregoing provisions, or otherwise, Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by Registrant
of expenses incurred or paid by a director, officer or controlling person of
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, Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy, as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Registrant
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 Amendment No. 3 to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in Old Greenwich, Connecticut, on this first day of
September, 1999.
FORTUNE BRANDS, INC.
Dudley L. Bauerlein, Jr.
By __________________________________
Dudley L. Bauerlein, Jr.
Senior Vice President
and Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 3 to the Registration Statement has been signed by the following persons in
the capacities indicated on this first day of September, 1999.
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
Thomas C. Hays* Chairman of the Board and Chief Executive
- -------------------------- Officer (principal executive officer) and
(Thomas C. Hays) Director
Norman H. Wesley* President and Chief Operating Officer and
- -------------------------- Director
(Norman H. Wesley)
John T. Ludes* Vice Chairman and Director
- --------------------------
(John T. Ludes)
Gilbert L. Klemann, II* Executive Vice President--Corporate and
- -------------------------- Director
(Gilbert L. Klemann, II)
Dudley L. Bauerlein, Jr. Senior Vice President and Chief Financial
- -------------------------- Officer (principal financial officer)
(Dudley L. Bauerlein, Jr.)
Craig P. Omtvedt* Senior Vice President and Chief Accounting
- -------------------------- Officer (principal accounting officer)
(Craig P. Omtvedt)
Eugene R. Anderson* Director
- --------------------------
(Eugene R. Anderson)
Patricia O. Ewers* Director
- --------------------------
(Patricia O. Ewers)
John W. Johnstone, Jr.* Director
- --------------------------
(John W. Johnstone, Jr.)
</TABLE>
II-8
<PAGE>
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
Sidney Kirschner* Director
- ------------------------
(Sidney Kirschner)
Gordon R. Lohman* Director
- ------------------------
(Gordon R. Lohman)
Director
- ------------------------
(Charles H. Pistor, Jr.)
Eugene A. Renna* Director
- ------------------------
(Eugene A. Renna)
Anne M. Tatlock* Director
- ------------------------
(Anne M. Tatlock)
Peter M. Wilson* Director
- ------------------------
(Peter M. Wilson)
</TABLE>
Edward P. Smith
*By _________________________________
(Edward P. Smith, Attorney-in-
Fact)
II-9
<PAGE>
Exhibit 23a
-----------
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-3 of our report dated February 3, 1999 relating to the
consolidated financial statements, appearing in the 1998 Annual Report to
Stockholders of Fortune Brands, Inc. (the "Company"), which is incorporated by
reference in the Company's Annual Report on Form 10-K for the year ended
December 31, 1998. We also consent to the incorporation by reference in this
Registration Statement on Form S-3 of our report on the financial statement
schedule, which appears in such Annual Report on Form 10-K. We also consent to
the references to us under the heading "Experts" in such Registration Statement.
PricewaterhouseCoopers LLP
11 Madison Avenue
New York, New York 10010
September 1, 1999
