<PAGE> 1
Filed Pursuant to Rule 424(b)(2)
Registration No. 33-55949
PROSPECTUS SUPPLEMENT
(To Prospectus dated November 9, 1994)
$300,000,000
(ASSOCIATES LOGO)
7 3/4% SENIOR NOTES DUE FEBRUARY 15, 2005
------------------------
Interest on the Notes is payable semiannually on February 15 and August 15
of each year, beginning August 15, 1995. The registered holder of each Note may
elect to have that Note, or any portion thereof which is a multiple of $1,000,
repaid on February 15, 2000 at its principal amount together with interest
payable to the date of repayment. Such election, which is irrevocable when made,
must be made within the period commencing on December 15, 1999 and ending at the
close of business on January 15, 2000. The Notes are not redeemable at the
option of the Company prior to maturity.
------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
Price to Underwriting Proceeds to
Public(1) Discount Company(1)(2)
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
Per Note......................... 99.746% .231% 99.515%
- ------------------------------------------------------------------------------------------------
Total............................ $299,238,000 $693,000 $298,545,000
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
</TABLE>
(1) Plus accrued interest, if any, from February 13, 1995 to date of delivery.
(2) Before deducting expenses payable by the Company estimated to be $267,000.
------------------------
The Notes are offered subject to receipt and acceptance by the Underwriter,
to prior sale and to the Underwriter's right to reject any order in whole or in
part and to withdraw, cancel or modify the offer without notice. It is expected
that delivery of the Notes will be made at the office of the Underwriter in New
York, New York, or through the facilities of The Depository Trust Company, on or
about February 13, 1995, against payment therefor in immediately available
funds.
------------------------
LEHMAN BROTHERS
February 6, 1995
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. SUMMARY
FINANCIAL INFORMATION
The following summary of certain financial information of the Company and
its consolidated subsidiaries has been derived principally from information
contained in the Company's Annual Report on Form 10-K for the year ended
December 31, 1993 and its Quarterly Report on Form 10-Q for the nine months
ended September 30, 1994, available as described under "Documents Incorporated
by Reference", and is qualified in its entirety by the detailed information and
financial statements set forth therein.
<TABLE>
<CAPTION>
FOR THE NINE
MONTHS ENDED
FOR THE YEAR ENDED DECEMBER 31 SEPTEMBER 30
------------------------------------------------------------ ---------------------
1989(A) 1990 1991 1992 1993 1993 1994
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
(UNAUDITED)
(DOLLAR AMOUNTS IN MILLIONS)
REVENUE AND EARNINGS
Revenue --
Finance charges........................ $1,852.1 $2,246.7 $2,753.2 $2,931.9 $3,250.7 $2,398.0 $2,794.6
Insurance premiums..................... 196.9 212.7 202.5 209.9 242.2 177.0 211.8
Investment and other income............ 177.2 197.3 163.3 182.8 196.7 147.8 170.2
-------- -------- -------- -------- -------- -------- --------
2,226.2 2,656.7 3,119.0 3,324.6 3,689.6 2,722.8 3,176.6
Expenses --
Interest expense....................... 997.0 1,146.3 1,278.5 1,222.8 1,291.8 961.4 1,082.9
Operating expenses..................... 463.2 586.6 705.4 807.4 979.6 722.8 849.9
Provision for losses on finance
receivables.......................... 224.0 302.0 423.7 504.0 468.9 346.8 422.4
Insurance benefits paid or provided.... 95.2 96.8 91.1 100.0 114.9 83.2 108.7
-------- -------- -------- -------- -------- -------- --------
1,779.4 2,131.7 2,498.7 2,634.2 2,855.2 2,114.2 2,463.9
-------- -------- -------- -------- -------- -------- --------
Earnings from Domestic Operations........ 446.8 525.0 620.3 690.4 834.4 608.6 712.7
Earnings from Foreign Operations......... 60.9 -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Total Earnings Before Provision for
Income Taxes and Cumulative Effect of
Changes in Accounting Principles....... 507.7 525.0 620.3 690.4 834.4 608.6 712.7
Provision for Income Taxes............... 180.3 185.8 219.6 240.7 310.7 227.3 268.4
-------- -------- -------- -------- -------- -------- --------
Earnings Before Cumulative Effect of
Changes in Accounting Principles....... 327.4 339.2 400.7 449.7 523.7 381.3 444.3
Cumulative Effect of Changes in
Accounting Principles(b)............... -- -- -- (10.0) -- -- --
-------- -------- -------- -------- -------- -------- --------
Net Earnings(c).......................... $ 327.4 $ 339.2 $ 400.7 $ 439.7 $ 523.7 $ 381.3 $ 444.3
======= ======= ======= ======= ======= ======= =======
Ratio of Earnings to Fixed Charges(d).... 1.45 1.46 1.48 1.56 1.64 1.63 1.66
==== ==== ==== ==== ==== ==== ====
</TABLE>
- ---------------
(a) Results for the year ended December 31, 1989 are unaudited.
(b) The Company recorded a one-time cumulative effect of changes in accounting
principles related to the adoption, effective January 1, 1992, of SFAS No.
106, "Employers' Accounting for Postretirement Benefits Other Than
Pensions", and SFAS No. 109, "Accounting for Income Taxes".
(c) Includes the after-tax operating results of foreign operations through
October 30, 1989.
(d) For purposes of computing the Ratio of Earnings to Fixed Charges, "Earnings"
represent earnings from domestic operations before provision for income
taxes and cumulative effect of changes in accounting principles, plus fixed
charges. "Fixed Charges" represent interest expense and a portion of
rentals representative of an implicit interest factor for such rentals,
relating only to the domestic operations.
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<PAGE> 3
SUMMARY FINANCIAL INFORMATION -- (CONTINUED)
<TABLE>
<CAPTION>
DECEMBER 31 SEPTEMBER 30
1993 1994
----------- -------------
(UNAUDITED)
(IN MILLIONS)
<S> <C> <C>
BALANCE SHEET DATA
Assets:
Cash and Cash Equivalents........................................ $ 261.6 $ 303.9
Investments in Marketable Securities(e)
Bonds and Notes............................................... 603.5 556.1
Stocks........................................................ 35.0 32.9
---------- -----------
Total Investments in Marketable Securities............... 638.5 589.0
Finance Receivables
Consumer Finance.............................................. 20,330.1 22,942.4
Commercial Finance............................................ 9,077.2 10,350.1
---------- -----------
Total Finance Receivables................................ 29,407.3 33,292.5
Less -- Unearned finance income............................... 3,208.2 3,640.3
Allowance for losses on finance receivables........... 798.0 908.3
---------- -----------
25,401.1 28,743.9
Other Assets..................................................... 1,493.7 1,504.3
---------- -----------
Total Assets............................................. $27,794.9 $31,141.1
========== ===========
Liabilities and Stockholders' Equity:
Notes Payable unsecured short-term
Commercial paper.............................................. $ 9,735.8 $11,584.1
Bank loans.................................................... 472.4 --
Long-Term Debt unsecured due within one year
Senior........................................................ 1,911.4 2,059.1
Subordinated.................................................. 100.0 --
Capital....................................................... 0.1 0.1
Accounts Payable and Accruals.................................... 840.2 804.1
Insurance Policy and Claims Reserves............................. 429.8 524.9
Long-Term Debt unsecured
Senior........................................................ 10,889.2 12,324.1
Subordinated.................................................. 141.2 141.2
Capital....................................................... 0.6 0.5
---------- -----------
Total Long-Term Debt..................................... 11,031.0 12,465.8
---------- -----------
Stockholders' Equity............................................. 3,274.2 3,703.0
---------- -----------
Total Liabilities and Stockholders' Equity............... $27,794.9 $31,141.1
========== ===========
</TABLE>
- ---------------
(e) The Company adopted Statement of Financial Accounting Standards No. 115,
"Accounting for Certain Investments in Debt and Equity Securities"
effective March 31, 1994. Accordingly, at September 30, 1994, all
investments in marketable securities are carried at market value. At
December 31, 1993, investments in bonds and notes are carried at amortized
cost; market value on this date was $616.8 million.
---------------------
On February 1, 1995, the Company announced its results for the year ended
December 31, 1994. Such results, compared to the results of operations for the
prior fiscal year, were as follows: Revenue -- $4.4 billion (1994), $3.7 billion
(1993); Earnings before Provision for Income Taxes -- $972.6 million (1994),
$834.4 million (1993); and Net Earnings -- $603.5 million (1994), $523.7 million
(1993).
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<PAGE> 4
DESCRIPTION OF THE NOTES
The following description of the particular terms of the Notes offered
hereby supplements the description of the general terms and provisions of the
Debt Securities set forth in the Prospectus, to which description reference is
hereby made.
GENERAL
The Notes will constitute senior debt of the Company, will be issued under
an indenture dated as of October 15, 1994 (the "Indenture") between the Company
and Citibank, N.A., as Trustee ("Citibank"), will be limited to $300,000,000
aggregate principal amount and will mature on February 15, 2005. The Notes will
bear interest at the rate per annum shown on the cover page of this Prospectus
Supplement from February 13, 1995 or from the most recent Interest Payment Date
to which interest has been paid or provided for, payable semiannually on
February 15 and August 15 of each year, commencing on August 15, 1995, to the
persons in whose names the Notes are registered at the close of business on the
January 31 and the July 31, as the case may be, next preceding such Interest
Payment Date. Payment of interest will be made by check mailed to the persons
entitled thereto; provided, however, that such payment of interest will be made
by wire transfer of immediately available funds if appropriate wire transfer
instructions have been received in writing by Citibank at its Corporate Trust
Office not later than five business days prior to the record date for the
applicable Interest Payment Date. Payment of principal at maturity will be made
in immediately available funds upon surrender of a Note at the Corporate Trust
Office or agency of Citibank located in the Borough of Manhattan, The City of
New York.
The Notes are to be issued only in registered form without coupons in
denominations of $1,000 and any multiple of $1,000.
REDEMPTION
The Notes are not redeemable at the option of the Company prior to
maturity.
REPAYMENT AT OPTION OF HOLDER
The Notes will be repayable on February 15, 2000, at the option of the
registered Holders of the Notes, at 100% of their principal amount together with
interest payable to the date of repayment. In order for a Note to be repaid, the
Company must receive at its office or agency in the Borough of Manhattan, The
City of New York, during the period from and including December 15, 1999 to and
including January 15, 2000 (or, if such January 15, 2000 is not a Business Day,
the next succeeding Business Day), (i) the Note with the form entitled "Option
to Elect Repayment" on the reverse of the Note duly completed, or (ii) a
telegram, telex, facsimile transmission or letter from a member of a national
securities exchange or the National Association of Securities Dealers, Inc. or a
commercial bank or a trust company in the United States of America setting forth
the name of the Holder of the Note, the principal amount of the Note, the amount
of the Note to be repaid, a statement that the option to elect repayment is
being exercised thereby and a guarantee that the Note to be repaid with the form
entitled "Option to Elect Repayment" on the reverse of the Note duly completed
will be received by the Company not later than five Business Days after the date
of such telegram, telex, facsimile transmission or letter and such Note and form
duly completed are received by the Company by such fifth Business Day. Any such
notice received by the Company during the period from and including December 15,
1999 to and including January 15, 2000 shall be irrevocable. The repayment
option may be exercised by the Holder of a Note for less than the entire
principal amount of the Note, provided the principal amount which is to be
repaid is equal to $1,000 or an integral multiple of $1,000. All questions as to
the
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<PAGE> 5
validity, eligibility (including time of receipt) and acceptance of any Note for
repayment will be determined by the Company, whose determination will be final
and binding.
CONCERNING THE TRUSTEE
Citibank serves as trustee with respect to one other series of Debt
Securities previously issued under the Indenture. Citibank acts as depository
for funds of, extends credit to, and performs other banking services for, the
Company in the normal course of business.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting
Agreement, the Company has agreed to sell to Lehman Brothers Inc. (the
"Underwriter"), and the Underwriter has agreed to purchase, all of the Notes.
The Underwriting Agreement provides that the obligation of the Underwriter
is subject to certain conditions precedent. The Underwriter will be obligated to
purchase all of the Notes if any of the Notes are purchased.
The Company has been advised that the Underwriter proposes initially to
offer the Notes directly to the public at the public offering price set forth on
the cover page hereof and to certain dealers at a price which represents a
concession not in excess of .175% of the principal amount. The Underwriter may
allow and such dealers may reallow a concession, not in excess of .100% of the
principal amount, to certain other dealers. After the initial public offering,
the public offering price and such concessions may be changed.
The Company will indemnify the Underwriter against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, or
contribute to payments required to be made in respect thereof.
The Company has been advised by the Underwriter that it currently intends
to make a market in the Notes, but may discontinue such market making at any
time without notice. The Company cannot predict the liquidity of any trading
market for the Notes.
LEGAL OPINIONS
The legality of the Notes will be passed upon for the Company by its
Assistant General Counsel, Timothy M. Hayes, 250 Carpenter Freeway, Irving, TX
75062-2729, and for the Underwriter by LeBoeuf, Lamb, Greene & MacRae, L.L.P., a
limited liability partnership including professional corporations, 125 West 55th
Street, New York, New York 10019.
S-5
<PAGE> 6
===============================================================================
NO DEALER, SALESMAN OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS IN CONNECTION WITH THE
OFFER CONTAINED IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR BY THE UNDERWRITER. THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS DO NOT CONSTITUTE AN OFFER
OR SOLICITATION BY ANYONE IN ANY JURISDICTION IN WHICH SUCH OFFER OR
SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION.
---------------------
TABLE OF CONTENTS
PROSPECTUS SUPPLEMENT
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Summary Financial Information....... S-2
Description of the Notes............ S-4
Underwriting........................ S-5
Legal Opinions...................... S-5
PROSPECTUS
Available Information............... 2
Documents Incorporated by
Reference......................... 2
The Company......................... 3
Application of Proceeds............. 3
Description of Debt Securities...... 4
Description of Warrants............. 8
Plan of Distribution................ 9
Legal Opinions...................... 10
Experts............................. 10
</TABLE>
===============================================================================
===============================================================================
$300,000,000
[ASSOCIATES CORPORATION LOGO]
7 3/4% SENIOR NOTES
DUE FEBRUARY 15, 2005
---------------------------
PROSPECTUS SUPPLEMENT
February 6, 1995
---------------------------
LEHMAN BROTHERS
===============================================================================
