<PAGE> 1
Filed Pursuant to Rule 424(b)(2)
Registration No. 33-63577
PROSPECTUS SUPPLEMENT
(To Prospectus dated December 4, 1995)
$350,000,000
[ASSOCIATES CORPORATION OF NORTH AMERICA LOGO]
6 3/4% SENIOR NOTES DUE JULY 15, 2001
---------------------
Interest payable January 15 and July 15
---------------------
THE NOTES MAY NOT BE REDEEMED BY 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 TO WHICH IT
RELATES. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
---------------------
PRICE 99.565% AND ACCRUED INTEREST, IF ANY
---------------------
<TABLE>
<CAPTION>
UNDERWRITING
PRICE TO DISCOUNTS AND PROCEEDS TO
PUBLIC(1) COMMISSIONS(2) COMPANY(1)(3)
--------- -------------- -------------
<S> <C> <C> <C>
Per Note................... 99.565% .182% 99.383%
Total...................... $348,477,500 $637,000 $347,840,500
</TABLE>
- ---------------
(1) Plus accrued interest, if any, from July 23, 1996 to date of delivery.
(2) The Company has agreed to indemnify the Underwriters against certain
liabilities, including liabilities under the Securities Act of 1933.
(3) Before deduction of expenses payable by the Company estimated at
$290,000.
---------------------
The Notes are offered, subject to prior sale, when, as and if accepted by
the Underwriters and subject to approval of certain legal matters by LeBoeuf,
Lamb, Greene & MacRae, L.L.P., counsel for the Underwriters. It is expected that
delivery of the Notes will be made on or about July 23, 1996 at the office of
Morgan Stanley & Co. Incorporated, New York, N.Y., against payment therefor in
Federal funds.
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MORGAN STANLEY & CO. ABN AMRO SECURITIES (USA) INC.
Incorporated
July 18, 1996
<PAGE> 2
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE NOTES OFFERED
HEREBY AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET.
SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
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, 1995 and its Quarterly Report on Form 10-Q for the three months
ended March 31, 1996, 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 THREE MONTHS
FOR THE YEAR ENDED DECEMBER 31 ENDED MARCH 31
-------------------------------------------------------- --------------------
1991 1992 1993 1994 1995 1995 1996
-------- -------- -------- -------- -------- -------- --------
(DOLLAR AMOUNTS IN MILLIONS) (UNAUDITED)
<S> <C> <C> <C> <C> <C> <C> <C>
REVENUE AND EARNINGS
Revenue --
Finance charges............ $2,753.2 $2,931.9 $3,250.7 $3,866.7 $4,805.3 $1,121.2 $1,308.3
Insurance premiums......... 202.5 209.9 242.2 293.5 325.1 81.9 81.6
Investment and other
income................... 163.3 182.8 196.7 227.7 254.0 60.1 64.3
-------- -------- -------- -------- -------- -------- --------
3,119.0 3,324.6 3,689.6 4,387.9 5,384.4 1,263.2 1,454.2
Expenses --
Interest expense........... 1,278.5 1,222.8 1,291.8 1,509.7 1,979.8 462.5 514.7
Operating expenses......... 705.4 807.4 979.6 1,191.6 1,417.8 333.5 366.7
Provision for losses on
finance receivables..... 423.7 504.0 468.9 569.9 729.7 171.3 231.0
Insurance benefits paid or
provided................ 91.1 100.0 114.9 144.1 135.7 36.3 33.0
-------- -------- -------- -------- -------- -------- --------
2,498.7 2,634.2 2,855.2 3,415.3 4,263.0 1,003.6 1,145.4
-------- -------- -------- -------- -------- -------- --------
Earnings Before Provision for
Income Taxes and Cumulative
Effect of Changes in
Accounting Principles...... 620.3 690.4 834.4 972.6 1,121.4 259.6 308.8
Provision for Income Taxes... 219.6 240.7 310.7 369.1 413.3 93.6 115.0
-------- -------- -------- -------- -------- -------- --------
Earnings Before Cumulative
Effect of Changes in
Accounting Principles...... 400.7 449.7 523.7 603.5 708.1 166.0 193.8
Cumulative Effect of Changes
in Accounting
Principles(a).............. -- (10.0) -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Net Earnings................. $ 400.7 $ 439.7 $ 523.7 $ 603.5 $ 708.1 $ 166.0 $ 193.8
======== ======== ======== ======== ======== ======== ========
Ratio of Earnings to Fixed
Charges(b)................. 1.48 1.56 1.64 1.64 1.56 1.56 1.60
======== ======== ======== ======== ======== ======== ========
</TABLE>
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(a) 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".
(b) For purposes of computing the Ratio of Earnings to Fixed Charges, "earnings"
represent earnings 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.
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<PAGE> 3
SUMMARY FINANCIAL INFORMATION -- (CONTINUED)
<TABLE>
<CAPTION>
DECEMBER 31 MARCH 31
1995 1996
----------- ------------
(UNAUDITED)
(IN MILLIONS)
<S> <C> <C>
BALANCE SHEET DATA
Assets:
Cash and Cash Equivalents......................................... $ 309.2 $ 200.4
Investments in Debt and Equity Securities
Bonds and Notes................................................ 872.1 922.2
Stocks......................................................... 12.6 12.6
--------- ----------
Total Investments in Debt and Equity Securities........... 884.7 934.8
Finance Receivables, net of unearned finance income
Consumer Finance............................................... 24,609.2 25,578.0
Commercial Finance............................................. 11,759.1 11,998.8
--------- ----------
Total Net Finance Receivables............................. 36,368.3 37,576.8
Allowance for Losses on Finance Receivables....................... (1,109.2) (1,205.9)
Insurance Policy and Claims Reserves.............................. (602.8) (613.7)
Other Assets...................................................... 1,173.5 1,273.5
--------- ----------
Total Assets.............................................. $37,023.7 $ 38,165.9
========= ==========
Liabilities and Stockholders' Equity:
Notes Payable, unsecured short-term
Commercial paper............................................... $12,732.7 $ 14,467.1
Bank loans..................................................... 702.0 --
Long-Term Debt, unsecured due within one year
Senior......................................................... 2,611.3 2,128.0
Subordinated................................................... -- 16.2
Capital........................................................ 0.1 0.1
Accounts Payable and Accruals..................................... 833.5 975.7
Long-Term Debt, unsecured
Senior......................................................... 15,558.4 15,829.2
Subordinated................................................... 141.2 125.0
Capital........................................................ 0.5 0.5
--------- ----------
Total Long-Term Debt...................................... 15,700.1 15,954.7
Stockholders' Equity.............................................. 4,444.0 4,624.1
--------- ----------
Total Liabilities and Stockholders' Equity................ $37,023.7 $ 38,165.9
========= ==========
</TABLE>
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On July 16, 1996, the Company announced unaudited results for the six
months ended June 30, 1996. Such results, compared to the unaudited results of
operations for the similar period of the prior fiscal year, were as follows:
Revenue -- $3.0 billion (1996), $2.6 billion (1995); Earnings before Provision
for Income Taxes -- $633.1 million (1996), $534.5 million (1995); and Net
Earnings -- $399.3 million (1996), $338.7 million (1995).
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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 November 1, 1995 (the "Indenture") between the Company
and The Chase Manhattan Bank (formerly known as The Chase Manhattan Bank
(National Association)), as Trustee ("Chase"), will be limited to $350,000,000
aggregate principal amount and will mature on July 15, 2001. The Notes will bear
interest at the rate per annum shown on the cover page of this Prospectus
Supplement from July 23, 1996 or from the most recent Interest Payment Date to
which interest has been paid or provided for, payable semiannually on January 15
and July 15 of each year, commencing on January 15, 1997, to the persons in
whose names the Notes are registered at the close of business on the December 31
and June 30, 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 Chase 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.
The Notes may be presented for payment or for transfer or exchange at the
Corporate Trust Office of Chase, presently located at 4 Chase MetroTech Center
(3rd Floor), Brooklyn, New York 11245 (on and after August 2, 1996, to be
located at 450 West 33rd Street, 15th Floor, New York, New York 10001) or, at
the option of the holder, at Chase's corporate trust facility in the Borough of
Manhattan, The City of New York, presently located at Chase Institutional Trust
Window, 1 Chase Manhattan Plaza, 1B, New York, New York 10081 or at any other
office or agency maintained by the Company for such purpose. The Company may
from time to time vary the location of any such offices but will at all times
maintain an office or agency in the Borough of Manhattan for presentation for
payment or for transfer or exchange. Wire transfer instructions shall be
provided to Chase at either of the aforementioned offices.
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 prior to maturity.
CONCERNING THE TRUSTEE
Chase serves as trustee with respect to six other series of Debt Securities
previously issued under the Indenture. In addition, Chase acts as trustee with
respect to various debt securities issued under indentures originally executed
by Manufacturers Hanover Trust Company and Chemical Bank, respectively. Chase
acts as depository for funds of, extends credit to, and performs other banking
services for, the Company in the normal course of business.
S-4
<PAGE> 5
UNDERWRITERS
Under the terms of and subject to the conditions set forth in the
Underwriting Agreement dated July 18, 1996, the Company has agreed to sell to
each of the Underwriters named below, severally, and each of the Underwriters
has severally agreed to purchase, the principal amount of the Notes set forth
opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL
NAME AMOUNT
---- ------
<S> <C>
Morgan Stanley & Co. Incorporated....................................... $325,000,000
ABN AMRO Securities (USA) Inc........................................... 25,000,000
------------
Total......................................................... $350,000,000
============
</TABLE>
The Underwriting Agreement provides that the obligations of the
Underwriters thereunder are subject to approval of certain legal matters by
counsel and to various other conditions. The nature of the Underwriters'
obligations is such that they are committed to take and pay for all of the Notes
if any are taken.
The Underwriters propose to offer the Notes directly to the public at the
public offering price set forth on the cover page of this Prospectus Supplement
and to certain dealers at such price less a concession of .150% of the principal
amount of the Notes. The Underwriters may allow and such dealers may reallow to
certain other dealers a concession, not in excess of .075% of the principal
amount of the Notes. After the initial public offering, the offering price and
other selling terms may be changed by the Underwriters.
The Company has agreed to indemnify the Underwriters 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 Underwriters that they currently intend
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.
Affiliates of ABN AMRO Securities (USA) Inc. extend credit to, and perform
other banking services for, the Company and its affiliates in the normal course
of their respective businesses.
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 Underwriters by LeBoeuf, Lamb, Greene & MacRae, L.L.P.,
a limited liability partnership including professional corporations, 125 West
55th Street, New York, New York 10019. Mr. Hayes owns shares of Class A Common
Stock of the Company's parent, Associates First Capital Corporation, and has
options to purchase additional shares of such Class A Common Stock.
S-5
