<PAGE> 1
Filed Pursuant to Rule 424(b)(2)
Registration No. 333-39273
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED NOVEMBER 7, 1997
$800,000,000
<TABLE>
<S> <C>
[ASSOCIATES LOGO]
</TABLE>
$500,000,000 5.85% SENIOR NOTES DUE JANUARY 15, 2001
$300,000,000 6.10% SENIOR NOTES DUE JANUARY 15, 2005
------------------------
Interest on the 5.85% Senior Notes due 2001 (the "2001 Notes") and the
6.10% Senior Notes due 2005 (the "2005 Notes"; together with the 2001 Notes, the
"Notes") is payable on January 15 and July 15 of each year, commencing July 15,
1998. The Notes will not be redeemable prior to their respective maturities.
The Notes of each series will be represented by one or more Global
Securities registered in the name of a nominee of The Depository Trust Company,
as Depositary. Interests in the Global Securities will be shown on, and
transfers thereof will be effected only through, records maintained by the
Depositary and its participants. Except as described herein under "Description
of the Notes -- Book-Entry System", owners of beneficial interests in Book-Entry
Notes will not be considered holders thereof and will not be entitled to receive
physical delivery of Notes in definitive form.
------------------------
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.
------------------------
The Underwriters for the 2001 Notes have agreed to purchase from the
Company the 2001 Notes offered hereby for an aggregate purchase price of
$498,940,000, before deducting expenses payable by the Company, estimated to be
approximately $312,000. The Underwriters for the 2005 Notes have agreed to
purchase from the Company the 2005 Notes offered hereby for an aggregate
purchase price of $299,169,000, before deducting expenses payable by the
Company, estimated to be approximately $187,200. The respective Underwriters for
the 2001 Notes and the 2005 Notes propose to offer such Notes from time to time,
in negotiated transactions or otherwise, at varying prices to be determined at
the time of each sale.
------------------------
The Notes are offered severally by the respective Underwriters, as
specified herein, subject to receipt and acceptance by them and subject to their
right to reject any order in whole or in part. It is expected that the Notes
will be ready for delivery in book-entry form only through the facilities of The
Depository Trust Company in New York, New York, on or about January 9, 1998,
against payment therefor in immediately available funds.
For the 2001 Notes:
GOLDMAN, SACHS & CO. UBS SECURITIES
FIRST CHICAGO CAPITAL MARKETS, INC.
For the 2005 Notes:
GOLDMAN, SACHS & CO. FIRST CHICAGO CAPITAL MARKETS, INC.
------------------------
The date of this Prospectus Supplement is January 6, 1998.
<PAGE> 2
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, 1996 and its Quarterly Report on Form 10-Q for the nine months
ended September 30, 1997, 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
FOR THE YEAR ENDED DECEMBER 31 ENDED SEPTEMBER 30
---------------------------------------------------- -------------------
1992 1993 1994 1995 1996 1996 1997
-------- -------- -------- -------- -------- -------- --------
(UNAUDITED)
(DOLLAR AMOUNTS IN MILLIONS)
<S> <C> <C> <C> <C> <C> <C> <C>
REVENUE AND EARNINGS
Revenue --
Finance charges................. $2,931.9 $3,250.7 $3,866.7 $4,805.3 $5,580.3 $4,102.3 $4,744.2
Insurance premiums.............. 209.9 242.2 293.5 325.1 354.8 260.6 272.7
Investment and other income..... 182.8 196.7 227.7 254.0 286.3 212.3 270.0
-------- -------- -------- -------- -------- -------- --------
3,324.6 3,689.6 4,387.9 5,384.4 6,221.4 4,575.2 5,286.9
Expenses --
Interest expense................ 1,222.8 1,291.8 1,509.7 1,979.8 2,206.7 1,627.4 1,862.9
Operating expenses.............. 807.4 979.6 1,191.6 1,417.8 1,603.3 1,168.2 1,360.8
Provision for losses on finance
receivables................... 504.0 468.9 569.9 729.7 963.4 714.8 897.2
Insurance benefits paid or
provided...................... 100.0 114.9 144.1 135.7 142.9 105.3 104.9
-------- -------- -------- -------- -------- -------- --------
2,634.2 2,855.2 3,415.3 4,263.0 4,916.3 3,615.7 4,225.8
-------- -------- -------- -------- -------- -------- --------
Earnings Before Provision for
Income Taxes and Cumulative
Effect of Changes in Accounting
Principles...................... 690.4 834.4 972.6 1,121.4 1,305.1 959.5 1,061.1
Provision for Income Taxes........ 240.7 310.7 369.1 413.3 482.0 353.1 390.0
-------- -------- -------- -------- -------- -------- --------
Earnings Before Cumulative Effect
of Changes in Accounting
Principles...................... 449.7 523.7 603.5 708.1 823.1 606.4 671.1
Cumulative Effect of Changes in
Accounting Principles(a)........ (10.0) -- -- -- -- -- --
-------- -------- -------- -------- -------- -------- --------
Net Earnings...................... $ 439.7 $ 523.7 $ 603.5 $ 708.1 $ 823.1 $ 606.4 $ 671.1
======== ======== ======== ======== ======== ======== ========
Ratio of Earnings to Fixed
Charges(b)...................... 1.56 1.64 1.64 1.56 1.59 1.59 1.57
==== ==== ==== ==== ==== ==== ====
</TABLE>
- ---------------
(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.
S-2
<PAGE> 3
SUMMARY FINANCIAL INFORMATION -- (CONTINUED)
<TABLE>
<CAPTION>
DECEMBER 31 SEPTEMBER 30
1996 1997
----------- ------------
(UNAUDITED)
(IN MILLIONS)
<S> <C> <C>
BALANCE SHEET DATA
Assets:
Cash and Cash Equivalents................................. $ 278.4 $ 335.8
Investments in Debt and Equity Securities
Bonds and Notes........................................ 1,034.1 1,019.6
Stocks................................................. 10.3 81.2
--------- ---------
Total Investments in Debt and Equity Securities... 1,044.4 1,100.8
Finance Receivables, net of unearned finance income
Consumer Finance....................................... 27,997.1 31,957.9
Commercial Finance..................................... 13,781.8 14,974.0
--------- ---------
Total Net Finance Receivables..................... 41,778.9 46,931.9
Allowance for Losses on Finance Receivables............... (1,371.4) (1,637.1)
Insurance Policy and Claims Reserves...................... (693.0) (756.7)
Other Assets.............................................. 1,560.8 2,029.5
--------- ---------
Total Assets...................................... $42,598.1 $48,004.2
========= =========
Liabilities and Stockholders' Equity:
Notes Payable, unsecured short-term
Commercial paper....................................... $14,712.6 $17,606.0
Bank loans............................................. 1,001.8 34.0
Long-Term Debt, unsecured due within one year
Senior................................................. 3,080.4 4,430.9
Subordinated........................................... -- --
Capital................................................ 0.1 0.1
Accounts Payable and Accruals............................. 980.6 1,054.8
Long-Term Debt, unsecured
Senior................................................. 17,311.0 18,693.1
Subordinated........................................... 425.0 425.0
Capital................................................ 0.4 0.3
--------- ---------
Total Long-Term Debt.............................. 17,736.4 19,118.4
Stockholders' Equity...................................... 5,086.2 5,760.0
--------- ---------
Total Liabilities and Stockholders' Equity........ $42,598.1 $48,004.2
========= =========
</TABLE>
S-3
<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. The 2001 Notes and
2005 Notes will be issued as separate series under an indenture dated as of
November 1, 1995 (the "Indenture") between the Company and The Chase Manhattan
Bank ("Chase"), as Trustee. The 2001 Notes will be limited to $500,000,000
aggregate principal amount and will mature on January 15, 2001. The 2005 Notes
will be limited to $300,000,000 aggregate principal amount and will mature on
January 15, 2005.
Each series of Notes will bear interest at the applicable rate per annum
shown on the cover page of this Prospectus Supplement from January 9, 1998 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 July 15, 1998, to the persons in whose names the Notes are
registered at the close of business on the December 31 and the June 30, as the
case may be, next preceding such Interest Payment Date.
REDEMPTION
Neither series of Notes is redeemable prior to its maturity.
BOOK-ENTRY SYSTEM
Upon issuance, each series of Notes will be represented by Global
Securities registered in the name of Cede & Co., as nominee of The Depository
Trust Company, which will act as the depositary for the Notes (the
"Depositary"). The Depositary has advised the Company as follows: the Depositary
is a limited-purpose trust company organized under the New York Banking Law, a
"banking organization" within the meaning of the New York Banking Law, a member
of the Federal Reserve System, a "clearing corporation" within the meaning of
the New York Uniform Commercial Code and a "clearing agency" registered pursuant
to the provisions of Section 17A of the Securities Exchange Act of 1934, as
amended. The Depositary holds securities that its participants ("Participants")
deposit with the Depositary. The Depositary also facilitates the settlement
among Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. "Direct Participants" include securities brokers and
dealers, banks, trust companies, clearing corporations, and certain other
organizations. The Depositary is owned by a number of its Direct Participants
and by The New York Stock Exchange, Inc., the American Stock Exchange, Inc., and
the National Association of Securities Dealers, Inc. Access to the Depositary's
system is also available to others, such as securities brokers and dealers,
banks and trust companies, that clear through or maintain a custodial
relationship with a Direct Participant, either directly or indirectly ("Indirect
Participants"). The rules applicable to the Depositary and its Participants are
on file with the Securities and Exchange Commission.
Purchases of the Notes under the Depositary's system must be made by or
through Direct Participants, which will receive a credit for the Notes on the
Depositary's records. The ownership interest of each actual purchaser of a Note
(a "Beneficial Owner") is in turn to be recorded on the
S-4
<PAGE> 5
Direct and Indirect Participants' records. Beneficial Owners will not receive
written confirmation from the Depositary of their purchase, but Beneficial
Owners are expected to receive written confirmations providing details of the
transaction, as well as periodic statements of their holdings, from the Direct
or Indirect Participant through which the Beneficial Owner entered into the
transaction. Transfers of ownership interests in the Notes are to be
accomplished by entries made on the books of Participants acting on behalf of
Beneficial Owners. Beneficial Owners will not receive certificates representing
their ownership interests in Global Securities, except in the event that use of
the book-entry system for the Notes is discontinued.
To facilitate subsequent transfers, all Notes deposited by Participants
with the Depositary are registered in the name of the Depositary's partnership
nominee, Cede & Co. The deposit of Notes with the Depositary and their
registration in the name of Cede & Co. effect no change in beneficial ownership.
The Depositary has no knowledge of the actual Beneficial Owners of the Notes;
the Depositary's records reflect only the identity of the Direct Participants to
whose accounts the Notes are credited, which may or may not be the Beneficial
Owners. The Participants will remain responsible for keeping account of their
holdings on behalf of their customers.
As long as the Notes are held by the Depositary or its nominee and the
Depositary continues to make its same-day funds settlement system available to
the Company, all payments of principal of and interest on the Notes will be made
by the Company in immediately available funds to the Depositary. The Company has
been advised that the Depositary's practice is to credit Direct Participants'
accounts on the applicable payment date in accordance with their respective
holdings shown on the Depositary's records unless the Depositary has reason to
believe that it will not receive payment on such date. Payments by Participants
to Beneficial Owners will be governed by standing instructions and customary
practices, as is the case with securities held for the accounts of customers in
bearer form or registered in "street name," and will be the responsibility of
such Participant and not of the Depositary, the Trustee or the Company, subject
to any statutory or regulatory requirements as may be in effect from time to
time. Payment of principal and interest to the Depositary is the responsibility
of the Company or the Trustee, disbursement of such payments to Direct
Participants shall be the responsibility of the Depositary and disbursement of
such payments to the Beneficial Owners shall be the responsibility of Direct and
Indirect Participants.
Secondary trading in long-term notes and debentures of corporate issuers is
generally settled in clearing house or next-day funds. In contrast, the Notes
will trade in the Depositary's Same-Day Funds Settlement system. Accordingly,
the Depositary will require that secondary trading activity in the Notes settle
in immediately available funds. No assurance can be given as to the effect, if
any, of settlement in immediately available funds on trading activity in the
Notes.
The Company expects that conveyance of notices and other communications by
the Depositary to Direct Participants, by Direct Participants to Indirect
Participants, and by Direct Participants and Indirect Participants to Beneficial
Owners will be governed by arrangements among them, subject to any statutory or
regulatory requirements as may be in effect from time to time. In addition,
neither the Depositary nor Cede & Co. will consent or vote with respect to the
Notes; the Company has been advised that the Depositary's usual procedure is to
mail an omnibus proxy to the Company as soon as possible after the record date
with respect to such consent or vote. The omnibus proxy would assign Cede &
Co.'s consenting or voting rights to those Direct Participants to whose accounts
the Notes are credited on such record date (identified in a listing attached to
the omnibus proxy).
The Depositary may discontinue providing its services as securities
depositary with respect to the Notes at any time by giving reasonable notice to
the Company or the Trustee. Under such
S-5
<PAGE> 6
circumstances, if a successor depositary is not appointed by the Company within
90 days, the Company will issue individual definitive Notes in exchange for all
the Global Securities representing such Notes. In addition, the Company may at
any time and in its sole discretion determine not to have the Notes represented
by Global Securities and, in such event, will issue individual definitive Notes
in exchange for all the Global Securities representing the Notes. Individual
definitive Notes so issued will be issued in denominations of $1,000 and any
larger amount that is an integral multiple of $1,000 and registered in such
names as the Depositary shall direct.
The information in this section concerning the Depositary and the
Depositary's book-entry system has been obtained from sources that the Company
believes to be reliable, but the Company takes no responsibility for the
accuracy thereof.
CONCERNING THE TRUSTEE
Chase serves as trustee with respect to twenty-three 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.
UNDERWRITING
Subject to the terms and conditions set forth in the Underwriting Agreement
for the 2001 Notes dated January 6, 1998, the Company has agreed to sell to each
of the Underwriters named below, and each of such Underwriters has severally
agreed to purchase, the principal amount of the 2001 Notes set forth opposite
its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
UNDERWRITER 2001 NOTES
----------- ------------
<S> <C>
Goldman, Sachs & Co. ....................................... $237,500,000
UBS Securities LLC.......................................... 237,500,000
First Chicago Capital Markets, Inc. ........................ 25,000,000
------------
Total.................................................. $500,000,000
============
</TABLE>
Subject to the terms and conditions set forth in the Underwriting Agreement
for the 2005 Notes dated January 6, 1998, the Company has agreed to sell to each
of the Underwriters named below, and each of such Underwriters has severally
agreed to purchase, the principal amount of the 2005 Notes set forth opposite
its name below:
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT OF
UNDERWRITER 2005 NOTES
----------- ------------
<S> <C>
Goldman, Sachs & Co. ....................................... $275,000,000
First Chicago Capital Markets, Inc. ........................ 25,000,000
------------
Total.................................................. $300,000,000
============
</TABLE>
The Underwriters of the 2001 Notes and the Underwriters of the 2005 Notes
are referred to collectively in this Prospectus Supplement as the
"Underwriters". References herein to the
S-6
<PAGE> 7
"relevant Underwriting Agreement" and the "relevant Underwriters" mean, with
respect to each series of Notes, the Underwriting Agreement for such Notes and
the Underwriters thereunder.
Under the terms and conditions of the Underwriting Agreement for each
series of Notes, the relevant Underwriters are committed to take and pay for all
of the Notes of such series, if any are taken. The closings of the offerings of
the 2001 Notes and the 2005 Notes are not conditioned upon one another.
The relevant Underwriters propose to offer the 2001 Notes and the 2005
Notes offered hereby from time to time, in negotiated transactions or otherwise,
at varying prices to be determined at the time of each sale. In connection with
the sale of the 2001 Notes and the 2005 Notes offered hereby, the relevant
Underwriters may be deemed to have received compensation from the Company in the
form of underwriting discounts. The relevant Underwriters may effect such
transactions by selling the 2001 Notes and the 2005 Notes to or through dealers,
and such dealers may receive compensation in the form of discounts, concessions
or commissions from the relevant Underwriters and/or the purchasers of such
Notes for whom they may act as agents or to whom they may sell as principal.
The Company has been advised by the relevant Underwriters that such
Underwriters intend to make a market in the Notes of each respective series, but
are not obligated to do so and may discontinue market making at any time without
notice. The Company cannot predict the liquidity of any trading market for the
Notes of each respective series.
The Company has agreed to indemnify the several Underwriters against
certain liabilities, including liabilities under the Securities Act of 1933.
Each of the Underwriters has from time to time performed various investment
banking services for the Company. Affiliates of First Chicago Capital Markets,
Inc. and UBS Securities LLC from time to time conduct banking transactions with
the Company and its affiliates in the normal course of business.
S-7
<PAGE> 8
======================================================
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 UNDERWRITERS. 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
<TABLE>
<CAPTION>
PAGE
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<S> <C>
PROSPECTUS SUPPLEMENT
Summary Financial Information......... S-2
Description of the Notes.............. S-4
Underwriting.......................... S-6
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>
======================================================
======================================================
$800,000,000
[ASSOCIATES LOGO]
$500,000,000
5.85% SENIOR NOTES DUE JANUARY 15, 2001
$300,000,000
6.10% SENIOR NOTES DUE JANUARY 15, 2005
---------------------
PROSPECTUS SUPPLEMENT
---------------------
GOLDMAN, SACHS & CO.
UBS SECURITIES
FIRST CHICAGO CAPITAL MARKETS, INC.
For the 2001 Notes
GOLDMAN, SACHS & CO.
FIRST CHICAGO CAPITAL MARKETS, INC.
For the 2005 Notes
======================================================
