<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER , 1998
REGISTRATION NO. 333-62105
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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AMENDMENT NO. 1
TO
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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PREMARK INTERNATIONAL, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 36-3461320
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
1717 DEERFIELD ROAD, DEERFIELD, ILLINOIS 60015, (847) 405-6000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
JOHN M. COSTIGAN, ESQ.
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
PREMARK INTERNATIONAL, INC.
1717 DEERFIELD ROAD
DEERFIELD, ILLINOIS 60015
(847) 405-6000
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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COPIES TO:
STEVEN SUTHERLAND ROBERT E. BUCKHOLZ, JR.
SIDLEY & AUSTIN SULLIVAN & CROMWELL
ONE FIRST NATIONAL PLAZA 125 BROAD STREET
CHICAGO, IL 60603 NEW YORK, NY 10004
(312) 853-7000 (212) 558-4000
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, 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, 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 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
TITLE OF EACH CLASS OF AMOUNT MAXIMUM MAXIMUM AMOUNT OF
SECURITIES TO BE OFFERING PRICE AGGREGATE REGISTRATION
TO BE REGISTERED REGISTERED PER SHARE OFFERING PRICE FEE
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<S> <C> <C> <C> <C>
Debt Securities......... $150,000,000(1)(3) 100%(2) $150,000,000 $44,250(3)
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</TABLE>
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(1) Or its equivalent in any other currency or units based on or relating to
foreign currencies. If any Debt Securities are issued at an original issue
discount, such greater amount as shall result in an aggregate offering
price to the public which shall not exceed the amount set forth under
Proposed Maximum Aggregate Offering Price.
(2) Estimated solely for purposes of calculating the Registration Fee.
(3) Debt securities in the amount of $100,000,000 registered under
Registration Statement on Form S-3 (Registration No. 33-35137), for which
a registration fee of $25,000 was paid, are being carried forward to this
Registration Statement.
PURSUANT TO THE PROVISIONS OF RULE 429 OF THE RULES AND REGULATIONS OF THE
SECURITIES AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, THE FORM OF PROSPECTUS SET FORTH HEREIN ALSO RELATES TO THE
REGISTRANT'S REGISTRATION STATEMENT ON FORM S-3 NO. 33-35137. THIS
REGISTRATION STATEMENT ALSO CONSTITUTES POST-EFFECTIVE AMENDMENT NO. 1 WITH
RESPECT TO THE REGISTRANT'S REGISTRATION STATEMENT ON FORM S-3 NO. 33-35137.
--------------
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 THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A +
+REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE +
+SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY +
+OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT +
+BECOMES EFFECTIVE. THIS PROSPECTUS SUPPLEMENT SHALL NOT CONSTITUTE AN OFFER +
+TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF +
+THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD +
+BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS +
+OF ANY SUCH STATE. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
SUBJECT TO COMPLETION, DATED OCTOBER , 1998
PROSPECTUS
PREMARK INTERNATIONAL, INC.
DEBT SECURITIES
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Premark International, Inc. (the "Company"), may from time to time offer
debentures, notes and/or other unsecured evidences of indebtedness
(collectively, the "Debt Securities") at an aggregate initial offering price
not to exceed U.S. $250,000,000 or its equivalent in any other currency or
units based on or relating to foreign currencies. The Debt Securities may be
offered in one or more series in amounts, at prices and on terms to be
determined at the time of sale. When a particular series of Debt Securities
(the "Offered Securities") are offered, a supplement to this Prospectus (a
"Prospectus Supplement") will be delivered with this Prospectus setting forth
the terms of such Offered Securities, including, if applicable, the specific
designation, aggregate principal amount, denominations, currency, purchase
price, maturity, rate (which may be fixed or variable) and time of payment of
interest, redemption terms, and any listing on a securities exchange of the
Offered Securities.
The Debt Securities may be issued in registered form or bearer form with
coupons attached or both. In addition, all or a portion of the Debt Securities
of any series may be issuable in permanent registered global form which will be
exchangeable only under certain conditions into definitive Debt Securities.
The Company may sell Debt Securities to or through underwriters, and also may
sell Debt Securities to other purchasers directly or through agents. The
accompanying Prospectus Supplement sets forth the names of any underwriters or
agents involved in the sale of the Offered Debt Securities, the principal
amounts, if any, to be purchased by the underwriters and the compensation of
such underwriters or agents.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
-----------
The date of this Prospectus is October , 1998.
<PAGE>
NO PERSON IS AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION NOT CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS
OR ANY PROSPECTUS SUPPLEMENT, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY OR ANY UNDERWRITER OR AGENT. NEITHER THIS PROSPECTUS NOR ANY
PROSPECTUS SUPPLEMENT CONSTITUTES AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY ANY SECURITIES OTHER THAN THE SECURITIES OFFERED HEREBY OR AN
OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY TO ANY PERSON IN ANY
JURISDICTION IN WHICH IT IS UNLAWFUL TO MAKE ANY SUCH OFFER OR SOLICITATION TO
SUCH PERSON. NEITHER THE DELIVERY OF THIS PROSPECTUS OR ANY ACCOMPANYING
PROSPECTUS SUPPLEMENT NOR ANY SALE MADE HEREBY SHALL UNDER ANY CIRCUMSTANCE
IMPLY THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY DATE
SUBSEQUENT TO THE DATE HEREOF.
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TABLE OF CONTENTS
<TABLE>
<S> <C>
Available Information....................................................... i
Incorporation of Certain Documents by Reference............................. ii
The Company................................................................. 1
Ratio of Earnings to Fixed Charges.......................................... 2
Use of Proceeds............................................................. 2
Description of Debt Securities.............................................. 2
Plan of Distribution........................................................ 9
Legal Opinions.............................................................. 10
Experts..................................................................... 11
Note Regarding Forward Looking Statements................................... 11
</TABLE>
AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports, proxy statements, information statements and other
information with the Securities and Exchange Commission (the "Commission").
Copies of reports, proxy statements and other information concerning the
Company may be inspected and copied at the public reference facilities
maintained by the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549
and at the following Regional Offices of the Commission: Citicorp Center, 500
West Madison Street, Suite 1400, Chicago, Illinois 60661 and 7 World Trade
Center, 13th Floor, New York, New York 10048. Copies can be obtained by mail
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. Such material may also be
inspected on the Internet at the Commission's website (http://www.sec.gov). In
addition, reports, proxy materials, information statements and other
information concerning the Company can also be inspected at the offices of the
New York Stock Exchange, Inc., 20 Broad Street, New York, New York 10005 and
the Pacific Stock Exchange, Inc., 301 Pine Street, San Francisco, California
94104, on which exchanges the Company's Common Stock is listed.
The Company has filed with the Commission a registration statement on Form
S-3 (the "Registration Statement") (which term encompasses any amendments
thereto) under the Securities Act of 1933, as amended (the "Securities Act")
with respect to the Debt Securities. This Prospectus does not contain all of
the information set forth in such Registration Statement, certain parts of
which are omitted in accordance with the rules and regulations of the
Commission. Reference is made to such Registration Statement and to the
exhibits thereto for further information with respect to the Company and the
Debt Securities. Statements made in this Prospectus as to the contents of any
documents referred to are not necessarily complete, and in each instance
reference is made to such exhibit for a more complete description and each
such statement is qualified in its entirety by such reference.
i
<PAGE>
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by the Company are
incorporated herein by reference:
(1) The Company's Annual Report on Form 10-K for the fiscal year ended
December 27, 1997, as amended by Form 10-K/A filed on March 23, 1998; and
(2) The Company's Quarterly Reports on Form 10-Q for the fiscal quarters
ended March 28, 1998 and June 27, 1998.
The Company's Commission File No. is 1-9256.
All other documents filed by the Company pursuant to Section 13(a), 13(c),
14 and 15(d) of the Exchange Act after the date of this Prospectus and prior
to the termination of the offering made by this Prospectus shall be deemed to
be incorporated by reference in this Prospectus from the date of filing of
such documents. Any statement contained herein or in a document incorporated
by reference herein shall be deemed to be modified or superseded for purposes
of this Prospectus to the extent that a statement contained in any
subsequently filed document which also is, or is deemed to be, incorporated by
reference herein modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
Upon request, the Company will furnish without charge to each person,
including any beneficial owners, to whom this Prospectus is delivered a copy
of any or all of the documents described above (without exhibits other than
exhibits specifically incorporated by reference into such documents). Requests
should be directed to: Corporate Secretary's Office, Premark International,
Inc., 1717 Deerfield Road, Deerfield, Illinois 60015; telephone (847) 405-
6000.
ii
<PAGE>
THE COMPANY
The Company is a multinational commercial and consumer products company with
three principal business segments: the Food Equipment Group, the Decorative
Products Group and the Consumer Products Group. The Company is a Delaware
corporation that was organized on August 29, 1986, in connection with the
corporate reorganization of Kraft, Inc. ("Kraft"). On October 31, 1986, the
Company became a publicly held company through the pro rata distribution by
Kraft to its shareholders of all the outstanding shares of common stock of the
Company. On May 31, 1996, the Company distributed on a pro rata basis to its
shareholders all of the issued and outstanding stock of Tupperware
Corporation, a direct seller of consumer products.
The Food Equipment Group is engaged in the design, manufacture, distribution
and service of commercial equipment for food preparation, cooking, baking,
warewashing, weighing, wrapping and refrigeration. The Food Equipment Group's
core products include warewashing equipment; food preparation machines, such
as mixers, slicers, cutters, meat saws and grinders; weighing and wrapping
equipment and related systems; baking and cooking equipment, such as ovens,
ranges, fryers, griddles and broilers; and refrigeration equipment. Products
are marketed under trademarks including Hobart, Stero, Vulcan-Hart, Wolf,
Tasselli, Adamatic, Still, Foster, Inoxyform, Ungermann, Baxter, Somat,
Wittco, Traulsen, Elettrobar, GBG, Sencotel, Colged and Promag. Food equipment
products are sold to the retail food industry, including supermarket chains,
independent grocers, delicatessens, convenience and other food stores, and to
the foodservice industry, including independent restaurants, restaurant
chains, hospitals, healthcare facilities, correctional facilities, schools,
bakeries, hotels, resorts and airlines. Food equipment products are
distributed through company-owned operations or through dealers, agents and
distributors. The Food Equipment Group contributed 53%, 55% and 56% to the
Company's sales for fiscal years 1997, 1996 and 1995, respectively.
The Decorative Products Group is composed of two businesses: Wilsonart and
Florida Tile. Wilsonart designs, manufactures and distributes decorative
surfacing products, primarily high pressure decorative laminates for numerous
interior surfacing applications such as cabinetry, countertops, and flooring,
and specialty-grade laminates, including chemical-resistant, wear-resistant
and fire-retardant laminates. In addition to laminate products, Wilsonart
sells solid surfacing products, panels and sinks, contact adhesives,
decorative metal surfacing products, wood and laminate-clad decorative edge
moldings for countertops and furniture, and threshold transitions for use with
its flooring products. Wilsonart products are sold through wholesale building
material distributors, original equipment manufacturers and dealers. Florida
Tile manufactures glazed ceramic wall and floor tile products for residential
and commercial uses, and unglazed porcelain mosaic tile primarily for
commercial applications. Florida Tile products are sold through company-owned
and independent distributors. The Decorative Products Group contributed 33%,
32% and 31% of the sales of the Company's businesses for the fiscal years
1997, 1996 and 1995, respectively.
The Consumer Products Group is composed of two businesses: West Bend and
Precor. West Bend designs, manufactures and sells small electric appliances,
such as bread makers, electric skillets, slow cookers, woks, corn poppers,
beverage makers, mixers, electronic timers, high-quality stainless steel
cookware, and a line of household water distillers. West Bend small appliances
are sold directly to mass merchandisers, department stores, hardware stores,
warehouse clubs and catalog showrooms. West Bend's stainless steel cookware
and household water distillers are sold to consumers by independent
distributors through dinner parties and by other direct sales methods. Precor
manufactures aerobic physical fitness equipment, such as treadmills,
elliptical crosstrainers, low-impact climbers and exercise cycles. Precor
equipment for home use is sold primarily through specialty fitness equipment
retail stores. Precor commercial equipment is sold through specialty fitness
dealers and directly to major fitness clubs. The Consumer Products Group
contributed 14%, 13% and 13% of the sales of the Company's business for the
fiscal years 1997, 1996 and 1995, respectively.
<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the Company's consolidated ratio of earnings
to fixed charges for the periods shown.
<TABLE>
<CAPTION>
26 WEEKS ENDED FISCAL YEAR ENDED
----------------- ----------------------------------------------------------------
JUNE 27, JUNE 28, DECEMBER 27, DECEMBER 28, DECEMBER 30, DECEMBER 31, DECEMBER 25,
1998 1997 1997 1996 1995 1994 1993
-------- -------- ------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to
fixed charges.......... 8.1 7.8 8.1 5.0* 4.1 4.5 3.7
</TABLE>
*For the fiscal year ended December 28, 1996, pre-tax income was reduced by
$43.1 million related to the loss on the sale of the Company's Hartco
subsidiary. Excluding this charge, the ratio would have been 6.5.
Earnings available for fixed charges represent earnings before income taxes
and fixed charges (excluding capitalized interest). Fixed charges represent
interest incurred plus that portion of rental expense deemed to be the
equivalent of interest.
USE OF PROCEEDS
Except as otherwise set forth in the applicable Prospectus Supplement, the
Company intends to use the net proceeds from the sale of the Debt Securities
for general corporate purposes.
DESCRIPTION OF DEBT SECURITIES
The Debt Securities will be issued in one or more series under an Indenture
(the "Indenture") between the Company and The First National Bank of Chicago,
as Trustee (the "Trustee"), the form of which is filed as an exhibit to the
Registration Statement of which this Prospectus is a part. The following
statements with respect to the Indenture and the Securities (as hereinafter
defined) are brief summaries of the material provisions of the Indenture and
do not purport to be complete; such statements are subject to the detailed
referenced provisions of the Indenture, including the definition of
capitalized terms used under this caption. Whenever particular sections or
defined terms of the Indenture are referred to, such sections or defined terms
are incorporated herein by reference as a part of the statement made, and the
statement is qualified in its entirety by such reference. The term
"Securities", as used under this caption, refers to all securities issued
under the Indenture, including the Debt Securities.
GENERAL
The Indenture does not limit the aggregate principal amount of Securities
(which may include debentures, notes and other evidences of indebtedness)
which may be issued thereunder, and Securities may be issued thereunder from
time to time in one or more series and may be denominated and payable in
foreign currencies or units based on or relating to foreign currencies,
including European Currency Units. Special United States federal income tax
considerations applicable to any Securities so denominated will be described
in the Prospectus Supplement relating thereto. Unless otherwise indicated in
the applicable Prospectus Supplement, the Indenture also permits the Company
to increase the principal amount of any series of Securities previously issued
and to issue such increased principal amount. (Section 2.3)
The Prospectus Supplement will set forth the following terms relating to the
Offered Securities: (1) the specific designation of the Offered Securities;
(2) any limit on the aggregate principal amount of the Offered Securities; (3)
the date or dates, if any, on which the Offered Securities will mature; (4)
the rate or rates per annum (which may be fixed or variable) at which the
Offered Securities will bear interest, if any, the date or dates on which any
such interest will be payable and the Record Dates for any interest payable on
the Offered
2
<PAGE>
Securities which are Registered Securities; (5) any mandatory or optional
redemption or sinking fund provisions, including the period or periods within
which, the price or prices at which and the terms and conditions upon which
the Offered Securities may be redeemed or purchased at the option of the
Company or otherwise; (6) whether the Offered Securities will be issuable in
registered form or bearer form or both, and, if issuable in bearer form, the
restrictions as to the offer, sale and delivery of the Offered Securities in
bearer form and as to exchanges between registered and bearer form; (7)
whether the Offered Securities will be issuable in the form of one or more
temporary or permanent Global Securities and, if so, the identity of the
Depositary for such Global Securities; (8) the denominations in which any of
the Offered Securities which are in registered form will be issuable, if other
than denominations of $1,000 and any multiple thereof, and the denominations
in which any of the Offered Securities which in bearer form will be issuable,
if other than the denominations of $1,000 and $5,000; (9) each office or
agency where the principal of and any premium and interest on the Offered
Securities will be payable, and each office or agency where the Offered
Securities may be presented for registration of transfer or exchange; (10) if
other than United States dollars, the foreign currency or the units based on
or relating to foreign currencies in which the Offered Securities are
denominated and/or in which the payment of the principal of and any premium
and interest on the Offered Securities will or may be payable; (11) any
applicable United States federal income tax consequences, including whether
and under what circumstances the Company will pay additional amounts with
respect to the Offered Securities to a non-United States Person (as defined in
such Prospectus Supplement) on account of any tax, assessment or governmental
charge withheld or deducted and, if so, whether the Company will have the
option to redeem such Offered Securities rather than pay such additional
amounts; and (12) any other terms of the Offered Securities not inconsistent
with the Indenture, including covenants and events of default relating solely
to the Offered Securities.
Securities may be issued under the Indenture bearing no interest or interest
at a rate below the prevailing market rate at the time of issuance, to be
offered and sold at a discount below their stated principal amount. United
States federal income tax consequences and other special considerations
applicable to any such discounted Securities or to other Securities offered
and sold at par which are treated as having been issued at a discount for
United States federal income tax purposes will be described in the Prospectus
Supplement relating thereto.
The Securities and any coupons appertaining thereto will be unsecured and
will rank pari passu with all other unsecured and unsubordinated indebtedness
of the Company. However, since the Company is a holding company, the right of
the Company, and hence the right of the creditors of the Company (including
the Holders of Securities), to participate in any distribution of the assets
of any subsidiary upon its liquidation or reorganization or otherwise is
necessarily subject to the prior claims of creditors of such subsidiary,
except to the extent that claims of the Company as a creditor of such
subsidiary may be recognized.
EXCHANGE AND TRANSFER
Securities may be presented for exchange and registered Securities may be
presented for registration of transfer at the offices and subject to the
restrictions set forth therein and in the applicable Prospectus Supplement
without service charge, but upon payment of any taxes or other governmental
charges due in connection therewith, subject to any applicable limitations
contained in the Indenture. The Company has appointed the Trustee as Security
Registrar. Securities in bearer form and the coupons appertaining thereto, if
any, will be transferable by delivery. (Sections 2.8 and 3.2)
PAYMENT
Unless otherwise indicated in the applicable Prospectus Supplement, payment
of the principal of and the premium and interest, if any, on all Securities
(other than a Registered Global Security) in registered form will be made at
the office or agency of the Trustee in the Borough of Manhattan, The City of
New York or Chicago, Illinois, except that, at the option of the Company,
payment of any interest may be made (i) by check mailed to the address of the
Person entitled thereto as such address shall appear in the Security Register
or (ii) by wire transfer to an account maintained by the Person entitled
thereto as specified in the Security Register. (Sections
3
<PAGE>
3.1 and 3.2). Unless otherwise indicated in the applicable Prospectus
Supplement, payment of any interest due on Securities in registered form will
be made to the Person in whose name such Registered Securities are registered
at the close of business on the Record Date for such interest payment.
(Section 2.7)
REGISTERED GLOBAL SECURITIES
The registered Securities of a particular series may be issued in the form
of one or more Registered Global Securities which will be deposited with a
Depositary, or its nominee, each of which will be identified in the Prospectus
Supplement relating to such series. Unless and until exchanged, in whole or in
part, for Securities in definitive Registered form, a Registered Global
Security may not be transferred except as a whole by the Depositary for such
Registered Global Security to a nominee of such Depositary, by a nominee of
such Depositary to such Depositary or another nominee of such Depositary or by
such Depositary or any such nominee to a successor of such Depositary or a
nominee of such successor. (Section 2.8)
The specific terms of the depositary arrangement with respect to any portion
of a particular series of Securities to be represented by a Registered Global
Security will be described in the Prospectus Supplement relating to such
series. The Company anticipates that the following provisions will apply to
all depositary arrangements.
Upon the issuance of a Registered Global Security, the Depositary therefor
or its nominee will credit, on its book entry and registration system, the
respective principal amounts of the Securities represented by such Registered
Global Security to the accounts of such persons having accounts with such
Depositary ("participants"), as shall be designated by the underwriters or
agents participating in the distribution of such Securities or by the Company
if such Securities are offered and sold directly by the Company. Ownership of
beneficial interests in a Global Security will be limited to participants or
persons that may hold beneficial interests through participants. Ownership of
beneficial interests in such Registered Global Security will be shown on, and
the transfer of such ownership will be effected only through, records
maintained by such Depositary therefor or its nominee (with respect to
interests of participants) or by participants or persons that hold through
participants (with respect to interests of persons other than participants).
The laws of some states require certain purchasers of securities to take
physical delivery thereof in definitive form. Such depositary arrangements and
such laws may impair the ability to transfer beneficial interests in a
Registered Global Security.
So long as the Depositary for a Registered Global Security or its nominee is
the registered owner thereof, such Depositary or such nominee, as the case may
be, will be considered the sole owner or Holder of the Securities represented
by such Registered Global Security for all purposes under the Indenture.
Except as provided below, owners of beneficial interests in a Registered
Global Security will not be entitled to have Securities of the series
represented by such Registered Global Security registered in their names, will
not receive or be entitled to receive physical delivery of Securities of such
series in definitive form and will not be considered the owners or Holders
thereof under the Indenture.
Principal, premium, if any, and interest payments on a Registered Global
Security registered in the name of a Depositary or its nominee will be made to
such Depositary or its nominee, as the case may be, as the registered owner of
such Registered Global Security. None of the Company, the Trustee, or any
paying agent for Securities of the series represented by such Registered
Global Security will have any responsibility or liability for any aspect of
the records relating to or payments made on account of beneficial interests in
such Registered Global Security or for maintaining, supervising or reviewing
any records relating to such beneficial interests.
The Company expects that the Depositary for a Registered Global Security or
its nominee, upon receipt of any payment of principal, premium or interest,
will credit immediately participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal amount
of such Registered Global Security as shown on the records of such Depositary
or its nominee. The Company also expects that payments by participants to
owners of beneficial interests in such Registered Global Security held through
such participants
4
<PAGE>
will be governed by standing instructions and customary practices, as is the
case with securities held for the accounts of customers registered in "street
name", and will be the responsibility of such participants.
If a Depositary for a Registered Global Security representing Securities of
a particular series is at any time unwilling or unable to continue as
Depositary and a successor Depositary is not appointed by the Company within
90 days, the Company will issue Securities of such series in definitive form
in exchange for such Registered Global Security. In addition, the Company may
at any time and in its sole discretion determine not to have the Securities of
a particular series represented by a Registered Global Security and, in such
event, will issue Securities of such series in definitive form in exchange for
all of the Registered Global Securities representing Securities of such
series.
CERTAIN COVENANTS OF THE COMPANY
Limitation on Liens. Neither the Company nor any Restricted Subsidiary will
incur, assume or guarantee any indebtedness for borrowed money secured by a
mortgage, pledge, security interest or other lien or encumbrance (any such
mortgage, pledge, security interest or other lien or encumbrance being
hereinafter called a "Mortgage" and any such indebtedness being hereinafter
called "Secured Debt") on any Principal Property or on any shares of stock or
indebtedness of any Restricted Subsidiary without effectively providing that
the Securities (together with, if the Company shall so determine, any other
indebtedness for borrowed money ranking equally with or prior to the
Securities incurred, assumed or guaranteed by the Company or any Restricted
Subsidiary, whether then or thereafter existing) shall be secured equally and
ratably with (or, at the option of the Company, prior to) such Secured Debt,
unless after giving effect thereto the aggregate principal amount of all
Secured Debt, plus the aggregate amount of all Attributable Debt in respect of
sale and leaseback transactions involving Principal Properties (with certain
exceptions), would not exceed 10% of Consolidated Net Tangible Assets. This
restriction will not apply to, and there will be excluded in computing Secured
Debt for the purposes of such restriction, indebtedness secured by (a)
Mortgages on property of, or on any shares of stock or indebtedness of, any
corporation existing at the time it is merged into or consolidated with the
Company or any Restricted Subsidiary, at the time of a sale or other
disposition of its properties (or any division thereof) as an entirety or
substantially as an entirety to the Company or any Restricted Subsidiary or at
the time it becomes a Restricted Subsidiary; (b) Mortgages securing
indebtedness of a Restricted Subsidiary to the Company or to another
Restricted Subsidiary; (c) Mortgages on any Principal Property, shares of
stock or indebtedness existing at the time of acquisition thereof by the
Company or any Restricted Subsidiary; (d) certain Mortgages created, incurred
or assumed within 180 days after the latest to occur of the acquisition, the
completion of construction or improvement or the commencement of commercial
operation of any property acquired, constructed or improved after the date of
the Indenture to secure the payment of any part of the purchase price of such
property or the cost of such construction or improvement; (e) Mortgages in
favor of the United States of America or other governmental bodies to secure
partial, progress, advance or other payments, or other obligations, or to
secure any indebtedness incurred for the purpose of financing all or any part
of the cost of acquiring, constructing or improving the property subject
thereto (including Mortgages incurred in connection with industrial revenue
and pollution control bonds); (f) Mortgages existing at the date of the
Indenture; and (g) Mortgages for the sole purpose of extending, renewing or
replacing indebtedness secured by or described in the foregoing clauses (a)
through (f). (Section 3.6)
The term "Subsidiary" means a corporation a majority of the outstanding
voting stock of which is owned, directly or indirectly, by the Company and/or
one or more of its Subsidiaries. The term "Restricted Subsidiary" means a
Subsidiary substantially all of whose assets are located or substantially all
of whose business is carried on within the United States of America (and its
territories and possessions) and which owns any Principal Property. The term
"Principal Property" means any manufacturing or processing plant or warehouse
located in the United States of America owned by the Company or any Restricted
Subsidiary and having a gross book value in excess of 3% of Consolidated Net
Tangible Assets, other than (a) any such plant or warehouse which, in the
opinion of the Board of Directors, is not of material importance to the total
business conducted by the Company and its Subsidiaries as an entirety or (b)
any portion of any such plant or warehouse which, in the opinion of
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such Board, is not of material importance to the use or operation of such
plant or warehouse. The term "Attributable Debt" means, with respect to any
lease constituting part of a sale and leaseback transaction, the lesser of (a)
the fair value of the Principal Property subject to such lease (as determined
by the Board of Directors) and (b) the total net amount of rent (excluding
rent contingent on the amount of sales) required to be paid by the lessee
under such lease during the remaining primary term thereof (discounted at the
rate of interest implicit in such lease). The term "Consolidated Net Tangible
Assets" means the aggregate amount of assets (less applicable reserves and
other properly deductible items), after deducting therefrom: (a) all current
liabilities (including the current portion of Funded Debt), (b) all other
liabilities except deferred income taxes, Funded Debt and stockholders'
equity, (c) all goodwill, trade names, trademarks, patents, organization
expenses, unamortized debt discount and expense less unamortized debt premium
and other like intangibles (other than deferred charges and prepaid expenses),
(d) adjustments for minority interests and (e) equity in and net advances to
Subsidiaries (other than Restricted Subsidiaries), all as set forth on the
most recent consolidated balance sheet of the Company and its Restricted
Subsidiaries and computed in accordance with generally accepted accounting
principles. "Funded Debt" means all indebtedness for borrowed money owed or
guaranteed by the Company or any of its Restricted Subsidiaries, and any other
indebtedness which would appear as indebtedness on the most recent
consolidated balance sheet of the Company and its Restricted Subsidiaries,
which matures, or is renewable or extendible at the option of the borrower so
that it matures, more than 12 months from the date of such consolidated
balance sheet. (Section 1.1)
Restrictions on Sale and Leaseback Transactions. Neither the Company nor any
Restricted Subsidiary may enter into any sale and leaseback transaction
involving any Principal Property if the latest to occur of the acquisition,
the completion of construction and the commencement of commercial operation of
such Principal Property shall have occurred more than 180 days prior thereto,
unless (a) the Company or such Restricted Subsidiary could create Secured Debt
secured by such Principal Property under the restrictions described above
under "Limitation on Liens" in an amount equal to the Attributable Debt with
respect to such sale and leaseback transaction without equally and ratably
securing the Securities or (b) the Company, within 90 days from the effective
date of such sale and leaseback transaction, shall apply an amount not less
than the greater of (i) the net proceeds of the sale of such Principal
Property or (ii) the fair value (as determined by the Board of Directors) of
such Principal Property to (x) the retirement of Funded Debt or (y) the
purchase of other property which will constitute a Principal Property having a
fair value (as so determined) at least equal to the fair value of the
Principal Property leased in such sale and leaseback transaction. This
restriction will not apply to any sale and leaseback transaction (a) between
the Company and a Restricted Subsidiary or between Restricted Subsidiaries or
(b) involving the taking back of a lease for a period of less than three
years. (Section 3.7)
EVENTS OF DEFAULT
The occurrence of any of the following events with respect to the Securities
of any series will constitute an "Event of Default" with respect to the
Securities of such series: (a) default for 30 days in the payment of any
interest upon any of the Securities of such series; (b) default in the payment
of any principal of or the premium, if any, on any of the Securities of such
series, whether at maturity, upon redemption, by declaration or otherwise; (c)
default in the deposit of any sinking fund payment in respect of any
Securities of such series; (d) default for 90 days by the Company in the
observance or performance of any other covenant or agreement contained in the
Indenture relating to the Securities of such series after written notice
thereof as provided in the Indenture; or (e) certain events of bankruptcy,
insolvency or reorganization relating to the Company. (Section 5.1) Additional
Events of Default may be prescribed for the benefit of the Holders of a
particular series of Securities as described in the Prospectus Supplement
relating thereto.
If an Event of Default due to a default in the payment of the principal of
or the premium or interest, if any, on, or in the deposit of any sinking fund
payment with respect to, any series of Securities shall have occurred and be
continuing, either the Trustee or the Holders of not less than 25% in
aggregate principal amount of the Securities of such series then Outstanding
may declare the principal of all Securities of such series and the interest,
if any, accrued thereon to be due and payable immediately. If any Event of
Default due to a default in
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the observance or performance of any other covenant or agreement of the
Company contained in the Indenture and applicable to the Securities of one or
more (but less than all) series then Outstanding shall have occurred and be
continuing, either the Trustee or the Holders of not less than 25% in
aggregate principal amount of the Securities of the affected series then
Outstanding (voting as one class) may declare the principal of all Securities
of each such affected series and the interest, if any, accrued thereon to be
due and payable immediately. If an Event of Default due to a default in the
observance or performance of any other covenant or agreement of the Company
contained in the Indenture applicable to all Securities then Outstanding or
due to certain events of bankruptcy, insolvency or reorganization relating to
the Company shall have occurred and be continuing, either the Trustee or the
Holders of not less than 25% in aggregate principal amount of all Securities
then Outstanding (voting as one class) may declare the principal of all
Securities and the interest, if any, accrued thereon to be due and payable
immediately. Upon certain conditions, any such declarations may be rescinded
and annulled if all Events of Default, other than the nonpayment of
accelerated principal, with respect to the Securities of all such affected
series then Outstanding shall have been cured or waived as provided in the
Indenture by the Holders of a majority in aggregate principal amount of the
Securities of the affected series then Outstanding (voting as one class,
except in the case of Events of Default described in clauses (a), (b) and (c)
of the preceding paragraph, as to which each series so affected will vote as a
separate class). See "Modification of the Indenture" below. Reference is made
to the Prospectus Supplement relating to any series of Original Issue Discount
Series for the particular provisions relating to the acceleration of a portion
of the principal amount thereof upon the occurrence and continuance of an
Event of Default with respect thereto. (Section 5.1)
The Indenture provides that, subject to the duty of the Trustee to act with
the requisite standard of care in case a default with respect to a series of
Securities shall have occurred and be continuing, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request, order or direction of the Holders of the Securities, unless such
Holders shall have offered to the Trustee reasonable security or indemnity.
(Sections 5.6 and 6.2) Subject to such provisions for indemnity and certain
other limitations contained in the Indenture, the Holders of a majority of the
aggregate principal amount of the Securities of each Outstanding series then
Outstanding will 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
Securities of such affected series. (Section 5.9)
The Indenture provides that no Holder of Securities may institute any action
against the Company under the Indenture (except actions for payment of overdue
principal, premium or interest) unless such Holder previously shall have given
to the Trustee written notice of default and continuance thereof and unless
the Holders of not less than 25% in aggregate principal amount of the
Securities of the affected series then Outstanding (voting as one class) shall
have requested the Trustee to institute such action and shall have offered the
Trustee reasonable indemnity, the Trustee shall not have instituted such
action within 60 days of such request and the Trustee shall have received
direction inconsistent with such request by the Holders of a majority in
aggregate principal amount of the Securities of the affected series then
Outstanding (voting as one class). (Sections 5.6 and 5.9)
The Indenture requires the Company to furnish to the Trustee annually a
statement as to the absence of certain defaults under the Indenture. (Section
3.5) The Indenture provides that the Trustee may withhold notice to the
Holders of the Securities of any series of any default affecting such series
(except defaults as to payment of principal, premium or interest on the
Securities of such series or as to sinking fund payments) if it considers such
withholding to be in the interests of the Holders of the Securities of such
series. (Section 5.11)
CONSOLIDATION, MERGER OR SALE OF ASSETS
The Company may consolidate with or merge into, or sell, lease or convey its
property as an entirety or substantially as an entirety to, any other
corporation if (a) such corporation assumes the obligations of the Company
under the Securities and the Indenture and is organized and existing under the
laws of the United States of America, any state thereof or the District of
Columbia and (b) immediately after such consolidation, merger, sale, lease or
conveyance, no Event of Default, and no event which, after notice, lapse of
time or both, would become an Event of Default, shall have occurred and be
continuing. If, upon any such consolidation, merger,
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sale, lease or conveyance, any Principal Property or any shares of stock or
indebtedness of any Restricted Subsidiary owned by the Company or a Restricted
Subsidiary immediately prior thereto would become subject to any mortgage,
security interest, pledge, lien or other encumbrance (unless such mortgage,
security interest, pledge, lien or other encumbrance would be permitted by the
provisions described above under "Limitation on Liens"), the Securities must
be secured (together with, if the Company shall so determine, any other
indebtedness for borrowed money ranking equally with or prior to the
Securities incurred, assumed or guaranteed by the Company or any Restricted
Subsidiary, whether then or thereafter existing) by a direct lien on such
Principal Property, shares of stock or indebtedness prior to all liens other
than any theretofore existing thereon. (Sections 9.1 and 9.2)
MODIFICATION OF THE INDENTURE
The Indenture permits the Company and the Trustee to enter into supplemental
indentures without the consent of the Holders of the Securities to: (a) secure
the Securities of one or more series, (b) evidence the assumption by a
successor corporation of the obligations of the Company under the Indenture
and the Securities then Outstanding, (c) add covenants for the protection of
the Holders of the Securities, (d) cure any ambiguity or correct any
inconsistency in the Indenture, (e) establish the form and terms of the
Securities of any series and (f) evidence the acceptance of appointment by a
successor Trustee. (Section 8.1)
The Indenture also permits the Company and the Trustee, with the consent of
the Holders of not less than a majority in aggregate principal amount of the
Securities of each series then Outstanding and affected, to add any provisions
to, or change in any manner or eliminate any of the provisions of, the
Indenture or modify in any manner the right of the Holders of the Securities
of each such affected series; provided, however, that the Company and the
Trustee may not, without the consent of the Holder of each Security then
Outstanding and affected thereby: (a) extend the time of payment of the
principal (or any installment) of any Security, or reduce the principal amount
thereof, reduce the rate or extend the time of payment of interest thereon, or
reduce any amount payable on the redemption thereof, or change the currency in
which the principal thereof or the interest thereon is payable, or reduce the
amount payable on any Original Issue Discount Security upon acceleration or
provable in bankruptcy, or alter certain provisions of the Indenture relating
to Securities not denominated in United States dollars, or impair the right to
institute suit for the enforcement of any payment on any Security when due; or
(b) reduce the percentage in principal amount of the Securities of the
affected series, the consent of whose Holders is required for any such
modification or for any waiver provided for in the Indenture. (Section 8.2)
Prior to the acceleration of the maturity of any Securities, the Holders of
a majority in aggregate principal amount of the Securities of all series at
the time Outstanding with respect to which a default or an Event of Default
shall have occurred and be continuing (voting as one class) may on behalf of
the Holders of all such affected Securities waive any past default or Event of
Default and its consequences, except a default or an Event of Default in
respect of a covenant or provision of the Indenture or of any Security which
cannot be modified or amended without the consent to the Holder of each
Security affected.
DEFEASANCE AND DISCHARGE
The Indenture provides that, at the option of the Company: (a) the Company
will be discharged from any and all obligations in respect of the Securities
of a particular series then Outstanding (except for certain obligations to
register the transfer of or exchange the Securities of such series, to replace
stolen, lost or mutilated Securities of such series, to maintain paying
agencies and to maintain the trust described below) or (b) the Company need
not comply with certain restrictive covenants of the Indenture (including
those described under "Certain Covenants of the Company" and "Consolidation,
Merger or Sale of Assets"), in each case if the Company irrevocably deposits
in trust with the Trustee money, and/or securities of the government which
issued the currency in which the Securities of such series are payable or
securities backed by the full faith and credit of such government which,
through the payment of the principal thereof and the interest thereon in
accordance with their terms, will provide money in an amount sufficient to pay
all the principal of (and premium, if any) and
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interest on the Securities of such series on the stated maturity of such
Securities (which may include one or more redemption dates designated by the
Company) in accordance with the terms thereof. To exercise such option, the
Company is required, among other things, to deliver to the Trustee an opinion
of independent counsel of nationally-recognized standing to the effect that
the exercise of such option would not cause the Holders of the Securities of
such series to recognize income, gain or loss for United States federal income
tax purposes as a result of such defeasance, and such Holders will be subject
to United States federal income tax on the same amounts, in the same manner
and at the same times as would have been the case if such defeasance had not
occurred, and, in the case of a discharge as described in clause (a) of the
preceding sentence, such opinion is to be accompanied by a private letter
ruling to the same effect received from the Internal Revenue Service, a
revenue ruling to such effect pertaining to a comparable form of transaction
published by the Internal Revenue Service or appropriate evidence that since
the date of the Indenture there has been a change in the applicable federal
income tax law. (Section 10.1)
In the event the Company exercises its option to effect a covenant
defeasance with respect to the Securities of any series as described in the
preceding paragraph and the Securities of such series are thereafter declared
due and payable because of the occurrence of any Event of Default other than
an Event of Default caused by failing to comply with the covenants which are
defeased, and the amount of money and securities on deposit with the Trustee
would be insufficient to pay amounts due on the Securities of such series at
the time of their accelerated maturity, the Company would remain liable for
such amounts.
The Company may also obtain a discharge of the Indenture with respect to all
Securities then Outstanding (except for certain obligations to register the
transfer of or exchange such Securities, to replace stolen, loss or mutilated
Securities, to maintain paying agencies and to maintain the trust described
below) by irrevocably depositing in trust with the Trustee money, and/or
securities of the government which issued the currency in which such
Securities are payable or securities backed by the full faith and credit of
such government which, through the payment of the principal thereof or the
interest thereon in accordance with their terms, will provide money in an
amount sufficient to pay all the principal of (and premium, if any) and
interest on the Securities on the stated maturities thereof (including one or
more redemption dates), provided that such Securities are by their terms due
and payable, or are to be called for redemption, within one year. (Section
10.1)
CONCERNING THE TRUSTEE
The First National Bank of Chicago, the trustee under the Indenture, is one
of a number of banks with which the Company and its subsidiaries maintain
ordinary banking relationships, including, in certain cases, credit
facilities.
GOVERNING LAW
The Indenture and the Debt Securities shall be governed by, and for all
purposes shall be construed in accordance with, the laws of the State of New
York, except as may otherwise be required by mandatory provisions of law.
PLAN OF DISTRIBUTION
The Company may sell Debt Securities in a public offering to or through
underwriters and may also sell Debt Securities directly to one or more other
purchasers or through agents.
The Company may sell Debt Securities as soon as practicable after the
effectiveness of the Registration Statement of which this Prospectus forms a
part. The names of any underwriters involved in the sale of the Debt
Securities in respect of which this Prospectus is delivered, the amount or
number of Debt Securities to be purchased by any such underwriters and any
applicable commissions or discounts will be set forth in the applicable
Prospectus Supplement.
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The distribution of the Debt Securities may be effected from time to time in
one or more transactions at a fixed price or prices, which may be changed, or
at market prices prevailing at the time of sale, at prices relating to such
prevailing market prices or at negotiated prices. The Prospectus Supplement
will describe the method of distribution of the Offered Debt Securities.
In connection with the sale of Debt Securities, underwriters or agents may
receive compensation from the Company or from purchasers of Debt Securities
for whom they may act as agents in the form of discounts, concessions or
commissions. Underwriters may sell Debt Securities to or through dealers, and
such dealers may receive compensation in the form of discounts, concessions or
commissions from the underwriters and/or commissions from the purchasers for
whom they may act as agents. Underwriters, dealers and agents that participate
in the distribution of Debt Securities may be deemed to be underwriters, and
any discounts or commissions received by them from the Company and any profit
on the resale of Debt Securities by them may be deemed to be underwriting
discounts and commissions, under the Securities Act. Any such underwriter or
agent will be identified, and any such compensation received from the Company
will be described, in the Prospectus Supplement.
Under agreements that may be entered into by the Company, underwriters,
dealers and agents who participate in the distribution of Debt Securities may
be entitled to indemnification by the Company against certain liabilities,
including liabilities under the Securities Act, or to contribution with
respect to payments which such underwriters, dealer or agents may be required
to make in respect thereof.
In connection with any offering of Debt Securities, the Company may grant to
the underwriters an option to purchase additional Debt Securities to cover
over-allotments, if any, at the initial public offering price (with an
additional underwriting commission), as may be set forth in the accompanying
Prospectus Supplement. If the Company grants any such option, the terms of
such option will be set forth in the applicable Prospectus Supplement.
If so indicated in the accompanying Prospectus Supplement, the Company will
authorize underwriters or other persons acting as the Company's agents to
solicit offers by certain institutions to purchase the Offered Securities from
the Company pursuant to contracts providing for payment and delivery on a
future date. Institutions with which such contracts may be made include
commercial and savings banks, insurance companies, pension funds, educational
and charitable institutions and others, but in all cases such institutions
must be approved by the Company. The obligations of any purchaser under any
such contract will be subject to the condition that the purchase of the
Offered Securities shall not at the time of delivery be prohibited under the
laws of the jurisdiction to which such purchaser is subject. The underwriters
and such other agents will not have any responsibility in respect of the
validity or performance of such contracts.
Certain of the underwriters or agents and their associates may be customers
of, or engage in transactions with and perform services for the Company in the
ordinary course of business.
All Debt Securities will be issues of new securities with no established
trading market. Any underwriters to whom Debt Securities are sold by the
Company for public offering and sale may make a market in such Debt
Securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. No assurance can be
given concerning the liquidity of the trading market for any Debt Securities.
LEGAL OPINIONS
The validity of the Debt Securities offered hereby will be passed upon for
the Company by John M. Costigan, in his capacity as Senior Vice President,
General Counsel and Secretary of the Company, and Sidley & Austin, Chicago,
Illinois, and for any underwriters, dealers or agents by Sullivan & Cromwell,
New York, New York. Mr. Costigan, in his capacity as Senior Vice President,
General Counsel and Secretary of the Company, is paid a salary by the Company
and is a participant in various employee benefits plans offered to employees
of the Company.
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EXPERTS
The financial statements as of and for the fiscal year ended December 27,
1997 incorporated in this Prospectus by reference to the Annual Report on Form
10-K of the Company for the fiscal year ended December 27, 1997 have been so
incorporated in reliance on the report of Ernst & Young LLP, independent
accountants, given on the authority of said firm as experts in auditing and
accounting. The financial statements as of December 28, 1996 and for each of
the two years in the fiscal period ended December 28, 1996 incorporated in
this Prospectus by reference to the Annual Report on Form 10-K of the Company
for the fiscal year ending December 27, 1997 have been so incorporated in
reliance on the report of PricewaterhouseCoopers LLP, independent accountants,
given on the authority of said firms as experts in auditing and accounting.
NOTE REGARDING FORWARD LOOKING STATEMENTS
Section 21E of the Exchange Act provides a "safe harbor" for forward-looking
statements to encourage companies to provide prospective information about
their companies, so long as those statements are identified as forward-looking
and are accompanied by meaningful cautionary statements identifying important
factors that could cause actual results to differ materially from those
discussed in the statements. The Company desires to take advantage of the
"safe harbor" provisions of the Exchange Act with regard to forward-looking
statements contained in this Prospectus and any document incorporated by
reference herein. The forward-looking statements are and will be based on
management's then current views and assumptions regarding future events and
financial performance. The factors identified by the Company include, among
other things, the factors noted in the "Narrative Description of Business" in
the Company's Annual Report on Form 10-K for the fiscal year ended December
27, 1997 ("Annual Report"), and "Management's Discussion and Analysis of
Financial Condition and Results of Operation" in the Annual Report and in the
Company's Quarterly Report on Form 10-Q for the fiscal quarter ended June 27,
1998. Other risk factors include the following: general economic and business
conditions in the domestic and global markets; actions of competitors,
including competitive pricing; changes in customer preferences and spending
patterns; changes in social and demographic trends; changes in laws and
regulations, including changes in taxation and accounting standards; foreign
economic conditions, including currency exchange rate fluctuations; interest
rate fluctuations; the effects of changing cost and availability of raw
materials; outcome of litigation; adequacy of reserves; and the effectiveness
of the Company's marketing and sales programs.
11
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table sets forth the estimated expenses in connection with the
offering described in the Registration Statement:
Securities and Exchange Commission Registration fee $ 44,250
Blue Sky fees and expenses (including counsel fees) 15,000
Legal fees 75,000
Trustee and transfer agent fees and expenses 15,000
Printing and engraving 10,000
Accounting fees 32,000
Rating Agency fees 165,000
Miscellaneous 50,000
-------
Total $406,250
All of the above, except for the SEC fee, are estimated.
Item 15. Indemnification of Directors and Officers
Article Tenth of the Company's Restated Certificate of Incorporation provides
that each person who was or is made a party to or is threatened to be made a
party to any action, suit or proceeding by reason of the fact that he or she is
or was 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 for another
entity) will be indemnified and held harmless by the Company, to the full extent
authorized by the General Corporation Law of the State of Delaware (the
"Delaware Law"), as currently in effect (or, to the extent indemnification is
broadened, as it may be amended), against all expense, liability or loss
(including attorneys' fees, judgments, fines, ERISA excise taxes or penalties
and amounts to be paid or to be paid in settlement) reasonably incurred by such
person in connection therewith. Such Article also provides that the rights
conferred thereby are contract rights and will include the right to be paid by
the Company for the expenses incurred in defending the proceedings specified
above, in advance of their final disposition, except that, if the Delaware Law
so requires, such payment will only be made upon delivery to the Company by the
indemnified party of an undertaking to repay all amounts so advanced if it is
ultimately determined that the person receiving such payments is not entitled to
be indemnified under such provisions or otherwise. Article Tenth provides that
the Company may, by action of its Board of Directors, provide indemnification to
its agents with the same scope and effect as the foregoing indemnification of
directors, officers and employees.
<PAGE>
Such Article also provides that persons indemnified thereunder may bring suit
against the Company to recover unpaid amounts claimed thereunder, and that if
such suit is successful, the expense of bringing such a suit will be reimbursed
by the Company. It further provides that while it is a defense to such suit that
the person claiming indemnification has not met the applicable standards of
conduct making indemnification permissible under the Delaware Law, the burden of
proving the defense will be on the Company and neither the failure of the
Company's Board of Directors to have made a determination that indemnification
is proper, nor an actual determination by such Board that the claimant has not
met the applicable standard of conduct, will be a defense to the action or
create a presumption that the claimant has not met the applicable standard of
conduct.
Such Article also provides that the rights to indemnification and the payment
of expenses incurred in defending a proceeding in advance of its final
disposition conferred therein will not be exclusive of any other right which any
such person may have or acquire under any statute, provision of the Restated
Certificate of Incorporation or the By-Laws of the Company, or otherwise.
Finally, such Article provides that the Company may maintain insurance, at its
expense, to protect itself and any of its directors, officers, employees or
agents against any expense, liability or loss, whether or not the Company would
have the power to indemnify such persons against such expense, liability or loss
under the Delaware Law.
Section 145 of the Delaware Law provides that corporations organized under the
Delaware Law have the power to indemnify directors, officers and agents against
liability in certain circumstances.
Item 16. Exhibits
Exhibits
________
1 - Form of Underwriting Agreement with form of pricing agreement
attached./(1)/
4 - Form of Indenture./(2)/
5 - Opinion and consent of Sidley & Austin.
12 - Calculation of Ratio of Earnings to Fixed Charges./(3)/
23(a) - Consent of Independent Auditors./(1)/
23(b) - Consent of Independent Accountants./(1)/
23(c) - Consent of Counsel (included in Exhibit 5 above).
24 - Powers of Attorney./(3)/
25 - Form T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of The First National Bank of Chicago, Trustee
(bound separately).
/(1)/ Constitutes an amendment to the Exhibits filed with the
<PAGE>
Registrant's Registration Statement on Form S-3 (Commission File No.
33-35137).
/(2)/ Incorporated by reference to Exhibit 4.2 to Registrant's Annual Report on
Form 10-K for the year ended December 28, 1996.
/(3)/ Previously filed.
Item 17. Undertakings
The undersigned 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 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement;
(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 the undertakings set forth in paragraphs (i) and (ii)
above do not apply if the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic reports filed
with or furnished to the Commission by the registrant pursuant to section 13 or
section 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
<PAGE>
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 section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the provisions set forth or referred to in
Item 15, or otherwise, the registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer,
or controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the 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 Act and
will be governed by the final adjudication of such issue.
(6) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form or prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective.
(7) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus 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.
(8) 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 in accordance with the rules and regulations prescribed by the Commission
under Section 305(b)(2) of the Act.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all the
requirements for filing on Form S-3 and has duly caused this amendment to
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, in the City of Deerfield, State of Illinois, on this ____ day
of October 1998.
Premark International, Inc.
(Registrant)
By
JAMES M. RINGLER
- ---------------------
James M. Ringler
Chairman of the Board,
Chief Executive Officer and President
Pursuant to the requirements of the Securities Act of 1933, this amendment
to registration statement has been signed below by the following persons in the
capacities indicated.
Signature Title Date
JAMES M. RINGLER Chairman of the Board, October __, 1998
- --------------------- Chief Executive Officer
James M. Ringler and President (Principal
Executive Officer)
* Senior Vice President October __, 1998
- --------------------- and Chief Financial
Lawrence B. Skatoff Officer (Principal
Financial Officer)
* Vice President and October __, 1998
- --------------------- Controller (Principal
Robert W. Hoaglund Accounting Officer)
<PAGE>
* Director October , 1998
- ---------------------
Harry W. Bowman
* Director October , 1998
- ---------------------
Dr. Ruth M. Davis
* Director October , 1998
- ---------------------
Lloyd C. Elam, M.D.
* Director October , 1998
- ---------------------
W. James Farrell
* Director October , 1998
- ---------------------
Richard S. Friedland
* Director October , 1998
- ---------------------
John B. McKinnon
* Director October , 1998
- ---------------------
David R. Parker
* Director October , 1998
- ---------------------
Janice D. Stoney
*By JOHN M. COSTIGAN
--------------------
John M. Costigan
Attorney-in-fact
EXHIBIT INDEX
Exhibit
Number Description
1 Form of Underwriting Agreement with form of pricing agreement
attached.
5 Opinion and consent of Sidley & Austin.
12 Calculation of Ratio of Earnings to Fixed Charges.
23(a) Consent of Independent Auditors.
23(b) Consent of Independent Accountants.
25 Form T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of The First National Bank of Chicago,
Trustee.
<PAGE>
Premark International, Inc.
Debt Securities
-----------------
Underwriting Agreement
----------------------
________ __, 1998
Goldman, Sachs & Co.,
85 Broad Street,
New York, New York 10004.
Ladies and Gentlemen:
From time to time, Premark International, Inc., a Delaware corporation (the
"Company"), proposes to enter into one or more Pricing Agreements (each a
"Pricing Agreement") in the form of Annex I hereto, with such additions and
deletions as the parties thereto may determine, and, subject to the terms and
conditions stated herein and therein, to issue and sell to the firms named in
Schedule I to the applicable Pricing Agreement (such firms constituting the
"Underwriters" with respect to such Pricing Agreement and the securities
specified therein) certain of its debt securities (the "Securities") specified
in Schedule II to such Pricing Agreement (with respect to such Pricing
Agreement, the "Designated Securities").
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Pricing Agreement relating thereto and in or
pursuant to the indenture (the "Indenture") identified in such Pricing
Agreement.
1. Particular sales of Designated Securities may be made from time to time
to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to an Underwriter or Underwriters who act without any firm
being designated as its or their representatives. This Underwriting Agreement
shall not be construed as an obligation of the Company to sell any of the
Securities or as an obligation of any of the Underwriters to purchase the
Securities. The obligation of the Company to issue and sell any of the
Securities and the obligation of any of the Underwriters to purchase any of the
Securities shall be evidenced by the Pricing Agreement with respect to the
Designated Securities specified therein. Each Pricing Agreement shall specify
the aggregate principal amount of such Designated Securities, the initial public
offering price of such Designated Securities, the purchase price to the
Underwriters of such Designated Securities, the names of the Underwriters of
such Designated Securities, the names of the Representatives of such
Underwriters and the
<PAGE>
principal amount of such Designated Securities to be purchased by each
Underwriter and shall set forth the date, time and manner of delivery of such
Designated Securities and payment therefor. The Pricing Agreement shall also
specify (to the extent not set forth in the Indenture and the registration
statement and prospectus with respect thereto) the terms of such Designated
Securities. A Pricing Agreement shall be in the form of an executed writing
(which may be in counterparts), and may be evidenced by an exchange of
telegraphic communications or any other rapid transmission device designed to
produce a written record of communications transmitted. The obligations of the
Underwriters under this Underwriting Agreement and each Pricing Agreement shall
be several and not joint.
2. The Company represents and warrants to, and agrees with, each of the
Underwriters that:
(a) A registration statement on Form S-3 (File No. 333-____) (the "Initial
Registration Statement") in respect of the Securities, which Initial
Registration Statement also constitutes Post-Effective Amendment No. 1 with
respect to a registration statement on Form S-3 (File No. 33-35137) (the "1990
Registration Statement") filed by the Company with the Securities and Exchange
Commission (the "Commission") on May 31, 1990, has been filed with the
Commission; the Initial Registration Statement, the 1990 Registration Statement
and any post-effective amendment thereto, each in the form heretofore delivered
or to be delivered to the Representatives and, excluding exhibits to the Initial
Registration Statement or the 1990 Registration Statement, but including all
documents incorporated by reference in the prospectus contained in the Initial
Registration Statement, to the Representatives for each of the other
Underwriters, have been declared effective by the Commission in such form; other
than a registration statement, if any, increasing the size of the offering (a
"Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b) under the
Securities Act of 1933, as amended (the "Act"), which became effective upon
filing, no other document with respect to the Initial Registration Statement or
document incorporated by reference therein has heretofore been filed or
transmitted for filing with the Commission (other than prospectuses filed
pursuant to Rule 424(b) of the rules and regulations of the Commission under the
Act, each in the form heretofore delivered to the Representatives); and no stop
order suspending the effectiveness of the Initial Registration Statement, any
post-effective amendment thereto or the Rule 462(b) Registration Statement, if
any, has been issued and no proceeding for that purpose has been initiated or,
to the best knowledge of the Company, threatened by the Commission (any
preliminary prospectus included in the Initial Registration Statement or filed
with the Commission pursuant to Rule 424(a) under the Act, is hereinafter called
a "Preliminary Prospectus" and also relates to the 1990 Registration Statement);
the various parts of the Initial Registration Statement, the 1990 Registration
Statement, any post-effective amendment to either of them and the Rule 462(b)
Registration Statement, if any, including all exhibits to either of them and the
documents incorporated by reference in the prospectus contained in the Initial
Registration Statement at the time such part of the Initial Registration
Statement became effective but excluding Form T-1, each as amended at the time
such part of the Initial Registration Statement became effective or such part of
the Rule 462(b) Registration Statement, if any, became or hereafter becomes
effective, are hereinafter collectively called the "Registration Statement"; the
prospectus relating to the Securities, in the form in which it has most recently
been filed, or transmitted for filing, with the Commission on or prior to the
date of this Agreement, being hereinafter called the "Prospectus" (it being
understood that the term "Prospectus" does not include any prospectus supplement
relating to the offering of
2
<PAGE>
Securities other than the Designated Securities described in the applicable
Pricing Agreement); any reference herein to any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to the applicable form under the Act, as of the date
of such Preliminary Prospectus or Prospectus, as the case may be; any reference
to any amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the date of
such Preliminary Prospectus or Prospectus, as the case may be, under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
incorporated by reference in such Preliminary Prospectus or Prospectus, as the
case may be; any reference to any amendment to the Initial Registration
Statement shall be deemed to refer to and include any annual report of the
Company filed pursuant to Sections 13(a) or 15(d) of the Exchange Act after the
effective date of the Initial Registration Statement that is incorporated by
reference in the Registration Statement; and any reference to the Prospectus as
amended or supplemented shall be deemed to refer to the Prospectus as amended or
supplemented in relation to the applicable Designated Securities in the form in
which it is filed with the Commission pursuant to Rule 424(b) under the Act in
accordance with Section 5(a) hereof, including any documents incorporated by
reference therein as of the date of such filing);
(b) The documents incorporated by reference in the Prospectus, when they
became effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the Commission
thereunder, and none of such documents, when they became effective or were filed
with the Commission, as the case may be, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements therein not misleading; and any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become effective or
are filed with the Commission, as the case may be, will conform in all material
respects to the requirements of the Act or the Exchange Act, as applicable, and
the rules and regulations of the Commission thereunder and will not contain an
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter of Designated Securities
through the Representatives expressly for use in the Prospectus as amended or
supplemented relating to such Securities;
(c) The Registration Statement and the Prospectus conform, and any further
amendments or supplements to the Registration Statement or the Prospectus will
conform, in all material respects to the requirements of the Act and the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act") and the rules and
regulations of the Commission thereunder and do not and will not, as of the
applicable effective date as to the Registration Statement and any amendment
thereto and as of the applicable filing date as to the Prospectus and any
amendment or supplement thereto, contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions made
in reliance upon and in conformity with information furnished in writing to the
Company by an Underwriter of
3
<PAGE>
Designated Securities through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Securities;
(d) The Company and its subsidiaries, taken as a whole, have not sustained
since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus any loss or interference with its
business from fire, explosion, flood or other calamity, whether or not covered
by insurance, or from any labor dispute or court or governmental action, order
or decree, which is material to the Company and its subsidiaries, taken as a
whole, otherwise than as set forth or contemplated in the Prospectus; and, since
the respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any change in the capital stock
(other than changes disclosed in writing to the Representatives prior to the
date of the applicable Pricing Agreement and changes pursuant to employee
benefits plans or stock options, repurchases by the Company of shares of its
common stock in an amount not in excess of 1% of the number of such shares
outstanding on the date of such Pricing Agreement, conversions of convertible
securities or the exercise of warrants or other rights outstanding on the date
of such Pricing Agreement), any material change in the long-term debt (other
than changes as a result of maturities, sinking fund payments or amortization of
debt discount) of the Company and its subsidiaries, taken as a whole, or any
material adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, management, financial
position, shareholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole, otherwise than as set forth or contemplated in
the Prospectus;
(e) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus;
(f) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company have
been duly and validly authorized and issued and are fully paid and non-
assessable;
(g) The Securities have been duly authorized, and, when Designated
Securities are issued, authenticated and delivered to, and paid for by, the
Underwriters of such Designated Securities pursuant to the Indenture, this
Agreement and the Pricing Agreement with respect to such Designated Securities,
such Designated Securities will have been duly executed, authenticated, issued
and delivered and will constitute valid and legally binding obligations of the
Company entitled to the benefits provided by the Indenture, which will be
substantially in the form filed as an exhibit to the Registration Statement; the
Indenture has been duly authorized and duly qualified under the Trust Indenture
Act and, at the Time of Delivery for such Designated Securities (as defined in
Section 4 hereof), the Indenture will constitute a valid and binding instrument
of the Company enforceable in accordance with its terms, except as (i) the
enforceability thereof may be limited by bankruptcy, insolvency or similar laws
affecting the enforcement of creditors' rights generally and (ii) rights of
acceleration and the availability of other remedies may be limited by equitable
principles of general applicability; and the Indenture conforms, and such
Designated Securities will conform, to the descriptions thereof contained in the
Prospectus as amended or supplemented with respect to such Designated
Securities;
4
<PAGE>
(h) The issue and sale of the Securities and the compliance by the Company
with all of the provisions of the Securities, the Indenture, this Agreement and
any Pricing Agreement, and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach or violation
of any of the terms or provisions of, or constitute a default under, any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument to which the Company is a party or by which the Company is bound or
to which any of the property or assets of the Company is subject, except for
such conflicts, breaches, violations or defaults that will not individually or
in the aggregate have a material adverse effect on the business, financial
position or results of operations of the Company and its subsidiaries, taken as
a whole, or the credit rating, validity or enforceability of the Securities, nor
will such action result in any violation of the provisions of the Certificate of
Incorporation or By-laws of the Company or any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its properties, except for such violations (other than
with respect to the Company's Certificate of Incorporation or By-Laws) that will
not individually or in the aggregate have a material adverse effect on the
business, financial position or results of operations of the Company and its
subsidiaries, taken as a whole, or the credit rating, validity or enforceability
of the Securities; and no consent, approval, authorization, order, registration
or qualification of or with any such court or governmental agency or body is
required for the issue and sale of the Securities or the consummation by the
Company of the transactions contemplated by this Agreement or any Pricing
Agreement or the Indenture, except such as have been, or will have been prior to
the Time of Delivery, obtained under the Act and the Trust Indenture Act and
such consents, approvals, authorizations, registrations or qualifications as may
be required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the Underwriters;
(i) The statements set forth in the Prospectus under the caption
"Description of Notes", insofar as they purport to constitute a summary of the
terms of the Securities, and under the caption "Underwriting", insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate, complete and fair;
(j) Neither the Company nor any of its "significant subsidiaries" (as
defined in Rule 1-102(w) of Regulation S-X) is in violation of its Certificate
of Incorporation or By-laws, and neither the Company nor any of its subsidiaries
is in default in the performance or observance of any obligation, agreement,
covenant or condition contained in any indenture, mortgage, deed of trust, loan
agreement, lease or other agreement or instrument to which it is a party or by
which it or any of its properties may be bound, which default is material to the
Company and its subsidiaries, taken as a whole;
(k) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Company or any of its subsidiaries
is a party or of which any property of the Company or any of its subsidiaries is
the subject which, if determined adversely to the Company or any of its
subsidiaries, would individually or in the aggregate have a material adverse
effect on the current or future consolidated financial position, shareholders'
equity or results of operations of the Company and its subsidiaries, taken as a
whole; and, to the best of the Company's knowledge, no such proceedings are
threatened or contemplated by governmental authorities or threatened by others;
5
<PAGE>
(l) The Company is not and, after giving effect to the offering and sale of
the Securities, will not be an "investment company", as such term is defined in
the Investment Company Act of 1940, as amended (the "Investment Company Act");
and
(m) Ernst & Young LLP, who have certified certain financial statements of
the Company and its subsidiaries, and Price Waterhouse LLP, who certified
certain financial statements of the Company and its subsidiaries in the past,
are, to the best knowledge of the Company, each independent public accountants
as required by the Act and the rules and regulations of the Commission
thereunder.
3. Upon the execution of the Pricing Agreement applicable to any
Designated Securities and authorization by the Representatives of the release of
such Designated Securities, the several Underwriters propose to offer such
Designated Securities for sale upon the terms and conditions set forth in the
Prospectus as amended or supplemented.
4. Designated Securities to be purchased by each Underwriter pursuant to
the Pricing Agreement relating thereto, in the form specified in such Pricing
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least forty-eight hours' prior notice to
the Company, shall be delivered by or on behalf of the Company to the
Representatives for the account of such Underwriter, against payment by such
Underwriter or on its behalf of the purchase price therefor by wire transfer of
Federal (same-day) funds to the account specified by the Company to the
Representatives at least forty-eight hours in advance or at such other place and
time and date as the Representatives and the Company may agree upon in writing,
such time and date being herein called the "Time of Delivery" for such
Securities.
5. The Company agrees with each of the Underwriters of any Designated
Securities:
(a) To prepare the Prospectus as amended or supplemented in relation to the
applicable Designated Securities in a form reasonably approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under the
Act not later than the Commission's close of business on the second business day
following the execution and delivery of the Pricing Agreement relating to the
applicable Designated Securities or, if applicable, such earlier time as may be
required by Rule 424(b); to make no further amendment or supplement to the
Registration Statement or Prospectus as amended or supplemented after the date
of the Pricing Agreement relating to such Designated Securities and prior to the
Time of Delivery for such Securities which shall be reasonably disapproved by
the Representatives for such Securities promptly after reasonable notice
thereof; to advise the Representatives promptly of any such amendment or
supplement after such Time of Delivery and furnish the Representatives with
copies thereof; to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as
the delivery of a prospectus is required by law in connection with the offering
or sale of such Securities, and during such same period to advise the
Representatives, promptly after it receives notice thereof, of the time when any
amendment to the Registration Statement has been filed or becomes effective or
any supplement to the Prospectus or any amended Prospectus has been filed with
the Commission, of the issuance by the Commission of any stop order or of any
order preventing or suspending the use of any prospectus relating to the
Securities, of the suspension of the qualification of
6
<PAGE>
such Securities for offering or sale in any jurisdiction, of the initiation or
threatening of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
Prospectus or for additional information; and, in the event of the issuance of
any such stop order or of any such order preventing or suspending the use of any
prospectus relating to the Securities or suspending any such qualification, to
promptly use its best efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as the Representatives
may reasonably request to qualify such Securities for offering and sale under
the securities laws of such jurisdictions as the Representatives may reasonably
request and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of such Securities, provided that in connection
therewith the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any jurisdiction;
(c) Prior to 12:00 noon, New York City time, on the New York Business Day
next succeeding the date of this Agreement and from time to time as the
Representatives may reasonably request, to furnish the Underwriters with copies
of the Prospectus in New York City as amended or supplemented in such quantities
as the Representatives may reasonably request, and, if the delivery of a
prospectus is required by law at any time in connection with the offering or
sale of the Securities and if at such time any event shall have occurred as a
result of which the Prospectus as then amended or supplemented would include an
untrue statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not misleading, or, if
for any other reason it shall be necessary during such same period to amend or
supplement the Prospectus or to file under the Exchange Act any document
incorporated by reference in the Prospectus in order to comply with the Act, the
Exchange Act or the Trust Indenture Act, to notify the Representatives and upon
their request to file such document and to prepare and furnish without charge to
each Underwriter and to any dealer in securities as many copies as the
Representatives may from time to time reasonably request of an amended
Prospectus or a supplement to the Prospectus which will correct such statement
or omission or effect such compliance;
(d) To make generally available to its securityholders as soon as
practicable, but in any event not later than eighteen months after the effective
date of the Registration Statement (as defined in Rule 158(c) under the Act), an
earnings statement of the Company and its subsidiaries (which need not be
audited) complying with Section 11(a) of the Act and the rules and regulations
of the Commission thereunder (including, at the option of the Company, Rule
158);
(e) During the period beginning from the date of the Pricing Agreement for
such Designated Securities and continuing to and including the later of (i) the
termination of trading restrictions for such Designated Securities, as notified
to the Company by the Representatives and (ii) the Time of Delivery for such
Designated Securities, not to offer, sell, contract to sell or otherwise dispose
of any debt securities of the Company which mature more than one year after such
Time of Delivery and which are substantially similar to such Designated
Securities, without the prior written consent of the Representatives, which
consent shall not be unreasonably withheld; and
7
<PAGE>
(f) If the Company elects to rely upon Rule 462(b), the Company shall file
a Rule 462(b) Registration Statement with the Commission in compliance with Rule
462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and
the Company shall at the time of filing either pay to the Commission the filing
fee for the Rule 462(b) Registration Statement or give irrevocable instructions
for the payment of such fee pursuant to Rule 111(b) under the Act.
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (a) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
registration of the Securities under the Act and all other expenses in
connection with the preparation, printing and filing of the Registration
Statement, any Preliminary Prospectus and the Prospectus and amendments and
supplements thereto and the mailing and delivering of copies thereof to the
Underwriters and dealers; (b) the cost of printing or producing any Agreement
among Underwriters, this Agreement, any Pricing Agreement, any Indenture, any
Blue Sky and Legal Investment Memoranda and any other documents in connection
with the offering, purchase, sale and delivery of the Securities; (c) all
reasonable expenses in connection with the qualification of the Securities for
offering and sale under state securities laws as provided in Section 5(b)
hereof, including the reasonable fees and disbursements of counsel for the
Underwriters in connection with such qualification and in connection with the
Blue Sky and Legal Investment Surveys; (d) any fees charged by securities rating
services for rating the Securities; (e) any filing fees incident to any required
review by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Securities; (f) the cost of preparing the Securities; (g) the
fees and expenses of any Trustee and any agent of any Trustee and the fees and
disbursements of counsel for any Trustee in connection with any Indenture and
the Securities; and (h) all other costs and expenses incident to the performance
of its obligations hereunder which are not otherwise specifically provided for
in this Section. It is understood, however, that, except as provided in this
Section, and Sections 8 and 11 hereof, the Underwriters will pay all of their
own costs and expenses, including the fees of their counsel, transfer taxes on
resale of any of the Securities by them, and any advertising expenses connected
with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities under
the Pricing Agreement relating to such Designated Securities shall be subject,
in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Company in or
incorporated by reference in the Pricing Agreement relating to such Designated
Securities are, at and as of the Time of Delivery for such Designated
Securities, true and correct, the condition that the Company shall have
performed all of its obligations hereunder theretofore to be performed, and the
following additional conditions:
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for such
filing by the rules and regulations under the Act and in accordance with Section
5(a) hereof; if the Company has elected to rely upon Rule 462(b), the Rule
462(b) Registration Statement shall have become effective by 10:00 P.M.,
Washington, D.C. time, on the date of this Agreement; no stop order suspending
the effectiveness of the Registration Statement or any part thereof shall have
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been issued and no proceeding for that purpose shall have been initiated or
threatened by the Commission; and all requests for additional information on the
part of the Commission shall have been complied with to the Representatives'
reasonable satisfaction;
(b) Counsel for the Underwriters shall have furnished to the
Representatives such written opinion and letter (drafts of which are attached
hereto as Annex III-A and III-B), dated the Time of Delivery for such Designated
Securities, with respect to the incorporation of the Company, the Indenture, the
validity of such Designated Securities, the Registration Statement and the
Prospectus and such other related matters as the Representatives may reasonably
request, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters;
(c) John Costigan, Senior Vice President, General Counsel and Secretary of
the Company, shall have furnished to the Representatives his written opinion (a
draft of such opinion is attached as Annex IV hereto), dated the Time of
Delivery for such Designated Securities, in form and substance reasonably
satisfactory to the Representatives, to the effect that:
(i) The Company has an authorized capitalization as set forth in the
Prospectus as amended or supplemented and all of the issued shares of
capital stock of the Company have been duly and validly authorized and
issued and are fully paid and non-assessable;
(ii) To such counsel's knowledge and other than as set forth in the
Prospectus, there are no legal or governmental proceedings pending to which
the Company or any of its subsidiaries is a party or of which any property
of the Company or any of its subsidiaries is the subject which, if
determined adversely to the Company or any of its subsidiaries, would
individually or in the aggregate have a material adverse effect on the
current or future consolidated financial position, shareholders' equity or
results of operations of the Company and its subsidiaries, taken as a
whole; and, to such counsel's knowledge, no such proceedings are threatened
or contemplated by governmental authorities or threatened by others;
(iii) The issue and sale of the Designated Securities and the
compliance by the Company with all of the provisions of the Designated
Securities, the Indenture, this Agreement and the Pricing Agreement with
respect to the Designated Securities and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of the provisions of, or constitute a
default under, any indenture, mortgage, deed of trust, loan agreement or
other agreement or instrument known to such counsel to which the Company is
a party or by which the Company is bound or to which any of the property or
assets of the Company is subject, except for such conflicts, breaches,
violations or defaults that will not individually or in the aggregate have
a material adverse effect on the business, financial position or results of
operations of the Company and its subsidiaries, taken as a whole, or the
credit rating, validity or enforceability of the Securities, nor will such
actions result in any violation of the provisions of the Certificate of
Incorporation or By-laws of the Company or any statute or any order, rule
or regulation known to such counsel of any court or governmental agency or
body having jurisdiction over the Company or any of its properties, except
for such violations (other than with respect to the Company's
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Certificate of Incorporation or By-Laws) that will not individually or in
the aggregate have a material adverse effect on the business, financial
position or results of operations of the Company and its subsidiaries,
taken as a whole, or the credit rating, validity or enforceability of the
Securities;
(iv) Neither the Company nor any of its "significant subsidiaries" (as
defined in Rule 1-102(w) of Regulation S-X) is in violation of its
Certificate of Incorporation or By-laws, and neither the Company nor any of
its subsidiaries is in default in the performance or observance of any
obligation, agreement, covenant or condition contained in any contract,
indenture, mortgage, loan agreement, note, lease or other instrument to
which it is a party or by which it or any of its properties may be bound,
which default is material to the Company and its subsidiaries, taken as a
whole;
(v) At the time each of the Registration Statements became effective,
each such Registration Statement (other than the financial statements,
financial data and financial schedules included therein, as to which we
express no opinion) complied as to form in all material respects with the
requirements of the Securities Act and the rules and regulations of the SEC
thereunder; and nothing has come to our attention which causes us to
believe that either of such Registration Statements (other than the
financial statements, financial data and financial schedules included
therein, as to which we express no belief), at the time it became
effective, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading or that the Final Prospectus (other
than the financial statements, financial data and financial schedules
included therein, as to which we express no belief), at the date of the
Final Prospectus or at the date hereof, included any untrue statement of a
material fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading.
(vi) The documents incorporated by reference in the Final Prospectus
(other than the financial statements, financial data and financial
schedules included therein, as to which we express no opinion), at the
respective times such documents were filed with the SEC, complied as to
form in all material respects with the requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and
regulations of the SEC thereunder; and nothing has come to our attention
which causes us to believe that any of such documents (other than the
financial statements, financial data and financial schedules included
therein, as to which we express no belief), at the respective times such
documents were so filed, contained any untrue statement of a material fact
or omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made at the respective times such documents were so filed, not misleading.
(d) Sidley & Austin, counsel for the Company, shall have furnished to the
Representatives their written opinion (a draft of such opinion is attached as
Annex V
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hereto), dated the Time of Delivery for such Designated Securities, in form and
substance reasonably satisfactory to the Representatives, to the effect that:
(i) The Company is duly incorporated, validly existing and in good
standing under the laws of the State of Delaware and has corporate power
and authority to own, lease and operate its properties and to conduct the
business in which it is engaged as described in the Registration Statements
and the Final Prospectus.
(ii) The Indenture has been duly authorized by the Company, qualified
under the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), and executed and delivered by the Company and constitutes the legal,
valid and binding obligation of the Company enforceable against the Company
in accordance with its terms, except to the extent enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws of general applicability relating to or
affecting the enforcement of creditors' rights and by the effect of general
principles of equity (regardless of whether enforceability is considered in
a proceeding in equity or at law).
(iii) The Securities have been duly authorized and, when duly executed
and authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Underwriters in accordance with the terms
of the Agreement, will constitute legal, valid and binding obligations of
the Company enforceable against the Company in accordance with their
respective terms, except to the extent enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer or
other similar laws of general applicability relating to or affecting the
enforcement of creditors' rights and by the effect of general principles of
equity (regardless of whether enforceability is considered in a proceeding
in equity or at law).
. (iv) Each of the Underwriting Agreement and the Pricing Agreement has
been duly authorized, executed and delivered by the Company.
(v) At the time each of the Registration Statements became effective,
each such Registration Statement (other than the financial statements,
financial data and financial schedules included therein, as to which we
express no opinion) complied as to form in all material respects with the
requirements of the Securities Act and the rules and regulations of the SEC
thereunder; and nothing has come to our attention which causes us to
believe that either of such Registration Statements (other than the
financial statements, financial data and financial schedules included
therein, as to which we express no belief), at the time it became
effective, contained any untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make
the statements therein not misleading or that the Final Prospectus (other
than the financial statements, financial data and financial schedules
included therein, as to which we express no belief), at the date of the
Final Prospectus or at the date hereof, included any untrue statement of a
material fact or omitted to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under which
they were made, not misleading.
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<PAGE>
(vi) The Securities and the Indenture conform in all material respects
to the descriptions thereof contained in the Registration Statements; and
the information in the Registration Statements under the captions
"Description of Notes" and "Underwriting" to the extent that it constitutes
matters of law or legal conclusions, has been reviewed by us and is correct
and complete in all material respects.
(vii) The documents incorporated by reference in the Final Prospectus
(other than the financial statements, financial data and financial
schedules included therein, as to which we express no opinion), at the
respective times such documents were filed with the SEC, complied as to
form in all material respects with the requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and
regulations of the SEC thereunder; and nothing has come to our attention
which causes us to believe that any of such documents (other than the
financial statements, financial data and financial schedules included
therein, as to which we express no belief), at the respective times such
documents were so filed, contained any untrue statement of a material fact
or omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made at the respective times such documents were so filed, not misleading.
(viii) We do not know of any statutes or legal or governmental
proceedings required to be described in the Financial Prospectus which are
not described as required, or of any contracts or documents of a character
required to be described in the Registration Statements or the Final
Prospectus (or required to be filed under the Exchange Act if upon such
filing they would be incorporated, in whole or in part, by reference
therein) or to be filed as exhibits to the Registration Statements which
are not described or filed as required.
. (ix) No consent, approval or authorization of, or registration, filing
or declaration with, any federal or state governmental authority or other
regulatory agency (other than under the Securities Act, the Trust Indenture
Act and the securities or blue sky laws of various states) is required for
the valid authorization, issuance, sale and delivery of the Securities as
contemplated in the Indenture and the Agreement.
(e) On the date of the Pricing Agreement for such Designated Securities at
a time prior to the execution of the Pricing Agreement with respect to such
Designated Securities and at the Time of Delivery for such Designated
Securities, the independent accountants of the Company who have certified the
financial statements of the Company and its subsidiaries included or
incorporated by reference in the Registration Statement shall have furnished to
the Representatives a letter, dated the effective date of the Registration
Statement or the date of the most recent report filed with the Commission
containing financial statements and incorporated by reference in the
Registration Statement, if the date of such report is later than such effective
date, and a letter dated such Time of Delivery, respectively, to the effect set
forth in Annex II hereto, and with respect to such letter dated such Time of
Delivery, as to such other matters as the Representatives may reasonably request
and in form and substance reasonably satisfactory to the Representatives (the
executed copy of the letter delivered prior to the execution of this Agreement
is attached as Annex II(a) hereto and a draft of the form of
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<PAGE>
letter to be delivered on the effective date of any post-effective amendment to
the Registration Statement and as of each Time of Delivery is attached as Annex
II(b) hereto);
(f) (i) Neither the Company nor any of its subsidiaries shall have
sustained since the date of the latest audited financial statements included or
incorporated by reference in the Prospectus as amended prior to the date of the
Pricing Agreement relating to the Designated Securities any loss or interference
with its business, which loss or interference is material to the business of the
Company and its subsidiaries, taken as a whole, from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, otherwise than as set forth or
contemplated in the Prospectus as amended prior to the date of the Pricing
Agreement relating to the Designated Securities, and (ii) since the respective
dates as of which information is given in the Prospectus as amended prior to the
date of the Pricing Agreement relating to the Designated Securities there shall
not have been any change in the capital stock (other than changes disclosed in
writing to the Representatives prior to the date of the applicable Pricing
Agreement and changes pursuant to employee benefits plans or stock options,
repurchases by the Company of shares of its common stock in an amount not in
excess of 1% of the number of such shares outstanding on the date of such
Pricing Agreement, conversions of convertible securities or the exercise of
warrants or other rights outstanding on the date of such Pricing Agreement), any
material change in the long-term debt (other than changes as a result of
maturities, sinking fund payments or amortization of debt discount) of the
Company and its subsidiaries, taken as a whole, or any material adverse change,
or any development involving a prospective material adverse change, in or
affecting the general affairs, management, financial position, shareholders'
equity or results of operations of the Company and its subsidiaries, taken as a
whole, otherwise than as set forth or contemplated in the Prospectus as amended
prior to the date of the Pricing Agreement relating to the Designated
Securities, the effect of which, in any such case described in clause (i) or
(ii), is in the judgment of the Representatives so material and adverse as to
make it impracticable or inadvisable to proceed with the public offering or the
delivery of such Designated Securities on the terms and in the manner
contemplated in the Prospectus as amended or supplemented relating to the
Designated Securities;
(g) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities or preferred stock (if any) by any
"nationally recognized statistical rating organization", as that term is defined
by the Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such
organization shall have publicly announced that it has under surveillance or
review, with possible negative implications, its rating of any of the Company's
debt securities or preferred stock (if any);
(h) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following: (i) a
suspension or material limitation in trading in securities generally on the New
York Stock Exchange; (ii) a suspension or material limitation in trading in the
Company's securities on the New York Stock Exchange; (iii) a general moratorium
on commercial banking activities declared by either Federal or New York State
authorities; or (iv) the outbreak or escalation of hostilities involving the
United States or the declaration by the United States of a national emergency or
war, if the effect of any such event specified in this clause (v) in the
reasonable judgment of the Representatives makes it impracticable or inadvisable
to proceed with the public
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<PAGE>
offering or the delivery of the Designated Securities on the terms and in the
manner contemplated in the Prospectus as amended or supplemented relating to the
Designated Securities;
(i) The Company shall have complied with the provisions of Section 5(c)
hereof with respect to the furnishing of prospectuses on the New York Business
Day next succeeding the date of this Agreement; and
(j) The Company shall have furnished or caused to be furnished to the
Representatives at the Time of Delivery for such Designated Securities a
certificate or certificates of officers of the Company reasonably satisfactory
to the Representatives as to the accuracy of the representations and warranties
of the Company herein at and as of such Time of Delivery, as to the performance
by the Company of all of its obligations hereunder to be performed at or prior
to such Time of Delivery, as to the matters set forth in subsections (a) and (f)
of this Section and as to such other matters as the Representatives may
reasonably request.
8. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Securities, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that the
Company shall not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Securities, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by any Underwriter
of Designated Securities through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the Company against
any losses, claims, damages or liabilities to which the Company may become
subject, under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Securities, or any amendment or supplement thereto, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in any Preliminary
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<PAGE>
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Securities, or any such amendment or supplement in reliance upon and in
conformity with written information furnished to the Company by such Underwriter
through the Representatives expressly for use therein; and will reimburse the
Company for any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending any such action or claim as such
expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party (who shall not, except
with the consent of the indemnified party, be counsel to the indemnifying
party), and, after notice from the indemnifying party to such indemnified party
of its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party for any legal expenses of other counsel
or any other expenses, in each case subsequently incurred by such indemnified
party, in connection with the defense thereof. No indemnifying party shall,
without the written consent of the indemnified party, effect the settlement or
compromise of, or consent to the entry of any judgment with respect to, any
pending or threatened action or claim in respect of which indemnification or
contribution may be sought hereunder (whether or not the indemnified party is an
actual or potential party to such action or claim) unless such settlement,
compromise or judgment (i) includes an unconditional release of the indemnified
party from all liability arising out of such action or claim and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of any indemnified party.
(d) If the indemnification provided for in this Section 8 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Company on the one hand and the Underwriters of the Designated Securities
on the other from the offering of the Designated Securities to which such loss,
claim, damage or liability (or action in respect thereof) relates. If, however,
the allocation provided by the immediately preceding sentence is not permitted
by applicable law or if the indemnified party failed to give the notice required
under subsection (c) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and the Underwriters of the Designated
Securities on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by the Company on
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<PAGE>
the one hand and such Underwriters on the other shall be deemed to be in the
same proportion as the total net proceeds from such offering (before deducting
expenses) received by the Company bear to the total underwriting discounts and
commissions received by such Underwriters. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company on the one hand
or such Underwriters on the other and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subsection (d) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this subsection (d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in this
subsection (d) shall be deemed to include any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this subsection (d),
no Underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the applicable Designated Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
obligations of the Underwriters of Designated Securities in this subsection (d)
to contribute are several in proportion to their respective underwriting
obligations with respect to such Securities and not joint.
(e) The obligations of the Company under this Section 8 shall be in
addition to any liability which the Company may otherwise have and shall extend,
upon the same terms and conditions, to each person, if any, who controls any
Underwriter within the meaning of the Act; and the obligations of the
Underwriters under this Section 8 shall be in addition to any liability which
the respective Underwriters may otherwise have and shall extend, upon the same
terms and conditions, to each officer and director of the Company and to each
person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Designated Securities which it has agreed to purchase under the Pricing
Agreement relating to such Designated Securities, the Representatives may in
their discretion arrange for themselves or another party or other parties
reasonably satisfactory to the Company to purchase such Designated Securities on
the terms contained herein. If within thirty-six hours after such default by
any Underwriter the Representatives do not arrange for the purchase of such
Designated Securities, then the Company shall be entitled to a further period of
thirty-six hours within which to procure another party or other parties
reasonably satisfactory to the Representatives to purchase such Designated
Securities on such terms. In the event that, within the respective prescribed
period, the Representatives notify the Company that they have so arranged for
the purchase of such Designated Securities, or the Company notifies the
Representatives that it has so arranged for the purchase of such Designated
Securities, the Representatives or the Company shall have the right to postpone
the Time of Delivery for such Designated Securities for a period of not more
than
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seven days, in order to effect whatever changes may thereby be made necessary in
the Registration Statement or the Prospectus as amended or supplemented, or in
any other documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in the reasonable opinion of the Representatives may thereby be made necessary.
The term "Underwriter" as used in this Agreement shall include any person
substituted under this Section with like effect as if such person had originally
been a party to the Pricing Agreement with respect to such Designated
Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of such Designated Securities which remains
unpurchased does not exceed one-eleventh of the aggregate principal amount of
the Designated Securities, then the Company shall have the right to require each
non-defaulting Underwriter to purchase the principal amount of Designated
Securities which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each non-
defaulting Underwriter to purchase its pro rata share (based on the principal
amount of Designated Securities which such Underwriter agreed to purchase under
such Pricing Agreement) of the Designated Securities of such defaulting
Underwriter or Underwriters for which such arrangements have not been made; but
nothing herein shall relieve a defaulting Underwriter from liability for its
default.
(c) If, after giving effect to any arrangements for the purchase of the
Designated Securities of a defaulting Underwriter or Underwriters by the
Representatives and the Company as provided in subsection (a) above, the
aggregate principal amount of Designated Securities which remains unpurchased
exceeds one-eleventh of the aggregate principal amount of the Designated
Securities, as referred to in subsection (b) above, or if the Company shall not
exercise the right described in subsection (b) above to require non-defaulting
Underwriters to purchase Designated Securities of a defaulting Underwriter or
Underwriters, then the Pricing Agreement relating to such Designated Securities
shall thereupon terminate, without liability on the part of any non-defaulting
Underwriter or the Company, except for the expenses to be borne by the Company
and the Underwriters as provided in Section 6 hereof and the indemnity and
contribution agreements in Section 8 hereof; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Company and the several Underwriters, as set forth
in this Agreement or made by or on behalf of them, respectively, pursuant to
this Agreement, shall remain in full force and effect, regardless of any
investigation (or any statement as to the results thereof) made by or on behalf
of any Underwriter or any controlling person of any Underwriter, or the Company,
or any officer or director or controlling person of the Company, and shall
survive delivery of and payment for the Securities.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, the Company shall not then be under any liability to any Underwriter
with respect to the Designated Securities covered by such Pricing Agreement
except as provided in Sections 6 and 8 hereof; but, if for any other reason
Designated Securities are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through the
Representatives for all out-of-pocket expenses approved in writing by the
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Representatives, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of such Designated Securities, but the Company shall then be under no
further liability to any Underwriter with respect to such Designated Securities
except as provided in Sections 6 and 8 hereof.
12. In all dealings hereunder, the Representatives of the Underwriters of
Designated Securities shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be delivered or sent by mail,
telex or facsimile transmission to the address of the Company set forth in the
Registration Statement: Attention: Secretary; provided, however, that any notice
to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by
mail, telex or facsimile transmission to such Underwriter at its address set
forth in its Underwriters' Questionnaire, or telex constituting such
Questionnaire, which address will be supplied to the Company by the
Representatives upon request. Any such statements, requests, notices or
agreements shall take effect upon receipt thereof.
13. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, the Company and, to the extent
provided in Sections 8 and 10 hereof, the officers and directors of the Company
and each person who controls the Company or any Underwriter, and their
respective heirs, executors, administrators, successors and assigns, and no
other person shall acquire or have any right under or by virtue of this
Agreement or any such Pricing Agreement. No purchaser of any of the Securities
from any Underwriter shall be deemed a successor or assign by reason merely of
such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used
herein, "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business and "New York Business Day" shall mean
each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in The City of New York, New York are generally authorized
or obligated by law or executive order to close.
15. This Agreement and each Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
16. This Agreement and each Pricing Agreement may be executed by any one
or more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
17. This Underwriting Agreement may be terminated by the Company or the
Underwriters at any time with respect to Securities that are not the subject of
a Pricing Agreement.
18
<PAGE>
If the foregoing is in accordance with your understanding, please sign and
return to us four copies hereof.
Very truly yours,
Premark International, Inc.
By: __________________________
Name:
Title:
Accepted as of the date hereof:
__________________________
(Goldman, Sachs & Co.)
19
<PAGE>
ANNEX I
Pricing Agreement
-----------------
[Goldman, Sachs & Co.,
As Representatives of the
Several Underwriters,
named in Schedule I hereto
85 Broad Street,
New York, New York 10004.]
____________ __, ____
Ladies and Gentlemen:
Premark International, Inc., a Delaware corporation (the "Company"),
proposes, subject to the terms and conditions stated herein and in the
Underwriting Agreement, dated __________ __, 1998 (the "Underwriting
Agreement"), between the Company on the one hand and Goldman, Sachs & Co. on the
other hand, to issue and sell to the Underwriters named in Schedule I hereto
(the "Underwriters") the Securities specified in Schedule II hereto (the
"Designated Securities"). Each of the provisions of the Underwriting Agreement
is incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Pricing Agreement to the same extent as if such provisions had been
set forth in full herein; and each of the representations and warranties set
forth therein shall be deemed to have been made at and as of the date of this
Pricing Agreement, except that each representation and warranty which refers to
the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be
a representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives herein
and in the provisions of the Underwriting Agreement so incorporated by reference
shall be deemed to refer to you. Unless otherwise defined herein, terms defined
in the Underwriting Agreement are used herein as therein defined. The
Representatives designated to act on behalf of the Representatives and on behalf
of each of the Underwriters of the Designated Securities pursuant to Section 12
of the Underwriting Agreement and the address of the Representatives referred to
in such Section 12 are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you, is now proposed to be filed with the
Commission.
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, the Company agrees to
issue and sell to each of the Underwriters, and each of the Underwriters agrees,
severally and not jointly, to purchase from the Company, at the time and place
and at the purchase price to the Underwriters set forth in Schedule II hereto,
the principal amount of Designated Securities set forth opposite the name of
such Underwriter in Schedule I hereto.
I-1
<PAGE>
If the foregoing is in accordance with your understanding, please sign and
return to us _______ copies hereof, and upon acceptance hereof by you, on behalf
of each of the Underwriters, this letter and such acceptance hereof, including
the provisions of the Underwriting Agreement incorporated herein by reference,
shall constitute a binding agreement between each of the Underwriters and the
Company. It is understood that your acceptance of this letter on behalf of each
of the Underwriters is or will be pursuant to the authority set forth in a form
of Agreement among Underwriters, the form of which shall be submitted to the
Company for examination upon request, but without warranty on the part of the
Representatives as to the authority of the signers thereof.
Very truly yours,
Premark International, Inc.
By: __________________________
Name:
Title:
Accepted as of the date hereof:
[Goldman, Sachs & Co.
__________________________
(Goldman, Sachs & Co.)]
I-2
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Principal
Amount of
Designated
Securities to be
Underwriter Purchased
- ----------- ---------
<S> <C>
Goldman, Sachs & Co. $
_______
Total $
=======
</TABLE>
I-3
<PAGE>
SCHEDULE II
Title of Designated Securities:
[ %] [Floating Rate] [Zero Coupon] [Notes]
[Debentures] due ____________________ __, ____
Aggregate principal amount:
[$]
Price to Public:
% of the principal amount of the Designated Securities, plus accrued
interest[, if any,] from ____________________ __, ____ to
____________________ __, ____ [and accrued amortization [, if any,] from
____________________ __, ____ to ____________________ __, ____ ]
Purchase Price by Underwriters:
% of the principal amount of the Designated Securities, plus accrued
interest from ____________________ __, ____ to ____________________ __,
____ [and accrued amortization[, if any,] from ____________________ __,
____ to ____________________ __, ____ ]
Form of Designated Securities:
Book-entry only form represented by one or more global securities deposited
with The Depository Trust Company ("DTC") or its designated custodian, to
be made available for checking by the Representatives at least twenty-four
hours prior to the Time of Delivery at the office of DTC.
Specified funds for payment of purchase price:
Federal (same day) funds
Time of Delivery:
____ a.m. (New York City time), ________ __, ____
Indenture:
Indenture dated September 15, 1990 between the Company and The First
National Bank of Chicago, as Trustee
Maturity:
Interest Rate:
[ %] [Zero Coupon] [See Floating Rate Provisions]
Interest Payment Dates:
[months and dates, commencing ________ __, ____]
I-4
<PAGE>
Redemption Provisions:
[No provisions for redemption]
[The Designated Securities may be redeemed, otherwise than through the
sinking fund, in whole or in part at the option of the Company, in the
amount of [$] or an integral multiple thereof,
[on or after ________ __, ____ at the following redemption prices
(expressed in percentages of principal amount). If [redeemed on or before
________ __, ____, ___%, and if] redeemed during the 12-month period
beginning ________ __, ____
<TABLE>
<CAPTION>
Redemption
Year Price
---- -----
<S> <C>
</TABLE>
and thereafter at 100% of their principal amount, together in each case
with accrued interest to the redemption date.]
[on any interest payment date falling on or after ________ __, ____, at the
election of the Company, at a redemption price equal to the principal
amount thereof, plus accrued interest to the date of redemption.]]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
[Restriction on refunding]
Sinking Fund Provisions:
[No sinking fund provisions]
[The Designated Securities are entitled to the benefit of a sinking fund to
retire [$ ] principal amount of Designated Securities on ________
in each of the years ________ through ________ at 100% of their principal
amount plus accrued interest[, together with [cumulative] [noncumulative]
redemptions at the option of the Company to retire an additional [$
] principal amount of Designated Securities in the years ________ through
________ at 100% of their principal amount plus accrued interest.]
[If Designated Securities are extendable debt securities, insert--
Extendable provisions:
Designated Securities are repayable on __________ __, ____, at the option
of the holder, at their principal amount with accrued interest. The
initial annual interest rate will be ____%, and thereafter the annual
interest rate will be adjusted on __________ __, ____, and to a
rate not less than ____% of the effective annual interest rate on U.S.
Treasury obligations with ____-year maturities as of the [insert date 15
days prior to maturity date] prior to such [insert maturity date].]
[If Designated Securities are floating rate debt securities, insert--
I-5
<PAGE>
Floating rate provisions:
Initial annual interest rate will be ____% through ________ [and thereafter
will be adjusted [monthly] [on each ____, ____, ____ and ____] [to an
annual rate of ____% above the average rate for ____-year
[month][securities][certificates of deposit] issued by ________________ and
________________ [insert names of banks].] [and the annual interest rate
[thereafter] [from ________ through ________] will be the interest yield
equivalent of the weekly average per annum market discount rate for ____-
month Treasury bills plus ____% of Interest Differential (the excess, if
any, of (i) the then current weekly average per annum secondary market
yield for ____-month certificates of deposit over (ii) the then current
interest yield equivalent of the weekly average per annum market discount
rate for ____-month Treasury bills); [from ________ __, ____ and thereafter
the rate will be the then current interest yield equivalent plus ____% of
Interest Differential].]
Defeasance provisions:
Closing location for delivery of Designated Securities:
Sullivan & Cromwell, 125 Broad Street, New York, New York 10004
Additional Closing Conditions:
Names and addresses of Representatives:
Designated Representatives: Goldman, Sachs & Co.
Address for Notices, etc.: 85 Broad Street, New York, New York 10004,
Attention: __________________
[Other Terms]:
I-6
<PAGE>
ANNEX II
Pursuant to Section 7(d) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect to
the Company and its subsidiaries within the meaning of the Act and the
applicable published rules and regulations thereunder;
(ii) In their opinion, the financial statements and any supplementary
financial information and schedules audited (and, if applicable, financial
forecasts and/or pro forma financial information) examined by them and
included or incorporated by reference in the Registration Statement or the
Prospectus comply as to form in all material respects with the applicable
accounting requirements of the Act or the Exchange Act, as applicable, and
the related published rules and regulations thereunder; and, if applicable,
they have made a review in accordance with standards established by the
American Institute of Certified Public Accountants of the consolidated
interim financial statements, selected financial data, pro forma financial
information, financial forecasts and/or condensed financial statements
derived from audited financial statements of the Company for the periods
specified in such letter, as indicated in their reports thereon, copies of
which have been furnished to the representative or representatives of the
Underwriters (the "Representatives"), such term to include an Underwriter
or Underwriters who act without any firm being designated as its or their
representatives and are attached hereto;
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the
Prospectus and/or included in the Company's quarterly report on Form 10-Q
incorporated by reference into the Prospectus as indicated in their reports
thereon copies of which are attached hereto; and on the basis of specified
procedures including inquiries of officials of the Company who have
responsibility for financial and accounting matters regarding whether the
unaudited condensed consolidated financial statements referred to in
paragraph (vi)(A)(i) below comply as to form in all material respects with
the applicable accounting requirements of the Act and the Exchange Act and
the related published rules and regulations, nothing came to their
attention that caused them to believe that the unaudited condensed
consolidated financial statements do not comply as to form in all material
respects with the applicable accounting requirements of the Act and the
Exchange Act and the related published rules and regulations;
(iv) The unaudited selected financial information with respect to the
consolidated results of operations and financial position of the Company
for the five most recent fiscal years included in the Prospectus and
included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for five such fiscal years
II-1
<PAGE>
which were included or incorporated by reference in the Company's Annual
Reports on Form 10-K for such fiscal years;
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or incorporated
by reference in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the Exchange Act and the related published rules and regulations,
or (ii) any material modifications should be made to the unaudited
condensed consolidated statements of income, consolidated balance
sheets and consolidated statements of cash flows included in the
Prospectus or included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus for them to be in
conformity with generally accepted accounting principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included in
the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or
II-2
<PAGE>
incorporated by reference in the Company's Annual Report on Form 10-K
for the most recent fiscal year;
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the published rules and
regulations thereunder or the pro forma adjustments have not been
properly applied to the historical amounts in the compilation of those
statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current assets or
shareholders' equity or other items specified by the Representatives,
or any increases in any items specified by the Representatives, in
each case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in
each case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in clause (E) there were any decreases
in consolidated net revenues or operating profit or the total or per
share amounts of consolidated net income or other items specified by
the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period
of the preceding year and with any other period of corresponding
length specified by the Representatives, except in each case for
increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(vii) In addition to the audit referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an audit in accordance with
generally accepted auditing standards, with respect to certain amounts,
percentages and financial information specified by the Representatives
which are derived from the general accounting records of the Company and
its subsidiaries, which appear in the Prospectus (excluding documents
incorporated by reference), or in Part II of, or in exhibits and schedules
to, the Registration Statement specified by the Representatives or in
documents incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts, percentages and
financial information with
II-3
<PAGE>
the accounting records of the Company and its subsidiaries and have found
them to be in agreement.
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Securities for
purposes of the letter delivered at the Time of Delivery for such Designated
Securities.
II-4
<PAGE>
Exhibit 5
Premark International, Inc.
1717 Deerfield Road
Deerfield, Illinois 60015
Re: $150,000 Principal Amount of Debt Securities
Ladies and Gentlemen:
We refer to the Registration Statement on Form S-3 (the "Registration
Statement") being filed by Premark International, Inc. (the "Company") with the
Securities and Exchange Commission (the "SEC") under the Securities Act of 1933,
as amended (the "Securities Act"), relating to the shelf registration of
$150,000,000 principal amount of the Company's debt securities (the "Debt
Securities"). The Debt Securities are to be issued under an Indenture to be
dated as of September 15, 1990 between the Company and The First National Bank
of Chicago, as Trustee (the "Trustee").
We are familiar with the proceedings to date with respect to the proposed
issuance and sale of the Debt Securities and have examined such records,
documents and questions of law, and satisfied ourselves as to such matters of
fact, as we have considered relevant and necessary as a basis for this opinion.
Based on the foregoing, we are of the opinion that:
1. The Company is duly incorporated and validly existing under the laws
of the State of Delaware.
2. The Company has corporate power and authority to execute and deliver
the Indenture and to authorize and sell the Debt Securities.
3. Each series of Debt Securities will be legally issued and binding
obligations of the Company (except to the extent A may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent
transfer or other similar laws affecting the enforcement of creditors' rights
generally and by the effect of general principles of equity, regardless of
whether enforceability is considered in a proceeding in equity or at law) when
(i) the Registration Statement, as finally amended (including any necessary
post-effective amendments), shall have become effective under the Securities Act
and the Indenture (including any necessary supplemental indenture) shall have
been qualified under the Trust Indenture Act of 1939, as amended, and duly
executed and delivered by the Company and the Trustee; (ii) a Prospectus
Supplement with respect to such series of Debt Securities shall have been filed
(or mailed for filing) with the SEC pursuant to Rule 424 under the Securities
Act; (iii) the Company's Board of Directors or a duly authorized committee
thereof shall have duly adopted final resolutions authorizing the issuance and
sale of such series of Debt Securities as contemplated by the Registration
Statement and the Indenture; and (iv) such series of Debt Securities shall have
been duly executed and authenticated as provided in the Indenture and such
resolutions and shall have been duly delivered to the purchasers thereof against
payment of the agreed consideration therefor.
We do not find it necessary for the purposes of this opinion to cover,
and accordingly we express no opinion as to, the application of the securities
or blue sky laws of the various states to sales of the Debt Securities.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to all references to our firm included in or made a
part of the Registration Statement.
Very truly yours
SIDLEY & AUSTIN
<PAGE>
Exhibit 23(a)
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) and related Prospectus of Premark
International, Inc. for the registration of $150,000,000 of debt securities and
to the incorporation by reference therein of our report dated February 6, 1998,
with respect to the 1997 consolidated financial statements and schedules of
Premark International, Inc. included in its Annual Report (Form 10-K) for the
year ended December 27, 1997, filed with the Securities and Exchange Commission.
Ernst & Young LLP
Chicago, Illinois
October _, 1998
<PAGE>
Exhibit 23(b)
Consent of Independent Accountants
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report dated
February 14, 1997 appearing as Exhibit 99.1 of Premark International, Inc.'s
Annual Report on Form 10-K for the fiscal year ended December 27, 1997. We also
consent to the reference to us under the heading "Experts" in such Prospectus.
PRICEWATERHOUSECOOPERS LLP
Chicago, Illinois
October _, 1998
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
--------
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b)(2)
--------------------
THE FIRST NATIONAL BANK OF CHICAGO
(Exact name of trustee as specified in its charter)
A National Banking Association 36-0899825
(I.R.S. employer
identification number)
One First National Plaza, Chicago, Illinois 60670-0126
(Address of principal executive offices) (Zip Code)
The First National Bank of Chicago
One First National Plaza, Suite 0286
Chicago, Illinois 60670-0286
Attn: Lynn A. Goldstein, Law Department (312) 732-6919
(Name, address and telephone number of agent for service)
--------------------
Premark International, Inc.
(Exact name of obligors as specified in their trust agreements)
Delaware 36-3461320
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification number)
1717 Deerfield Road
Deerfield, Illinois 60015
(Address of principal executive offices) (Zip Code)
Debt Securities
(Title of Indenture Securities)
<PAGE>
Item 1. General Information. Furnish the following
information as to the trustee:
(a) Name and address of each examining or
supervising authority to which it is subject.
Comptroller of Currency, Washington, D.C.;
Federal Deposit Insurance Corporation,
Washington, D.C.; The Board of Governors of
the Federal Reserve System, Washington D.C.
(b) Whether it is authorized to exercise
corporate trust powers.
The trustee is authorized to exercise corporate
trust powers.
Item 2. Affiliations With the Obligor. If the obligor
is an affiliate of the trustee, describe each
such affiliation.
No such affiliation exists with the trustee.
Item 16. List of exhibits. List below all exhibits filed as a
part of this Statement of Eligibility.
1. A copy of the articles of association of the
trustee now in effect.*
2. A copy of the certificates of authority of the
trustee to commence business.*
3. A copy of the authorization of the trustee to
exercise corporate trust powers.*
4. A copy of the existing by-laws of the trustee.*
5. Not Applicable.
6. The consent of the trustee required by
Section 321(b) of the Act.
2
<PAGE>
7. A copy of the latest report of condition of the
trustee published pursuant to law or the
requirements of its supervising or examining
authority.
8. Not Applicable.
9. Not Applicable.
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, The First National Bank of Chicago, a national
banking association organized and existing under the laws of the United
States of America, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago and State of Illinois, on the 19th day of October,
1998.
The First National Bank of Chicago,
Trustee
By ___________________________________________
Steven M. Wagner
First Vice President
* Exhibit 1, 2, 3 and 4 are herein incorporated by reference to Exhibits bearing
identical numbers in Item 16 of the Form T-1 of The First National Bank of
Chicago, filed as Exhibit 25 to the Registration Statement on Form S-3 of
U S WEST Capital Funding, Inc., filed with the Securities and Exchange
Commission on May 6, 1998 (Registration No. 333-51907-01).
3
<PAGE>
EXHIBIT 6
THE CONSENT OF THE TRUSTEE REQUIRED
BY SECTION 321(b) OF THE ACT
October 19, 1998
Securities and Exchange Commission
Washington, D.C. 20549
Gentlemen:
In connection with the qualification of an indenture of Premark International,
Inc. to The First National Bank of Chicago, as Trustee, the undersigned, in
accordance with Section 321(b) of the Trust Indenture Act of 1939, as amended,
hereby consents that the reports of examinations of the undersigned, made by
Federal or State authorities authorized to make such examinations, may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
Very truly yours,
The First National Bank of Chicago
By: ______________________________________
Steven M. Wagner
First Vice President
4
<PAGE>
EXHIBIT 7
<TABLE>
<CAPTION>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-1
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for June 30, 1998
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding of the last business day of the
quarter.
Schedule RC--Balance Sheet
Dollar Amounts in thousands C400
----------
ASSETS
<S> <C> <C> <C> <C>
1. Cash and balances due from depository institutions (from Schedule
RC-A): RCFD
----
a. Noninterest-bearing balances and currency and coin(1).......... 0081 4,490,272 1.a
b. Interest-bearing balances(2)................................... 0071 5,586,990 1.b
2. Securities:
a. Held-to-maturity securities (from Schedule RC-B, column A)..... 1754 0 2.a
b. Available-for-sale securities (from Schedule RC-B, column D)... 1773 8,974,952 2.b
3. Federal funds sold and securities purchased under agreements to
resell............................................................. 1350 5,558,583 3.
4. Loans and lease financing receivables: RCFD
a. Loans and leases, net of unearned income (from Schedule ----
RC-C).......................................................... 2122 28,257,868
b. LESS: Allowance for loan and lease losses...................... 3123 413,742
c. LESS: Allocated transfer risk reserve.......................... 3128 0
RCFD
d. Loans and leases, net of unearned income, allowance, and ----
reserve (item 4.a minus 4.b and 4.c)........................... 2125 27,844,126 4.d
5. Trading assets (from Schedule RD-D)................................ 3545 6,073,169 5.
6. Premises and fixed assets (including capitalized leases)........... 2145 721,430 6.
7. Other real estate owned (from Schedule RC-M)....................... 2150 6,827 7.
8. Investments in unconsolidated subsidiaries and associated
companies (from Schedule RC-M)..................................... 2130 184,515 8.
9. Customers' liability to this bank on acceptances outstanding....... 2155 310,026 9.
10. Intangible assets (from Schedule RC-M)............................. 2143 302,859 10.
11. Other assets (from Schedule RC-F).................................. 2160 2,137,491 11.
12. Total assets (sum of items 1 through 11)........................... 2170 62,191,240 12.
</TABLE>
- ------------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
Legal Title of Bank: The First National Bank of Chicago Call Date: 06/30/98 ST-BK: 17-1630 FFIEC 031
Address: One First National Plaza, Ste 0460 Page RC-2
City, State Zip: Chicago, IL 60670
FDIC Certificate No.: 0/3/6/1/8
---------
</TABLE>
Schedule RC-Continued
<TABLE>
<CAPTION>
Dollar Amounts in
Thousands
-----------------
<S> <C> <C> <C> <C>
LIABILITIES
13. Deposits:
RCON
a. In domestic offices (sum of totals of columns A and C ----
from Schedule RC-E, part 1)................................ 2200 21,810,607 13.a
(1) Noninterest-bearing(1)................................. 6631 9,864,956 13.a1
Interest-bearing........................................... 6636 11,945,651 13.a2
RCFN
b. In foreign offices, Edge and Agreement subsidiaries, and ----
IBFs (from Schedule RC-E, part II)......................... 2200 15,794,963 13.b
(1) Noninterest bearing.................................... 6631 482,528 13.b1
(2) Interest-bearing....................................... 6636 15,312,435 13.b2
14. Federal funds purchased and securities sold under agreements
to repurchase: RCFD 2800 3.858,711 14
15. a. Demand notes issued to the U.S. Treasury RCON 2840 1,444,748 15.a
Trading Liabilities(from Sechedule RC-D)...................... RCFD 3548 5,661,633 15.b
RCFD
16. Other borrowed money: ----
a. With original maturity of one year or less................. 2332 4,356,061 16.a
b. With original maturity of more than one year............... A547 385,550 16.b
c. With original maturity of more than three years YYYY....... A548 320,386 16.c
17. Not applicable
18. Bank's liability on acceptance executed and outstanding....... 2920 310,026 18.
19. Subordinated notes and debentures............................. 3200 2,200,000 19.
20. Other liabilities (from Schedule RC-G)........................ 2930 1,176,564 20.
21. Total liabilities (sum of items 13 through 20)................ 2948 57,319,249 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus................. 3838 0 23.
24. Common stock.................................................. 3230 200,858 24.
25. Surplus (exclude all surplus related to preferred stock)...... 3839 3,188,187 25.
26. a. Undivided profits and capital reserves 3632 1,467,324 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities.................................................... 8434 18,040 26.b
27. Cumulative foreign currency translation adjustments........... 3284 (2,418) 27.
28. Total equity capital (sum of items 23 through 27)............. 3210 4,871,991 28.
29. Total liabilities, limited-life preferred stock, and equity
capital (sum of items 21, 22, and 28)......................... 3300 62,191,240 29.
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best
describes the most comprehensive level of auditing work performed for the bank Number
by independent external auditors as of any date during 1996...............RCFD 6724..... M.1.
</TABLE>
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
- -------------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
