Subject to Completion, dated December 11, 1995
PRELIMINARY PROSPECTUS SUPPLEMENT
(To Prospectus dated September 4, 1992)
$150,000,000
Harnischfeger Industries, Inc.
% Debentures due , 2025
--------------------
Interest Payable and
--------------------
The Debentures will mature on , 2025. The
Debentures are not redeemable prior to maturity and are not
subject to any sinking fund. Interest on the Debentures is
payable semi-annually on and of each
year, commencing , 1996. The Debentures will
be issued in the form of one or more Global Securities (the
"Global Securities") registered in the name of The
Depository Trust Company as Depositary (the "Depositary").
Beneficial interests in the Global Securities will be shown
on, and transfer will be effected only through, records
maintained by the Depositary and its participants. Except
as described herein, Debentures in definitive form will not
be issued. See "Description of the Debentures." The
Debentures will trade in the Depositary's Same-Day Funds
Settlement System until maturity, and secondary market
trading activity for the Debentures will therefore settle
in immediately available funds. All payments of principal
and interest will be made in immediately available funds.
See "Description of the Debentures - Same-Day Settlement
and Payment."
------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON
THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR
THE ACCOMPANYING PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE.
- -----------------------------------------------------------
- -----------------------------------------------------------
Price to Underwriting Proceeds to
Public(1) Discount(2) Company(1)(3)
- -----------------------------------------------------------
Per Debenture % % %
- -----------------------------------------------------------
Total $ $ $
- -----------------------------------------------------------
- -----------------------------------------------------------
(1) Plus accrued interest, if any, from , 1995
to date of delivery.
(2) The Company has agreed to indemnify the Underwriters
against certain liabilities, including liabilities
under the Securities Act of 1933, as amended. See
"Underwriting."
(3) Before deduction of expenses payable by the Company
estimated at .
------------------------------
The Debentures offered by this Prospectus Supplement
are offered by the Underwriters subject to prior sale,
withdrawal, cancellation or modification of the offer
without notice, to delivery to and acceptance by the
Underwriters and to certain further conditions. It is
expected that delivery of the Debentures will be made in
book-entry form through the facilities of the Depositary,
against payment therefor in immediately available funds, on
or about December , 1995.
----------------------------------
LEHMAN BROTHERS SALOMON BROTHERS INC
CHEMICAL SECURITIES INC.
FIRST CHICAGO CAPITAL MARKETS, INC.
RBC DOMINION SECURITIES CORPORATION
December , 1995
<PAGE>
IN CONNECTION WITH THIS OFFERING, THE UNDERWRITERS
MAY OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR
MAINTAIN THE MARKET PRICE OF THE DEBENTURES OFFERED HEREBY
AT A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE
OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the year
ended October 31, 1994, the Company's Current Reports on
Form 8-K dated December 13, 1994, January 17, 1995,
February 17, 1995, June 9, 1995, September 1, 1995, October
11, 1995, October 26, 1995, December 4 and December 8, 1995
and the Company's Quarterly Reports on Form 10-Q for the
quarters ended January 31, 1995, April 30, 1995 and July
31, 1995, and on Form 10-QA for the quarter ended January
31, 1995, each of which has been filed by the Company with
the Commission, are incorporated herein by reference.
All documents filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of this Prospectus
Supplement and prior to the termination of the offering of
the Debentures shall be deemed to be incorporated by
reference in this Prospectus Supplement and to be a part
hereof 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 Supplement and
the accompanying Prospectus to the extent that a statement
contained herein or in any other 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 Supplement or the accompanying
Prospectus.
The Company will provide without charge to each
person, including any beneficial owner to whom this
Prospectus Supplement is delivered, upon written or oral
request of such person, a copy of any document incorporated
by reference in this Prospectus Supplement or the
accompanying Prospectus, other than exhibits to any such
document not specifically described above. Requests for
such documents should be directed to Harnischfeger
Industries, Inc., 13400 Bishops Lane, Brookfield, Wisconsin
53005, Attention: Corporate Secretary (Telephone Number
(414) 671-4400).
<PAGE>
RECENT DEVELOPMENT
On December 4, 1995, Harnischfeger Industries, Inc.
("Harnischfeger" or the "Company") acquired substantially
all of the stock of Dobson Park Industries plc ("Dobson
Park") in a transaction valued at approximately $330
million, plus the assumption of approximately $40 million
million of debt. For the year ended September 30, 1995,
Dobson Park had net profits of $9.5 million on sales of
$427 million.
Dobson Park is a manufacturer of mining equipment,
industrial electronic control systems, toys and plastics.
Dobson Park's principal subsidiary, Longwall International,
is engaged in the manufacture, sale and service of mining
equipment for the international underground coal mining
industry. Its principal products include electronically
controlled hydraulic roof support systems, armored face
conveyors, pumps and belt conveyor components and systems.
For the year ended September 30, 1995, Longwall
International had operating profits of $22 million on sales
of $373 million.
THE COMPANY
Harnischfeger is an international holding company
with business segments involved in the manufacture and
distribution of equipment for papermaking (Beloit
Corporation); surface mining (P&H Mining Equipment) and
underground mining (Joy Mining Machinery); and material
handling (P&H Material Handling). Harnischfeger is the
direct successor to a business begun over 100 years ago
which, at October 31, 1995, through its subsidiaries,
manufactures and markets products classified into three
industry segments: Papermaking Machinery and Systems,
Mining Equipment, and Material Handling.
Papermaking Machinery and Systems
The Papermaking Machinery and Systems Group is
comprised of the Company's 80% interest in Beloit
Corporation ("Beloit"). Mitsubishi Heavy Industries, Ltd.
("Mitsubishi") is the owner of the remaining 20% interest
in Beloit. The Company and Mitsubishi have entered into
certain agreements that provide Mitsubishi with the right
to designate one of Beloit's five directors. These
agreements also place certain restrictions on the transfer
of Beloit stock. In the event of a change in control of
the Company, Mitsubishi has the right to sell its 20%
interest back to the Company for the greater of $60 million
or the book value of its equity interest. Beloit is a
leader in the design and manufacture of papermaking
machinery and related products used in the pulp and paper
industries. Beloit operates on a global basis with major
manufacturing facilities in seven countries and sales and
service offices located throughout the world. In addition,
licensing arrangements exist with several major foreign
companies. Beloit's activities concerning papermaking
equipment and systems are divided into the following
principal categories: the design, manufacture, sale and
installation of integrated papermaking equipment systems;
major rebuilds and servicing of existing systems; and the
sale of ancillary equipment and replacement parts. This
machinery is often custom designed to meet the specific
needs of each customer. Beloit is known for the quality
and dependability of its products and is a leader in
product innovation and development. Beloit has made a
continuous commitment to research and development
activities, and has been granted numerous patents on its
designs. Beloit systems and equipment are used by a
substantial number of paper producers, both domestic and
foreign, and Beloit's installed base of equipment exceeds
that of any of its competitors. A major factor in Beloit's
success in the paper machinery industry has been its
international manufacturing operations. Beloit's overseas
facilities have been used to support both domestic and
foreign sales and have provided Beloit with the flexibility
to shift its manufacturing to more favorable locations as
appropriate. In addition, Beloit has at times been able to
take advantage of favorable export financing provided by
certain foreign governments. Beloit's manufacturing
facilities are supported by a domestic and international
marketing network staffed by experienced sales engineers.
Mining Equipment
P & H Mining Equipment is the world's largest
producer of electric mining shovels and is a significant
producer of electric and diesel-electric crawler and
walking draglines, hydraulic mining excavators, blasthole
drills, and electric shovels, dredge and dragline bucket
products. P & H Mining Equipment products are used in
mines, quarries and earth-moving operations in the digging
and loading of minerals and ores such as coal, copper,
gold, iron ore, lead, zinc, bauxite, uranium, phosphate,
stone and clay. P & H Mining Equipment has a significant
relationship in the mining shovel business with Kobe Steel,
Ltd. ("Kobe") pursuant to which P & H Mining Equipment
licenses Kobe to manufacture certain electric mining
shovels and related replacement parts in Japan. P & H
Mining Equipment has the exclusive right to market Kobe-
manufactured mining shovels and parts outside Japan (except
in the case of certain government sales). In addition, P &
H Mining Equipment is party to an agreement, through 1996,
with a corporate unit of the People's Republic of China,
licensing the manufacture and sale of two models of
electric mining shovels and related components. This
relationship provides
<PAGE>
P & H Mining Equipment with an opportunity to sell
component parts for shovels built in China.
In November 1994, the Company acquired Joy
Technologies Inc., a world leader in underground mining
equipment in an exchange of common stock. Its Joy Mining
Machinery division manufactures and services mining
equipment for the underground extraction of coal and other
bedded deposits and has facilities in Australia, South
Africa, the United Kingdom and the United States, as well
as sales offices in both Poland and the People's Republic
of China. Joy Mining Machinery designs, manufactures and
distributes continuous miners, entry drivers and sump
shearers, long-wall shearers, shuttle cars, and continuous
haulage systems for use in underground mining and highwall
mining systems for above ground mining. Joy Mining
Machinery also maintains an extensive network of service
and spare parts distribution centers to rebuild and service
equipment and sell spare parts in support of its installed
base. This network includes six service centers in the
United States and four outside of the United States, all of
which are strategically located in major underground mining
regions.
Material Handling Equipment
P & H Material Handling designs, manufactures, sales
installs and services lines of through-the-air material
handling equipment designed for a variety of uses as well
as container handling cranes for use in ports. P & H
Material Handling is comprised of six business groups:
P&H Equipment, Products Support, PHoenix , Distribution
and Service, Morris Engineered Products Division and
Morris Standard Products Division. As a result of recent
acquisitions and a change in business strategy, P&H
Material Handling changed the focus of its business from
North America to a worldwide presence.
USE OF PROCEEDS
The net proceeds to be received by the Company from
the sale of the Debentures will initially be added to the
general corporate funds of the Company. While such funds
may be used for general corporate purposes, it is expected
that the entire net proceeds will be used to refinance a
portion of the bank indebtedness incurred in the
acquisition of Dobson Park. As of December 11, 1995,
borrowings under the Credit Agreement among the Company and
royal Bank of Canada, Chemical Bank and The First National
Bank of Cicago were $200 million, bore interest at 6.175%
and were required to be repaid no later than February 27,
1996.
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges for the
Company is defined as income before provision for income
taxes and minority interest plus interest expense
(including amortization of debt issuance expense), the
portion of rental expense which represents interest (deemed
to be one-third of rentals) and dividends received on
less-than-fifty-percent-owned companies, reduced by equity
income recorded on less-than-fifty-percent-owned companies,
divided by fixed charges. Fixed charges include interest
expense (including amortization of debt issuance expense)
and the portion of rental expense which represents
interest. Earnings did not cover fixed charges by $47.4
million in 1993.
Fiscal Years Ended October 31,
--------------------------------
1995 1994 1993 1992 1991
---- ---- ---- ---- ----
Ratio of Earnings
to Fixed Charges: 3.60 1.87 --- 2.05 2.40
---- ---- ---- ---- ----
---- ---- ---- ---- ----
DESCRIPTION OF THE DEBENTURES
The following description of the particular terms of
the Debentures offered hereby (referred to in the
Prospectus as "Securities") supplements and, to the extent
inconsistent therewith replaces, the description of the
general terms and provisions of the Securities set forth in
the accompanying Prospectus, to which description reference
is hereby made.
General
The Debentures will be limited to an aggregate
principal amount of $150,000,000, will mature on ,
2025, and will be issued under an Indenture dated as of
March 1, 1992, as supplemented by a supplemental indenture
dated as of June 12, 1992 (collectively, the "Indenture"),
between the Company and First Trust of Illinois, National
Association, as trustee (the "Trustee"), which is
<PAGE>
described more fully in the accompanying Prospectus. The
following summaries of certain provisions of the Indenture
do not purport to be complete and are subject to, and are
qualified in their entirety by reference to, all provisions
of the Indenture, including the definition therein of
certain terms. Capitalized terms used herein and not
defined herein or on the cover page hereof shall have the
respective meanings set forth in the Indenture.
Each Debenture will bear interest at the rate of
% per annum from , 1995 or from the most recent
interest payment date to which interest has been paid,
payable semi-annually on and in each
year (each such date being hereinafter referred to as an
"Interest Payment Date"), commencing
, 1996, to the person in whose name such
Debenture is registered at the close of business on the
or , as the case may be, immediately
preceding such Interest Payment Dates. The Debentures will
be sold in denominations of $1,000 or any amount in excess
thereof which is an integral multiple of $1,000.
The Debentures will not be subject to redemption
prior to maturity at the option of the Company and will not
be entitled to the benefit of any sinking fund.
The Company is a holding company, conducting its
operations through its operating subsidiaries.
Accordingly, the Company's ability to service the
Debentures is dependent, in part, on its ability to obtain
dividends or loans from such operating subsidiaries. The
Debentures will be unsecured and will rank pari passu with
all other unsecured and unsubordinated indebtedness of the
Company. However, because the Company is a holding company
which conducts substantially all of its operations through
subsidiaries, the right of the Company, and hence the right
of creditors of the Company (including the Holders of the
Debentures), 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 the subsidiary, except to the
extent that claims of the Company itself as a creditor of
the subsidiary may be recognized.
The covenants in the Indenture would not necessarily
afford the holders of the Debentures protection in the
event of a decline in the Company's credit quality
resulting from highly leveraged or other transactions
involving the Company.
Book-Entry Securities
Except as otherwise provided in this Prospectus
Supplement or the Indenture, the Debentures will be
represented by one or more global securities ("Global
Securities") held in book-entry form. The Global Security
representing the Debentures will be deposited with, or on
behalf of, The Depository Trust Company ("DTC"), or other
successor depository appointed by the Company (DTC or such
other depository is herein referred to as the "Depository")
and registered in the name of the Depository or its
nominee. Unless otherwise provided in this Prospectus
Supplement or the Indenture, Debentures will not be issued
in definitive form.
DTC has advised the Company that DTC is a
limited-purpose trust company organized under the New York
Banking Law, a "banking organization" within the meaning of
the New York Banking Law, a member of the Federal Reserve
System, a "clearing corporation" within the meaning of the
New York Uniform Commercial Code, and a "clearing agency"
registered pursuant to the provisions of Section 17A of the
Securities Exchange Act of 1934. DTC holds securities that
its participants ("Participants") deposit with DTC. DTC
also facilitates the settlement among Participants of
securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-
entry changes in Participants' accounts, thereby
eliminating the need for physical movement of securities
certificates. Participants which have accounts directly
with DTC ("Direct Participants") include securities brokers
and dealers, banks, trust companies, clearing corporations
and certain other organizations. DTC is owned by a number
of its Direct Participants and by the New York Stock
Exchange, Inc., the American Stock Exchange, Inc. and the
National Association of Securities Dealers, Inc. Access to
the DTC system is also available to others such as
securities brokers and dealers, banks and trust companies
that clear through or maintain a custodial relationship
with a Direct Participant, either directly or indirectly
("Indirect Participants"). The Rules applicable to DTC and
its Participants are on file with the Securities and
Exchange Commission.
Upon the issuance by the Company of the Debentures
represented by a Global Security, purchases of the
Debentures under the DTC system must be made by or through
Direct Participants, which will receive a credit for the
Debentures on DTC's records. The ownership interest of
each actual purchaser of each Debenture ("Beneficial
Owner") is in turn to be recorded on the Direct and
Indirect Participants' records. Beneficial Owners will not
receive written confirmation from DTC of their purchase,
but Beneficial Owners are expected to receive written
confirmations providing details of the transaction, as well
as periodic statements of their holdings, from the Direct
or Indirect Participant through which the Beneficial Owner
entered into the transaction. Transfers of ownership
interests in the Debentures are to be accomplished by
entries made on the books of Participants acting on behalf
of Beneficial Owners. Beneficial Owners will not receive
certificates representing their ownership interests in the
Debentures, except in the event that use of the book-entry
system for the Debentures is discontinued. The laws of
some states require that certain purchasers of securities
take physical delivery of such securities in definitive
form. Such limits and such laws may impair the ability to
transfer beneficial interests in the Global Security.
So long as the Depository for the Global Security, or
its nominee, is the registered owner of the Global
Security, the Depository or its nominee, as the case may
be, will be considered the sole owner or holder of the
Debentures represented by such Global Security for all
purposes under the Indenture. Except as provided below,
<PAGE>
owners of beneficial interest in the Debentures represented
by the Global Security will not be entitled to have
Debentures represented by such Global Security registered
in their names, will not receive or be entitled to receive
physical delivery of the Debentures in definitive form and
will not be considered the owners or holders thereof under
the applicable Indenture.
To facilitate subsequent transfers, all Debentures
deposited by Participants with DTC are registered in the
name of DTC's partnership nominee, Cede & Co. The deposit
of the Debentures with DTC and their registration in the
name of Cede & Co. effect no change in beneficial
ownership. DTC has no knowledge of the actual Beneficial
Owners of the Debentures. DTC's records reflect only the
identity of the Direct Participants to whose accounts such
Debentures are credited, which may or may not be the
Beneficial Owners. The Participants will remain
responsible for keeping account of their holdings on behalf
of their customers. Conveyance of notices and other
communications by DTC to Direct Participants, by Direct
Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners
will be governed by arrangements among them, subject to any
statutory or regulatory requirements as may be in effect
from time to time.
Neither DTC nor Cede & Co. will consent or vote with
respect to Debentures. The Company has been advised that
under its usual procedures, DTC mails an Omnibus Proxy to
the issuer as soon as possible after the record date. The
Omnibus Proxy assigns Cede & Co.'s consenting or voting
rights to those Direct Participants to whose accounts the
Debentures are credited on the record date (identified in a
listing attached to the Omnibus Proxy).
Payments of principal of and interest, if any, on the
Debentures represented by the Global Security registered in
the name of DTC or its nominee will be made by the Company
though the Trustee under the Indenture or a paying agent
(the "Paying Agent"), which may also be the Trustee under
the Indenture, to DTC or its nominee, as the case may be,
as the registered owner of the Global Security. None of
the Company, the Trustee, any Paying Agent or the
Underwriters will have any responsibility or liability for
any aspect of the records relating to or payments made on
account of beneficial ownership interests of the Global
Security representing any Debentures or for maintaining,
supervising or reviewing any records relating to such
beneficial ownership interests.
The Company has been advised that DTC, upon receipt
of any payment of principal and interest in respect of a
Global Security, will credit Direct Participants' accounts
on the payable date in accordance with their respective
holdings shown on DTC's records unless DTC has reason to
believe that it will not receive payment on the payable
date. Payments by Participants to Beneficial Owners will
be governed by standing instructions and customary
practices, as is the case with securities held for the
accounts of customers in bearer form or registered in
"street name," and will be the responsibility of such
Participants and not of DTC, the Paying Agent, or the
Company, subject to any statutory or regulatory
requirements as may be in effect from time to time.
Payment of principal and interest to DTC is the
responsibility of the Company or the Paying Agent,
disbursement of such payments to Direct Participants shall
be the responsibility of DTC, and disbursement of such
payments to the Beneficial Owners shall be the
responsibility of Direct and Indirect Participants.
If the Depository with respect to a Global Security
is at any time unwilling or unable to continue as
Depository and a successor Depository is not appointed by
the Company within 90 days, the Company will issue
certificated debentures in exchange for the Debentures
represented by such Global Security.
The information in this section concerning the
Depository and the Depository's book-entry system has been
obtained from sources that the Company believes to be
reliable, but the Company takes no responsibility for the
accuracy thereof.
Same-Day Settlement and Payment
Settlement for the Debentures will be made by the
Underwriters in immediately available funds. All
<PAGE>
payments of principal and interest will be made by the
Company in immediately available funds.
The Debentures will trade in the Depositary's Same-
Day Funds Settlement System until maturity, and secondary
market trading activity in the Debentures will therefore be
required by the Depositary to settle in immediately
available funds. No assurance can be given as to the
effect, if any, of settlement in immediately available
funds on trading activity in the Debentures.
UNDERWRITING
Subject to the terms and conditions set forth in the
Distribution Agreement and Terms Agreement, the Company has
agreed to sell to each of the Underwriters named below, and
each of the Underwriters has severally agreed to purchase
from the Company, the principal amounts of the Debentures
set forth opposite its name below.
Principal
Amount
Underwriter of Debentures
Lehman Brothers Inc. $
Salomon Brothers Inc.
Chemical Securities, Inc.
First Chicago Capital Markets, Inc.
RBC Dominion Securities Corporation
Total $
The Distribution Agreement and the Terms Agreement
provide that the obligations of the Underwriters are
subject to certain conditions precedent and that the
Underwriters will be obligated to purchase all of the
Debentures if any are purchased.
The Underwriters have advised the Company that they
propose initially to offer the Debentures to the public at
the public offering price set forth on the cover page of
this Prospectus Supplement, and to certain dealers at such
price less a concession not in excess of [ ]% of the
principal amount of the Debentures. The Underwriters may
allow, and such dealers may reallow, a discount not in
excess of [ ]% of the principal amount of the Debentures
to certain other dealers. After the initial public
offering, the public offering price, concession and
discount may be changed.
The Company does not intend to list the Debentures on
any securities exchange or on the NASDAQ National Market
System. The Company has been advised by Lehman Brothers
Inc. and Saloman Brothers Inc that they presently intend to
make a market in the Debentures; however, they are not
obligated to do so, and market making with respect to the
Debentures may be discontinued at any time without notice.
There can be no assurance that an active public market for
the Debentures will develop.
The Company has agreed to indemnify the Underwriters
against certain liabilities, including liabilities under
the Securities Act of 1933, as amended, or to contribute to
payments the Underwriters may be required to make in
respect of such liabilities.
The proceeds of the offering will be used to repay
debts owed to affiliates of the following underwriters:
First Chicago Capital Markets, Inc., RBC Dominion
Securities Corporation and Chemical Securities Inc.
Certain of the Underwriters have provided from time
to time, and expect to provide in the future, financial
advisory and investment banking services to the Company and
its affiliates, for which such Underwriters have received
and will receive customary fees and commissions.
VALIDITY OF SECURITIES
The validity of the Debentures will be passed upon
for the Company by K. Thor Lundgren, General Counsel to the
Company, and Eric B. Fonstad, Senior Corporate Counsel to
the Company, and for the Underwriters by Mayer, Brown &
Platt, Chicago, Illinois, which may rely on the opinion of
K. Thor Lundgren or Eric B. Fonstad as to matters of
Wisconsin law.
<PAGE>
PROSPECTUS
$150,000,000
HARNISCHFEGER INDUSTRIES, INC.
Debt Securities
Harnischfeger Industries, Inc. (the "Company")
directly, through agents designated from time to time, or
through dealers or underwriters also to be designated, may
sell from time to time up to $150,000,000 aggregate
principal amount of its debt securities (the "Securities")
on terms to be determined at the time of sale. The
specific designation, aggregate principal amount,
maturities, rate (or method of calculation) and time of
payment of interest, purchase price, any terms for
redemption and the agent, dealer or underwriter, if any, in
connection with the sale of the Securities in respect of
which this Prospectus is being delivered and other terms of
the Securities are set forth in the accompanying Prospectus
Supplement ("Prospectus Supplement"). The Company reserves
the sole right to accept and, together with its agents from
time to time, to reject in whole or in part any proposed
purchase of Securities to be made directly or through
agents.
If an agent of the Company or a dealer or underwriter
is involved in the sale of the Securities in respect of
which this Prospectus is being delivered, the agent's
commission, dealer's purchase price, or underwriter's
discount will be set forth in, or may be calculated from,
the Prospectus Supplement and the net proceeds to the
Company from such sale will be the purchase price of such
Securities less such commission in the case of any agent,
the purchase price of such Securities in the case of a
dealer, or the public offering price less such discount in
the case of an underwriter and less, in each case, the
other attributable issuance expenses. The aggregate
proceeds to the Company from all the Securities will be the
purchase price of Securities sold less the aggregate of
agents' commissions and underwriters' discounts and other
expenses of issuance and distribution. See "Plan of
Distribution" for possible indemnification arrangements for
the agents, dealers and underwriters.
-----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES OMISSION 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 September 4, 1992
<PAGE>
No person is authorized to give any information or to
make any representations other than those contained in this
Prospectus, the Prospectus Supplement or any Pricing
Supplement and, if given or made, such information or
representation must not be relied upon as having been
authorized. This Prospectus, the Prospectus Supplement and
any Pricing Supplement do not constitute an offer to sell
or a solicitation of any offer to buy any securities other
than the securities offered by this Prospectus, the
Prospectus Supplement and any Pricing Supplement or an
offer to sell or a solicitation of an offer to buy such
securities in any jurisdiction to any person to whom it is
unlawful to make such offer or solicitation in such
jurisdiction. Neither the delivery of this Prospectus, the
Prospectus Supplement or any Pricing Supplement nor any
sale made thereunder shall, under any circumstances, create
any implication that there has been no change in the
affairs of the Company since the date of this Prospectus,
the Prospectus Supplement or any Pricing Supplement, or
that the information herein or therein is correct as of any
time since such date.
AVAILABLE INFORMATION
The Company is subject to the informational
requirements of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), and in accordance therewith
files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission").
Such reports, proxy statements and other information filed
by the Company with the Commission can be inspected, and
copies may be obtained, at the Public Reference Section of
the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549, at prescribed rates, as well as at the following
Regional Offices of the Commission: 75 Park Place, New
York, New York 10007; and 500 West Madison Street, Suite
1400, Chicago, Illinois 60661-2511. Reports, proxy
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., 233 South Beaudry
Street, Los Angeles, California 90012 and 301 Pine Street,
San Francisco, California 94014.
The Company has filed with the Commission a
Registration Statement on Form S-3 (the "Registration
Statement") under the Securities Act of 1933, as amended
(the "Securities Act"), covering the Securities. This
Prospectus and the accompanying Prospectus Supplement do
not contain all of the information set forth in the
Registration Statement, certain parts of which are omitted
in accordance with the rules and regulations of the
Commission. For further information, reference is hereby
made to the Registration Statement.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the year
ended October 31, 1991, the Company's Current Reports on
Form 8-K dated February 27, 1992, March 25, 1992, June 1,
1992, June 12, 1992 and August 24, 1992 and the Company's
Quarterly Reports on Form 10-Q for the quarters ended
January 31, 1992 and April 30, 1992, each of which has been
filed by the Company with the Commission, are incorporated
herein by reference.
All documents filed by the Company with the
Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Exchange Act after the date of this Prospectus and
prior to the termination of the offering of the Securities
shall be deemed to be incorporated by reference in this
Prospectus and to be a part hereof from the date of filing
of such documents. Any statement contained herein or in a
document incorporated or deemed to be incorporated by
reference in this Prospectus shall be deemed to be modified
or superseded for purposes of this Prospectus to the extent
that a statement contained herein or in any other
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.
The Company will provide without charge to each
person, including any beneficial owner to whom this
Prospectus is delivered, upon written or oral request of
such person, a copy of any document incorporated by
reference in this Prospectus, other than exhibits to any
such document not specifically described above. Requests
for such documents should be directed to Harnischfeger
Industries, Inc., 13400 Bishops Lane, Brookfield, Wisconsin
53005, Attention: Corporate Secretary (Telephone Number
(414) 671-4400).
THE COMPANY
The Company is a holding company for four principal
subsidiaries: Beloit Corporation, Harnischfeger
Corporation, Harnischfeger Engineers, Inc. and Syscon
Corporation. Harnischfeger Industries is the direct
successor to a business begun over 100 years ago which,
through its subsidiaries, manufactures and markets products
classified into four industry segments; Papermaking
Machinery and Systems, Mining Equipment, Material Handling
Equipment and the Systems Group.
<PAGE>
Papermaking Machinery and Systems
The Papermaking Machinery and Systems Group is
comprised of the Company's 80% interest in Beloit
Corporation ("Beloit") and the Company's 20% interest in
Measurex Corporation ("Measurex"). Beloit is consolidated
while Measurex is accounted for on the equity basis.
Mitsubishi Heavy Industries, Ltd. ("Mitsubishi") is the
owner of the remaining 20% interest in Beloit. The Company
and Mitsubishi have entered into certain agreements that
provide Mitsubishi with the right to designate one of
Beloit's five directors. Pursuant to these agreements,
there are certain restrictions on the transfer of stock of
Beloit and, in the event of a change in control of the
Company, Mitsubishi has the right to sell its 20% interest
back to the Company for the greater of $60 million or the
book value of its equity interest. In addition, the
Company and Measurex have entered into an agreement
pursuant to which, among other things, the Company has
agreed that neither it nor any of its affiliates will,
without the prior written consent of a majority of
Measurex's board of directors, acquire, directly or
indirectly, any of Measurex's voting securities, including
shares of Measurex common stock, if after such acquisition
the Company and its affiliates would beneficially own in
the aggregate more than 20% of the total combined voting
power of Measurex's voting securities outstanding after
such acquisition.
Beloit is a leader in the design and manufacture of
papermaking machinery and related products used in the pulp
and paper industries. Beloit operates on a global basis
with manufacturing facilities in six countries and sales
and service offices located throughout the world. In
addition, licensing arrangements exist with several major
foreign companies. Beloit's activities are divided into
the following categories: complete installations involving
the design, manufacture and installation of equipment and
systems; major rebuilds and servicing of existing
installations; and the sale of ancillary equipment and
replacement parts. This machinery is custom designed to
meet the specific needs of each customer. Beloit is known
for the quality and dependability of its products and is a
leader in product innovation and development. A major
factor in Beloit's success in the papermaking machinery
industry has been its international manufacturing
operations. Beloit's overseas facilities have been used to
support both domestic and foreign sales and have provided
Beloit with the flexibility to shift its manufacturing to
more favorable locations as appropriate. In addition,
Beloit has been able to take advantage of favorable export
financing provided by certain foreign governments.
Beloit's manufacturing facilities are supported by a
domestic and international marketing network staffed by
experienced sales engineers.
Measurex provides its customers with
computer-integrated manufacturing through design,
production, marketing and servicing of sensor-based
information and control systems. Over 75% of Measurex's
business is with the pulp and paper industry, with the
remaining business being with the plastic, metal, rubber,
chemicals, glass and pharmaceutical industries.
Mining Equipment
Harnischfeger Corporation is the world's largest
producer of electric mining shovels and is a significant
producer of electric and diesel-electric crawler and
walking draglines, hydraulic mining excavators, and
electric, dredge and dragline bucket products. In 1991,
Harnischfeger Corporation expanded its product lines by
acquiring the large rotary blasthole drill product line
from the Gardner-Denver Mining and Construction Division of
Cooper Industries, Inc. The products of the Mining
Equipment segment are used in mines, quarries and
earth-moving operations in the digging and loading of such
minerals as coal, copper, gold, iron ore, lead, zinc,
bauxite, uranium, phosphate, stone and clay. Harnischfeger
Corporation has a significant relationship in the mining
shovel business with Kobe Steel, Ltd. ("Kobe") pursuant to
which Harnischfeger Corporation licenses Kobe to
manufacture certain electric mining shovels and related
replacement parts in Japan. Harnischfeger Corporation has
the exclusive right to market Kobe-manufactured mining
shovels and parts outside Japan (except in the case of
certain government sales). In addition, Harnischfeger
Corporation is party to an agreement, through 1993, with a
corporate unit of the People's Republic of China, licensing
the manufacture and sale of two models of electric mining
shovels and related components. This relationship provides
Harnischfeger Corporation with an opportunity to sell
component parts for shovels built in China.
Material Handling Equipment
The Material Handling Equipment Division of
Harnischfeger Corporation produces lines of through-the-air
material handling equipment designed for a wide variety of
users. The Division is comprised of five business groups:
new cranes, pre-owned cranes, specialized equipment, parts
and service.
Systems
The Systems Group is comprised of two principal
subsidiaries: Harnischfeger Engineers, Inc. ("HEI") and
Syscon Corporation ("Syscon"). HEI designs, system
engineers, installs and integrates complete automated
material handling
<PAGE>
systems for manufacturing, distribution and warehousing
applications. HEI offers clients a range of services from
feasibility studies, computer modeling and simulation of
manufacturing operations through turnkey installation and
project management. Syscon is engaged principally in
providing systems development, systems integration and
systems services to the United States Government,
government agencies and commercial enterprises.
USE OF PROCEEDS
Except as may be set forth in the Prospectus
Supplement, the Company intends to use the net proceeds
from the sale of the Securities for general corporate
purposes, including, without limitation, the financing of
its operations, the financing of capital expenditures, the
repayment of short-term indebtedness, the acquisition of
equity securities of the Company and possible business
investments and acquisitions. Pending such applications,
the net proceeds will be temporarily invested in marketable
securities.
<PAGE>
SELECTED FINANCIAL DATA
(dollars in thousands)
The following selected financial data at and for the
fiscal years ended October 31, 1991, 1990, 1989, 1998 and
1987 has been derived from the Company's consolidated
financial statements audited by Price Waterhouse,
independent accountants. The following selected financial
data at and for the nine months ended July 31, 1992 and
July 31, 1991 is unaudited. The following selected
financial data should be read in conjunction with, and is
qualified in its entirety by, the related financial
statements and notes thereto which have been incorporated
in this Prospectus by reference.
<TABLE>
<CAPTION>
STATEMENT OF INCOME Nine Months Ended Fiscal Year Ended October 31,
DATA: (unaudited) -----------------------------
-----------
</CAPTION>
<S> <C> <C> <C> <C> <C> <C> <C>
7/31/92 7/31/91 1991 1990 1989 1988 1987
Net sales $1,022,234 $1,195,126 $1,584,114 $1,761,805 $1,466,626 $1,187,457 $ 957,546
Other income 9,823 14,864 19,361 15,195 16,208 21,112 16,589
---------- ---------- ---------- ---------- ---------- ---------- ---------
1,032,057 1,209,990 1,603,475 1,777,000 1,482,834 1,208,569 974,135
Cost of sales 805,665 961,785 1,264,847 1,438,100 1,172,038 956,644 770,415
Product devel.,
selling and
admin. expenses 155,016 161,571 217,708 215,383 204,423 182,578 160,402
---------- ---------- ---------- ---------- ---------- ---------- ---------
Operating income 71,376 86,634 120,920 123,517 106,373 69,347 43,318
Interest (expense)
income - net (5,645) 3,987 4,535 8,202 2,368 (9,340) (11,273)
----------- ---------- ----------- ----------- ---------- ---------- ---------
Income before
provision for
income taxes and
minority interest 65,731 90,621 125,455 131,719 108,741 60,007 32,045
Provision for
income taxes 23,000) (32,600) (45,150) (44,800) (38,050) (16,800) (14,400)
Minority interest (6,745) (12,038) (15,695) (16,911) (16,925) (10,674) (4,629)
----------- ---------- ------------ ---------- ----------- ----------- ----------
Income from
operations 35,986 45,983 64,610 70,008 53,766 32,533 13,016
Extraordinary loss
on retirement debt,
net of tax benefits - - - - - (18,111)(2) -
Income tax benefit
from recognition of
operating loss carry
forwards - - - 3,050 16,825 - 9,900
---------- ---------- ------------ ---------- ----------- ----------- ---------
Net income $ 35,986 $ 45,983 $ 64,610 $ 73,058 $ 70,591 $ 14,422 $ 22,916
---------- ---------- ------------ ----------- ----------- ---------- ---------
---------- ---------- ------------ ----------- ----------- ---------- ---------
Earnings per share:
Income from
operations $1.23 $1.47 $2.08 $2.18 $1.66 $1.15 $ .51
Extraordinary loss on
retirement of debt - - - - - (.64) -
Income tax benefit - - - .09 .51 - .45
Net income $1.23 $1.47 $2.08 $2.27 $2.17 $ .51 $ .96
BALANCE SHEET DATA:
(at period end)
Total assets 1,550,300 $1,493,276 1,506,882 1,576,489 $1,369,892 $1,166,709 $1,070,739
Working capital 446,358 367,330 376,400 365,563 361,451 271,948 287,721
Long-term
obligations(1) 258,936 123,206 135,690 121,702 127,499 95,693 179,083
Shareholders'
equity 609,044 592,624 594,418 582,589 513,937 461,419 323,369
DEBT TO
CAPITALIZATION
RATIO(3)
28.9% 17.9% 19.4% 18.3% 18.3% 17.0% 36.2%
- -----------------------------
(1) Includes current portion of long-term debt and capitalized lease obligations. On March 3, 1992, the Company
issued $75,000 of 8.90% Debentures due March 1, 2002. On June 22, 1992, the Company issued $75,000 of 8.70%
Debentures due June 15, 2022.
(2) On August 1, 1988, the Company redeemed for par value plus accrued interest the $100,000 12% Subordinated
Debentures, due 2004, of Harnischfeger Corporation. A one-time extraordinary charge of $18,111 (net of
applicable income tax benefits of $5,950) was recorded to write off the remaining unamortized discount and debt
issue expenses associated with the debentures.
(3) The debt to capitalization ratio is defined as the sum of short-term notes payable, long-term debt (including
current portion) and capitalized lease obligations divided by the sum of short-term notes payable, long-term
debt (including current portion) and capitalized lease obligations, minority interest and shareholders' equity.
</TABLE>
<PAGE>
CONSOLIDATED RATIOS OF EARNINGS TO FIXED CHARGES
The ratio of earnings to fixed charges for the
Company is defined as income before provision for income
taxes and minority interest plus interest expense
(including amortization of debt issuance expense), the
portion of rental expense which represents interest (deemed
to be one-third of rentals) and dividends received on less-
than-fifty-percent-owned companies, reduced (increased) by
equity income (loss) recorded on less-than-fifty-percent-
owned companies, divided by fixed charges. Fixed charges
include interest expense (including amortization of debt
issuance expense) and the portion of rental expense which
represents interest.
Nine Months
Ended Fiscal Years Ended October 31
7/31/92 1991 1990 1989 1988 1987
Ratio of
Earnings
to Fixed
Charges: 4.61 6.15(1) 5.99(1) 5.69(1) 2.73(1) 1.47
---- ------ ------ ------- ------- ----
---- ------ ------ ------- ------- ----
(1) Through April 1991, the Company, in connection with
the May 1988 divestiture of Harnischfeger
Corporation's Construction Equipment Division, had
guaranteed a bank loan provided to Century II,
Inc., the purchaser. As of October 31, 1988, the
Company was contingently liable to those banks for
the $24,000 outstanding balance of the loan. In
April 1991, the Company was released from all
guarantees and contingent liabilities. Any fixed
charges associated with this guarantee have been
excluded in the consolidated ratios of earnings to
fixed charges calculation.
DESCRIPTION OF SECURITIES
The following descriptions set forth certain general
terms and provisions of the Securities to which any
Prospectus Supplement may relate. The particular terms and
provisions of the series of Securities offered by a
Prospectus Supplement, and the extent to which such general
terms and provisions described below may apply thereto,
will be described in the Prospectus Supplement relating to
such series of Securities.
The Securities are to be issued under an Indenture dated
as of March 1, 1992, as supplemented by a First
Supplemental Indenture dated as of June 12, 1992
(collectively, the "Indenture"), with Continental Bank,
National Association, as Trustee (the "Trustee"). The
following summaries of certain provisions of the Securities
and the Indenture do not purport to be complete and are
subject to, and are qualified in their entirety by
reference to, all provisions of the Indenture, including
the definition therein of certain terms. Particular
sections of the Indenture which are relevant to the
discussion are cited parenthetically. Wherever particular
sections or defined terms of the Indenture are referred to,
it is intended that such sections or defined terms shall be
incorporated herein by reference.
General
The Indenture does not limit the amount of Securities
which can be issued thereunder or the amount or type of
debt securities which may otherwise be issued by the
Company and additional debt securities may, without the
consent of the holders of outstanding Securities, be issued
under the Indenture up to the aggregate principal amount
which may be authorized from time to time by, or pursuant
to a resolution of, the Company's Board of Directors or by
a supplemental indenture. Reference is made to the
Prospectus Supplement for the following terms, if
applicable, of the particular series of Securities being
offered thereby: (1) the title of the Securities of the
series; (2) any limit upon the aggregate principal amount
of the Securities of the series; (3) whether the Securities
of the series will be issuable in registered or bearer form
or both, any restrictions applicable to the offer, sale or
delivery of Securities in bearer form ("bearer Securities")
and whether and the terms upon which bearer Securities will
be exchangeable for Securities in registered form
("registered Securities") and vice versa; (4) the date as
of which any bearer Securities of the series and any
temporary global Security shall be dated if other than the
date of issuance of the first Security of the series; (5)
the method of paying interest with respect to any portion
of a temporary bearer Security in the form of a global
note; (6) the date or dates on which the principal of the
Securities of the series will be payable; (7) the rate or
rates (or manner of calculation thereof), if any, at which
the Securities of the series will bear interest, the date
or dates from which any such interest will accrue and on
which such interest will be payable, and, with respect to
Securities of the series in registered form, the record
date for the interest payable on any interest payment date,
whether and under what circumstances the Company will pay
additional amounts on the Securities of the series held by
a person who is not a U.S. person in respect of taxes or
similar charges withheld or deducted and, if so, whether
the Company will have the option to redeem such Securities
rather than pay such additional amounts; (8) the place or
places where the principal of and interest or additional
amounts, if any, on the Securities of the series will be
payable; (9) the period or periods within which, the price
or prices at which and the terms and conditions upon which
the Securities of the series may be redeemed at the option
of the Company; (10) any redemption or sinking fund
provisions; (11) the denominations in which Securities of
the series shall be issuable;
<PAGE>
(12) if other than the principal amount thereof, the
portion of the principal amount of Securities of the series
which will be payable upon declaration of acceleration of
the maturity thereof; (13) the currencies in which payments
of interest, premium or principal are payable with respect
to such Securities; and (14) any additional provisions or
other terms not inconsistent with the provisions of the
Indenture, including any terms which may be required by or
advisable under United States laws or regulations or
advisable in connection with the marketing of Securities of
such series. (Sections 3.1 and 3.2.) To the extent not
described herein, principal and interest, if any, will be
payable, and the Securities of a particular series will be
transferable, in the manner described in the Prospectus
Supplement relating to such series. "Principal" when used
herein includes, when appropriate, the premium, if any, on
the Securities.
Securities of any series may be issued as registered
Securities or bearer Securities or both as specified in the
terms of the series. Additionally, Securities of any
series may be represented by one or more global notes
registered in the name of a depositary's nominee and, if so
represented, beneficial interests in such global note will
be shown on, and transfers thereof will be effected only
through, records maintained by a designated depositary and
its participants. Unless otherwise indicated in the
Prospectus Supplement, registered Securities will be issued
in the denomination of $1,000 and integral multiples
thereof and bearer Securities will be issued in the
denomination of $5,000 and integral multiples thereof.
If appropriate, federal income tax consequences
applicable to a series of Securities will be described in
the Prospectus Supplement relating thereto.
Exchange of Securities
Registered Securities may be exchanged for an equal
aggregate principal amount of registered Securities of the
same series and date of maturity in such authorized
denominations as may be requested upon surrender of the
registered Securities at an agency of the Company
maintained for such purpose and upon fulfillment of all
other requirements of such agent. (Section 3.5.)
To the extent permitted by the terms of a series of
Securities authorized to be issued in registered form and
bearer form, bearer Securities may be exchanged for an
equal aggregate principal amount of registered or bearer
Securities of the same series and date of maturity in such
authorized denominations as may be requested upon surrender
of the bearer Securities with all unpaid coupons relating
thereto at an agency of the Company maintained for such
purpose and upon fulfillment of all other requirements of
such agent. (Section 3.5.) As of the date of this
Prospectus, registered Securities may not be exchanged for
bearer Securities and, unless such regulations are
modified, the terms of a series of Securities will not
permit registered Securities to be exchanged for bearer
Securities.
Limitation Upon Liens
The Indenture provides that the Company will not, and
will not permit any Restricted Subsidiary (as defined
below) to create, incur, issue, assume or guarantee any
indebtedness for borrowed money ("Indebtedness") secured by
a mortgage, security interest, pledge or lien (each a
"Lien") of or upon any Principal Manufacturing Property (as
defined below), or any shares of capital stock or
indebtedness of any Restricted Subsidiary (as defined
below), whether owned at the date of the Indenture or
thereafter acquired, without effectively providing that the
Notes and any other Securities issued under the Indenture
shall be secured by such Lien equally and ratably with (or,
at the option of the Company, prior to) such indebtedness,
so long as such indebtedness shall be so secured. The
foregoing restrictions, however, shall not apply to (i)
taxes, assessments or governmental charges which are not
yet delinquent, or are being diligently contested in good
faith and by appropriate proceeding; (ii) governmental
Liens or Liens imposed by law, such as carriers',
warehousemen's, mechanics', materialmen's and vendors'
liens for sums not yet due or which are being diligently
contested in good faith and by appropriate proceedings;
(iii) existing Liens; (iv) any Lien on any property
acquired, constructed or substantially improved by, or of
or upon any shares of capital stock or indebtedness
acquired by, the Company or any Restricted Subsidiary after
the date of the Indenture and created contemporaneously
with or within twelve (12) months of such acquisition,
construction or improvement to secure or provide for all or
a portion of the purchase price of such property or for
such construction or improvement; (v) Liens in connection
with industrial revenue bonds, pollution control bonds or
similar secured financings; (vi) performance of bids,
tenders, contracts (other than for the repayment of or in
connection with borrowed money), or for purposes of like
general nature in the ordinary course of the Company's
business; (vii) Liens in favor of any customer to the
extent necessary to secure partial, progress, advance or
other payments for goods produced or services rendered to
such customer in the ordinary course of business; (viii)
attachment, judgment and other similar Liens arising in
connection with court proceedings, provided the execution
or other enforcement of such Liens is effectively stayed
within thirty (30) days after the Company or a Restricted
Subsidiary receives notice thereof and the claims secured
thereby are being actively contested in good faith by
appropriate proceedings and against which an adequate
reserve has been established; (ix) any Lien existing on the
property, shares of stock or indebtedness of a Person at
the time such Person becomes a Restricted Subsidiary of the
Company
<PAGE>
or is merged into or consolidated with the Company or a
Restricted Subsidiary or at the time of a sale, lease or
other disposition of the properties of any Person as an
entirety or substantially as an entirety to the Company or
a Restricted Subsidiary (whether or not such Lien is
assumed by the Company or a Restricted Subsidiary); (x)
Liens on the property of a Restricted Subsidiary to secure
indebtedness for borrowed money owed to the Company or
another Subsidiary; (xi) in the case of leased properties,
the terms and conditions of leases or subleases creating
the leasehold estate and, in the case of all real
properties, title exceptions affecting the underlying fee
simple estate; or (xii) Liens created in connection with
the extension or renewal of any secured indebtedness or
other obligations permitted under the terms of the
Indenture.
Notwithstanding the restrictions outlined above, the
Company or any Restricted Subsidiary may, without equally
and ratably securing the Securities, issue, assume or
guarantee indebtedness secured by a Lien not excepted under
clauses (i) through (xii) above, if the aggregate amount of
such indebtedness, together with all other indebtedness
secured by Liens not so excepted, does not at the time
exceed 10% of Consolidated Net Tangible Assets (as defined
below).
The term "Consolidated Net Tangible Assets" means, as of
any particular time, the total amount of assets (less
applicable reserves) after deducting therefrom (i) all
current liabilities (excluding any thereof which are by
their terms extendible or renewable at the option of the
obligor thereon to a time more than twelve (12) months
after the time as of which the amount thereof is being
computed and excluding current maturities of long-term
indebtedness), and (ii) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense
and other like intangible assets, all as shown in the
audited consolidated balance sheet of the Company and its
Subsidiaries contained in the Company's then most recent
annual report to stockholders.
The term "Principal Manufacturing Property" means any
manufacturing plant (including fixtures and improvements
but excluding equipment, leases and other contract rights
which might otherwise be deemed real property) owned by the
Company, or any Restricted Subsidiary, whether owned on the
date of the Indenture or thereafter, provided each such
plant has a gross book value (without deduction for any
depreciation reserves) at the date as of which the
determination is being made of in excess of two percent
(2%) of Consolidated Net Tangible Assets, other than any
such plant or portion thereof which, in the opinion of the
Board of Directors (evidenced by a Board Resolution), is
not of material importance to the business conducted by the
Company and its Subsidiaries taken as a whole.
The term "Restricted Subsidiary" means each Subsidiary
(i) substantially all the property of which is located, or
substantially all the business of which is conducted,
within the United States excluding its territories and
possessions, and (ii) which owns or leases a Principal
Manufacturing Property.
Additional Restrictive Covenants
Reference is made to the Prospectus Supplement relating
to a particular Note for any additional restrictive
covenants which may relate to such Note.
Amendment and Waiver
Subject to certain exceptions, the Indenture or the
Securities may be amended or supplemented by the Company
and the Trustee with the written consent of the holders of
not less than 66-2/3% in principal amount of the
outstanding Securities of each series affected by the
amendment or supplement (with each series voting as a
class) or compliance with any provision may be waived with
the consent of the holders of a majority in principal
amount of the outstanding Securities of each series
affected by such waiver (with each series voting as a
class). However, without the consent of each Security
holder affected, an amendment or waiver may not, among
other things, (i) reduce the principal of or change the
Stated Maturity of any Security, (ii) reduce the rate of or
change the time for payment of interest on any Security;
(iii) reduce any premium payable upon redemption of any
Security; (iv) change the place of payment where any
Security or any interest thereon is payable; (v) waive a
default in the payment of the principal of or interest on
any Security (Section 5.13); (vi) make any Security payable
in money other than that stated in the Security, (vii)
impair the right to institute suit on or after the Stated
Maturity Date of any Security for the enforcement of any
payment on or with respect to such Security; or (viii)
reduce the percentage in principal amount of Securities
whose holders must consent to a supplemental indenture,
amendment or any waiver of compliance with certain
provisions of the Indenture or certain defaults thereunder
and their consequence. (Section 9.2.) The Indenture may be
amended or supplemented without the consent of any Security
holder, among other things, (I) to provide for the
assumption of all the obligations of the Company under the
Securities and any coupons appertaining thereto and under
the Indenture by any corporation in connection with a
merger, consolidation, or transfer or lease of the
Company's property and assets substantially as an entirety,
as provided for in the Indenture; (ii) to add to the
covenants of the Company, for the benefits of the Holders
of all or any series of Securities; (iii) to provide for
bearer Securities that are registrable as to principal or
to change or eliminate in certain circumstances
<PAGE>
any restrictions on the payment of principal (and interest
in the case of bearer Securities) on the Securities; (iv)
to provide for uncertificated Securities in addition to or
in place of certificated Securities; (v) to make any change
that does not adversely affect the rights of any Holder of
Securities; (vi) to provide for the issuance of and
establish the form and terms and conditions of a series of
Securities or to establish the form of any certifications
required to be furnished pursuant to the terms of the
Indenture or any series of Securities; (vii) to cure any
ambiguity, defect or inconsistency in the Indenture or in
the Securities of any series; (viii) to evidence the
appointment of a successor Trustee; or (ix) to secure the
Securities. (Section 9.1.)
Successor Entity
The Company may consolidate with, or merge into, or be
merged into, or transfer or lease its property and assets
substantially as an entirety to, any other corporation, if
(I) the Company is the continuing corporation, or the
successor is a U.S. corporation which assumes all the
obligations of the Company under the Securities and any
coupons appertaining thereto and under the Indenture, and
(ii) after giving effect thereto, no default under the
Indenture shall have occurred and be continuing.
Thereafter, except in the case of a lease, all such
obligations of the Company shall terminate. (Section 8.1
and Section 8.2.)
Defeasance, Satisfaction and Discharge of the Securities
Prior to Maturity
Defeasance. Unless provided for otherwise in the
applicable Prospectus Supplement, if the Company shall
deposit with the Trustee, in trust, at or before maturity,
lawful money or direct obligations of the United States of
America or obligations the principal of and interest on
which are guaranteed by the United States of America in
such amounts and maturing at such times that the proceeds
of such obligations to be received upon the respective
maturities and interest payment dates of such obligations
will provide funds sufficient, in the opinion of a
nationally-recognized firm of independent public
accountants chosen by the Company, to pay when due the
principal of and interest on the Securities to maturity
(such money or direct obligations of, or obligations
guaranteed by, the United States of America initially
deposited or equivalent cash or securities subsequently
exchanged therefor, to be held as security for the payment
of such principal and interest), then the Company may omit
to comply with certain of the terms of the Indenture as
they relate to the Securities, including the restrictive
covenants described herein under the caption "Description
of Securities - Limitation Upon Liens" and the Event of
Default described in clause (iv) under the caption
"Description of Securities--Events of Default." Defeasance
of the Securities would be subject to the satisfaction of
certain conditions, including, among others, (I) the
absence of an Event of Default at the date of the deposit,
(ii) the perfection of the holders' interest in such
deposit and (iii) the condition that such deposit would not
result in a breach of a material instrument by which the
Company is bound. (Section 4.2.)
Satisfaction and Discharge. Upon the deposit of money or
securities contemplated above and the satisfaction of
certain conditions, the Company may omit to comply with its
obligations duly and punctually to pay the principal of and
interest on the Securities, or with any Events of Default
with respect thereto, and thereafter the holders of
Securities shall be entitled only to payment out of the
money or securities deposited with the Trustee. Such
conditions may include, among others, (I) except in certain
limited circumstances involving a deposit made within one
year of maturity, (A) the absence of an Event of Default at
the date of deposit or on the 91st day thereafter, and (B)
the delivery to the Trustee by the Company of an opinion of
nationally-recognized tax counsel to the effect that
holders of Securities will not recognize income, gain or
loss for federal income tax purposes as a result of such
deposit and discharge and will be subject to federal income
tax on the same amounts and in the same manner and at the
same times as would have been the case if such deposit and
discharge had not occurred, and (ii) the receipt by the
Company of an opinion of counsel to the effect that such
satisfaction and discharge will not result in a violation
of the rules of any nationally-recognized exchange on which
the Securities are listed. (Section 4.1.)
Events of Default
The following events are defined in the Indenture as
"Events of Default" with respect to a series of Securities:
(I) default in the payment of interest on any Security of
such series which continues for 30 days; (ii) failure by
the Company for two business days after notice to it to pay
the principal of any Security of such series when due;
(iii) failure by the Company for two business days after
notice to it to pay any sinking fund installment required
to be made by the Company with respect to any series of
Securities; (iv) failure by the Company for 60 days after
notice to it to comply with any of its other agreements
with respect to the Securities of such series in the
Indenture or in any supplemental indenture under which the
Securities of that series may have been issued; (v) certain
events of bankruptcy or insolvency and (vi) acceleration of
any indebtedness for money borrowed by the Company or any
Restricted Subsidiary in excess of $10,000,000 in aggregate
principal amount, if such acceleration is not rescinded or
annulled within 10 days after written notice has been
provided to the Company by the Trustee or to the Company
and the Trustee by the holders of at least 25% in aggregate
principal amount of outstanding Securities. (Section 5.1.)
If an Event of Default occurs with respect to the
Securities of any series and is
<PAGE>
continuing, the Trustee or the holders of at least 25% in
principal amount of all of the outstanding Securities of
that series may declare the principal (or, if the
Securities of that series are original issue discount
Securities, such portion of the principal amount as may be
specified in the terms of that series) of, and any accrued
interest on, all the Securities of that series to be due
and payable. Upon such declaration, such principal (or, in
the case of original issue discount Securities, such
specified amount) and all accrued interest thereon shall be
due and payable immediately. (Section 5.2.)
Holders of Securities may not enforce the Indenture or
the Securities, except as provided in the Indenture.
(Section 5.7.) The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the
Securities. (Section 6.3(e).) Subject to certain
limitations, holders of a majority in principal amount of
the Securities of each series affected (with each series
voting as a class) may direct the Trustee in its exercise
of any trust power. (Section 5.12.) The Trustee may
withhold from Security holders notice of any continuing
default (except a default in payment of principal or
interest) if it determines in good faith that withholding
notice is in their interests. (Section 6.2.) The Company
is not required under the Indenture to furnish any periodic
evidence as to the absence of default or as to compliance
with the terms of the Indenture.
Concerning the Trustee
Continental Bank, National Association, the Trustee under
the Indenture, is a participating bank under the Company's
Amended and Restated Multiple Option Financing Facility
dated as of December 5, 1989, pursuant to which, as of the
date of this Prospectus, Continental Bank, National
Association, was committed to advance $15,500,000 to the
Company.
PLAN OF DISTRIBUTION
The Company may sell the Securities being offered hereby:
(I) directly to purchasers, (ii) through agents, (iii)
through underwriters, (iv) through dealers or (v) through a
combination of any such methods of sale.
The distribution of the Securities may be effected from
time to time in one or more transactions either: (I) at a
fixed price or prices, which may be changed, or (ii) at
market prices prevailing at the time of sale, or (iii) at
prices related to such prevailing market prices, or (iv) at
negotiated prices.
Offers to purchase Securities may be solicited directly
by the Company or by agents designated by the Company from
time to time. Any such agent, which may be deemed to be an
underwriter as that term is defined in the Securities Act,
involved in the offer or sale of the Securities in respect
of which this Prospectus is delivered will be named, and
any commissions payable by the Company to such agent will
be set forth, in the Prospectus Supplement. Unless
otherwise indicated in the Prospectus Supplement, any such
agent will be acting on a reasonable best efforts basis for
the period of its appointment. Agents may be customers of,
engage in transactions with or perform services for the
Company in the ordinary course of business.
If an underwriter or underwriters are utilized in the
sale, the Company will execute an underwriting agreement
with such underwriters at the time of sale to them and the
names of the underwriters and the terms of the transaction
will be set forth in the Prospectus Supplement, which will
be used by the underwriters to make resales of the
Securities in respect of which this Prospectus is delivered
to the public.
If a dealer is utilized in the sale of the Securities in
respect of which this Prospectus is delivered, the Company
will sell such Securities to the dealer as principal. The
dealer may then resell such Securities to the public at
varying prices to be determined by such dealer at the time
of resale.
In the event the Securities are not listed on a national
securities exchange, certain broker-dealers may make a
market in the Securities, but will not be obligated to do
so and may discontinue any market making at any time
without notice. No assurance can be given that any broker-
dealer will make a market in the Securities or as to the
liquidity of the trading market for the Securities, whether
or not the Securities are listed on a national securities
exchange. The Prospectus Supplement with respect to the
Securities will state, if known, whether or not any broker-
dealer intends to make a market in the Securities. If no
such determination has been made, the Prospectus Supplement
will so state.
Underwriters, dealers, agents and other persons may be
entitled, under agreements which may be entered into with
the Company, to indemnification against certain civil
liabilities, including liabilities under the Securities
Act.
The place and time of delivery for the Securities in
respect of which this Prospectus is delivered will be set
forth in the accompanying Prospectus Supplement.
<PAGE>
LEGAL MATTERS
Unless otherwise indicated in the Prospectus Supplement,
certain legal matters in connection with the Securities
offered hereby will be passed upon for the Company by
Kirkland & Ellis, Chicago, Illinois, and for any
underwriters, agents and certain other purchasers by Sidley
& Austin, Chicago, Illinois.
EXPERTS
The financial statements incorporated in this Prospectus
by reference to the Company's Annual Report on Form 10-K
for the year ended October 31, 1991, have been so
incorporated in reliance on the report of Price Waterhouse,
independent accountants, given on the authority of said
firm as experts in auditing and accounting.
<PAGE>
No dealer, salesperson or other person has been
authorized to give any information or to make any
representations not contained in this Prospectus Supplement
or the accompanying Prospectus, and, if given or made, such
information or representations must not be relied upon as
having been authorized by the Company or any of the
Underwriters. This Prospectus Supplement and the
accompanying Prospectus do not constitute an offer of any
securities other than those described in this Prospectus
Supplement or an offer to sell, or a solicitation of an
offer to buy, to any person in any jurisdiction where such
an offer or solicitation would be unlawful. Neither the
delivery of this Prospectus Supplement or the Prospectus
nor any sale made hereunder or thereunder shall, under any
circumstances, create any implication that the information
contained herein or therein is correct as of any time
subsequent to the date of such information
--------------------
TABLE OF CONTENTS
Prospectus Supplement
Page
----
Incorporation of Certain Documents
by Reference S-2
Recent Development S-3
The Company S-3
Use of Proceeds S-4
Consolidated Ratios of Earnings
to Fixed Charges S-4
Description of the Debentures S-4
Underwriting S-6
Validity of Securities S-7
Prospectus
Available Information 2
Incorporation of Certain Documents by
Reference 2
The Company 2
Use of Proceeds 4
Selected Financial Data 5
Consolidated Ratios of Earnings to
Fixed Charges 6
Description of Securities 6
Plan of Distribution 10
Legal Matters 11
Experts 11
$150,000,000
Harnischfeger Industries, Inc.
% Debentures
due , 2025
---------------------
PROSPECTUS SUPPLEMENT
December , 1995
--------------------
LEHMAN BROTHERS
SALOMON BROTHERS INC
Chemical Securities Inc.
First Chicago Capital
Markets, Inc.
RBC Dominion
Securities Corporation
