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Filed Pursuant to Rule 424(b)(3)
Registration Number 333-63903
PROSPECTUS
OCTOBER 7, 1998
IMC GLOBAL INC.
LOGO
OFFER TO EXCHANGE ITS 6 1/2% NOTES DUE 2003 AND ITS 7 3/8% DEBENTURES DUE
2018, WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, FOR ANY AND
ALL OF ITS OUTSTANDING 6 1/2% NOTES DUE 2003 AND 7 3/8% DEBENTURES DUE 2018,
RESPECTIVELY.
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON NOVEMBER 6, 1998, UNLESS EXTENDED.
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IMC Global Inc. ("IMC" or the "Company"), hereby offers (the "Exchange
Offer"), upon the terms and conditions set forth in this Prospectus (the
"Prospectus") and the accompanying Letter of Transmittal (the "Letter of
Transmittal"), to exchange $1,000 principal amount of its 6 1/2% Notes due
2003 (the "Exchange Notes") and $1,000 principal amount of its 7 3/8%
Debentures due 2018 (the "Exchange Debentures," and together with the Exchange
Notes, the "Exchange Securities"), each registered under the Securities Act of
1933, as amended (the "Securities Act"), pursuant to a Registration Statement
of which this Prospectus is a part, for each $1,000 principal amount of its
outstanding 6 1/2% Notes due 2003 (the "Old Notes"), of which $200,000,000
principal amount is outstanding, and for each $1,000 principal amount of its
outstanding 7 3/8% Debentures due 2018 (the "Old Debentures," and together
with the Old Notes, the "Old Securities"), of which $100,000,000 principal
amount is outstanding, respectively. The forms and terms of the Exchange Notes
and the Exchange Debentures are the same as the forms and terms of the Old
Notes and the Old Debentures, respectively, except that (i) the Exchange Notes
and the Exchange Debentures will each bear a different CUSIP number from the
Old Notes and the Old Debentures, respectively, (ii) the Exchange Notes and
the Exchange Debentures will have been registered under the Securities Act
and, therefore, will not bear legends restricting the transfer thereof and
(iii) holders of the Exchange Notes and the Exchange Debentures will not be
entitled to certain rights of holders of Old Notes and Old Debentures under
the Registration Rights Agreement (as defined). The Old Notes and the Exchange
Notes are sometimes referred to herein collectively as the "Notes" and the Old
Debentures and the Exchange Debentures are sometimes referred to herein
collectively as the "Debentures." The Exchange Notes and the Exchange
Debentures will evidence the same debt as the Old Notes and the Old Debentures
(which they respectively replace) and will be issued under and be entitled to
the benefits of the Indenture dated as of August 1, 1998 (the "Indenture")
between IMC and The Bank of New York, as Trustee, governing the Notes and the
Debentures. The Old Notes and the Exchange Notes will constitute a single
series of debt securities under the Indenture. In the event that the Exchange
Offer is consummated, any Old Notes that remain outstanding after consummation
of the Exchange Offer and the Exchange Notes issued in the Exchange Offer will
vote together as a single class for purposes of determining whether holders of
the requisite percentage in outstanding principal amount of Notes have taken
certain actions or exercised certain rights under the Indenture. Similarly,
the Old Debentures and the Exchange Debentures will constitute a single series
of debt securities under the Indenture. In the event that the Exchange Offer
is consummated, any Old Debentures outstanding after consummation of the
Exchange Offer and the Exchange Debentures issued in the Exchange Offer will
vote together as a single class for purposes of determining whether holders of
the requisite percentage in outstanding principal amount of Debentures have
taken certain actions or exercised certain rights under the Indenture. See
"Description of Exchange Notes and Exchange Debentures" and "Exchange Offer."
IMC will accept for exchange any and all Old Notes and Old Debentures
validly tendered and not withdrawn prior to 5:00 p.m., New York City time, on
November 6, 1998, unless extended by IMC in its sole discretion (such time and
date, as the same may be extended, the "Expiration Date"). Tenders of Old
Notes and Old Debentures may be withdrawn at any time on or prior to the
Expiration Date. The Exchange Offer is subject to certain customary
conditions. See "Exchange Offer."
The Old Securities were sold by IMC on August 11, 1998 to Merrill Lynch,
Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities Inc., Chase
Securities Inc. and Salomon Brothers Inc (the "Initial Purchasers") in a
transaction not registered under the Securities Act in reliance upon an
exemption under the Securities Act (the "Initial Offering"). The Initial
Purchasers subsequently placed the Old Securities with qualified institutional
buyers in reliance upon Rule 144A under the Securities Act ("Rule 144A").
Accordingly, the Old Securities may not be reoffered, resold or otherwise
transferred in
(Continued on following page)
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This Prospectus and the Letter of Transmittal are first being mailed to all
holders of Old Securities on October 7, 1998.
SEE "RISK FACTORS" BEGINNING ON PAGE 17 FOR A DESCRIPTION OF CERTAIN RISKS
TO BE CONSIDERED WITH RESPECT TO THE EXCHANGE OFFER.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
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(continued from previous page)
the United States unless registered under the Securities Act or unless an
applicable exemption from the registration requirements of the Securities Act
is available. The Exchange Securities are being offered hereunder in order to
satisfy the obligations of the Company under the Registration Rights Agreement
entered into by the Company and the Initial Purchasers in connection with the
Initial Offering (the "Registration Rights Agreement"). See "Exchange Offer."
The Exchange Notes will mature on August 1, 2003 and the Exchange Debentures
will mature on August 1, 2018. Each Exchange Note will bear interest at the
rate of 6 1/2% per annum and each Exchange Debenture will bear interest at the
rate of 7 3/8% per annum, in each case from the last Interest Payment Date (as
defined) to which interest was paid on the Old Note or Old Debenture (as the
case may be) surrendered in exchange therefor or, if no interest has been paid
on such Old Note or Old Debenture, from August 11, 1998, payable semiannually
on February 1 and August 1 in each year, commencing February 1, 1999. Holders
of the Old Notes or the Old Debentures whose Old Notes or Old Debentures are
accepted for exchange will not receive accrued interest on such Old Notes or
Old Debentures for any period from and after the last Interest Payment Date to
which interest has been paid or duly provided for on such Old Notes or Old
Debentures prior to the original issue date of the Exchange Notes or Exchange
Debentures or, if no such interest has been paid or duly provided for, will
not receive any accrued interest on such Old Notes or Old Debentures, and will
be deemed to have waived the right to receive any interest on such Old Notes
or Old Debentures accrued from and after such Interest Payment Date or, if no
such interest has been paid or duly provided for, from and after August 11,
1998. Each of the Exchange Notes and the Exchange Debentures will be
redeemable at the option of IMC, in whole at any time or in part from time to
time, at a redemption price equal to the greater of (i) 100% of their
principal amount and (ii) the sum of the present values of the principal
amount and the remaining scheduled payments of interest thereon, in each case
discounted from their respective scheduled payment dates to the redemption
date on a semiannual basis at the Treasury Rate (as defined) plus 15 basis
points in the case of the Exchange Notes and 25 basis points in the case of
the Exchange Debentures, plus in either case accrued interest thereon to the
redemption date. See "Description of Exchange Notes and Exchange Debentures."
The Exchange Notes and the Exchange Debentures will be unsecured, senior
debt of IMC and will rank on a parity with all other unsecured and
unsubordinated indebtedness of IMC. See "Description of Exchange Notes and
Exchange Debentures."
Any Old Notes or Old Debentures not tendered and accepted in the Exchange
Offer will remain outstanding and will be entitled to all the same rights and
benefits and will be subject to the same limitations applicable thereto under
the Indenture (except for those rights which terminate upon consummation of
the Exchange Offer). Following consummation of the Exchange Offer, the holders
of Old Notes or Old Debentures will continue to be subject to the existing
restrictions upon transfer thereof and the Company will have no further
obligation to such holders to provide for registration under the Securities
Act of the Old Notes or the Old Debentures held by them. To the extent that
Old Notes or Old Debentures are tendered and accepted in the Exchange Offer,
the trading market for untendered and tendered but unaccepted Old Notes and
Old Debentures could be adversely affected.
Based on existing interpretations of the Securities Act by the staff of the
Securities and Exchange Commission (the "SEC" or the "Commission") set forth
in several no-action letters to third parties, and subject to the immediately
following sentence, the Company believes that the Exchange Securities to be
issued pursuant to the Exchange Offer may be offered for resale, resold and
otherwise transferred by the holders thereof (other than any such holders who
are broker-dealers) without compliance with the registration and prospectus
delivery requirements of the Securities Act. However, any holder of Old Notes
or Old Debentures who is an "affiliate" of the Company or who intends to
participate in the Exchange Offer for the purpose of distributing the Exchange
Notes or the Exchange Debentures, or any broker-dealer who purchased the Old
Notes or the Old Debentures from the Company for resale pursuant to Rule 144A
or any other available exemption under the Securities Act, (i) will not be
able to rely on the interpretations of the staff of the Commission (the
"Staff") set forth in the above-mentioned no-action letters, (ii) will not be
entitled to tender its Old Notes or Old Debentures, as
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applicable, in the Exchange Offer and (iii) must comply with the registration
and prospectus delivery requirements of the Securities Act in connection with
any sale or transfer of the Old Notes or Old Debentures, as applicable, unless
such sale or transfer is made pursuant to an exemption from such requirements.
The Company does not intend to seek its own no-action letter, and there can be
no assurance that the Staff would make a similar determination with respect to
the Exchange Notes or the Exchange Debentures as it has in such no-action
letters to third parties.
Each holder of Old Notes or Old Debentures (other than certain specified
holders) who wishes to exchange the Old Notes or the Old Debentures, as
applicable, for Exchange Notes or Exchange Debentures, as applicable, in the
Exchange Offer will be required to represent that (i) it is not an "affiliate"
of the Company, (ii) the Exchange Notes or the Exchange Debentures, as
applicable, to be received by it are being acquired in the ordinary course of
its business, (iii) it has no arrangement with any person to participate in
the distribution (within the meaning of the Securities Act) of the Exchange
Notes or the Exchange Debentures, as applicable, and (iv) if such holder is
not a broker-dealer, such holder is not engaged in, and does not intend to
engage in, a distribution (within the meaning of the Securities Act). Each
broker-dealer that receives Exchange Notes or Exchange Debentures for its own
account pursuant to the Exchange Offer must acknowledge that it acquired the
Old Notes or the Old Debentures for its own account as a result of market-
making or other trading activities and must agree that it will deliver a
prospectus meeting the requirements of the Securities Act in connection with
any resale of such Exchange Notes or Exchange Debentures. The Letter of
Transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within
the meaning of the Securities Act. The Commission has taken the position in
the above-mentioned no-action letters that broker-dealers who acquired Old
Notes or Old Debentures for their own accounts as a result of market-making or
other trading activities ("Participating Broker-Dealers") may fulfill their
prospectus delivery requirements with respect to the Exchange Notes or the
Exchange Debentures, as applicable, other than a resale of an unsold allotment
from the original sale thereof, with a prospectus meeting the requirements of
the Securities Act, which may be the prospectus prepared for an exchange offer
so long as it contains a plan of distribution with respect to the resale of
such Exchange Notes and Exchange Debentures. Under the Registration Rights
Agreement, the Company is required to allow Participating Broker-Dealers and
other persons, if any, subject to similar prospectus delivery requirements to
use this Prospectus, as it may be amended or supplemented from time to time,
in connection with the resale of such Exchange Notes or Exchange Debentures,
as applicable, for a period of 180 days from the issuance of the Exchange
Notes or the Exchange Debentures, as applicable. The Company has agreed that,
for a period of 180 days after the Expiration Date, it will make this
Prospectus available to any Participating Broker-Dealer for use in connection
with any such resale (provided that the Company has received prior written
notice from such Participating Broker-Dealer of its status as a Participating
Broker-Dealer). See "Plan of Distribution." Any Participating Broker-Dealer
who is an "affiliate" of the Company may not rely on the above-mentioned no-
action letters and must comply with the registration and delivery requirements
of the Securities Act in connection with any resale transaction.
The Company will not receive any cash proceeds from the issuance of the
Exchange Securities offered hereby. The Company has agreed to bear the
expenses of the Exchange Offer. No dealer-manager is being used in connection
with the Exchange Offer.
The Exchange Notes and the Exchange Debentures will each constitute a new
issue of securities with no established trading market. The Company does not
intend to list the Exchange Notes or the Exchange Debentures on any national
securities exchange or seek the admission thereof to trading in the National
Association of Securities Dealers Automated Quotation System. The Initial
Purchasers have advised the Company that they currently intend to make a
market in each of the Exchange Notes and the Exchange Debentures, but they are
not obligated to do so and may discontinue such market making at any time. In
addition, such market making activity will be subject to the limits imposed by
the Securities Act and the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and may be limited during the Exchange Offer and the pendency
of any Shelf Registration Statement (as defined). Accordingly, no assurance
can be given that an active public market or other market will develop for the
Exchange Notes or the Exchange Debentures. See "Risk Factors--Absence of a
Public Market Could Adversely Affect the Value of Exchange Securities."
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THIS PROSPECTUS AND THE LETTER OF TRANSMITTAL CONTAIN IMPORTANT INFORMATION.
HOLDERS OF OLD NOTES OR OLD DEBENTURES ARE URGED TO READ THIS PROSPECTUS AND
THE LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO TENDER THEIR
OLD NOTES OR OLD DEBENTURES PURSUANT TO THE EXCHANGE OFFER.
THE EXCHANGE OFFER IS NOT BEING MADE TO, NOR WILL THE COMPANY ACCEPT
SURRENDERS FOR EXCHANGE FROM, HOLDERS OF OLD NOTES OR OLD DEBENTURES IN ANY
JURISDICTION IN WHICH THE EXCHANGE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT
BE IN COMPLIANCE WITH THE SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTION.
NO PERSON IS AUTHORIZED IN CONNECTION WITH ANY OFFERING HEREBY TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS OR
THE ACCOMPANYING LETTER OF TRANSMITTAL, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED BY THE COMPANY. NEITHER THE DELIVERY OF THIS PROSPECTUS OR THE
ACCOMPANYING LETTER OF TRANSMITTAL, NOR ANY EXCHANGE MADE HEREUNDER SHALL
UNDER ANY CIRCUMSTANCES CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED
HEREIN IS CORRECT AS OF ANY DATE SUBSEQUENT TO THE DATE HEREOF.
THE EXCHANGE NOTES AND THE EXCHANGE DEBENTURES WILL BE AVAILABLE INITIALLY
ONLY IN BOOK-ENTRY FORM. EXCEPT AS DESCRIBED UNDER "DESCRIPTION OF EXCHANGE
NOTES AND EXCHANGE DEBENTURES--BOOK ENTRY SYSTEM," THE COMPANY EXPECTS THAT
THE EXCHANGE NOTES AND THE EXCHANGE DEBENTURES ISSUED PURSUANT TO THE EXCHANGE
OFFER WILL BE REPRESENTED BY GLOBAL SECURITIES, WHICH WILL BE DEPOSITED WITH,
OR ON BEHALF OF, THE DEPOSITORY TRUST COMPANY (THE "DEPOSITARY" OR "DTC") AND
REGISTERED IN THE NAME OF CEDE & CO. (DTC'S PARTNERSHIP NOMINEE). BENEFICIAL
INTERESTS IN THE GLOBAL SECURITIES WILL BE SHOWN ON, AND TRANSFERS THEREOF
WILL BE EFFECTED ONLY THROUGH, RECORDS MAINTAINED BY DTC AND ITS PARTICIPANTS
(WHICH MAY INCLUDE MORGAN GUARANTY TRUST COMPANY OF NEW YORK, BRUSSELS OFFICE,
AS OPERATOR OF THE EUROCLEAR SYSTEM, AND CITIBANK, N.A., AS OPERATOR OF CEDEL
BANK, SOCIETE ANONYME). AFTER THE INITIAL ISSUANCE OF THE GLOBAL SECURITIES,
EXCHANGE NOTES AND EXCHANGE DEBENTURES IN CERTIFICATED FORM WILL BE ISSUED IN
EXCHANGE FOR THE GLOBAL SECURITIES ONLY UNDER LIMITED CIRCUMSTANCES AS SET
FORTH IN THE INDENTURE. SEE "DESCRIPTION OF EXCHANGE NOTES AND EXCHANGE
DEBENTURES--BOOK ENTRY SYSTEM."
PROSPECTIVE INVESTORS IN THE EXCHANGE NOTES AND THE EXCHANGE DEBENTURES ARE
NOT TO CONSTRUE THE CONTENTS OF THIS PROSPECTUS AS INVESTMENT, LEGAL OR TAX
ADVICE. EACH INVESTOR SHOULD CONSULT ITS OWN COUNSEL, ACCOUNTANT AND OTHER
ADVISORS AS TO LEGAL, TAX, BUSINESS, FINANCIAL AND RELATED ASPECTS OF THE
EXCHANGE NOTES AND THE EXCHANGE DEBENTURES. THE COMPANY IS NOT MAKING ANY
REPRESENTATION TO ANY PROSPECTIVE INVESTOR IN THE EXCHANGE NOTES OR THE
EXCHANGE DEBENTURES REGARDING THE LEGALITY OF AN INVESTMENT THEREIN BY SUCH
PERSON UNDER APPROPRIATE LEGAL INVESTMENT OR SIMILAR LAWS.
THIS PROSPECTUS INCORPORATES DOCUMENTS BY REFERENCE WHICH ARE NOT PRESENTED
HEREIN OR DELIVERED HEREWITH. THESE DOCUMENTS ARE AVAILABLE UPON REQUEST FROM
THE CORPORATE SECRETARY, IMC GLOBAL INC., 2100 SANDERS ROAD, NORTHBROOK,
ILLINOIS 60062, TELEPHONE NUMBER (847) 272-9200. IN ORDER TO ENSURE TIMELY
DELIVERY OF THE DOCUMENTS, ANY REQUEST SHOULD BE MADE BY OCTOBER 31, 1998
(FIVE BUSINESS DAYS PRIOR TO THE EXPIRATION DATE).
THE COMPANY HAS FIXED THE CLOSE OF BUSINESS ON OCTOBER 5, 1998 AS THE RECORD
DATE FOR THE EXCHANGE OFFER FOR PURPOSES OF DETERMINING THE HOLDERS TO WHOM
THIS PROSPECTUS AND THE LETTER OF TRANSMITTAL WILL BE MAILED INITIALLY.
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Exchange Act
and in accordance therewith files reports and other information with the
Commission. Reports, proxy and information statements and other information
filed by the Company can be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, and at the following Regional Offices of the
Commission: Midwest Regional Office, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661 and Northeast Regional Office, 7 World Trade Center,
Suite 1300, New York, New York 10048. Copies of such material can be obtained
from the Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. Reports, proxy and information
statements and other information concerning the Company may also be inspected
at the offices of the national securities exchanges on which the Company's
Common Stock is listed: The New York Stock Exchange, Inc., 20 Broad Street, New
York, New York 10005, and The Chicago Stock Exchange, Incorporated, 440 South
LaSalle Street, Chicago, Illinois 60605. The Company is subject to the
electronic filing requirements of the Commission. Accordingly, pursuant to the
rules and regulations of the Commission, certain documents, including annual
and quarterly reports and proxy statements, filed by the Company with the
Commission have been and will be filed electronically. The Commission maintains
a Web site at http://www.sec.gov containing reports, proxy and information
statements and other information regarding registrants, including the Company,
that file electronically with the Commission.
This Prospectus constitutes a part of a Registration Statement on Form S-4
(the "Exchange Offer Registration Statement," which term shall encompass all
amendments, exhibits, annexes and schedules thereto) filed by the Company with
the Commission under the Securities Act covering the Exchange Offer
contemplated hereby. This Prospectus omits certain of the information contained
in the Exchange Offer Registration Statement in accordance with the rules and
regulations of the Commission. Reference is hereby made to the Exchange Offer
Registration Statement and related exhibits for further information with
respect to the Company and the Exchange Offer. Statements contained herein
concerning the provisions of any document are not necessarily complete and, in
each instance, reference is made to the copy of such document filed as an
exhibit to the Exchange Offer Registration Statement or otherwise filed with
the Commission. Each such statement is qualified in its entirety by such
reference.
The Company has agreed that, if the Company ceases to be subject to the
reporting requirements of Section 13 or Section 15 of the Exchange Act, (i) for
so long as any Notes or Debentures remain outstanding, it will mail to the
holders of the Notes and the Debentures (a) annual reports containing the
information required by the Exchange Act to be contained in an Annual Report on
Form 10-K, (b) quarterly reports containing the information required by the
Exchange Act to be contained in a Quarterly Report on Form 10-Q and (c)
promptly after the occurrence of an event required to be therein reported, such
other reports containing information required by the Exchange Act to be
contained in a Current Report on Form 8-K and (ii) for so long as any
Registrable Notes (as defined in the Registration Rights Agreement) or
Registrable Debentures (as defined in the Registration Rights Agreement) remain
outstanding, it will, upon the request of any holder of Registrable Notes or
Registrable Debentures (x) make publicly available such information as is
necessary to permit sales of such securities pursuant to Rule 144 under the
Securities Act and (y) deliver such information to a prospective purchaser as
is necessary to permit sales of such securities pursuant to Rule 144A under the
Securities Act.
INFORMATION INCORPORATED BY REFERENCE
The following documents of the Company heretofore filed with the Commission
pursuant to the Exchange Act (File No. 1-9759) are incorporated herein by
reference:
1. The Company's Annual Report on Form 10-K for the year ended December 31,
1997;
2. The Company's Quarterly Report on Form 10-Q for the quarter ended March
31, 1998;
3. The Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 1998;
4. The Company's Current Report on Form 8-K filed on January 6, 1998;
5. The Company's Current Report on Form 8-K filed on January 15, 1998; and
6. The Company's Current Report on Form 8-K filed on April 15, 1998, as
amended on June 15, 1998 and September 16, 1998.
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The consolidated financial statements of Freeport-McMoRan Inc. ("FTX") at
December 31, 1996 and for each of the three years in the period ended December
31, 1996 contained in FTX's Annual Report on Form 10-K for the year ended
December 31, 1996 filed with the Commission pursuant to the Exchange Act (File
No. 1-8124) are incorporated herein by reference. The unaudited interim
consolidated financial statements of FTX for the quarter ended September 30,
1997 contained in FTX's Quarterly Report on Form 10-Q for the quarter ended
September 30, 1997 filed with the Commission pursuant to the Exchange Act (File
No. 1-8124) are incorporated herein by reference.
All reports and other documents filed by the Company pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
Prospectus and prior to the termination of the offering of the Exchange
Securities offered hereby shall be deemed to be incorporated by reference into
this Prospectus and to be a part hereof from the date of filing of such reports
and documents; provided, however, that the Report of the Compensation Committee
and the Performance Graph contained in any Proxy Statement of the Company shall
not be so deemed incorporated by reference. Any statement contained 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, therein or in any
other subsequently filed documents which also is or is deemed to be
incorporated by reference in this Prospectus 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 to whom this
Prospectus is delivered, on the written or oral request of such person, a copy
(without exhibits other than exhibits specifically incorporated by reference)
of any or all documents incorporated by reference into this Prospectus.
Requests for such copies should be directed to the Corporate Secretary, IMC
Global Inc., 2100 Sanders Road, Northbrook, Illinois 60062, telephone number
(847) 272-9200.
FORWARD-LOOKING STATEMENTS
This Prospectus, including the documents incorporated by reference herein,
includes "forward-looking statements" within the meaning of various provisions
of the Securities Act and the Exchange Act. All statements, other than
statements of historical facts, included or incorporated by reference in this
Prospectus that address activities, events or developments that the Company
expects or anticipates will or may occur in the future, including such things
as future capital expenditures (including the amount and nature thereof),
business strategy and measures to implement strategy, competitive strengths,
goals, expansion and growth of the Company's and its subsidiaries' business and
operations, plans, references to future success as well as other statements
which include words such as "anticipate," "believe," "plan," "estimate,"
"expect" and "intend" and other similar expressions, constitute forward-looking
statements. These statements are based on certain assumptions and analyses made
by the Company in light of its experience and its perception of historical
trends, current conditions and expected future developments as well as other
factors it believes are appropriate in the circumstances. However, whether
actual results and developments will conform with the Company's expectations
and predictions is subject to a number of risks and uncertainties, including
any special considerations included or incorporated by reference in this
Prospectus; general economic, market or business conditions; conditions in and
policies of the agriculture industry; weather; risks associated with export
sales and investments and operations in foreign jurisdictions and any future
international expansion, including those related to economic, political and
regulatory policies of local governments and laws or policies of the United
States and Canada, as well as those of the United Kingdom and other European
countries, China and other countries in the Far East and Australia; changes in
governmental laws and regulations affecting environmental compliance, taxes and
other matters impacting the Company; the risks attendant with mining
operations; the potential impacts of increased competition in the markets the
Company operates within; risk factors reported from time to time in the reports
filed by the Company with the SEC and other factors, many of which are beyond
the control of the Company and its subsidiaries. Consequently, all of the
forward-looking statements made in this Prospectus are qualified by these
cautionary statements, and there can be no assurance that the actual results or
developments anticipated by the Company will be realized or, even if
substantially realized, that they will have the expected consequences to or
effects on the Company and its subsidiaries or their business or operations.
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PROSPECTUS SUMMARY
The following summary is qualified in its entirety by, and should be read in
conjunction with, the more detailed information and financial data included
elsewhere in this Prospectus and in the documents incorporated by reference in
this Prospectus.
THE COMPANY
The Company is one of the world's leading producers of crop nutrients for the
international agricultural community and is one of the foremost distributors in
the United States of crop nutrients and related products through its retail and
wholesale distribution networks. The Company is also one of the world's leading
producers of salt, soda ash and other inorganic chemicals. The Company mines,
processes and distributes potash in the United States and Canada and is the
majority joint venture partner in IMC-Agrico Company ("IMC-Agrico"), a leading
producer, marketer and distributor of phosphate crop nutrients and animal feed
ingredients. The Company also mines, processes and distributes salt products in
the United States, Canada and Europe and is a major producer of soda ash and
other inorganic chemicals in the United States, Europe and Australia. The
Company has structured its operations into five business units corresponding to
its major product lines as follows: IMC Crop Nutrients (phosphates and potash),
IMC Salt (salt), IMC-Agrico Feed Ingredients (animal feed), IMC Chemicals (soda
ash and other inorganic chemicals) and IMC AgriBusiness (wholesale and retail
distribution).
The Company believes that it is one of the most efficient North American
producers of concentrated phosphates, potash and animal feed ingredients. The
Company's retail distribution network, which extends principally to corn and
soybean farmers in the eastern Midwest and to cotton, peanut and vegetable
farmers in the southeastern United States, is one of the preeminent
distributors of crop nutrients and related products. In addition, the Company
believes it is one of the lowest cost producers of salt in North America. The
Company produces and markets water conditioning, agricultural, industrial,
consumer and road salt products. The Company also produces soda ash, boron
chemicals and other inorganic chemicals. As a result of the merger with FTX,
the Company participates in the exploration and production of oil and gas with
McMoRan Oil & Gas Co.
The three major nutrients required for plant growth are phosphorus, contained
in phosphate rock; potassium, contained in potash; and nitrogen. Phosphorus
plays a key role in the photosynthesis process. Potassium is an important
regulator of plants' physiological functions. Nitrogen is an essential element
for most organic compounds and plants. These elements are naturally present in
the soil but need to be replaced through the use of crop nutrients as crops
exhaust them. Currently, no viable crop nutrient substitutes exist to replace
the role of phosphate, potash and nitrogen in the development and maintenance
of high-yield crops.
The Company's business strategy focuses on maintaining and growing its
leading position as a crop nutrient producer and distributor through extensive
customer service, efficient distribution and transportation and supplying
products worldwide at competitive prices by taking advantage of economies of
scale and state-of-the-art technology to reduce costs. The Company intends to
continue to expand its product distribution and marketing throughout the world
through export associations and its international sales force. The Company
recently expanded its strategy to include salt production and distribution
which it considers complementary to its crop nutrient businesses.
In April 1998, the Company completed its previously announced acquisition of
privately held Harris Chemical Group, Inc. ("HCG") and its Australian
affiliate, Harris Chemical Australia Pty Ltd. & Its Controlled Entities
("Penrice," and collectively with HCG, "Harris"), for approximately $1.4
billion (the "Harris Acquisition"). Under the terms of the Harris Acquisition,
the Company purchased all Harris equity for approximately $450 million in cash
and assumed approximately $950 million of debt. Harris, with annual sales
7
<PAGE>
of approximately $800 million, is a leading producer of salt, soda ash, boron
chemicals and other inorganic chemicals, including potash crop nutrients.
In December 1997, the Company completed a merger with FTX (the "FTX Merger"),
which held approximately 52% of the interest in Phosphate Resource Partners
Limited Partnership ("PLP"). The Company was the surviving entity and the
transaction was accounted for as a purchase. Immediately prior to the FTX
Merger, the sulphur and Main Pass 299 ("Main Pass") businesses of PLP and the
Company were transferred to Freeport-McMoRan Sulphur Inc. ("FSC"); the Company
does not own any of the outstanding shares of FSC. As a result of the FTX
Merger, the Company's total interest in IMC-Agrico increased from approximately
57% to approximately 79%.
The Company's principal executive office is located at 2100 Sanders Road,
Northbrook, Illinois 60062, telephone number (847) 272-9200.
THE INITIAL OFFERING
Old Securities.................. The Old Securities were sold by IMC on August
11, 1998 to the Initial Purchasers pursuant
to a Purchase Agreement dated August 6, 1998
(the "Purchase Agreement") in a transaction
not registered under the Securities Act in
reliance upon an exemption under the
Securities Act. The Initial Purchasers
subsequently placed the Old Securities with
qualified institutional buyers in reliance
upon Rule 144A.
Registration Rights Agreement... Pursuant to the Purchase Agreement, the
Company and the Initial Purchasers entered
into the Registration Rights Agreement, which
grants the holders of the Old Notes and the
Old Debentures certain exchange and
registration rights. The Company is making
the Exchange Offer in order to satisfy its
obligations under the Registration Rights
Agreement relating to the Old Securities.
THE EXCHANGE OFFER
Securities Offered.............. Up to $200,000,000 aggregate principal amount
of 6 1/2% Notes due 2003 and up to
$100,000,000 aggregate principal amount of 7
3/8% Debentures due 2018, which have been
registered under the Securities Act.
The Exchange Offer.............. $1,000 principal amount of Exchange Notes and
$1,000 principal amount of Exchange
Debentures in exchange for each $1,000
principal amount of Old Notes and Old
Debentures, respectively. As of the date
hereof, $200,000,000 aggregate principal
amount of Old Notes are outstanding and
$100,000,000 aggregate principal amount of
Old Debentures are outstanding. The Company
will issue the Exchange Notes and the
Exchange Debentures, as applicable, to
holders on or promptly after the Expiration
Date.
8
<PAGE>
Based on existing interpretations by the
Staff set forth in several no-action letters
issued to third parties, and subject to the
immediately following sentence, the Company
believes that the Exchange Securities to be
issued pursuant to the Exchange Offer may be
offered for resale, resold and otherwise
transferred by the holder thereof (other than
holders who are broker-dealers) without
compliance with the registration and
prospectus delivery requirements of the
Securities Act. However, any holder of Old
Notes or Old Debentures who is an "affiliate"
of the Company or who intends to participate
in the Exchange Offer for the purpose of
distributing the Exchange Notes or the
Exchange Debentures, or any broker-dealer who
purchased the Old Notes or the Old Debentures
from the Company for resale pursuant to Rule
144A or any other available exemption under
the Securities Act, (i) will not be able to
rely on the interpretations of the Staff set
forth in the above-mentioned no-action
letters, (ii) will not be entitled to tender
its Old Notes or Old Debentures, as
applicable, in the Exchange Offer and (iii)
must comply with the registration and
prospectus delivery requirements of the
Securities Act in connection with any sale or
transfer of the Old Notes or Old Debentures,
as applicable, unless such sale or transfer
is made pursuant to an exemption from such
requirements. The Company does not intend to
seek its own no-action letter, and there can
be no assurance that the Staff would make a
similar determination with respect to the
Exchange Notes or the Exchange Debentures as
it has in such no-action letters to third
parties.
Each holder of Old Notes or Old Debentures
(other than certain specified holders) who
wishes to exchange the Old Notes or the Old
Debentures, as applicable, for Exchange Notes
or Exchange Debentures, as applicable, in the
Exchange Offer will be required to represent
that (i) it is not an "affiliate" of the
Company, (ii) the Exchange Notes or the
Exchange Debentures, as applicable, to be
received by it are being acquired in the
ordinary course of its business, (iii) it has
no arrangement with any person to participate
in the distribution (within the meaning of
the Securities Act) of the Exchange Notes or
the Exchange Debentures, as applicable, and
(iv) if such holder is not a broker-dealer,
such holder is not engaged in, and does not
intend to engage in, a distribution (within
the meaning of the Securities Act). Each
Participating Broker-Dealer that receives
Exchange Notes or Exchange Debentures for its
own account pursuant to the Exchange Offer
must acknowledge that it acquired the Old
Notes or the Old Debentures for its own
account as a result of market-making or other
trading activities and must agree that it
will deliver a prospectus meeting the
requirements of the Securities Act in
connection with any resale of such Exchange
Notes or
9
<PAGE>
Exchange Debentures. The Letter of
Transmittal states that by so acknowledging
and by delivering a prospectus, a
Participating Broker-Dealer will not be
deemed to admit that it is an "underwriter"
within the meaning of the Securities Act. The
Commission has taken the position in the
above-mentioned no-action letters that
Participating Broker-Dealers who acquired Old
Notes or Old Debentures for their own
accounts as a result of market-making or
other trading activities may fulfill their
prospectus delivery requirements with respect
to the Exchange Notes or the Exchange
Debentures, as applicable, other than a
resale of an unsold allotment from the
original sale thereof, with a prospectus
meeting the requirements of the Securities
Act, which may be the prospectus prepared for
an exchange offer so long as it contains a
plan of distribution with respect to the
resale of such Exchange Notes and Exchange
Debentures. Under the Registration Rights
Agreement, the Company is required to allow
Participating Broker-Dealers and other
persons, if any, subject to similar
prospectus delivery requirements to use this
Prospectus, as it may be amended or
supplemented from time to time, in connection
with the resale of such Exchange Notes or
Exchange Debentures, as applicable, for a
period of 180 days from the issuance of the
Exchange Notes or the Exchange Debentures, as
applicable. The Company has agreed that, for
a period of 180 days after the Expiration
Date, it will make this Prospectus available
to any Participating Broker-Dealer for use in
connection with any such resale (provided
that the Company has received prior written
notice from such Participating Broker-Dealer
of its status as a Participating Broker-
Dealer). See "Plan of Distribution." Any
Participating Broker-Dealer who is an
"affiliate" of the Company may not rely on
the above-mentioned no-action letters and
must comply with the registration and
delivery requirements of the Securities Act
in connection with any resale transaction.
Holders of Old Notes or Old Debentures do not
have any appraisal or dissenters' rights
under the General Corporation Law of Delaware
or the Indenture in connection with the
Exchange Offer.
Expiration Date................. 5:00 p.m., New York City time, on November 6,
1998 unless extended by IMC in its sole
discretion, in which case the term
"Expiration Date" shall mean the latest date
and time to which the Exchange Offer is
extended.
Conditions to the Exchange The Exchange Offer is subject to certain
Offer........................... customary conditions, which may be waived by
the Company. See "Exchange Offer--
Conditions."
Procedures for Tendering Old Each holder of Old Notes or Old Debentures
Securities...................... wishing to accept the Exchange Offer must
complete, sign and date the
10
<PAGE>
accompanying Letter of Transmittal, or a
facsimile thereof (or, in the case of a book-
entry transfer, deliver an Agent's Message
(as defined) in lieu thereof), in accordance
with the instructions contained herein and
therein, and mail or otherwise deliver such
Letter of Transmittal, or such facsimile (or,
in the case of book-entry transfer, deliver
an Agent's Message in lieu thereof), together
with the Old Notes or Old Debentures and any
other required documentation to the Exchange
Agent (as defined) at the address set forth
herein. By executing the Letter of
Transmittal (or, in the case of a book-entry
transfer, delivering an Agent's Message in
lieu thereof), each holder will represent to
the Company that, among other things, (i) it
is not an "affiliate" of the Company, (ii)
the Exchange Notes or the Exchange
Debentures, as applicable, to be received by
it are being acquired in the ordinary course
of its business, (iii) it has no arrangement
with any person to participate in the
distribution (within the meaning of the
Securities Act) of the Exchange Notes or the
Exchange Debentures, as applicable, and (iv)
if such holder is not a broker-dealer, such
holder is not engaged in, and does not intend
to engage in, a distribution (within the
meaning of the Securities Act). Each
Participating Broker-Dealer that receives
Exchange Notes or Exchange Debentures for its
own account pursuant to the Exchange Offer
must acknowledge that it acquired the Old
Notes or the Old Debentures for its own
account as a result of market-making or other
trading activities and must agree that it
will deliver a prospectus meeting the
requirements of the Securities Act in
connection with any resale of such Exchange
Notes or Exchange Debentures. Questions
regarding how to tender and requests for
information should be directed to the
Exchange Agent. See "Exchange Offer--Purpose
and Effect of the Exchange Offer," "--
Procedures for Tendering" and "--Exchange
Agent."
Untendered Old Securities....... Any Old Notes or Old Debentures not tendered
and accepted in the Exchange Offer will
remain outstanding and will be entitled to
all the same rights and benefits and will be
subject to the same limitations applicable
thereto under the Indenture (except for those
rights which terminate upon consummation of
the Exchange Offer). Following consummation
of the Exchange Offer, the holders of Old
Notes or Old Debentures will continue to be
subject to the existing restrictions upon
transfer thereof and the Company will have no
further obligation to such holders to provide
for registration under the Securities Act of
the Old Notes or the Old Debentures held by
them. To the extent that Old Notes or Old
Debentures are tendered and accepted in the
Exchange Offer, the trading market for
untendered and tendered but unaccepted Old
Notes and Old Debentures could be adversely
affected.
11
<PAGE>
Consequences of Failure to The Old Notes and the Old Debentures that are
Exchange........................ not exchanged for Exchange Notes and Exchange
Debentures, respectively, pursuant to the
Exchange Offer will remain restricted
securities. Accordingly, such Old Notes or
Old Debentures may be offered, sold or
otherwise transferred only to certain persons
or under certain circumstances. The Old Notes
and the Exchange Notes will constitute a
single series of debt securities under the
Indenture. In the event that the Exchange
Offer is consummated, any Old Notes that
remain outstanding after consummation of the
Exchange Offer and the Exchange Notes issued
in the Exchange Offer will vote together as a
single class for purposes of determining
whether holders of the requisite percentage
in outstanding principal amount of Notes have
taken certain actions or exercised certain
rights under the Indenture. Similarly, the
Old Debentures and the Exchange Debentures
will constitute a single series of debt
securities under the Indenture. In the event
that the Exchange Offer is consummated, any
Old Debentures outstanding after consummation
of the Exchange Offer and the Exchange
Debentures issued in the Exchange Offer will
vote together as a single class for purposes
of determining whether holders of the
requisite percentage in outstanding principal
amount of Debentures have taken certain
actions or exercised certain rights under the
Indenture. See "Exchange Offer--Consequences
of Failure to Exchange."
Shelf Registration Statement.... If (i) because of any change in law or in
currently prevailing interpretations thereof
by the Staff, the Company is not permitted to
effect the Exchange Offer, (ii) the Exchange
Offer is not consummated within 180 days
after the date of issuance of the Old
Securities or (iii) upon the request of any
Initial Purchaser, if such Initial Purchaser
is not permitted, in the reasonable opinion
of counsel, pursuant to applicable law or
applicable interpretations of the Staff, to
participate in the Exchange Offer and thereby
receive securities that are freely tradeable
without restriction under the Securities Act
and applicable blue sky or state securities
laws, then in each case, the Company has
agreed, among other things, to file a shelf
registration statement covering resales of
the Old Securities (the "Shelf Registration
Statement") and use its reasonable best
efforts to cause it to be declared effective
under the Securities Act. See "Exchange
Offer--Purpose and Effect of the Exchange
Offer."
Special Procedures for Any beneficial owner whose Old Notes or Old
Beneficial Owners............... Debentures are registered in the name of a
broker, dealer, commercial bank, trust
company or other nominee and who wishes to
tender should contact such registered holder
promptly and instruct such registered holder
to tender on such beneficial owner's behalf.
See "Instructions to Registered Holder and/or
Book-Entry Transfer Facility Participant from
Beneficial Owner" included with the Letter of
Transmittal.
12
<PAGE>
Guaranteed Delivery Procedures.. Holders of Old Notes or Old Debentures who
wish to tender their Old Notes or Old
Debentures and whose Old Notes or Old
Debentures are not immediately available or
who cannot deliver their Old Notes or Old
Debentures, the Letter of Transmittal (or, in
the case of a book-entry transfer, deliver an
Agent's Message in lieu thereof) or any other
documents required by the Letter of
Transmittal to the Exchange Agent (or comply
with the procedures for book-entry transfer)
prior to the Expiration Date must tender
their Old Notes or Old Debentures according
to the guaranteed delivery procedures set
forth in "Exchange Offer--Guaranteed Delivery
Procedures."
Withdrawal Rights............... Tenders of Old Notes and Old Debentures may
be withdrawn at any time on or prior to the
Expiration Date.
Acceptance of Old Securities
and Delivery of Exchange
Securities......................
The Company will accept for exchange any and
all Old Securities which are properly
tendered in the Exchange Offer on or prior to
the Expiration Date. The Exchange Securities
issued pursuant to the Exchange Offer will be
delivered promptly following the Expiration
Date. See "Exchange Offer-- Terms of the
Exchange Offer."
Use of Proceeds................. The Company will not receive any cash
proceeds from the issuance of the Exchange
Securities offered hereby.
Exchange Agent.................. The Bank of New York is serving as Exchange
Agent in connection with the exchange offer
of Exchange Securities for Old Securities.
The Bank of New York is referred to herein as
the "Exchange Agent."
Certain Federal Income Tax See "Certain Federal Income Tax Consequences"
Consequences.................... for a discussion of certain federal income
tax consequences of the exchange of Old Notes
or Old Debentures for Exchange Notes or
Exchange Debentures, respectively.
THE EXCHANGE SECURITIES
General......................... The forms and terms of the Exchange Notes and
the Exchange Debentures are the same as the
forms and terms of the Old Notes and the Old
Debentures, respectively, except that (i) the
Exchange Notes and the Exchange Debentures
will each bear a different CUSIP number from
the Old Notes and the Old Debentures,
respectively, (ii) the Exchange Notes and the
Exchange Debentures will have been registered
under the Securities Act and, therefore, will
not bear legends restricting the transfer
thereof and (iii) holders of the Exchange
Notes and the Exchange Debentures will not be
entitled to certain rights of holders of Old
Notes and Old Debentures under the
Registration Rights Agreement. The Exchange
Notes and the Exchange Debentures will
evidence the same debt as the Old
13
<PAGE>
Notes and the Old Debentures (which they
respectively replace) and will be issued
under and be entitled to the benefits of the
Indenture. The Old Notes and the Exchange
Notes will constitute a single series of debt
securities under the Indenture. In the event
that the Exchange Offer is consummated, any
Old Notes that remain outstanding after
consummation of the Exchange Offer and the
Exchange Notes issued in the Exchange Offer
will vote together as a single class for
purposes of determining whether holders of
the requisite percentage in outstanding
principal amount of Notes have taken certain
actions or exercised certain rights under the
Indenture. Similarly, the Old Debentures and
the Exchange Debentures will constitute a
single series of debt securities under the
Indenture. In the event that the Exchange
Offer is consummated, any Old Debentures
outstanding after consummation of the
Exchange Offer and the Exchange Debentures
issued in the Exchange Offer will vote
together as a single class for purposes of
determining whether holders of the requisite
percentage in outstanding principal amount of
Debentures have taken certain actions or
exercised certain rights under the Indenture.
See "Description of Exchange Notes and
Exchange Debentures."
Issuer.......................... IMC Global Inc.
Maturity Dates.................. The Exchange Notes will mature on August 1,
2003 and the Exchange Debentures will mature
on August 1, 2018.
Interest Rates.................. Each Exchange Note will bear interest at the
rate of 6 1/2% per annum and each Exchange
Debenture will bear interest at the rate of 7
3/8% per annum, in each case from the last
Interest Payment Date to which interest was
paid on the Old Notes or Old Debentures (as
the case may be) surrendered in exchange
therefor or, if no interest has been paid on
such Old Notes or Old Debentures, from August
11, 1998, payable semiannually on February 1
and August 1 in each year, commencing
February 1, 1999. Holders of the Old Notes or
the Old Debentures whose Old Notes or Old
Debentures are accepted for exchange will not
receive accrued interest on such Old Notes or
Old Debentures for any period from and after
the last Interest Payment Date to which
interest has been paid or duly provided for
on such Old Notes or Old Debentures prior to
the original issue date of the Exchange Notes
or Exchange Debentures or, if no such
interest has been paid or duly provided for,
will not receive any accrued interest on such
Old Notes or Old Debentures, and will be
deemed to have waived the right to receive
any interest on such Old Notes or Old
Debentures accrued from and after such
Interest Payment Date or, if no such interest
has been paid or duly provided for, from and
after August 11, 1998.
Ranking......................... The Exchange Notes and the Exchange
Debentures will be unsecured, senior debt of
the Company and will rank on a
14
<PAGE>
parity 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 Exchange Notes and the
Exchange 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.
Optional Redemption............. Each of the Exchange Notes and the Exchange
Debentures is redeemable at the option of the
Company, in whole at any time or in part from
time to time, at a redemption price equal to
the greater of (i) 100% of their principal
amount and (ii) the sum of the present values
of the principal amount and the remaining
scheduled payments of interest thereon, in
each case discounted from their respective
scheduled payment dates to the redemption
date on a semiannual basis at the Treasury
Rate (as defined) plus 15 basis points in the
case of the Exchange Notes and 25 basis
points in the case of the Exchange
Debentures, plus in either case accrued
interest thereon to the redemption date. The
Exchange Notes and the Exchange Debentures
will not be subject to any sinking fund. See
"Description of Exchange Notes and Exchange
Debentures--Optional Redemption."
Certain Covenants............... The Indenture contains certain covenants that
limit, among other things, the ability of the
Company and its Restricted Subsidiaries (as
defined) to create liens on certain assets or
enter into sale and leaseback transactions
with respect to certain assets. See
"Description of Exchange Notes and Exchange
Debentures--Certain Covenants." In addition,
the Indenture limits the ability of the
Company to consolidate or merge with or into,
or sell, lease, convey or otherwise dispose
of all or substantially all of its assets or
assign any of its obligations under the Notes
and Debentures or the Indenture to any other
person. See "Description of Exchange Notes
and Exchange Debentures--Successor Company."
For additional information regarding the Exchange Securities, see
"Description of Exchange Notes and Exchange Debentures."
USE OF PROCEEDS
There will be no cash proceeds to the Company from the issuance of the
Exchange Securities offered hereby. The proceeds of the Initial Offering were
used to repay short-term debt, including commercial paper, of IMC and for
general corporate purposes. See "Use or Proceeds."
RISK FACTORS
See "Risk Factors" for a discussion of certain factors that should be
considered before tendering Old Notes or Old Debentures for Exchange Notes or
Exchange Debentures.
15
<PAGE>
SELECTED HISTORICAL CONSOLIDATED FINANCIAL DATA
The following selected historical consolidated financial information for IMC
with respect to each year in the five-year period ended December 31, 1997 is
derived from and should be read in conjunction with the consolidated financial
statements of IMC. The consolidated financial statements of IMC for each of the
years in the three-year period ended December 31, 1997 are included in
documents incorporated by reference in this Prospectus. Such consolidated
financial statements have been audited by Ernst & Young LLP, independent
auditors. The following selected consolidated financial information as of and
for each of the six-month periods ended June 30, 1998 and 1997 is derived from
and should be read in conjunction with the unaudited interim condensed
consolidated financial statements of IMC which are included in documents
incorporated by reference in this Prospectus. Such unaudited interim condensed
consolidated financial statements reflect all adjustments (consisting only of
normally recurring accruals) which the management of IMC considers necessary to
present fairly the financial information for such periods. The results of
operations for any interim period are not necessarily indicative of results for
a full year. See "Information Incorporated by Reference."
<TABLE>
<CAPTION>
SIX MONTHS
ENDED JUNE 30, YEARS ENDED DECEMBER 31,
-------------------- ------------------------------------------------
1998 (1)(2) 1997 1997 (2) 1996 1995 1994 1993 (3)
----------- -------- -------- -------- -------- -------- --------
(DOLLARS IN MILLIONS EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF OPERATIONS
DATA:
Net sales............... $1,898.6 $1,713.0 $2,988.6 $2,941.0 $2,940.4 $2,475.7 $1,640.5
Gross margins........... 467.1 430.0 738.6 745.0 778.7 559.9 252.7
Main Pass writedown (4). -- -- 183.7 -- -- -- --
Sterlington litigation
settlement, net (5).... -- -- -- -- -- -- 169.1
Operating earnings
(loss)................. 300.2 297.4 303.0 461.4 566.6 399.7 (98.1)
Interest expense........ 83.7 25.2 53.5 56.7 69.8 77.5 76.6
Other (income) expense,
net.................... (8.9) -- (6.2) (5.9) (15.2) (6.6) 21.1
-------- -------- -------- -------- -------- -------- --------
Earnings (loss) before
minority interest...... 225.4 272.2 255.7 410.6 512.0 328.8 (195.8)
Minority interest....... 17.2 71.5 124.4 185.7 163.6 106.8 5.3
-------- -------- -------- -------- -------- -------- --------
Earnings (loss) before
taxes.................. 208.2 200.7 131.3 224.9 348.4 222.0 (201.1)
Provision (credit) for
income taxes........... 73.2 73.3 43.5 89.7 129.4 97.8 (75.2)
-------- -------- -------- -------- -------- -------- --------
Earnings (loss) before
extraordinary item and
cumulative effect of
accounting change...... 135.0 127.4 87.8 135.2 219.0 124.2 (125.9)
Extraordinary charge--
debt retirement........ (2.7) (3.3) (24.9) (8.1) (3.5) (4.4) (25.2)
Cumulative effect on
prior years of change
in accounting for
postemployment benefits
(net of taxes)......... -- -- -- -- -- (5.9) --
-------- -------- -------- -------- -------- -------- --------
Net earnings (loss)..... $ 132.3 $ 124.1 $ 62.9 $ 127.1 $ 215.5 $ 113.9 $ (151.1)
======== ======== ======== ======== ======== ======== ========
DILUTED EARNINGS (LOSS)
PER SHARE:
Earnings (loss) before
extraordinary item and
cumulative effect of
accounting change...... $ 1.18 $ 1.33 $ 0.93 $ 1.39 $ 2.34 $ 1.45 $ (1.50)
Extraordinary charge--
debt retirement........ (0.02) (0.03) (0.26) (0.08) (0.04) (0.05) (0.31)
Cumulative effect on
prior years of change
in
accounting............. -- -- -- -- -- (0.07) --
-------- -------- -------- -------- -------- -------- --------
Net earnings (loss)..... $ 1.16 $ 1.30 $ 0.67 $ 1.31 $ 2.30 $ 1.33 $ (1.81)
======== ======== ======== ======== ======== ======== ========
Diluted weighted average
number of shares
outstanding............ 114.8 95.6 94.7 97.0 95.5 88.8 81.2
BALANCE SHEET DATA (AT
END OF PERIOD):
Working capital......... $ (536.0) $ 592.6 $ 389.1 $ 582.6 $ 507.6 $ 355.2 $ 427.7
Total assets............ 6,741.1 3,611.6 4,673.9 3,485.2 3,521.8 3,275.1 3,280.9
Long-term debt, less
current maturities..... 1,639.1 694.8 1,235.2 656.8 741.7 699.1 950.0
Total stockholders'
equity................. 2,037.3 1,339.9 1,935.7 1,326.2 1,090.4 883.3 653.1
OTHER FINANCIAL DATA:
Capital expenditures.... $ 174.0 $ 105.0 $ 244.0 $ 209.0 $ 146.0 $ 97.7 $ 74.1
Depreciation, depletion
and amortization....... 124.6 100.5 183.2 171.0 166.4 162.7 104.9
</TABLE>
- --------
(1) Operating results reflect the Harris Acquisition which occurred in April
1998. Also, includes a $14.0 million restructuring charge, $9.1 million
after tax benefits or $0.08 per share, recorded in conjunction with the
divestiture of the IMC Vigoro business unit.
(2) Operating results reflect the FTX Merger which occurred in December 1997.
(3) Operating results reflect the consolidation of IMC-Agrico which was formed
in July 1993.
(4) Represents an adjustment to reduce the historical carrying value of IMC's
interest in Main Pass to estimated fair value.
(5) Represents a charge related to the settlement of litigation resulting from
a May 1991 explosion at a nitroparafins plant in Sterlington, Louisiana.
16
<PAGE>
RISK FACTORS
Prospective investors should carefully consider the following factors in
addition to the other information set forth in the Prospectus before tendering
Old Notes or Old Debentures in exchange for Exchange Notes or Exchange
Debentures.
ABSENCE OF A PUBLIC MARKET COULD ADVERSELY AFFECT THE VALUE OF EXCHANGE
SECURITIES
The Old Notes and the Old Debentures were issued to, and the Company
believes are currently owned by, a relatively small number of beneficial
owners. Prior to the Exchange Offer, there has not been any public market for
the Old Notes or the Old Debentures. The Old Notes and the Old Debentures have
not been registered under the Securities Act and will be subject to
restrictions on transferability to the extent that they are not exchanged for
Exchange Notes and Exchange Debentures, respectively, by holders who are
entitled to participate in this Exchange Offer. After consummation of the
Exchange Offer, the market for each of the Old Notes and the Old Debentures
not tendered or exchanged (or tendered but not accepted for exchange) in the
Exchange Offer will be even more limited than their existing market. The
Exchange Notes and the Exchange Debentures will each constitute a new issue of
securities with no established trading market. The Company does not intend to
list the Exchange Notes or the Exchange Debentures on any national securities
exchange or seek the admission thereof to trading in the National Association
of Securities Dealers Automated Quotation System. The Initial Purchasers have
advised the Company that they currently intend to make a market in each of the
Exchange Notes and the Exchange Debentures, but they are not obligated to do
so and may discontinue such market making at any time. In addition, such
market making activity will be subject to the limits imposed by the Securities
Act and the Exchange Act and may be limited during the Exchange Offer and the
pendency of any Shelf Registration Statement. Accordingly, no assurance can be
given that an active public or other market will develop for the Exchange
Notes or the Exchange Debentures or as to the liquidity of the trading market
for each of the Exchange Notes and the Exchange Debentures. If a trading
market does not develop or is not maintained, holders of the Exchange Notes or
the Exchange Debentures, as applicable, may experience difficulty in reselling
the Exchange Notes or the Exchange Debentures, as applicable, or may be unable
to sell them at all. If a market for the Exchange Notes or the Exchange
Debentures develops, any such market may be discontinued at any time.
If a public trading market develops for the Exchange Notes or the Exchange
Debentures, future trading prices of such securities will depend on many
factors including, among other things, prevailing interest rates, the
Company's results of operations and market for similar securities. Depending
on prevailing interest rates, the market for similar securities and other
factors, including the financial condition of the Company, the Exchange Notes
and the Exchange Debentures may each trade at a discount from their respective
principal amount.
FAILURE TO FOLLOW EXCHANGE OFFER PROCEDURES COULD ADVERSELY AFFECT HOLDERS
Issuance of the Exchange Notes and the Exchange Debentures in exchange for
the Old Notes and the Old Debentures, respectively, pursuant to the Exchange
Offer will be made only after a timely receipt by the Company of such Old
Notes or Old Debentures, a properly completed and duly executed Letter of
Transmittal (or, in the case of a book-entry transfer, an Agent's Message in
lieu thereof) and all other required documents. Therefore, holders of the Old
Notes or the Old Debentures desiring to tender such Old Notes or Old
Debentures in exchange for Exchange Notes or Exchange Debentures,
respectively, should allow sufficient time to ensure timely delivery. The
Company is under no duty to give notification of defects or irregularities
with respect to the tenders of Old Notes or Old Debentures for exchange. Old
Notes and Old Debentures that are not tendered or are tendered but not
accepted will, following the consummation of the Exchange Offer, continue to
be subject to certain restrictions on transfer, and holders thereof will not
have any further registration rights under the Registration Rights Agreement.
In addition, any holder of Old Notes or Old Debentures who tenders in the
Exchange Offer for the purpose of participating in a distribution of the
Exchange Notes or the Exchange Debentures may be deemed to have received
restricted securities, and if so, will be required to comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any resale transaction.
17
<PAGE>
Each Participating Broker-Dealer that receives Exchange Notes or Exchange
Debentures for its own account pursuant to the Exchange Offer must acknowledge
that it acquired the Old Notes or the Old Debentures for its own account as a
result of market-making or other trading activities and must agree that it
will deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Notes or Exchange Debentures. See
"Exchange Offer--Resale of the Exchange Securities" and "Plan of
Distribution." To the extent that Old Notes or Old Debentures are tendered and
accepted in the Exchange Offer, the trading market for untendered and tendered
but unaccepted Old Notes or Old Debentures could be adversely affected. See
"Exchange Offer."
USE OF PROCEEDS
The Exchange Offer is intended to satisfy certain of the Company's
obligations under the Purchase Agreement and the Registration Rights
Agreement. The Company will not receive any cash proceeds from the issuance of
the Exchange Notes or the Exchange Debentures offered hereby. In consideration
for issuing the Exchange Notes and the Exchange Debentures contemplated in
this Prospectus, the Company will receive Old Notes and Old Debentures, each
in like principal amount, the forms and terms of which are the same as the
forms and terms of the Exchange Notes (which replace the Old Notes) and the
Exchange Debentures (which replace the Old Debentures), except as otherwise
described herein. The Old Notes and the Old Debentures surrendered in exchange
for Exchange Notes and the Exchange Debentures, respectively, will be retired
and cancelled and cannot be reissued. Accordingly, the issuance of the
Exchange Notes and the Exchange Debentures will not result in any increase or
decrease in the indebtedness of the Company. As such, no effect has been given
to the Exchange Offer in the capitalization table.
The net proceeds to the Company from the sale of the Old Securities in the
Initial Offering (after deducting discounts, fees and expenses) were utilized
by the Company to repay short-term debt, including commercial paper, and for
general corporate purposes.
CAPITALIZATION
The following table sets forth, at June 30, 1998, (i) the unaudited
consolidated historical capitalization of IMC and (ii) the unaudited combined
pro forma capitalization of IMC giving effect to the sale of the Old Notes and
the Old Debentures and the application of the proceeds therefrom as described
under "Use of Proceeds." The pro forma capitalization is presented for
informational purposes only and is not necessarily indicative of the future
capitalization of IMC. The table should be read in conjunction with the
historical and pro forma financial statements and notes thereto of IMC,
including IMC's Current Report on Form 8-K filed on April 15, 1998, as amended
on June 15, 1998 and September 16, 1998. See "Information Incorporated by
Reference."
<TABLE>
<CAPTION>
AT JUNE 30, 1998
--------------------
HISTORICAL PRO FORMA
---------- ---------
(DOLLARS IN
MILLIONS)
<S> <C> <C>
Short-term debt:
Commercial paper......................................... $ 482.1 $ 182.1
Notes and debentures..................................... 718.8 718.8
Other.................................................... 93.2 93.2
-------- --------
Total short-term debt.................................. 1,294.1 994.1
Long-term debt:
Commercial paper......................................... 612.1 612.1
Notes and debentures..................................... 634.1 934.1
Other.................................................... 392.9 392.9
-------- --------
Total long-term debt................................... 1,639.1 1,939.1
-------- --------
Total debt................................................. 2,933.2 2,933.2
Total stockholders' equity................................. 2,037.3 2,037.3
-------- --------
Total capitalization....................................... $4,970.5 $4,970.5
======== ========
</TABLE>
18
<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges of IMC
for the periods indicated:
<TABLE>
<CAPTION>
SIX MONTHS YEAR ENDED DECEMBER 31,
ENDED JUNE -------------------------
30, 1998 1997 1996 1995 1994 1993
---------- ---- ---- ---- ---- -----
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges (a)... 3.69 5.78 8.24 8.34 5.24 (1.56)
Adjusted ratio of earnings to fixed
charges (b)............................. 3.86 9.21 9.98 8.34 5.24 0.65
</TABLE>
- --------
(a) Earnings consist of pre-tax earnings from continuing operations but before
fixed charges. Fixed charges consist of interest on indebtedness, interest
capitalized as part of fixed assets, amortization of debt expense and rent
expense which is deemed representative of an interest factor.
(b) The adjusted ratio of earnings to fixed charges for the six months ended
June 30, 1998 excludes a charge of $9.1 million relating to the sale of the
Company's IMC Vigoro business unit. The adjusted ratio of earnings to fixed
charges for the year ended December 31, 1997 excludes a charge of $183.7
million relating to the writedown of the historical carrying value of IMC's
interest in Main Pass. The adjusted ratio of earnings to fixed charges for
the year ended December 31, 1996 excludes a charge of $98.6 million
relating to the merger of The Vigoro Corporation into a wholly owned
subsidiary of IMC. The adjusted ratio of earnings to fixed charges for the
year ended December 31, 1993 excludes a charge of $169.1 million relating
to the settlement of litigation resulting from a May 1991 explosion at a
nitroparaffins plant in Sterlington, Louisiana.
19
<PAGE>
THE COMPANY
The Company is one of the world's leading producers of crop nutrients for the
international agricultural community and is one of the foremost distributors in
the United States of crop nutrients and related products through its retail and
wholesale distribution networks. The Company is also one of the world's leading
producers of salt, soda ash and other inorganic chemicals. The Company mines,
processes and distributes potash in the United States and Canada and is the
majority joint venture partner in IMC-Agrico, a leading producer, marketer and
distributor of phosphate crop nutrients and animal feed ingredients. The
Company also mines, processes and distributes salt products in the United
States, Canada and Europe and is a major producer of soda ash and other
inorganic chemicals in the United States, Europe and Australia. The Company has
structured its operations into five business units corresponding to its major
product lines as follows: IMC Crop Nutrients (phosphates and potash), IMC Salt
(salt), IMC-Agrico Feed Ingredients (animal feed), IMC Chemicals (soda ash and
other inorganic chemicals) and IMC AgriBusiness (wholesale and retail
distribution).
The Company believes that it is one of the most efficient North American
producers of concentrated phosphates, potash and animal feed ingredients. The
Company's retail distribution network, which extends principally to corn and
soybean farmers in the eastern Midwest and to cotton, peanut and vegetable
farmers in the southeastern United States, is one of the preeminent
distributors of crop nutrients and related products. In addition, the Company
believes it is one of the lowest cost producers of salt in North America. The
Company produces and markets water conditioning, agricultural, industrial,
consumer and road salt products. The Company also produces soda ash, boron
chemicals and other inorganic chemicals. As a result of the FTX Merger, the
Company participates in the exploration and production of oil and gas with
McMoRan Oil & Gas Co.
The three major nutrients required for plant growth are phosphorus, contained
in phosphate rock; potassium, contained in potash; and nitrogen. Phosphorus
plays a key role in the photosynthesis process. Potassium is an important
regulator of plants' physiological functions. Nitrogen is an essential element
for most organic compounds and plants. These elements are naturally present in
the soil but need to be replaced through the use of crop nutrients as crops
exhaust them. Currently, no viable crop nutrient substitutes exist to replace
the role of phosphate, potash and nitrogen in the development and maintenance
of high-yield crops.
The Company's business strategy focuses on maintaining and growing its
leading position as a crop nutrient producer and distributor through extensive
customer service, efficient distribution and transportation and supplying
products worldwide at competitive prices by taking advantage of economies of
scale and state-of-the-art technology to reduce costs. The Company intends to
continue to expand its product distribution and marketing throughout the world
through export associations and its international sales force. The Company
recently expanded its strategy to include salt production and distribution
which it considers complementary to its crop nutrient businesses.
In April 1998, the Company completed the Harris Acquisition for approximately
$1.4 billion. Under the terms of the Harris Acquisition, the Company purchased
all Harris equity for approximately $450 million in cash and assumed
approximately $950 million of debt. Harris, with annual sales of approximately
$800 million, is a leading producer of salt, soda ash, boron chemicals and
other inorganic chemicals, including potash crop nutrients.
In December 1997, the Company completed the FTX Merger, which held
approximately 52% of the interest in PLP. The Company was the surviving entity
and the transaction was accounted for as a purchase. Immediately prior to the
FTX Merger, the sulphur and Main Pass businesses of PLP and the Company were
transferred to FSC; the Company does not own any of the outstanding shares of
FSC. As a result of the FTX Merger, the Company's total interest in IMC-Agrico
increased from approximately 57% to approximately 79%.
RECENT DEVELOPMENTS
The Company is exploring strategic options for, including the possible
divestiture of, its IMC AgriBusiness retail and wholesale distribution unit. In
addition, the Company is exploring strategic options for, including the
possible divestiture of, certain chemical assets and businesses which were
acquired as part of the Harris Acquisition, which assets and businesses are not
deemed to be core to the Company's strategy.
In September 1998, the Company announced the consolidation of its phosphate
and potash business units into a new business unit, IMC Crop Nutrients. The
Company's phosphate business, formerly known as IMC-Agrico Crop Nutrients, is
now called IMC-Agrico Phosphates.
20
<PAGE>
DESCRIPTION OF EXCHANGE NOTES AND EXCHANGE DEBENTURES
The Exchange Notes and the Exchange Debentures will be issued as separate
series under an Indenture dated as of August 1, 1998 between the Company and
The Bank of New York, as Trustee. The Exchange Notes and the Exchange
Debentures will constitute "Senior Debt Securities" under the Indenture. The
forms and terms of the Exchange Notes and the Exchange Debentures are the same
as the forms and terms of the Old Notes and the Old Debentures, respectively,
except that (i) the Exchange Notes and the Exchange Debentures will each bear a
different CUSIP number from the Old Notes and the Old Debentures, respectively,
(ii) the Exchange Notes and the Exchange Debentures will have been registered
under the Securities Act and, therefore, will not bear legends restricting the
transfer thereof and (iii) holders of the Exchange Notes and the Exchange
Debentures will not be entitled to certain rights of holders of Old Notes and
Old Debentures under the Registration Rights Agreement. The following summary
of certain provisions of the Exchange Notes, the Exchange Debentures and the
Indenture do not purport to be complete and are subject to, and are qualified
in their entirety by reference to, all of the provisions of the Indenture
(including the definitions therein of certain terms), a copy of which has been
filed as an exhibit to the Exchange Offer Registration Statement. Certain
capitalized terms used herein are defined in the Indenture. Unless the context
otherwise indicates, references in this Description of Exchange Notes and
Exchange Debentures to the "Company" or "IMC" refer to IMC Global Inc., the
issuer of the Exchange Notes and the Exchange Debentures, and not to its
subsidiaries.
GENERAL
The Exchange Notes will mature on August 1, 2003 and the Exchange Debentures
will mature on August 1, 2018. Each Exchange Note will bear interest at the
rate of 6 1/2% per annum and each Exchange Debenture will bear interest at the
rate of 7 3/8% per annum, in each case from the last Interest Payment Date (as
defined) to which interest was paid on the Old Notes or Old Debentures (as the
case may be) surrendered in exchange therefor or, if no interest has been paid
or such Old Note or Old Debenture, from August 11, 1998, payable semiannually
on February 1 and August 1 in each year (each such date being referred to
herein as an "Interest Payment Date"), commencing February 1, 1999, to the
person in whose name such Exchange Note or Exchange Debenture, as the case may
be, is registered at the close of business on January 15 or July 15, as the
case may be, preceding such Interest Payment Dates. Interest on the Exchange
Notes and the Exchange Debentures will be computed on the basis of a 360-day
year of twelve 30-day months. If any Interest Payment Date, maturity date or
redemption date falls on a day that is not a Business Day, the required payment
shall be made on the next Business Day as if it were made on the date such
payment was due and no interest shall accrue on the amount so payable for the
period from and after such Interest Payment Date, maturity date or redemption
date, as the case may be, to such next Business Day. "Business Day" means any
day, other than a Saturday or Sunday, on which banking institutions in New
York, New York are open for business. Holders of the Old Notes or the Old
Debentures whose Old Notes or Old Debentures are accepted for exchange will not
receive accrued interest on such Old Notes or Old Debentures for any period
from and after the last Interest Payment Date to which interest has been paid
or duly provided for on such Old Notes or Old Debentures prior to the original
issue date of the Exchange Notes or Exchange Debentures or, if no such interest
has been paid or duly provided for, will not receive any accrued interest on
such Old Notes or Old Debentures, and will be deemed to have waived the right
to receive any interest on such Old Notes or Old Debentures accrued from and
after such Interest Payment Date or, if no such interest has been paid or duly
provided for, from and after August 11, 1998.
The Old Notes and the Old Debentures are, and the Exchange Notes and the
Exchange Debentures will be, unsecured, senior debt of the Company and rank,
and will rank, on a parity 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 Notes and 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.
21
<PAGE>
The Indenture does not limit the amount of debt securities which can be
issued thereunder and provides that debt securities of any series may be issued
thereunder up to the aggregate principal amount which may be authorized from
time to time by the Company. The Indenture does not limit the amount of other
Indebtedness or securities, other than certain secured Indebtedness as
described below, which may be issued by the Company or its Subsidiaries.
The Old Notes and the Exchange Notes will constitute a single series of debt
securities under the Indenture. In the event that the Exchange Offer is
consummated, any Old Notes that remain outstanding after consummation
of the Exchange Offer and the Exchange Notes issued in the Exchange Offer will
vote together as a single class for purposes of determining whether holders of
the requisite percentage in outstanding principal amount of Notes have taken
certain actions or exercised certain rights under the Indenture. Accordingly,
all references herein to specified percentages in aggregate principal amount of
the outstanding Notes shall be deemed to mean, at any time after the Exchange
Offer is consummated, such percentages in aggregate principal amount of the Old
Notes and the Exchange Notes then outstanding. Similarly, the Old Debentures
and the Exchange Debentures will constitute a single series of debt securities
under the Indenture. In the event that the Exchange Offer is consummated, any
Old Debentures outstanding after consummation of the Exchange Offer and the
Exchange Debentures issued in the Exchange Offer will vote together as a single
class for purposes of determining whether holders of the requisite percentage
in outstanding principal amount of Debentures have taken certain actions or
exercised certain rights under the Indenture. Accordingly, all references to
specified percentages in aggregate principal amount of the outstanding
Debentures shall be deemed to mean, at any time after the Exchange Offer is
consummated, such percentages in aggregate principal amount of the Old
Debentures and the Exchange Debentures then outstanding.
The Company currently guarantees the payment of $75 million principal amount
of industrial development bonds due 2015 issued by the Florida Polk County
Industrial Development Authority (the "Polk County Bonds"). As a result of the
FTX Merger, the Company is not in technical compliance with one covenant in
such guaranty. The Company has notified The Bank of New York, trustee for the
holders of the Polk County Bonds, regarding this issue. The holders of the Polk
County Bonds have not sought to accelerate the Polk County Bonds or requested
that any other action be taken. Because solicitation of a unanimous waiver is
impractical, the Company currently intends to take no action. The Company does
not believe that any acceleration, redemption or refinancing of the Polk County
Bonds would have a material adverse effect on the Company and its subsidiaries
taken as a whole because the Company believes it would be able to repay the
Polk County Bonds from available sources of liquidity.
Notes and Debentures will be issued only in fully registered form without
coupons in minimum denominations of $1,000 and any integral multiple thereof.
OPTIONAL REDEMPTION
Each of the Notes and the Debentures will be redeemable at the option of the
Company, in whole at any time or in part from time to time, at a redemption
price equal to the greater of (i) 100% of their principal amount and (ii) the
sum, as determined by the Independent Investment Banker, of the present values
of the principal amount and the remaining scheduled payments of interest on the
Notes or Debentures (as the case may be) to be redeemed, in each case
discounted from their respective scheduled payment dates to the redemption date
on a semiannual basis (assuming a 360-day year consisting of twelve 30-day
months) at the Treasury Rate plus 15 basis points in the case of the Notes and
25 basis points in the case of the Debentures, plus in either case accrued but
unpaid interest thereon to the redemption date. The Notes and the Debentures
will not be subject to any sinking fund.
Notice of any redemption must be given at least 30 days but not more than 60
days before the redemption date to each registered holder of Notes or
Debentures to be redeemed. If money sufficient to pay the redemption price of
and accrued interest on all of the Notes or the Debentures, as the case may be
(or portion thereof), to be redeemed on the redemption date is deposited with
the Trustee or a Paying Agent on or before the redemption date and certain
other conditions are satisfied, then on and after such date, interest will
cease to accrue on such Notes or Debentures, as the case may be (or such
portion thereof), called for redemption.
22
<PAGE>
"Comparable Treasury Issue" means the United States Treasury security
selected by the Independent Investment Banker as having a maturity comparable
to the remaining term of the Notes or the Debentures (as the case may be) to be
redeemed that would be utilized, at the time of selection and in accordance
with customary financial practice, in pricing new issues of corporate debt
securities of comparable maturity to the remaining term of such Notes or
Debentures (as the case may be) to be redeemed.
"Comparable Treasury Price" means, with respect to any redemption date, the
average of the Reference Treasury Dealer Quotations for such redemption date,
after excluding the highest and lowest such Reference Treasury Dealer
Quotations, or if the Trustee obtains fewer than four such Reference Treasury
Dealer Quotations, the average of all such Reference Treasury Dealer
Quotations.
"Independent Investment Banker" means one of the Reference Treasury Dealers
appointed by the Trustee after consultation with the Company.
"Reference Treasury Dealer" means each of Merrill Lynch Government Securities
Inc., J.P. Morgan Securities Inc., Chase Securities Inc. and Salomon Brothers
Inc, their affiliates, their respective successors and any other primary U.S.
Government securities dealer in New York City (a "Primary Treasury Dealer")
selected by the Company in addition to, or in substitution for, any of such
firms; provided, however, that if any of the foregoing shall cease to be a
Primary Treasury Dealer, the Company will substitute another Primary Treasury
Dealer.
"Reference Treasury Dealer Quotations" means, with respect to each Reference
Treasury Dealer and any redemption date, the average, as determined by the
Trustee, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in
writing to the Trustee by such Reference Treasury Dealer at 5:00 p.m., New York
City time, on the third Business Day preceding such redemption date.
"Treasury Rate" means, with respect to any redemption date, the rate per
annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, calculated on the third Business Day preceding such redemption
date using a price for the Comparable Treasury Issue (expressed as a percentage
of its principal amount) equal to the Comparable Treasury Price for such
redemption date.
BOOK ENTRY SYSTEM
The Company has established a depositary arrangement with the Depositary with
respect to the Notes and the Debentures, the terms of which are summarized
below.
Upon issuance, all Notes and Debentures will be represented by Global
Securities. The Global Securities representing the Notes and the Debentures
will be deposited with, or on behalf of, the Depositary and will be registered
in the name of the Depositary or a nominee of the Depositary. No Global
Securities may be transferred except as a whole by a nominee of the Depositary
to the Depositary or to another nominee of the Depositary, or by the Depositary
or such nominee to a successor of the Depositary or a nominee of such
successor.
So long as the Depositary or its nominee is the registered owner of a Global
Security, the Depositary or its nominee, as the case may be, will be the sole
holder of the Notes or Debentures represented thereby for all purposes under
the Indenture. Except as otherwise provided in this section, the Beneficial
Owners (as hereinafter defined) of the Global Securities representing the Notes
and the Debentures will not be entitled to receive physical delivery of
certificated Notes or Debentures and will not be considered the holders thereof
for any purpose under the Indenture, and no Global Security representing the
Notes or the Debentures shall be exchangeable or transferable. Accordingly,
each Beneficial Owner must rely on the procedures of the Depositary and, if
such Beneficial Owner is not a Participant (as defined), then such Beneficial
Owner must rely on the procedures of the Participant through which such
Beneficial Owner owns its interest in order to exercise any rights of a holder
under such Global Security or the Indenture. The laws of some jurisdictions
require that certain purchasers of securities take physical delivery of such
securities in certificated form. Such limits and such laws may impair the
ability to transfer beneficial interests in a Global Security representing the
Notes or the Debentures.
23
<PAGE>
The Global Securities representing the Notes and the Debentures will be
exchangeable for certificated Notes and Debentures, respectively, of like tenor
and terms and of differing authorized denominations aggregating a like
principal amount, only if (i) the Depositary notifies the Company that it is
unwilling or unable to continue as Depositary for the Global Securities, (ii)
the Depositary ceases to be a clearing agency registered under the Exchange
Act, (iii) the Company in its sole discretion determines that the Global
Securities shall be exchangeable for certificated Notes or Debentures or (iv)
there shall have occurred and be continuing an Event of Default under the
Indenture with respect to the Notes or the Debentures. Upon any such exchange,
the certificated Notes or Debentures shall be registered in the names of the
Beneficial Owners of the Global Securities representing the Notes or the
Debentures, which names shall be provided by the Depositary's relevant
Participants (as identified by the Depositary) to the Trustee.
The following is based on information furnished by the Depositary:
The Depositary will act as securities depository for the Notes and the
Debentures. The Notes and the Debentures will be issued as fully registered
securities registered in the name of Cede & Co. (the Depositary's
partnership nominee). Fully registered Global Securities will be issued for
the Notes and the Debentures, in the aggregate principal amount of such
issue, and will be deposited with the Depositary.
The Depositary is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the New
York Banking Law, a member of the Federal Reserve System, a "clearing
corporation" within the meaning of the New York Uniform Commercial Code,
and a "clearing agency" registered pursuant to the provisions of Section
17A of the Exchange Act. The Depositary holds securities that its
participants ("Participants") deposit with the Depositary. The Depositary
also facilitates the settlement among Participants of securities
transactions, such as transfers and pledges, in deposited securities
through electronic computerized book-entry changes to Participants'
accounts, thereby eliminating the need for physical movement of securities
certificates. Direct Participants of the Depositary ("Direct Participants")
include securities brokers and dealers (including the Initial Purchasers),
banks, trust companies, clearing corporations and certain other
organizations. The Depositary is owned by a number of its Direct
Participants and by the New York Stock Exchange, Inc., the American Stock
Exchange, Inc. and the National Association of Securities Dealers, Inc.
Access to the Depositary's system is also available to others such as
securities brokers and dealers and banks and trust companies that clear
through or maintain a custodial relationship with a Direct Participant,
either directly or indirectly ("Indirect Participants"). The rules
applicable to the Depositary and its Participants are on file with the
Commission.
Purchases of Notes and Debentures under the Depositary's system must be
made by or through Direct Participants, which will receive a credit for
such Notes and Debentures on the Depositary's records. The ownership
interest of each actual purchaser of each Note or Debenture represented by
a Global Security ("Beneficial Owner") is in turn to be recorded on the
Direct and Indirect Participants' records. Beneficial Owners will not
receive written confirmation from the Depositary of their purchase, but
Beneficial Owners are expected to receive written confirmations providing
details of the transaction, as well as periodic statements of their
holdings, from the Direct or Indirect Participants through which such
Beneficial Owner entered into the transaction. Transfers of ownership
interests in the Global Securities representing the Notes and the
Debentures are to be accomplished by entries made on the books of
Participants acting on behalf of Beneficial Owners. Beneficial Owners of
the Global Securities representing the Notes and the Debentures will not
receive certificated Notes and Debentures representing their ownership
interests therein, except in the event that use of the book-entry system
for such Debentures is discontinued.
To facilitate subsequent transfers, all Global Securities representing
the Notes and the Debentures which are deposited with, or on behalf of, the
Depositary are registered in the name of the Depositary's nominee, Cede &
Co. The deposit of Global Securities with, or on behalf of, the Depositary
and their registration in the name of Cede & Co. effect no change in
beneficial ownership. The Depositary has no knowledge of the actual
Beneficial Owners of the Global Securities representing the Notes and the
24
<PAGE>
Debentures; the Depositary's records reflect only the identity of the
Direct Participants to whose accounts such Notes or 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 the Depositary to
Direct Participants, by Direct Participants to Indirect Participants, and
by Direct 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 the Depositary nor Cede & Co. will consent or vote with respect
to the Global Securities representing the Notes and the Debentures. Under
its usual procedure, the Depositary mails an Omnibus Proxy to the Company
as soon as possible after the applicable record date. The Omnibus Proxy
assigns Cede & Co.'s consenting or voting rights to those Direct
Participants to whose accounts the Notes and the Debentures are credited on
the applicable record date (identified in a listing attached to the Omnibus
Proxy).
Principal, premium, if any, and/or interest, if any, payments on the
Global Securities representing the Notes and the Debentures will be made to
the Depositary. The Depositary's practice is to credit Direct Participants'
accounts on the applicable payment date in accordance with their respective
holdings shown on the Depositary's records unless the Depositary has reason
to believe that it will not receive payment on such date. Payments by
Participants to Beneficial Owners will be governed by standing instructions
and customary practices, as is the case with securities held for the
accounts of customers in bearer form or registered in "street name," and
will be the responsibility of such Participant and not of the Depositary,
the Trustee or the Company, subject to any statutory or regulatory
requirements as may be in effect from time to time. Payment of principal,
premium, if any, and/or interest, if any, to the Depositary is the
responsibility of the Company or the Trustee, disbursement of such payments
to Direct Participants shall be the responsibility of the Depositary, and
disbursement of such payments to the Beneficial Owners shall be the
responsibility of Direct and Indirect Participants.
The Depositary may discontinue providing its services as securities
depository with respect to the Notes and the Debentures at any time by
giving reasonable notice to the Company or the Trustee. Under such
circumstances, in the event that a successor securities depositary is not
obtained, certificated Notes and Debentures are required to be printed and
delivered.
The Company may decide to discontinue use of the system of book-entry
transfers through the Depositary (or a successor securities depository). In
that event, certificated Notes and Debentures will be printed and
delivered.
The information in this section concerning the Depositary and the
Depositary's 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
All payments of principal, premium, if any, and interest will be made by the
Company in immediately available funds. The Notes and the Debentures will trade
in the Depositary's Same-Day Funds Settlement System until maturity, and
secondary market trading activity in the Notes and the Debentures will
therefore be required by the Depositary to settle in immediately available
funds.
CERTAIN COVENANTS
Limitation on Liens. The Indenture provides that the Company will not, and
will not permit any of its Restricted Subsidiaries to, create, incur or
otherwise cause or suffer to exist or become effective any Liens of any kind
upon any Principal Property or any shares of stock or indebtedness of any
Restricted Subsidiary now owned or hereafter acquired, unless all payments due
under the Indenture and the Senior Debt Securities are secured on an equal and
ratable basis with the obligation so secured until such time as such obligation
is no longer secured by a Lien, except for Permitted Liens. See also "Exempted
Indebtedness" below.
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Limitations on Sale and Leaseback Transactions. The Indenture provides that
neither the Company nor any Restricted Subsidiary will enter into any sale and
leaseback transaction with respect to any Principal Property (whether such
Principal Property is now owned or hereafter acquired) (except for temporary
leases of a term, including renewals, not exceeding five years) unless either
(a) the Company or such Restricted Subsidiary would be entitled, pursuant to
the provisions of the Indenture, to incur Indebtedness secured by a Lien on
such property to be leased without equally and ratably securing the Senior Debt
Securities, or (b) the Company within 180 days after the effective date of such
transaction applies to the voluntary retirement of its Funded Debt an amount
equal to the value of such transaction, defined as the greater of the net
proceeds of the sale of the property leased in such transaction or the fair
value, as determined by the Board of Directors, of the leased property at the
time such transaction was entered into. The Indenture defines "Funded Debt" as
indebtedness (including the Senior Debt Securities) maturing by the terms
thereof more than one year after the original creation thereof. See also
"Exempted Indebtedness" below.
Exempted Indebtedness. Notwithstanding the foregoing limitations on Liens and
sale and leaseback transactions, the Company and its Restricted Subsidiaries
may issue, assume, suffer to exist or guarantee Indebtedness secured by a Lien
without securing the Senior Debt Securities, or may enter into sale and
leaseback transactions without retiring Funded Debt, or enter into a
combination of such transactions, if the sum of the principal amount of all
such Indebtedness and the aggregate value of all such sale and leaseback
transactions does not at any such time exceed 10% of the consolidated total
assets of the Company and its consolidated Subsidiaries as shown in the most
recent audited consolidated balance sheet contained in the latest annual report
to the stockholders of the Company.
EVENTS OF DEFAULT AND REMEDIES
An Event of Default with respect to any series of Senior Debt Securities is
defined as: (i) default in the payment of any installment of interest on or any
Additional Amounts payable in respect of any security of that series of Senior
Debt Securities when and as the same shall become due and payable, and
continuance of such default for a period of 30 days; (ii) default in the
payment of all or any part of the principal (which includes any premium payable
on any Senior Debt Security) of any security of that series of Senior Debt
Securities when and as the same shall become due and payable either at
maturity, upon any redemption, or otherwise; (iii) the failure by the Company
to perform or observe any of its other covenants, conditions or agreements
contained in the Indenture or in that series of Senior Debt Securities and
continuance of such failure for a period of 90 days after due notice by the
Trustee or by the holders of at least 25% in principal amount of such series of
Senior Debt Securities then outstanding; (iv) default in the payment of any
scheduled principal of or interest on any Indebtedness of the Company or any
wholly owned Subsidiary of the Company (other than that series of Senior Debt
Securities) aggregating more than $25 million in principal amount, when due
after giving effect to any applicable grace period, that results in such
Indebtedness becoming due and payable prior to the date on which it would
otherwise become due and payable, and such acceleration shall not have been
rescinded or annulled, or such Indebtedness shall not have been discharged; or
(v) certain events of bankruptcy, insolvency or reorganization involving the
Company as more fully described in the Indenture. The Indenture provides that
the Trustee shall notify the holders of the relevant series of Senior Debt
Securities of any continuing default known to the Trustee which has occurred
within 90 days after the occurrence thereof. The Indenture provides that
notwithstanding the foregoing, except in the case of default in the payment of
the principal of, interest on or any Additional Amounts payable in respect of
any series of Senior Debt Securities, the Trustee may withhold such notice if
the Trustee in good faith determines that the withholding of such notice is in
the interests of the holders of such series of Senior Debt Securities.
If an Event of Default of the type described in clause (v) shall happen and
be continuing, then the principal of, accrued and unpaid interest on and any
Additional Amounts payable in respect of the Senior Debt Securities will become
immediately due and payable. If one or more Events of Default of the type
described in clauses (i) through (iv) with respect to any series of Senior Debt
Securities at the time outstanding shall happen and be continuing, then either
the Trustee or the holders of not less than 25% of the principal amount of such
series of
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Senior Debt Securities then outstanding may declare the principal, accrued and
unpaid interest on and any Additional Amounts payable in respect of such series
of Senior Debt Securities due and payable immediately. This provision is
subject to the condition that if, after any declaration of acceleration and
before Stated Maturity of the principal with respect to such series of Senior
Debt Securities, all arrears of interest and any Additional Amounts and the
expenses of the Trustee, its agents or attorneys shall be paid by or for the
account of the Company, and all Defaults (other than the payment of principal
that has been declared due and payable) have been cured to the satisfaction of
the Trustee, then the Trustee shall, upon the written request of the holders of
a majority in principal amount of such series of Senior Debt Securities, waive
such Default and rescind or annul the declaration of acceleration; but no such
waiver, rescission or annulment shall extend to or affect any subsequent
Default or impair any right consequent thereon.
No holder of any series of Senior Debt Securities will have the right to
pursue a remedy under the Indenture or such series of Senior Debt Securities,
unless (1) such holder gives the Trustee notice of a continuing Default with
respect to such series of Senior Debt Securities, (2) the holders of at least a
majority in principal amount of such series of Senior Debt Securities make a
request to the Trustee to pursue the remedy, (3) such holder or holders offered
the Trustee security or indemnity satisfactory to the Trustee against any loss,
liability or expense and (4) the Trustee does not comply with the request
within 30 days after the receipt of the request and the offer of security or
indemnity. However, nothing contained in the Indenture shall affect or impair
the right of any holder of any series of Senior Debt Securities to institute
suit to enforce payment of the principal of, interest on and any Additional
Amounts payable in respect of such holder's Senior Debt Securities on or after
the due dates expressed in such Senior Debt Securities.
The Company must furnish to the Trustee a statement, detailing any Defaults
of which it is aware, within five days of the occurrence of any Default.
REPORTS
The Indenture requires the annual filing by the Company with the Trustee of a
certificate as to compliance with certain covenants contained in the Indenture.
The Indenture provides that the Company will file with the Trustee copies of
the annual reports and other information, documents and reports which the
Company is required to file with the Commission pursuant to the Exchange Act.
The Company shall also comply with the requirements of Section 314(a) of the
Trust Indenture Act of 1939, as amended (the "Trust Indenture Act").
SUCCESSOR COMPANY
The Indenture provides that the Company will not consolidate or merge with or
into, or sell, lease, convey or otherwise dispose of all or substantially all
of its assets or assign any of its obligations under Senior Debt Securities or
the Indenture to any Person unless (i) the entity formed by or surviving any
such consolidation or merger (if other than the Company), or to which such
sale, lease, conveyance or other disposition or assignment shall have been made
(the "Surviving Entity"), is a corporation organized and existing under the
laws of the United States, any state thereof, or the District of Columbia; (ii)
the Surviving Entity assumes by a supplemental indenture in a form satisfactory
to the Trustee all of the obligations of the Company under the Senior Debt
Securities and the Indenture; and (iii) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing. With respect to the sale of assets, the phrase "all or
substantially all" as used in the Indenture varies according to the facts and
circumstances of the subject transaction, has no clearly established meaning
under New York law (which governs the Indenture) and is subject to judicial
interpretation. Accordingly, in certain circumstances there may be a degree of
uncertainty in ascertaining whether a particular transaction would involve a
disposition of "all or substantially all" of the assets of a person, and
therefore it may be unclear as to whether a disposition of assets comes within
the terms of this provision.
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DISCHARGE
The Indenture provides that it will cease to be of further effect (except
that certain obligations will survive) with respect to the Senior Debt
Securities when all outstanding Senior Debt Securities authenticated and issued
have been delivered (other than destroyed, lost or stolen Senior Debt
Securities that have been replaced or paid) to the Trustee for cancellation and
the Company has paid all sums payable under the Indenture.
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the holders of not less than a majority in aggregate
principal amount of each affected series of Senior Debt Securities at the time
outstanding under the Indenture, to enter into supplemental indentures to amend
any of the provisions of the Indenture or any supplemental indenture with
respect to such series of Senior Debt Securities; provided that, unless
consented to by each affected holder of Senior Debt Securities, no such
supplemental indenture may (1) reduce the amount of such series of Senior Debt
Securities whose holders must consent to an amendment or a waiver; (2) reduce
the rate of or change the time for payment of interest or Additional Amounts,
including default interest on any such Senior Debt Security; (3) reduce the
principal of or change the Stated Maturity of any such Senior Debt Security or
alter the provisions with respect to redemption; (4) make any such Senior Debt
Security payable in money other than that stated in such Senior Debt Security;
(5) make any change in the types of amendment that need the approval of every
affected holder of such series of Senior Debt Securities; (6) with respect to
the Indenture, affect the ranking of such Senior Debt Securities; or (7) waive
a Default in the payment of principal of, any Additional Amounts payable in
respect of or interest on, or with respect to, any such Senior Debt Security.
The Trustee and the Company may enter into supplemental indentures which
amend the Indenture or a series of Senior Debt Securities without the consent
of any holder of Senior Debt Securities of such series in order to: (a) cure
any ambiguity, omission, defect or inconsistency; (b) comply with the Indenture
concerning the substitution of successor corporations pursuant to a merger or
consolidation; (c) comply with any requirements of the Commission in connection
with the qualification of the Indenture under the Trust Indenture Act; (d)
provide for uncertificated securities; (e) make any change that does not
materially adversely affect the legal rights of any holder of Senior Debt
Securities of such series under the Indenture as then in effect; (f) secure the
Senior Debt Securities and make intercreditor arrangements with respect to any
such Senior Debt Securities (unless prohibited by the Indenture); (g) provide
for a replacement Trustee; (h) add to the covenants and agreements of the
Company for the benefit of all the holders of all of the Senior Debt Securities
of such series and surrender any right or power reserved for the Company in the
Indenture; or (i) add to, change or eliminate any of the provisions of the
Indenture in respect of one or more series of Senior Debt Securities, provided
that any such addition, change or elimination (1) shall neither apply to any
Senior Debt Security of any series created prior to the execution of such
supplemental indenture and entitled to the benefit of such provision nor modify
the rights of the holder of any such Senior Debt Security with respect to such
provision or (2) shall become effective only when there is no Senior Debt
Security outstanding under the Indenture.
DEFEASANCE AND COVENANT DEFEASANCE
The Indenture provides that the Company may elect either (a) to terminate
(and be deemed to have satisfied) all its obligations with respect to a series
of Senior Debt Securities (except for the obligations to register the transfer
or exchange of such series of Senior Debt Securities, to replace mutilated,
destroyed, lost or stolen Senior Debt Securities, to maintain an office or
agency in respect of such series of Senior Debt Securities, to compensate and
indemnify the Trustee and to punctually pay or cause to be paid the principal
of, interest on and any Additional Amounts payable in respect of such series of
Senior Debt Securities when due) ("defeasance") or (b) to be released from its
obligations with respect to certain covenants, including those described above
under "Certain Covenants--Limitation on Liens" and "--Limitations on Sale and
Leaseback Transactions" above ("covenant defeasance"), upon the deposit with
the Trustee, in trust for such purpose, of money and/or U.S. Government
Obligations and/or Eligible Obligations (each as defined in the Indenture)
which through the
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payment of principal and interest in accordance with their terms will provide
money, in an amount sufficient (in the opinion of a nationally recognized firm
of independent public accountants) to pay the principal of, interest on and any
Additional Amounts payable in respect of the outstanding Senior Debt Securities
of such series, and any mandatory sinking fund or analogous payments thereon,
on the scheduled due dates therefor. Such a trust may be established only if,
among other things, the Company has delivered to the Trustee an opinion of
counsel (as specified in the Indenture) with regard to certain matters,
including an opinion to the effect that the holders of such series of Senior
Debt 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 on the same amounts and in the same manner and at the same times
as would have been the case if such deposit and defeasance or covenant
defeasance, as the case may be, had not occurred.
CONCERNING THE TRUSTEE
The Bank of New York is the Trustee under the Indenture and is an "eligible
trustee" under the Trust Indenture Act. The Company maintains normal commercial
banking relations with The Bank of New York, which is also the trustee under
certain other indentures of the Company.
CERTAIN DEFINITIONS
"Additional Amounts" shall mean any additional amounts which are required by
any Senior Debt Securities, under circumstances specified therein, to be paid
by the Company in respect of certain taxes imposed on certain holders of such
Senior Debt Securities, or as otherwise specified in the terms of such Senior
Debt Securities, and which are owing to such holders.
"Affiliate" shall mean, with respect to any Person, another Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such first Person. For the purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person, whether through the
ownership of voting securities or by contract or otherwise.
"Capital Stock"shall mean, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's capital stock or equity interests in a
partnership, joint venture, limited liability company or other equity that is
outstanding or issued on or after the Issue Date, including, without
limitation, all classes and series of such Person's common stock or ordinary
shares, preferred stock and preference stock.
"Capitalized Lease Obligation" shall mean an obligation that is required to
be classified and accounted for as a capitalized lease for financial reporting
purposes in accordance with GAAP, and the amount of Indebtedness represented by
such obligation shall be the capitalized amount of such obligation determined
in accordance with such principles; and the Stated Maturity thereof shall be
the date of the last payment of rent or any other amount due under such lease
prior to the first date upon which such lease may be terminated by the lessee
without payment of a penalty.
"Consolidated Net Worth" shall mean the excess of assets over liabilities of
the Company and its consolidated Subsidiaries, plus Minority Interests, as
determined from time to time in accordance with GAAP.
"Default" shall mean any event that is, or after notice or passage of time or
both would be, an Event of Default.
"Indebtedness" shall mean, with respect to any Person, at any date, any of
the following, without duplication, (i) any liability, contingent or otherwise,
of such Person (A) for borrowed money (whether or not the recourse of the
lender is to the whole of the assets of such Person or only to a portion
thereof), (B) evidenced
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by a note, bond, debenture or similar instrument or (C) for the payment of
money relating to a Capitalized Lease Obligation or other obligation (whether
issued or assumed) relating to the deferred purchase price of property; (ii)
all conditional sale obligations and all obligations under any title retention
agreement (even if the rights and remedies of the seller under such agreement
in the event of default are limited to repossession or sale of such property),
but excluding trade accounts payable arising in the ordinary course of
business; (iii) all obligations for the reimbursement of any obligor on any
letter of credit, banker's acceptance or similar credit transaction other than
entered into in the ordinary course of business; (iv) all indebtedness of
others secured by (or for which the holder of such indebtedness has an existing
right, contingent or otherwise, to be secured by) any Lien on any asset or
property (including, without limitation, leasehold interests and any other
tangible or intangible property) of such Person, whether or not such
indebtedness is assumed by such Person or is not otherwise such Person's legal
liability; provided, that if the obligations so secured have not been assumed
in full by such Person or are otherwise not such Person's legal liability in
full, the amount of such indebtedness for the purposes of this definition shall
be limited to the lesser of the amount of such indebtedness secured by such
Lien or the fair market value of the assets of the property securing such Lien;
(v) all indebtedness of others (including all interest and dividends on any
indebtedness or preferred stock of any other Person for the payment of which
is) guaranteed, directly or indirectly, by such Person or that is otherwise its
legal liability or which such Person has agreed to purchase or repurchase or in
respect of which such Person has agreed contingently to supply or advance
funds; and (vi) obligations in respect of Currency Agreements and Interest Swap
Obligations (as such capitalized terms are defined in the Indenture).
"Issue Date" shall mean the first date on which a Senior Debt Security is
authenticated by the Trustee pursuant to an Indenture.
"Lien" shall mean any mortgage, pledge, security interest, encumbrance, lien,
charge or adverse claim affecting title or resulting in an encumbrance against
real or personal property or a security interest of any kind (including,
without limitation, any conditional sale or other title retention agreement or
lease in the nature thereof or any filing or agreement to file a financing
statement as debtor under the Uniform Commercial Code or any similar statute
other than to reflect ownership by a third party or property leased to the
Company or any of its Subsidiaries under a lease that is not in the nature of a
conditional sale or title retention agreement).
"Minority Interest" is defined as any shares of stock of any class of a
Subsidiary that are not owned by the Company or a Subsidiary.
"Permitted Liens" shall mean, with respect to any Person: (i) Liens existing
on the Issue Date; (ii) Liens on property or assets of, or any shares of stock
of or secured debt of, any corporation existing at the time such corporation
becomes a Restricted Subsidiary of the Company or at the time such corporation
is merged into the Company or any of its Restricted Subsidiaries; (iii) Liens
in favor of the Company or any of its Restricted Subsidiaries; (iv) Liens in
favor of governmental bodies to secure progress or advance payments; (v) Liens
securing industrial revenue or pollution control bonds; (vi) Liens on Property
to secure Indebtedness incurred for the purpose of (a) financing all or any
part of the purchase price of such Property incurred prior to, at the time of,
or within 180 days after, the acquisition of such Property or (b) financing all
or any part of the cost of construction, improvement, development or expansion
of any such Property; (vii) statutory liens or landlords', carriers',
warehouseman's, mechanics', suppliers', materialmen's, repairmen's or other
like Liens arising in the ordinary course of business and with respect to
amounts not yet delinquent or being contested in good faith by appropriate
proceedings, if a reserve or other appropriate provisions, if any, as shall be
required in conformity with GAAP shall have been made therefor; (viii) Liens on
current assets of Restricted Subsidiaries securing Indebtedness of such
Restricted Subsidiaries; and (ix) any extensions, substitutions, replacements
or renewals in whole or in part of a Lien (an "existing Lien") enumerated in
clauses (i) through (viii) above; provided that the Lien may not extend beyond
(A) the Property or Indebtedness subject to the existing Lien and (B)
improvements and construction on such Property and the Indebtedness secured by
the Lien may not exceed the Indebtedness secured at the time by the existing
Lien.
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"Person" shall mean any individual, corporation, partnership, limited
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization, government or any agency or political subdivision
thereof, or any other entity.
"Principal Property" shall mean any manufacturing plant or warehouse owned or
leased by the Company or any Subsidiary, the gross book value of which exceeds
one percent of Consolidated Net Worth, other than manufacturing plants and
warehouses which the Board of Directors by resolution declares, together with
all other plants and warehouses previously so declared, are not of material
importance to the total business conducted by the Company and its Restricted
Subsidiaries as an entirety.
"Property" of any Person means all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included in
the most recent consolidated balance sheet of such Person and its Subsidiaries
under GAAP.
"Restricted Subsidiary" shall mean (i) IMC Global Operations Inc.,
International Minerals & Chemical (Canada) Global Limited ("IMC-Canada"), IMC-
Agrico, PLP, IMC Inorganic Chemicals Inc. and Penrice Holdings Pty., and any
intermediate holding company between either IMC Global Operations Inc., IMC-
Canada, IMC-Agrico, PLP, IMC Inorganic Chemicals Inc. or Penrice Holdings Pty.
and the Company and (ii) any other Subsidiary of the Company that is not an
Unrestricted Subsidiary.
"Stated Maturity," when used with respect to any security or any installment
of interest thereon, shall mean the date specified in such security as the
fixed date on which the principal of such security or such installment of
interest is due and payable.
"Subsidiary" of any Person shall mean (i) any Person of which more than 50%
of the total voting power of shares of Capital Stock entitled (without regard
to the occurrence of any contingency) to vote in the election of directors,
managers or trustees thereof is at the time owned or controlled, directly or
indirectly, by any Person or one or more of the Restricted Subsidiaries of that
Person or a combination thereof, and (ii) any partnership, joint venture or
other Person in which such Person or one or more of the Restricted Subsidiaries
of that Person or a combination thereof has the power to control by contract or
otherwise the board of directors or equivalent governing body or otherwise
controls such entity.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that at the
time of determination shall be designated an Unrestricted Subsidiary by the
Board of Directors of the Company in the manner provided below and (ii) any
Subsidiary of an Unrestricted Subsidiary. The Board of Directors may designate
any Subsidiary of the Company (including any newly-acquired or newly-formed
Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary owns any
Capital Stock of, or owns or holds any property of, the Company or any other
Subsidiary of the Company that is not a Subsidiary of the Subsidiary so
designated; provided, however, that the Subsidiary to be so designated has
total assets of $5,000 or less.
EXCHANGE OFFER
PURPOSE AND EFFECT OF THE EXCHANGE OFFER
The Old Securities were originally sold by the Company on August 11, 1998 to
the Initial Purchasers pursuant to the Purchase Agreement. The Initial
Purchasers subsequently resold the Old Securities to qualified institutional
buyers in reliance on Rule 144A. As a condition to the Purchase Agreement, the
Company entered into the Registration Rights Agreement with the Initial
Purchasers for the benefit of the holders of the Notes and the Debentures in
which the Company agreed for the benefit of the holders of the Notes and the
Debentures to use its reasonable best efforts (i) to file with the Commission
within 90 calendar days after the date on which the Company delivered the Old
Notes and the Old Debentures to the Initial Purchasers (the "Closing Date") a
registration statement (the "Registration Statement") with respect to notes and
debentures identical in all material respects to the Old Notes and the Old
Debentures, respectively, (except that the Exchange Notes and
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the Exchange Debentures will not contain terms with respect to transfer
restrictions and will not provide for any increase in the interest rate
thereon under the circumstances described below) and (ii) to cause the
Registration Statement to be declared effective under the Securities Act
within 150 calendar days after the Closing Date. Promptly after the
Registration Statement has been declared effective, the Company will offer to
holders of Old Notes and Old Debentures, as applicable, the opportunity to
exchange all their Old Notes and Old Debentures for Exchange Notes and
Exchange Debentures, respectively. The Company will keep the Exchange Offer
open for not less than 30 calendar days (or longer if required by applicable
law) after the date notice of the Exchange Offer is mailed to the holders of
the Old Notes and Old Debentures but will, in any event, use its reasonable
best efforts to cause the Exchange Offer to be consummated within 180 days of
the Closing Date. For each Old Note validly tendered to the Company pursuant
to the Exchange Offer, the holder of such Old Note will receive an Exchange
Note having a principal amount equal to the principal amount of the tendered
Old Note. For each Old Debenture validly tendered to the Company pursuant to
the Exchange Offer, the holder of such Old Debenture will receive an Exchange
Debenture having a principal amount equal to the principal amount of the
tendered Old Debenture. Interest on each Exchange Note and Exchange Debenture
will accrue from the last Interest Payment Date to which interest was paid on
the Old Note or Old Debenture (as the case may be) surrendered in exchange
therefor or, if no interest has been paid on such Old Note or Old Debenture,
from the date of the original issuance thereof. Holders of the Old Notes or
the Old Debentures whose Old Notes or Old Debentures are accepted for exchange
will not receive accrued interest on such Old Notes or Old Debentures for any
period from and after the last Interest Payment Date to which interest has
been paid or duly provided for on such Old Notes or Old Debentures prior to
the original issue date of the Exchange Notes or Exchange Debentures or, if no
such interest has been paid or duly provided for, will not receive any accrued
interest on such Old Notes or Old Debentures, and will be deemed to have
waived the right to receive any interest on such Old Notes or Old Debentures
accrued from and after such Interest Payment Date or, if no such interest has
been paid or duly provided for, from and after August 11, 1998.
Based on existing interpretations of the Securities Act by the Staff set
forth in several no-action letters to third parties, and subject to the
immediately following sentence, the Company believes that the Exchange Notes
and the Exchange Debentures to be issued pursuant to the Exchange Offer may be
offered for resale, resold and otherwise transferred by the holders thereof
(other than holders who are broker-dealers) without further compliance with
the registration and prospectus delivery provisions of the Securities Act.
However, any holder of Old Notes or Old Debentures who is an "affiliate" of
the Company or who intends to participate in the Exchange Offer for the
purpose of distributing the Exchange Notes or the Exchange Debentures, or any
broker-dealer who purchased the Old Notes or the Old Debentures from the
Company for resale pursuant to Rule 144A or any other available exemption
under the Securities Act, (i) will not be able to rely on the interpretations
of the Staff set forth in the above-mentioned no-action letters, (ii) will not
be entitled to tender its Old Notes or Old Debentures, as applicable, in the
Exchange Offer and (iii) must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any sale or
transfer of the Old Notes or Old Debentures, as applicable, unless such sale
or transfer is made pursuant to an exemption from such requirements. The
Company does not intend to seek its own no-action letter, and there can be no
assurance that the Staff would make a similar determination with respect to
the Exchange Notes or the Exchange Debentures as it has in such no-action
letters to third parties.
Each holder of Old Notes or Old Debentures (other than certain specified
holders) who wishes to exchange the Old Notes or the Old Debentures, as
applicable, for Exchange Notes or Exchange Debentures, as applicable, in the
Exchange Offer will be required to represent that (i) it is not an "affiliate"
of the Company, (ii) the Exchange Notes or the Exchange Debentures, as
applicable, to be received by it are being acquired in the ordinary course of
its business, (iii) it has no arrangement with any person to participate in
the distribution (within the meaning of the Securities Act) of the Exchange
Notes or the Exchange Debentures, as applicable, and (iv) if such holder is
not a broker-dealer, such holder is not engaged in, and does not intend to
engage in, a distribution (within the meaning of the Securities Act). Each
Participating Broker-Dealer that receives Exchange Notes or Exchange
Debentures for its own account pursuant to the Exchange Offer must acknowledge
that it acquired the Old Notes or the Old Debentures for its own account as a
result of market-making or other trading
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activities and must agree that it will deliver a prospectus meeting the
requirements of the Securities Act in connection with any resale of such
Exchange Notes or Exchange Debentures. The Letter of Transmittal states that
by so acknowledging and by delivering a prospectus, a Participating Broker-
Dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. The Commission has taken the position in the
above-mentioned no-action letters that Participating Broker-Dealers who
acquired Old Notes or Old Debentures for their own accounts as a result of
market-making or other trading activities may fulfill their prospectus
delivery requirements with respect to the Exchange Notes or the Exchange
Debentures, as applicable, other than a resale of an unsold allotment from the
original sale thereof, with a prospectus meeting the requirements of the
Securities Act, which may be the prospectus prepared for an exchange offer so
long as it contains a plan of distribution with respect to the resale of such
Exchange Notes and Exchange Debentures. Under the Registration Rights
Agreement, the Company is required to allow Participating Broker-Dealers and
other persons, if any, subject to similar prospectus delivery requirements to
use this Prospectus, as it may be amended or supplemented from time to time,
in connection with the resale of such Exchange Notes or Exchange Debentures,
as applicable, for a period of 180 days from the issuance of the Exchange
Notes or the Exchange Debentures, as applicable. The Company has agreed that,
for a period of 180 days after the Expiration Date, it will make this
Prospectus available to any Participating Broker-Dealer for use in connection
with any such resale (provided that the Company has received prior written
notice from such Participating Broker-Dealer of its status as a Participating
Broker-Dealer). See "Plan of Distribution." Any Participating Broker-Dealer
who is an "affiliate" of the Company may not rely on the above-mentioned no-
action letters and must comply with the registration and delivery requirements
of the Securities Act in connection with any resale transaction.
If: (i) because of any change in law or in currently prevailing
interpretations of the Staff, the Company is not permitted to effect the
Exchange Offer, (ii) the Exchange Offer is not consummated within 180 days of
the Closing Date or (iii) upon the request of any Initial Purchaser, if such
Initial Purchaser is not permitted, in the reasonable opinion of counsel,
pursuant to applicable law or applicable interpretations of the Staff, to
participate in the Exchange Offer and thereby receive securities that are
freely tradeable without restriction under the Securities Act and applicable
blue sky or state securities laws, then in each case, the Company will (x)
promptly deliver to the holders written notice thereof and (y) at the
Company's sole expense (a) as promptly as practicable (but in no event more
than 90 days after so required or requested pursuant to the Registration
Rights Agreement), file a shelf registration statement covering resales of the
Old Notes and the Old Debentures (the "Shelf Registration Statement"), (b) use
its reasonable best efforts to cause the Shelf Registration Statement to be
declared effective under the Securities Act and (c) use its reasonable best
efforts to keep effective the Shelf Registration Statement until the earlier
of two years (or, if Rule 144(k) is amended to provide a shorter restrictive
period, such shorter period) after the Closing Date or such time as all of the
applicable Old Notes and Old Debentures have been sold thereunder. The Company
will, if a Shelf Registration Statement is filed, provide to each holder
copies of the prospectus that is a part of the Shelf Registration Statement,
notify each such holder when the Shelf Registration Statement for the Old
Notes and the Old Debentures has become effective and take certain other
actions as are required to permit unrestricted resales of the Old Notes and
the Old Debentures. A holder that sells Old Notes or Old Debentures pursuant
to the Shelf Registration Statement will be required to be named as a selling
security holder in the related prospectus, to provide information related
thereto and to deliver such prospectus to purchasers, will be subject to
certain of the civil liability provisions under the Securities Act in
connection with such sales and will be bound by the provisions of the
Registration Rights Agreement that are applicable to such a holder (including
certain indemnification rights and obligations). The Company shall have no
obligation to include in the Shelf Registration Statement holders who do not
deliver such information to the Company.
If the Company fails to comply with certain provisions of the Registration
Rights Agreement, in each case as described below, then a special interest
premium (the "Special Interest Premium") shall become payable in respect of
the Old Notes and the Old Debentures.
If: (i) the Registration Statement is not filed with the Commission on or
prior to the 90th day following the Closing Date, (ii) the Registration
Statement is not declared effective on or prior to the 150th day following the
Closing Date or (iii) the Exchange Offer is not consummated or the Shelf
Registration Statement is not declared
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effective on or prior to the 180th day following the Closing Date, the Special
Interest Premium shall accrue in respect of the Old Notes and the Old
Debentures from and including the next day following each of (a) such 90-day
period in the case of clause (i) above, (b) such 150-day period in the case of
clause (ii) above and (c) such 180-day period in the case of clause (iii)
above, in each case at a rate equal to 0.25% per annum. The aggregate amount
of the Special Interest Premium in respect of each of the Old Notes and the
Old Debentures payable pursuant to the above provisions will in no event
exceed 0.25% per annum and provided, further, that if the Registration
Statement is not declared effective on or prior to the 150th day following the
Closing Date and the Company shall request holders of Old Notes and Old
Debentures to provide the information called for by the Registration Rights
Agreement referred to herein for inclusion in the Shelf Registration
Statement, the Old Notes or Old Debentures, as the case may be, owned by
holders who do not deliver such information to the Company when required
pursuant to the Registration Rights Agreement will not be entitled to any such
increase in the interest rate for any day after the 180th day following the
Closing Date. Upon (1) the filing of the Registration Statement after the 90-
day period described in clause (i) above, (2) the effectiveness of the
Registration Statement after the 150-day period described in clause (ii) above
or (3) the consummation of the Exchange Offer or the effectiveness of a Shelf
Registration Statement, as the case may be, after the 180-day period described
in clause (iii) above, the interest rate on the Old Notes and the Old
Debentures from the date of such filing, effectiveness or consummation, as the
case may be, will be reduced to the original interest rate for the Old Notes
and the Old Debentures, respectively.
If a Shelf Registration Statement is declared effective pursuant to the
foregoing paragraphs, and if the Company fails to keep such Shelf Registration
Statement continuously (x) effective or (y) useable for resales for the period
required by the Registration Rights Agreement due to certain circumstances
relating to pending corporate developments, public filings with the Commission
and similar events, or because the prospectus contains an untrue statement of
a material fact or omits to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading,
and such failure continues for more than 60 days (whether or not consecutive)
in any twelve-month period (the 61st day being referred to as the "Default
Day"), then from the Default Day until the earlier of (i) the date that the
Shelf Registration Statement is again deemed effective or is useable, (ii) the
date that is the second anniversary of the Closing Date (or, if Rule 144(k) is
amended to provide a shorter restrictive period, such shorter period) or (iii)
the date as of which all of the Old Notes and the Old Debentures are sold
pursuant to the Shelf Registration Statement, the Special Interest Premium in
respect of the Old Notes or the Old Debentures, as applicable, shall accrue at
a rate equal to 0.25% per annum.
If the Company fails to keep the Shelf Registration Statement continuously
effective or useable for resales pursuant to the preceding paragraph, it shall
give the holders notice to suspend the sale of the Old Notes and the Old
Debentures and shall extend the relevant period referred to above during which
the Company is required to keep effective the Shelf Registration Statement (or
the period during which Participating Broker-Dealers are entitled to use the
prospectus included in the Registration Statement in connection with the
resale of Exchange Notes or Exchange Debentures, as the case may be) by the
number of days during the period from and including the date of the giving of
such notice to and including the date when holders shall have received copies
of the supplemented or amended prospectus necessary to permit resales of the
Old Notes and the Old Debentures or to and including the date on which the
Company has given notice that the sale of the Old Notes and the Old Debentures
may be resumed, as the case may be.
The Registration Rights Agreement shall be governed by, and construed in
accordance with, the laws of the State of New York. The summary herein of
certain provisions of the Registration Rights Agreement does not purport to be
complete and is subject to, and is qualified in its entirety by reference to,
all the provisions of the Registration Rights Agreement, a copy of which has
been filed as an exhibit to the Exchange Offer Registration Statement. In
addition, the information set forth above concerning certain interpretations
and positions taken by the Staff is not intended to constitute legal advice,
and prospective investors should consult their own legal advisors with respect
to such matters.
Any Old Notes or Old Debentures not tendered and accepted in the Exchange
Offer will remain outstanding and will be entitled to all the same rights and
benefits and will be subject to the same limitations applicable
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thereto under the Indenture (except for those rights which terminate upon
consummation of the Exchange Offer). Following consummation of the Exchange
Offer, the holders of Old Notes or Old Debentures will continue to be subject
to the existing restrictions upon transfer thereof and the Company will have
no further obligation to such holders to provide for registration under the
Securities Act of the Old Notes or the Old Debentures held by them. To the
extent that Old Notes or Old Debentures are tendered and accepted in the
Exchange Offer, the trading market for untendered and tendered but unaccepted
Old Notes and Old Debentures could be adversely affected.
TERMS OF THE EXCHANGE OFFER
Upon the terms and subject to the conditions set forth in this Prospectus
and in the Letter of Transmittal, the Company will accept any and all Old
Notes and Old Debentures validly tendered in accordance with the procedures
described below on or prior to the Expiration Date and not withdrawn. The
Company will issue $1,000 principal amount of Exchange Notes in exchange for
each $1,000 principal amount of outstanding Old Notes accepted in the Exchange
Offer and $1,000 principal amount of Exchange Debentures in exchange for each
$1,000 principal amount of outstanding Old Debentures accepted in the Exchange
Offer. Holders may tender some or all of their Old Notes or Old Debentures
pursuant to the Exchange Offer. However, Old Notes and Old Debentures may each
be tendered only in integral multiples of $1,000.
The Exchange Offer is not conditioned upon any minimum principal amount of
Old Notes or Old Debentures being tendered. As of the date of this Prospectus,
$200,000,000 aggregate principal amount of Old Notes were outstanding and
$100,000,000 aggregate principal amount of Old Debentures were outstanding.
The Company has fixed the close of business on October 5, 1998 as the record
date for the Exchange Offer for purposes of determining the holders to whom
this Prospectus and the Letter of Transmittal will be mailed initially.
Holders of Old Notes or Old Debentures do not have any appraisal or
dissenters' rights under the General Corporation Law of Delaware or the
Indenture in connection with the Exchange Offer. The Company intends to
conduct the Exchange Offer in accordance with the applicable requirements of
the Exchange Act and the rules and regulations of the Commission thereunder.
Old Notes and Old Debentures which are not tendered for exchange, which are
tendered but validly withdrawn or which are tendered but not accepted in
connection with the Exchange Offer will remain outstanding and be entitled to
the benefits of the Indenture, but not be entitled to any further registration
rights under the Registration Rights Agreement.
The Company shall be deemed to have accepted validly tendered Old Notes or
Old Debentures when, as and if the Company has given oral or written notice
thereof to the Exchange Agent. The Exchange Agent will act as agent for the
tendering holders for the purpose of receiving the Exchange Notes and the
Exchange Debentures from the Company.
If any tendered Old Notes or Old Debentures are not accepted for exchange
because of an invalid tender, the occurrence of certain other events set forth
herein or otherwise, the certificates for any such unaccepted Old Notes or Old
Debentures (if such securities were certificated) will be returned, without
expense, to the tendering holder thereof as promptly as practicable after the
Expiration Date.
Holders who tender Old Notes or Old Debentures in the Exchange Offer will
not be required to pay brokerage commissions or fees or, subject to the
instructions in the Letter of Transmittal, transfer taxes with respect to the
exchange of Old Notes or Old Debentures pursuant to the Exchange Offer. The
Company will pay all charges and expenses, other than transfer taxes in
certain circumstances, in connection with the Exchange Offer. See "--Fees and
Expenses."
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The term "Expiration Date" shall mean 5:00 p.m., New York City time, on
November 6, 1998, unless extended by IMC in its sole discretion, in which case
the term "Expiration Date" shall mean the latest date and time to which the
Exchange Offer is extended.
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In order to extend the Exchange Offer, the Company will notify the Exchange
Agent of any extension by oral or written notice and will notify the holders
by issuing a press release regarding such extension, each prior to 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
Expiration Date.
The Company reserves the right, in its sole discretion, subject to
applicable law and the terms of the Registration Rights Agreement, at any time
or from time to time, (i) to delay accepting any Old Notes or Old Debentures,
to extend the Exchange Offer or to terminate the Exchange Offer if any of the
conditions set forth below under "--Conditions" shall not have been satisfied,
by giving oral or written notice of such delay, extension or termination to
the Exchange Agent or (ii) to amend the terms of the Exchange Offer in any
manner. Any such delay in acceptance, extension, termination or amendment will
be followed as promptly as practicable by oral or written notice thereof to
the registered holders.
PROCEDURES FOR TENDERING
Only a holder of Old Notes or Old Debentures may tender such Old Notes or
Old Debentures in the Exchange Offer. For a holder to tender Old Notes or Old
Debentures validly pursuant to the Exchange Offer, a properly completed and
duly executed Letter of Transmittal (or facsimile thereof), with any required
signature guarantee, or, in the case of a book-entry transfer, an Agent's
Message in lieu of the Letter of Transmittal, and any other required documents
must be received by the Exchange Agent at the address set forth under "--
Exchange Agent" on or prior to the Expiration Date. In addition, on or prior
to the Expiration Date, either (A) certificates for tendered Old Notes or Old
Debentures must be received by the Exchange Agent at such address or (B) such
Old Notes or Old Debentures must be transferred pursuant to the procedures for
book-entry transfer described below (and a confirmation of such tender
received by the Exchange Agent, including an Agent's Message if the tendering
holder has not delivered a Letter of Transmittal). The term "Agent's Message"
means a message, transmitted by the book-entry transfer facility, The
Depository Trust Company (the "Book-Entry Transfer Facility"), to and received
by the Exchange Agent and forming a part of a book-entry confirmation, which
states that the Book-Entry Transfer Facility has received an express
acknowledgment from the tendering participant that such participant has
received and agrees to be bound by the Letter of Transmittal and that the
Company may enforce such Letter of Transmittal against such participant.
By executing the Letter of Transmittal (or, in the case of a book-entry
transfer, an Agent's Message in lieu thereof), each holder will make to the
Company the representations set forth above in the third paragraph under the
heading "--Purpose and Effect of the Exchange Offer."
The tender by a holder and the acceptance thereof by the Company will
constitute agreement between such holder and the Company in accordance with
the terms and subject to the conditions set forth herein and in the Letter of
Transmittal.
THE METHOD OF DELIVERY OF OLD NOTES OR OLD DEBENTURES AND THE LETTER OF
TRANSMITTAL, INCLUDING DELIVERY THROUGH DTC AND ANY ACCEPTANCE OF AN AGENT'S
MESSAGE TRANSMITTED THROUGH THE DTC AUTOMATED TENDER OFFER PROGRAM, AND ALL
OTHER REQUIRED DOCUMENTS TO THE EXCHANGE AGENT IS AT THE ELECTION AND SOLE
RISK OF THE HOLDER. AS AN ALTERNATIVE TO DELIVERY BY MAIL, HOLDERS MAY WISH TO
CONSIDER OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL CASES, SUFFICIENT TIME
SHOULD BE ALLOWED TO ASSURE DELIVERY TO THE EXCHANGE AGENT BEFORE THE
EXPIRATION DATE. NO LETTER OF TRANSMITTAL OR OLD NOTES OR OLD DEBENTURES
SHOULD BE SENT TO THE COMPANY. HOLDERS MAY REQUEST THEIR RESPECTIVE BROKERS,
DEALERS, COMMERCIAL BANKS, TRUST COMPANIES OR NOMINEES TO EFFECT THE ABOVE
TRANSACTIONS FOR SUCH HOLDERS.
Any beneficial owner whose Old Notes or Old Debentures are registered in the
name of a broker, dealer, commercial bank, trust company or other nominee and
who wishes to tender should contact the registered holder promptly and
instruct such registered holder to tender on such beneficial owner's behalf.
See "Instructions to Registered Holder and/or Book-Entry Transfer Facility
Participant from Beneficial Owner" included with the Letter of Transmittal.
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Signatures on a Letter of Transmittal or a notice of withdrawal, as the case
may be, must be guaranteed by an Eligible Institution (as defined) unless the
Old Notes or Old Debentures tendered pursuant thereto are tendered (i) by a
registered holder who has not completed the box entitled "Special Delivery
Instructions" on the Letter of Transmittal or (ii) for the account of an
Eligible Institution. In the event that signatures on a Letter of Transmittal
or a notice of withdrawal, as the case may be, are required to be guaranteed,
such guarantee must be by a member firm of the Medallion System (an "Eligible
Institution").
If the Letter of Transmittal is signed by a person other than the registered
holder of any Old Notes or Old Debentures listed therein, such Old Notes or
Old Debentures must be endorsed or accompanied by a properly completed bond
power, signed by such registered holder as such registered holder's name
appears on such Old Notes or Old Debentures with the signature thereon
guaranteed by an Eligible Institution.
If the Letter of Transmittal or any Old Notes, Old Debentures or bond powers
are signed by trustees, executors, administrators, guardians, attorneys-in-
fact, officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when signing, and
evidence satisfactory to the Company of their authority to so act must be
submitted with the Letter of Transmittal.
The Company understands that the Exchange Agent will make a request promptly
after the date of this Prospectus to establish accounts with respect to the
Old Notes and the Old Debentures at the Book-Entry Transfer Facility for the
purpose of facilitating the Exchange Offer, and, subject to the establishment
thereof, any financial institution that is a participant in the Book-Entry
Transfer Facility's system may make book-entry delivery of Old Notes and Old
Debentures by causing such Book-Entry Transfer Facility to transfer such Old
Notes or Old Debentures, as applicable, into the Exchange Agent's account with
respect to the Old Notes or Old Debentures in accordance with the Book-Entry
Transfer Facility's procedures for such transfer. Although delivery of the Old
Notes or Old Debentures may be effected through book-entry transfer into the
Exchange Agent's account at the Book-Entry Transfer Facility, an appropriate
Letter of Transmittal properly completed and duly executed with any required
signature guarantee, or, in the case of a book-entry transfer, an Agent's
Message in lieu of the Letter of Transmittal, and all other required documents
must in each case be transmitted to and received or confirmed by the Exchange
Agent at its address set forth below on or prior to the Expiration Date, or,
if the guaranteed delivery procedures described below are complied with,
within the time period provided under such procedures. Delivery of documents
to the Book-Entry Transfer Facility does not constitute delivery to the
Exchange Agent.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance of tendered Old Notes or tendered Old Debentures and
withdrawal of tendered Old Notes or tendered Old Debentures will be determined
by the Company in its sole discretion, which determination will be final and
binding. The Company reserves the absolute right to reject any and all Old
Notes and Old Debentures not properly tendered or any Old Notes or Old
Debentures the Company's acceptance of which would, in the opinion of counsel
for the Company, be unlawful. The Company also reserves the right in its sole
discretion to waive any defects, irregularities or conditions of tender as to
particular Old Notes or Old Debentures. The Company's interpretation of the
terms and conditions of the Exchange Offer (including the instructions in the
Letter of Transmittal) will be final and binding on all parties. Unless
waived, any defects or irregularities in connection with tenders of Old Notes
or Old Debentures must be cured within such time as the Company shall
determine. Although the Company intends to notify holders of defects or
irregularities with respect to tenders of Old Notes and Old Debentures,
neither the Company, the Exchange Agent nor any other person shall incur any
liability for failure to give such notification. Tenders of Old Notes or Old
Debentures will not be deemed to have been made until such defects or
irregularities have been cured or waived. Any Old Notes or Old Debentures
received by the Exchange Agent that are not properly tendered and as to which
the defects or irregularities have not been cured or waived will be returned
by the Exchange Agent to the tendering holders, unless otherwise provided in
the Letter of Transmittal, as soon as practicable following the Expiration
Date.
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GUARANTEED DELIVERY PROCEDURES
Holders who wish to tender their Old Notes or Old Debentures and (i) whose
Old Notes or Old Debentures are not immediately available, (ii) who cannot
deliver their Old Notes or Old Debentures, the Letter of Transmittal (or, in
the case of a book-entry transfer, delivering an Agent's Message in lieu
thereof) or any other required documents to the Exchange Agent or (iii) who
cannot complete the procedures for book-entry transfer (including delivery of
an Agent's Message), prior to the Expiration Date, may effect a tender if:
(a) the tender is made by or through an Eligible Institution;
(b) on or prior to the Expiration Date, the Exchange Agent receives from
such Eligible Institution (i) an Agent's Message with respect to guaranteed
delivery that is accepted by the Company or (ii) a properly completed and
duly executed Notice of Guaranteed Delivery (by facsimile transmission,
mail or hand delivery) setting forth the name and address of the holder,
the certificate number(s) of such Old Notes or Old Debentures (or, in the
case of book-entry transfer, the name and number of the account at the
Book-Entry Transfer Facility) and the principal amount of Old Notes or Old
Debentures tendered, stating that the tender is being made thereby and
guaranteeing that, within three New York Stock Exchange trading days after
the Expiration Date, the Letter of Transmittal (or facsimile thereof) (or,
in the case of a book-entry transfer, an Agent's Message in lieu thereof)
together with the certificate(s) representing the Old Notes or the Old
Debentures (or a confirmation of book-entry transfer of such Old Notes or
Old Debentures into the Exchange Agent's account at the Book-Entry Transfer
Facility), and any other documents required by the Letter of Transmittal
will be deposited by the Eligible Institution with the Exchange Agent; and
(c) such properly completed and executed Letter of Transmittal (of
facsimile thereof) (or, in the case of a book-entry transfer, an Agent's
Message in lieu thereof), as well as the certificate(s) representing all
tendered Old Notes or Old Debentures in proper form for transfer (or a
confirmation of book-entry transfer of such Old Notes or Old Debentures
into the Exchange Agent's account at the Book-Entry Transfer Facility), and
all other documents required by the Letter of Transmittal are received by
the Exchange Agent within three New York Stock Exchange trading days after
the date of execution of the Notice of Guaranteed Delivery.
Notwithstanding any other provision hereof, the delivery of Exchange Notes
and Exchange Debentures in exchange for Old Notes and Old Debentures,
respectively, tendered and accepted for exchange pursuant to the Exchange
Offer will in all cases be made only after timely receipt by the Exchange
Agent of Old Notes or Old Debentures (as applicable), or of a book-entry
confirmation with respect to such Old Notes or Old Debentures (as applicable),
and a properly completed and duly executed Letter of Transmittal (or facsimile
thereof), together with any required signature guarantees and any other
documents required by the Letter of Transmittal. Accordingly, the delivery of
Exchange Notes and Exchange Debentures (as applicable) might not be made to
all tendering holders at the same time, and will depend upon when Old Notes
and Old Debentures (as applicable), book-entry confirmations with respect to
Old Notes and Old Debentures (as applicable) and other required documents are
received by the Exchange Agent.
WITHDRAWAL OF TENDERS
Except as otherwise provided herein, tenders of Old Notes or Old Debentures
may be withdrawn at any time on or prior to the Expiration Date.
To withdraw a tender of Old Notes or Old Debentures in the Exchange Offer, a
telegram, telex, letter or facsimile transmission notice of withdrawal must be
received by the Exchange Agent at its address set forth herein on or prior to
the Expiration Date. Any such notice of withdrawal must (i) specify the name
of the person having deposited the Old Notes or Old Debentures to be withdrawn
(the "Depositor"), (ii) identify the Old Notes or Old Debentures to be
withdrawn (including the certificate number(s) and principal amount of such
Old Notes, or, in the case of Old Notes or Old Debentures transferred by book-
entry transfer, the name and number of the account at the Book-Entry Transfer
Facility to be credited), (iii) be signed by the holder in the same manner as
the original signature on the Letter of Transmittal by which such Old Notes or
Old Debentures were tendered (including any required signature guarantees) or
be accompanied by documents of transfer sufficient to have the
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Trustee with respect to the Old Notes and the Old Debentures register the
transfer of such Old Notes or Old Debentures into the name of the person
withdrawing the tender and (iv) specify the name in which any such Old Notes
or Old Debentures are to be registered, if different from that of the
Depositor. All questions as to the validity, form and eligibility (including
time of receipt) of such notices will be determined by the Company, whose
determination shall be final and binding on all parties. Any Old Notes or Old
Debentures so withdrawn will be deemed not to have been validly tendered for
purposes of the Exchange Offer and no Exchange Notes or Exchange Debentures
will be issued with respect thereto unless the Old Notes or the Old Debentures
so withdrawn are validly retendered. Any Old Notes or Old Debentures which
have been tendered but which are not accepted for exchange will be returned to
the holder thereof without cost to such holder as soon as practicable after
withdrawal, rejection of tender or termination of the Exchange Offer. Properly
withdrawn Old Notes or Old Debentures may be retendered by following one of
the procedures described above under "--Procedures for Tendering" at any time
prior to the Expiration Date.
CONDITIONS
Notwithstanding any other term of the Exchange Offer, the Company shall not
be required to accept for exchange, or exchange Exchange Notes or Exchange
Debentures for, any Old Notes or Old Debentures, respectively, and may
terminate or amend the Exchange Offer as provided herein before the acceptance
of such Old Notes or Old Debentures, if:
(a) any action or proceeding is instituted or threatened in any court or
by or before any governmental agency with respect to the Exchange Offer
which, in the sole judgment of the Company, might materially impair the
ability of the Company to proceed with the Exchange Offer or any material
adverse development has occurred in any existing action or proceeding with
respect to the Company or any of its subsidiaries; or
(b) any law, statute, rule, regulation or interpretation by the Staff is
proposed, adopted or enacted, which, in the sole judgment of the Company,
might materially impair the ability of the Company to proceed with the
Exchange Offer or materially impair the contemplated benefits of the
Exchange Offer to the Company; or
(c) any governmental approval has not been obtained, which approval the
Company shall, in its sole discretion, deem necessary for the consummation
of the Exchange Offer as contemplated hereby.
If the Company determines in its sole discretion that any of the conditions
are not satisfied, the Company may (i) refuse to accept any Old Notes and Old
Debentures and return all tendered Old Notes and Old Debentures to the
tendering holders, (ii) extend the Exchange Offer and retain all Old Notes and
Old Debentures tendered prior to the expiration of the Exchange Offer,
subject, however, to the rights of holders to withdraw such Old Notes or Old
Debentures (see "--Withdrawal of Tenders") or (iii) waive such unsatisfied
conditions with respect to the Exchange Offer and accept all properly tendered
Old Notes and Old Debentures which have not been withdrawn. If such waiver or
amendment constitutes a material change to the Exchange Offer, the Company
will promptly disclose such waiver or amendment by means of a prospectus
supplement that will be distributed to the registered holders of the Old Notes
and the Old Debentures, and the Company will extend the Exchange Offer to the
extent required by Rule 14e-1 under the Exchange Act.
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EXCHANGE AGENT
The Bank of New York has been appointed as Exchange Agent for the Exchange
Offer. Questions and requests for assistance, requests for additional copies
of this Prospectus or of the Letter of Transmittal and requests for Notice of
Guaranteed Delivery should be directed to the Exchange Agent addressed as
follows:
THE BANK OF NEW YORK
By Hand or Overnignt By Facsimile Transmission: By Registered or
Delivery: (Eligible Institutions Only) Certified Mail:
The Bank of New York (212) 815-6339 The Bank of New York
101 Barclay Street 101 Barclay Street, 7E
Corporate Trust Services To Confirm by Telephone New York, New York 10286
Window or for Information Call: Attention:
Ground Level Reorganization
Attention: (212) 815-3738 Section, Carolle
Reorganization Montreuil
Section, Carolle
Montreuil
DELIVERY TO AN ADDRESS OTHER THAN SET FORTH ABOVE WILL NOT CONSTITUTE A
VALID DELIVERY.
FEES AND EXPENSES
The expenses of soliciting tenders will be borne by the Company. The
principal solicitation is being made by mail; however, additional solicitation
may be made by telegraph, telecopy, telephone or in person by officers and
regular employees of the Company and its affiliates.
The Company has not retained any dealer-manager in connection with the
Exchange Offer and will not make any payments to brokers, dealers or others
soliciting acceptances of the Exchange Offer. The Company, however, will pay
the Exchange Agent reasonable and customary fees for its services and will
reimburse it for its reasonable out-of-pocket expenses in connection
therewith.
The cash expenses to be incurred in connection with the Exchange Offer will
be paid by the Company. Such expenses include fees and expenses of the
Exchange Agent and Trustee, accounting and legal fees and printing costs,
among others.
The Company will pay all transfer taxes, if any, applicable to the exchange
of Old Notes and Old Debentures pursuant to the Exchange Offer. If, however, a
transfer tax is imposed for any reason other than the transfer and exchange of
Old Notes or Old Debentures pursuant to the Exchange Offer, then the amount of
any such transfer taxes (whether imposed on the registered holder or on any
other person) will be payable by the tendering holder. If satisfactory
evidence of payment of such taxes or exemption therefrom is not submitted with
this Letter of Transmittal, the amount of such transfer taxes will be billed
directly to such tendering holder.
ACCOUNTING TREATMENT
The Exchange Notes and the Exchange Debentures will be recorded at the same
carrying value as the Old Notes and the Old Debentures, respectively, which is
face value, as reflected in the Company's accounting records on the date of
exchange. Accordingly, no gain or loss for accounting purposes will be
recognized by the Company. The expenses of the Exchange Offer will be expensed
over the term of each of the Exchange Notes and the Exchange Debentures on a
pro rata basis.
CONSEQUENCES OF FAILURE TO EXCHANGE
The Old Notes and the Old Debentures that are not exchanged for Exchange
Notes and Exchange Debentures, respectively, pursuant to the Exchange Offer
will remain restricted securities. Accordingly, such Old Notes or Old
Debentures may offer, sell or otherwise transfer, as applicable, prior to the
date that is two years
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after the later of the date of original issue and the last date on which the
Company or any affiliate of the Company was the owner of such Old Notes or Old
Debentures, as applicable (or any predecessor thereto) (the "Resale
Restriction Termination Date") only (a) to the Company or any subsidiary
thereof, (b) to the Initial Purchasers, (c) pursuant to a registration
statement that has been declared effective under the Securities Act, (d) for
so long as the Old Notes or the Old Debentures, as applicable, are eligible
for resale pursuant to Rule 144A, to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
transfer is being made in reliance on Rule 144A or (e) pursuant to any other
available exemption from the registration requirements of the Securities Act,
subject in each of the foregoing cases to any requirement of law that the
disposition of its property or the property of such investor account or
accounts be at all times within its or their control and to compliance with
any applicable state securities laws; it being understood that prior to any
offer, sale or other transfer of Old Notes or Old Debentures, as applicable,
in certificated form prior to the Resale Restriction Termination Date pursuant
to clause (e) above, the Company reserves the right to require the delivery of
an opinion of counsel, certification and/or other information satisfactory to
the Company.
The Old Notes and the Exchange Notes will constitute a single series of debt
securities under the Indenture. In the event that the Exchange Offer is
consummated, any Old Notes that remain outstanding after consummation of the
Exchange Offer and the Exchange Notes issued in the Exchange Offer will vote
together as a single class for purposes of determining whether holders of the
requisite percentage in outstanding principal amount of Notes have taken
certain actions or exercised certain rights under the Indenture. Similarly,
the Old Debentures and the Exchange Debentures will constitute a single series
of debt securities under the Indenture. In the event that the Exchange Offer
is consummated, any Old Debentures outstanding after consummation of the
Exchange Offer and the Exchange Debentures issued in the Exchange Offer will
vote together as a single class for purposes of determining whether holders of
the requisite percentage in outstanding principal amount of Debentures have
taken certain actions or exercised certain rights under the Indenture.
RESALE OF THE EXCHANGE SECURITIES
Based on existing interpretations of the Securities Act by the Staff set
forth in several no-action letters to third parties, and subject to the
immediately following sentence, the Company believes that the Exchange Notes
and the Exchange Debentures to be issued pursuant to the Exchange Offer may be
offered for resale, resold and otherwise transferred by the holders thereof
(other than holders who are broker-dealers) without further compliance with
the registration and prospectus delivery provisions of the Securities Act.
However, any holder of Old Notes or Old Debentures who is an "affiliate" of
the Company or who intends to participate in the Exchange Offer for the
purpose of distributing the Exchange Notes or the Exchange Debentures, or any
broker-dealer who purchased the Old Notes or the Old Debentures from the
Company for resale pursuant to Rule 144A or any other available exemption
under the Securities Act, (i) will not be able to rely on the interpretations
of the Staff set forth in the above-mentioned no-action letters, (ii) will not
be entitled to tender its Old Notes or Old Debentures, as applicable, in the
Exchange Offer and (iii) must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with any sale or
transfer of the Old Notes or Old Debentures, as applicable, unless such sale
or transfer is made pursuant to an exemption from such requirements. The
Company does not intend to seek its own no-action letter, and there can be no
assurance that the Staff would make a similar determination with respect to
the Exchange Notes or the Exchange Debentures as it has in such no-action
letters to third parties.
Each holder of Old Notes or Old Debentures (other than certain specified
holders) who wishes to exchange the Old Notes or the Old Debentures, as
applicable, for Exchange Notes or Exchange Debentures, as applicable, in the
Exchange Offer will be required to represent that (i) it is not an "affiliate"
of the Company, (ii) the Exchange Notes or the Exchange Debentures, as
applicable, to be received by it are being acquired in the ordinary course of
its business, (iii) it has no arrangement with any person to participate in
the distribution (within the meaning of the Securities Act) of the Exchange
Notes or the Exchange Debentures, as applicable,
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<PAGE>
and (iv) if such holder is not a broker-dealer, such holder is not engaged in,
and does not intend to engage in, a distribution (within the meaning of the
Securities Act). Each Participating Broker-Dealer that receives Exchange Notes
or Exchange Debentures for its own account pursuant to the Exchange Offer must
acknowledge that it acquired the Old Notes or the Old Debentures for its own
account as a result of market-making or other trading activities and must
agree that it will deliver a prospectus meeting the requirements of the
Securities Act in connection with any resale of such Exchange Notes or
Exchange Debentures. The Letter of Transmittal states that by so acknowledging
and by delivering a prospectus, a Participating Broker-Dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the
Securities Act. The Commission has taken the position in the above-mentioned
no-action letters that Participating Broker-Dealers who acquired Old Notes or
Old Debentures for their own accounts as a result of market-making or other
trading activities may fulfill their prospectus delivery requirements with
respect to the Exchange Notes or the Exchange Debentures, as applicable, other
than a resale of an unsold allotment from the original sale thereof, with a
prospectus meeting the requirements of the Securities Act, which may be the
prospectus prepared for an exchange offer so long as it contains a plan of
distribution with respect to the resale of such Exchange Notes and Exchange
Debentures. Under the Registration Rights Agreement, the Company is required
to allow Participating Broker-Dealers and other persons, if any, subject to
similar prospectus delivery requirements to use this Prospectus, as it may be
amended or supplemented from time to time, in connection with the resale of
such Exchange Notes or Exchange Debentures, as applicable, for a period of 180
days from the issuance of the Exchange Notes or the Exchange Debentures, as
applicable. The Company has agreed that, for a period of 180 days after the
Expiration Date, it will make this Prospectus available to any Participating
Broker-Dealer for use in connection with any such resale (provided that the
Company has received prior written notice from such Participating Broker-
Dealer of its status as a Participating Broker-Dealer). See "Plan of
Distribution." Any Participating Broker-Dealer who is an "affiliate" of the
Company may not rely on the above-mentioned no-action letters and must comply
with the registration and delivery requirements of the Securities Act in
connection with any resale transaction.
CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The following discussion is based on the current provisions of the Internal
Revenue Code of 1986, as amended (the "Code"), applicable Treasury
regulations, judicial authority and administrative rulings and practice. There
can be no assurance that the Internal Revenue Service (the "Service") will not
take a contrary view, and no ruling from the Service has been or will be
sought. Legislative, judicial or administrative changes or interpretations may
be forthcoming that could alter or modify the statements and conditions set
forth herein. Any such changes or interpretations may or may not be
retroactive and could affect the tax consequences to holders. Certain holders
(including insurance companies, tax-exempt organizations, financial
institutions, broker-dealers, foreign corporations and persons who are not
citizens or residents of the United States) may be subject to special rules
not discussed below. The Company recommends that each holder consult such
holder's own tax advisor as to the particular tax consequences of exchanging
such holder's Old Notes or Old Debentures for Exchange Notes or Exchange
Debentures, respectively, including the applicability and effect of any state,
local or foreign tax laws.
The Company believes that the exchange of Old Notes or Old Debentures for
Exchange Notes or Exchange Debentures, respectively, pursuant to the Exchange
Offer will not be treated as an "exchange" for federal income tax purposes
because the Exchange Notes or the Exchange Debentures will not be considered
to differ materially in kind or extent from the Old Notes or the Old
Debentures, respectively. Rather, the Exchange Notes or the Exchange
Debentures received by a holder will be treated as a continuation of the Old
Notes or the Old Debentures, respectively, in the hands of such holder. As a
result, there will be no federal income tax consequences to holders exchanging
Old Notes or Old Debentures for Exchange Notes or Exchange Debentures,
respectively, pursuant to the Exchange Offer.
The Company may become obligated to pay additional interest to the
beneficial owners of the Old Notes and the Old Debentures under certain
circumstances described under "Exchange Offer--Purpose and Effect of
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<PAGE>
Exchange Offer." The Company believes that any such payments of interest
should be treated as an "incidental contingency" for purposes of the original
issue discount rules because the potential amount of any such interest
payments, if required to be made, is expected to be insignificant relative to
the total expected amount of remaining payments on the Old Notes and the Old
Debentures, and, accordingly, if such interest payments are required to be
made, such interest should be taxable to beneficial owners in the same manner
as any scheduled payments of interest.
PLAN OF DISTRIBUTION
Each Participating Broker-Dealer that receives Exchange Notes or Exchange
Debentures for its own account pursuant to the Exchange Offer must acknowledge
that it acquired the Old Notes or the Old Debentures for its own account as a
result of market-making or other trading activities and must agree that it
will deliver a prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Notes or Exchange Debentures. The
Letter of Transmittal states that by so acknowledging and by delivering a
prospectus, a Participating Broker-Dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act. Under the
Registration Rights Agreement, the Company is required to allow Participating
Broker-Dealers and other persons, if any, subject to similar prospectus
delivery requirements to use this Prospectus, as it may be amended or
supplemented from time to time, in connection with the resale of such Exchange
Notes or Exchange Debentures, as applicable, for a period of 180 days from the
issuance of the Exchange Notes or Exchange Debentures, as applicable. The
Company has agreed that, for a period of 180 days after the Expiration Date,
it will make this Prospectus, as amended or supplemented, available to any
Participating Broker-Dealer for use in connection with any such resale
(provided that the Company has received prior written notice from such
Participating Broker-Dealer of its status as a Participating Broker-Dealer).
See "Exchange Offer--Resale of the Exchange Securities."
The Company will not receive any cash proceeds from any sales of the
Exchange Notes or Exchange Debentures by Participating Broker-Dealers.
Exchange Notes or Exchange Debentures received by Participating Broker-Dealers
for their own account pursuant to the Exchange Offer may be sold from time to
time in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the Exchange Notes or the
Exchange Debentures or a combination of such methods of resale, at market
prices prevailing at the time of resale, at prices related to such prevailing
market prices or negotiated prices. Any such resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such Participating Broker-
Dealer and/or the purchasers of any such Exchange Notes or Exchange
Debentures. Any Participating Broker-Dealer that resells the Exchange Notes or
Exchange Debentures that were received by it for its own account pursuant to
the Exchange Offer and any broker or dealer that participates in a
distribution of such Exchange Notes or Exchange Debentures may be deemed to be
an "underwriter" within the meaning of the Securities Act and any profit on
any such resale of Exchange Notes or Exchange Debentures and any commissions
or concessions received by any such persons may be deemed to be underwriting
compensation under the Securities Act. The Letter of Transmittal states that
by acknowledging that it will deliver and by delivering a prospectus, a
Participating Broker-Dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
LEGAL MATTERS
The validity of the Exchange Notes and the Exchange Debentures offered
hereby will be passed upon for the Company by Kirkland & Ellis (a partnership
including professional corporations), Chicago, Illinois.
EXPERTS
The consolidated financial statements of the Company as of December 31, 1997
and 1996 and for each of the three years in the period ended December 31, 1997
appearing in the Company's Annual Report on Form 10-K for the year ended
December 31, 1997, have been audited by Ernst & Young LLP, independent
auditors,
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<PAGE>
as set forth in their report thereon included therein and incorporated herein
by reference. Such financial statements have been incorporated herein in
reliance upon such report given upon the authority of such firm as experts in
accounting and auditing.
The consolidated balance sheets of Harris Chemical Group, Inc. as of March
29, 1997 and March 30, 1996 and the related consolidated statements of
operations, cash flows and common stockholders' equity for each of the three
fiscal years in the period ended March 29, 1997 appearing in the Company's
Current Report on Form 8-K/A filed on June 15, 1998, which is incorporated by
reference in this Prospectus and in the Exchange Offer Registration Statement,
have been audited by PricewaterhouseCoopers LLP, independent accountants, as
set forth in their report thereon included therein and incorporated herein by
reference. The consolidated balance sheets of Harris Chemical Group, Inc. as
of March 28, 1998 and March 29, 1997 and the related consolidated statements
of operations, cash flows and common stockholders' equity for each of the
three fiscal years in the period ended March 28, 1998 appearing in the
Company's Current Report on Form 8-K/A filed on September 16, 1998, which is
incorporated by reference in this Prospectus and in the Exchange Offer
Registration Statement, have been audited by PricewaterhouseCoopers LLP,
independent accountants, as set forth in their report thereon included therein
and incorporated herein by reference. Such financial statements have been
incorporated herein in reliance upon such reports given upon the authority of
such firm as experts in accounting and auditing.
The financial statements of Penrice for the year ended June 30, 1997
appearing in the Company's Current Report on Form 8-K/A filed on June 15,
1998, which is incorporated by reference in this Prospectus and in the
Exchange Offer Registration Statement, have been audited by Arthur Andersen,
Chartered Accountants, as set forth in their report thereon included therein
and incorporated herein by reference. Such financial statements have been
incorporated herein in reliance upon such report given upon the authority of
such firm as experts in accounting and auditing.
The consolidated financial statements of FTX at December 31, 1996 and for
each of the three years in the period ended December 31, 1996 appearing in
FTX's Annual Report on Form 10-K for the year ended December 31, 1996, which
are incorporated by reference in this Prospectus and in the Exchange Offer
Registration Statement, have been audited by Arthur Andersen LLP, independent
public accountants, as set forth in their report thereon incorporated by
reference herein. In that report, that firm states that its report is based in
part on the report of other independent public accountants, Ernst & Young LLP.
Such financial statements have been incorporated herein by reference in
reliance upon the authority of those firms as experts in accounting and
auditing in giving said reports.
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NO DEALER, SALESPERSON OR ANY OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS IN CONNECTION WITH THE OFFER CON-
TAINED HEREIN, OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS, AND, IF GIVEN OR
MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING
BEEN AUTHORIZED BY THE COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER
TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY SECURITY OTHER THAN THOSE TO
WHICH IT RELATES NOR DOES IT CONSTITUTE AN OFFER TO SELL, OR A SOLICITATION OF
AN OFFER TO BUY, ANY SECURITY IN ANY JURISDICTION IN WHICH SUCH OFFER OR SO-
LICITATION IS NOT AUTHORIZED, OR IN WHICH THE PERSON MAKING SUCH OFFER OR SO-
LICITATION IS NOT AUTHORIZED TO DO SO, OR TO ANY PERSON TO WHOM IT IS UNLAWFUL
TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE DELIVERY OF THIS PROSPECTUS
NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLI-
CATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE
DATE HEREOF OR THAT THE INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSE-
QUENT TO THE DATE HEREOF.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information...................................................... 5
Information Incorporated by Reference...................................... 5
Forward-Looking Statements................................................. 6
Prospectus Summary......................................................... 7
Risk Factors............................................................... 17
Use of Proceeds............................................................ 18
Capitalization............................................................. 18
Ratio of Earnings to Fixed Charges......................................... 19
The Company................................................................ 20
Recent Developments........................................................ 20
Description of Exchange Notes and Exchange Debentures...................... 21
Exchange Offer............................................................. 31
Certain Federal Income Tax Considerations.................................. 42
Plan of Distribution....................................................... 43
Legal Matters.............................................................. 43
Experts.................................................................... 43
</TABLE>
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PROSPECTUS
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$300,000,000
IMC GLOBAL INC.
OFFER TO EXCHANGE ITS 6 1/2% NOTES DUE 2003 AND ITS 7 3/8% DEBENTURES DUE
2018, WHICH HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, FOR ANY AND
ALL OF ITS OUTSTANDING 6 1/2% NOTES DUE 2003 AND 7 3/8% DEBENTURES DUE 2018,
RESPECTIVELY
LOGO
OCTOBER 7, 1998
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