<PAGE>
Filed Pursuant to Rule 424(b)(3)
Registration No. 333-93307
PROSPECTUS
$1,000,000,000
TYCO INTERNATIONAL GROUP S.A.
OFFER TO EXCHANGE
UP TO $1,000,000,000 6 7/8% NOTES DUE 2002
FOR ANY AND ALL OUTSTANDING 6 7/8% NOTES DUE 2002
FULLY AND UNCONDITIONALLY GUARANTEED BY
[LOGO]
Summary of the Exchange Offer
This document and accompanying Letter of Transmittal relate to the proposed
offer by Tyco International Group S.A. (the "Company") to exchange up to
$1,000,000,000 aggregate principal amount of new 6 7/8% notes due 2002 for any
and all of its outstanding 6 7/8% notes due 2002. The new notes, which are
referred to as the "exchange notes," will be freely transferable. The
outstanding notes, which are referred to as the "restricted notes," have certain
transfer restrictions.
The restricted notes are, and the exchange notes will be, unsecured and
unsubordinated obligations of the Company that are fully and unconditionally
guaranteed on an unsecured and unsubordinated basis by Tyco International Ltd.
("Tyco"), the Company's corporate parent.
- The exchange offer expires 5:00 p.m. New York City time on July 28, 2000,
unless extended.
- All restricted notes that are tendered and not withdrawn will be exchanged
promptly upon consummation of the exchange offer.
- There should be no United States federal income tax consequences to
holders of restricted notes who exchange restricted notes for exchange
notes pursuant to the exchange offer.
- Holders of restricted notes do not have any appraisal or dissenters'
rights in connection with the exchange offer.
- Restricted notes not exchanged in the exchange offer will remain
outstanding and be entitled to the benefits of the indenture under which
they were issued, but except under certain circumstances will not have
further exchange or registration rights.
- The Company does not intend to apply for listing of the exchange notes on
any securities exchange or to arrange for them to be quoted on any
quotation system.
Each holder of restricted notes wishing to accept the exchange offer must
deliver the restricted notes to be exchanged, together with the Letter of
Transmittal that accompanies this document and any other required documentation,
to the exchange agent identified in this document. Alternatively, you may effect
a tender of restricted notes by book-entry transfer into the exchange agent's
account at The Depository Trust Company. All deliveries are at the risk of the
holder. You can find detailed instructions concerning delivery in the "Exchange
Offer" section of this document and in the accompanying Letter of Transmittal.
------------------------
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THE EXCHANGE NOTES OR DETERMINED IF
THIS DOCUMENT IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
YOU SHOULD READ THIS ENTIRE DOCUMENT AND THE ACCOMPANYING LETTER OF
TRANSMITTAL AND RELATED DOCUMENTS AND ANY AMENDMENTS OR SUPPLEMENTS CAREFULLY
BEFORE MAKING YOUR DECISION TO PARTICIPATE IN THE EXCHANGE OFFER.
The date of this prospectus is June 29, 2000
<PAGE>
YOU SHOULD RELY ONLY ON THE INFORMATION PROVIDED OR INCORPORATED BY
REFERENCE IN THIS DOCUMENT. NEITHER THE COMPANY NOR TYCO HAS AUTHORIZED ANYONE
ELSE TO PROVIDE YOU WITH DIFFERENT INFORMATION. YOU SHOULD NOT ASSUME THAT THE
INFORMATION IN THIS DOCUMENT IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON
THE FRONT OF THIS DOCUMENT. NEITHER THE DELIVERY OF THIS DOCUMENT OR THE
ACCOMPANYING LETTER OF TRANSMITTAL, NOR ANY EXCHANGE MADE PURSUANT TO THIS
DOCUMENT SHALL UNDER ANY CIRCUMSTANCES CREATE AN IMPLICATION THAT THE
INFORMATION CONTAINED IN THIS DOCUMENT IS CORRECT AS OF ANY SUBSEQUENT DATE.
THE EXCHANGE OFFER IS NOT BEING MADE TO, NOR WILL TENDERS OF RESTRICTED
NOTES BE ACCEPTED FROM, HOLDERS OF RESTRICTED NOTES IN ANY JURISDICTION IN WHICH
THE EXCHANGE OFFER OR ITS ACCEPTANCE IS UNLAWFUL.
TABLE OF CONTENTS
<TABLE>
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PAGE
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<S> <C>
Where You Can Find More Information......................... iii
Forward Looking Information................................. 1
Current Developments........................................ 1
Tyco........................................................ 2
The Company................................................. 2
Ratio of Earnings to Fixed Charges of Tyco.................. 3
Exchange Offer.............................................. 4
Description of the Notes and the Guarantees................. 14
Enforcement of Civil Liabilities............................ 31
Certain Luxembourg, Bermuda and United States Federal Income
Tax Consequences.......................................... 33
Plan of Distribution........................................ 36
Legal Matters............................................... 36
Experts..................................................... 37
</TABLE>
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WHERE YOU CAN FIND MORE INFORMATION
In connection with the exchange offer, the Company and Tyco have filed with
the Securities and Exchange Commission a registration statement under the
Securities Act of 1933, relating to the exchange notes. As permitted by SEC
rules, this document omits certain information included in the registration
statement. For a more complete understanding of the exchange offer, you should
refer to the registration statement, including its exhibits.
Tyco also files annual, quarterly and current reports, proxy statements and
other information with the SEC. These filings are available to the public over
the Internet at the SEC's web site at http://www.sec.gov. You may also read and
copy any document filed by Tyco or the Company with the SEC at the SEC's public
reference rooms in Washington, D.C., New York, New York and Chicago, Illinois.
Please call the SEC at 1-800-SEC-0330 for further information on the public
reference rooms and their copy charges. Tyco's common shares are listed on the
New York Stock Exchange, as well as on the London and Bermuda Stock Exchanges.
You can obtain information about Tyco from the New York Stock Exchange at 20
Broad Street, New York, New York 10005.
The SEC allows the Company and Tyco to "incorporate by reference"
information in documents filed with the SEC, which means that they can disclose
important information to you by referring you to those documents. These
incorporated documents contain important business and financial information
about the Company and Tyco that is not included in or delivered with this
document. The information incorporated by reference is considered to be part of
this document, and later information filed with the SEC may update and supersede
this information. The Company and Tyco incorporate by reference the documents
listed below and any future filings made with the SEC under Sections 13(a),
13(c), 14 or 15(d) of the Securities Exchange Act of 1934 prior to the
expiration of the exchange offer.
1. Tyco's Annual Report on Forms 10-K and 10-K/A for the fiscal year ended
September 30, 1999.
2. Tyco's Quarterly Reports on Forms 10-Q and 10-Q/A for the quarters ended
December 31, 1999 and March 31, 2000.
3. Tyco's Current Reports on Form 8-K filed on December 9, 1999,
December 10, 1999 and January 20, 2000.
4. The description of Tyco's common shares as set forth in Tyco's
Registration Statement on Form 8-A/A filed on March 1, 1999.
You may request a copy of these filings at no cost, by writing or calling
Tyco at the following address or telephone number:
Tyco International Ltd.
The Zurich Centre, Second Floor
90 Pitts Bay Road
Pembroke HM 08, Bermuda
(441) 292-8674
Exhibits to the documents will not be sent, unless those exhibits have
specifically been incorporated by reference in this document.
To obtain timely delivery of any copies of filings requested, please write
or telephone no later than July 18, 2000, ten days prior to the expiration of
the exchange offer.
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FORWARD LOOKING INFORMATION
Certain statements contained or incorporated by reference in this document
are "forward looking statements" within the meaning of the U.S. Private
Securities Litigation Reform Act of 1995. All forward looking statements involve
risks and uncertainties. In particular, any statement contained in this document
or any document incorporated by reference in this document regarding the
consummation and benefits of future acquisitions, as well as expectations with
respect to future sales, operating efficiencies and product expansion, are
subject to known and unknown risks, uncertainties and contingencies, many of
which are beyond the control of the Company and Tyco, which may cause actual
results, performance or achievements to differ materially from anticipated
results, performances or achievements. Factors that might affect such forward
looking statements include, among other things:
- overall economic and business conditions;
- the demand for the goods and services of the Company and Tyco;
- competitive factors in the industries in which the Company and Tyco
compete;
- changes in government regulation;
- changes in tax requirements, including tax rate changes, new tax laws and
revised tax law interpretations;
- interest rate fluctuations, foreign currency rate fluctuations and other
capital market conditions;
- economic and political conditions in international markets, including
governmental changes and restrictions on the ability to transfer capital
across borders;
- the ability to achieve anticipated synergies and other costs savings in
connection with acquisitions; and
- the timing, impact and other uncertainties of future acquisitions.
CURRENT DEVELOPMENTS
On June 28, 2000, Tyco announced that its subsidiary had entered into a
definitive agreement to acquire Mallinckrodt Inc., a global healthcare company.
Mallinckrodt shareholders will receive Tyco shares valued at $47.50 for each
share of Mallinckrodt. The transaction is valued at approximately $4.2 billion
and is contingent upon customary regulatory review and approval by Mallinckrodt
shareholders. Mallinckrodt will be integrated within Tyco's Healthcare group.
Tyco intends to account for the acquisition as a purchase.
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TYCO
Tyco is a diversified manufacturing and service company that, through its
subsidiaries:
- designs, manufactures and distributes electrical and electronic components
and designs, manufactures, installs and services undersea cable
communication systems;
- designs, manufactures and distributes disposable medical supplies and
other specialty products, and conducts auto redistribution services;
- designs, manufactures, installs and services fire detection and
suppression systems and installs, monitors and maintains electronic
security systems; and
- designs, manufactures and distributes flow control products.
Tyco's strategy is to be the low-cost, high quality producer and provider in
each of its markets. It promotes its leadership position by investing in
existing businesses, developing new markets and acquiring complementary
businesses and products. Combining the strengths of its existing operations and
its business acquisitions, Tyco seeks to enhance shareholder value through
increased earnings per share and strong cash flows.
Tyco reviews acquisition opportunities in the ordinary course of its
business, some of which may be material and some of which are currently under
investigation, discussion or negotiation. There can be no assurance that any of
such acquisitions will be consummated.
Tyco's registered and principal executive offices are located at The Zurich
Centre, Second Floor, 90 Pitts Bay Road, Pembroke HM 08, Bermuda, and its
telephone number is (441) 292-8674. The executive offices of Tyco International
(US) Inc., Tyco's principal United States subsidiary, are located at One Tyco
Park, Exeter, New Hampshire 03833, and its telephone number is (603) 778-9700.
THE COMPANY
Tyco International Group S.A., a Luxembourg company, is a wholly-owned
subsidiary of Tyco. The registered and principal offices of the Company are
located at 6, avenue Emile Reuter, 2nd Floor, L-2420 Luxembourg, and its
telephone number is (352) 46 43 40-1. The Company indirectly owns a substantial
portion of the operating subsidiaries of Tyco.
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RATIO OF EARNINGS TO FIXED CHARGES OF TYCO
The following table sets forth the ratio of earnings to fixed charges of
Tyco for the six months ended March 31, 2000, the years ended September 30, 1999
and 1998, the nine-month transition period ended September 30, 1997 and the
years ended December 31, 1996 and 1995.
<TABLE>
<CAPTION>
SIX MONTHS NINE MONTHS
ENDED YEAR ENDED ENDED YEAR ENDED
MARCH 31, SEPTEMBER 30, SEPTEMBER 30, DECEMBER 31,
---------- ------------------- ------------- -------------------
2000 1999 1998 1997(4) 1996 1995
---------- -------- -------- ------------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges
(1)(2)(3)............................. 5.66 3.53 5.07 1.00 2.54 4.68
</TABLE>
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(1) For purposes of determining the ratio of earnings to fixed charges, earnings
consist of income (loss) before income taxes, extraordinary items,
cumulative effect of accounting changes and fixed charges. Fixed charges
consist of interest on indebtedness, amortization of debt expenses and
one-third of rent expense which is deemed representative of an interest
factor.
(2) On July 2, 1997, Tyco, formerly called ADT Limited, merged with Tyco
International Ltd., a Massachusetts corporation ("Former Tyco"). On
April 2, 1999, October 1, 1998, August 29, 1997 and August 27, 1997, Tyco
consummated mergers with AMP Incorporated, United States Surgical
Corporation, Keystone International, Inc. and Inbrand Corporation,
respectively. Each of the five merger transactions qualifies for the pooling
of interests method of accounting. As such, the ratios of earnings to fixed
charges presented above include the effect of the mergers, except that the
calculation presented above for periods prior to January 1, 1997 does not
include Inbrand due to immateriality.
Prior to their respective mergers, AMP, US Surgical, Keystone, and ADT had
December 31 year ends and Former Tyco had a June 30 fiscal year end. The
historical results upon which the ratios are based have been combined using
a December 31 year end for AMP, US Surgical, Keystone, ADT and Former Tyco
for the year ended December 31, 1996. For 1995, the ratio of earnings to
fixed charges reflects the combination of AMP, US Surgical, Keystone and ADT
with a December 31 year end and Former Tyco with a June 30 fiscal year end.
(3) Earnings for the six months ended March 31, 2000, the years ended
September 30, 1999 and 1998, the nine months ended September 30, 1997 and
the years ended December 31, 1996 and 1995 include merger, restructuring and
other non-recurring (credits) charges of $(74.4) million (of which $1.0
million is included in cost of sales), $1,035.2 million (of which
$106.4 million is included in cost of sales), $256.9 million,
$947.9 million, $344.1 million and $97.1 million, respectively. Earnings
also include charges for the impairment of long-lived assets of $99.0
million, $507.5 million, $148.4 million, $744.7 million and $8.2 million in
the six months ended March 31, 2000, the year ended September 30, 1999, the
nine months ended September 30, 1997 and the years ended December 31, 1996
and 1995, respectively. The 1997 period also includes a write-off of
purchased in-process research and development of $361.0 million. The 1995
period also includes a net loss on the disposal of businesses of $34.4
million.
On a pro forma basis, the ratio of earnings to fixed charges excluding
merger, restructuring and other non-recurring charges, charges for the
impairment of long-lived assets, the write-off of purchased in-process
research and development and the net loss on the disposal of businesses
would have been 5.71x, 5.82x, 5.68x, 6.81x, 5.76x and 5.09x for the six
months ended March 31, 2000, the years ended September 30, 1999 and 1998,
the nine months ended September 30, 1997 and the years ended December 31,
1996 and 1995, respectively.
(4) In September 1997, Tyco changed its fiscal year end from December 31 to
September 30. Accordingly, the nine-month transition period ended
September 30, 1997 is presented.
3
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EXCHANGE OFFER
REASON FOR THE EXCHANGE OFFER
The Company initially sold the restricted notes in a private offering on
August 31, 1999 to Merrill Lynch Pierce, Fenner & Smith Incorporated, Lehman
Brothers Inc., J.P. Morgan Securities, Inc., Morgan Stanley & Co. Incorporated,
Credit Suisse First Boston Corporation, Donaldson, Lufkin & Jenrette Securities
Corporation, Goldman, Sachs & Co., Bear, Stearns Co. Inc., Banc of America
Securities LLC, Chase Securities Inc., Commerzbank Capital Markets Corporation,
Warburg Dillon Read LLC, Salomon Smith Barney Inc., The Williams Capital Group
L.P. and Blaylock & Partners, collectively referred to as the "Initial
Purchasers," pursuant to a Purchase Agreement dated August 26, 1999 among the
Company, Tyco as guarantor, and the Initial Purchasers. The Initial Purchasers
subsequently resold or were permitted to resell the restricted notes:
- to qualified institutional buyers in accordance with the provisions of
Rule 144A under the Securities Act, and
- outside the United States in accordance with the provisions of
Regulation S under the Securities Act.
In connection with the private offering of the restricted notes, the
Company, Tyco as guarantor, and the Initial Purchasers entered into a
Registration Rights Agreement dated August 31, 1999, in which the Company
agreed, among other things:
- to file with the SEC on or before December 29, 1999, a registration
statement relating to an exchange offer for the restricted notes;
- use its reasonable best efforts to cause the exchange offer registration
statement to be declared effective under the Securities Act on or before
February 25, 2000;
- upon the effectiveness of the exchange offer registration statement, to
offer the holders of the restricted notes the opportunity to exchange
their restricted notes in the exchange offer for a like principal amount
of exchange notes;
- to keep the exchange offer open for not less than 30 days, or longer, if
required by applicable law, after notice of the exchange offer is mailed
to holders of restricted notes; and
- to use its reasonable best efforts to consummate the exchange offer on or
before March 28, 2000.
The Company also agreed, under certain circumstances:
- to use its reasonable best efforts to file a shelf registration statement
relating to the offer and sale of the restricted notes by the holders of
the restricted notes;
- to use its reasonable best efforts to cause such shelf registration
statement to be declared effective; and
- to use its reasonable best efforts to keep such shelf registration
statement effective for two years after the shelf registration statement
becomes effective or until the restricted notes covered by the shelf
registration statement have been sold or cease to be outstanding.
The exchange offer being made by this document is intended to satisfy the
Company's exchange and registration obligations under the Registration Rights
Agreement. If the Company fails to fulfill such obligations, holders of
outstanding restricted notes are entitled to receive additional interest at the
rate of 0.25% per annum for each violation of the obligations. The rate will
increase by an additional 0.25% each 90-day period during which the additional
interest continues to accrue. The maximum aggregate increase to the interest
rate under all circumstances is 1% per annum. After the Company
4
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has cured all defaults of its registration and exchange obligations, the accrual
of additional interest on the restricted notes will cease, and the interest rate
for each series of restricted notes will revert to its original rate. As the
exchange offer registration statement was first declared effective on June 27,
2000 and the exchange offer will not be consummated prior to July 28, 2000, the
Company has been paying additional interest on the restricted notes. Upon
consummation of the exchange offer, the exchange notes and any outstanding
restricted notes will accrue interest at the original rate of 6 7/8% per annum.
For a more complete understanding of your exchange and registration rights,
please refer to the Registration Rights Agreement, which is included as
Exhibit 4.4 to the registration statement relating to the exchange notes.
TRANSFERABILITY OF THE EXCHANGE NOTES
Based on certain no-action letters issued by the staff of the SEC to others
in unrelated transactions, the Company believes that a noteholder may offer for
resale, resell or otherwise transfer any exchange notes without compliance with
the registration and prospectus delivery requirements of the Securities Act,
unless the noteholder
- is acquiring the exchange notes other than in the ordinary course of
business;
- is participating, intends to participate or has an arrangement or
understanding with any person to participate, in a distribution of the
exchange notes;
- is an "affiliate" of the Company, as defined in Rule 405 under the
Securities Act; or
- is an Initial Purchaser who acquired restricted notes directly from the
Company in the initial offering to resell pursuant to Rule 144A,
Regulation S or any other available exemption under the Securities Act.
In any of the foregoing circumstances, a noteholder
- will not be able to rely on the interpretations of the staff of the SEC,
in connection with any offer for resale, resale or other transfer of
exchange notes; and
- must comply with the registration and prospectus delivery requirements of
the Securities Act, or have an exemption available, in connection with any
offer for resale, resale or other transfer of the exchange notes.
The Company is not making this exchange offer to, nor will it accept
surrenders of restricted notes from, holders of restricted notes in any state in
which this exchange offer would not comply with the applicable securities laws
or "blue sky" laws of such state.
Each broker-dealer that receives exchange notes for its own account in
exchange for restricted notes, where such restricted notes were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such exchange notes. See "Plan of Distribution" on page 36."
USE OF PROCEEDS
Neither the Company nor Tyco will receive any cash proceeds from the
issuance of the exchange notes. As consideration for the exchange notes, the
Company will receive in exchange an equivalent principal amount of outstanding
restricted notes, the terms of which are substantially identical to the terms of
the exchange notes, except that the exchange notes will be freely transferable
and issued free of any covenants regarding exchange and registration rights.
5
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The Company will retire and cancel the restricted notes surrendered in
exchange for the exchange notes. Accordingly, the issuance of the exchange notes
under the exchange offer will not result in any change in the outstanding
aggregate indebtedness of the Company.
TERMS OF THE EXCHANGE OFFER
The restricted notes were issued in a single series of 6 7/8% notes due
2002. As of the date of this document, $1 billion aggregate principal amount of
the 6 7/8% notes are outstanding. In the exchange offer, restricted notes of
each series will be exchanged for exchange notes.
Upon the terms and subject to the conditions set forth in this document and
in the accompanying Letters of Transmittal, the Company will accept all
restricted notes validly tendered and not withdrawn prior to 5:00 p.m. New York
City time on July 28, 2000, the date that the exchange offer expires. This date
and time may be extended. See "Expiration Date; Extensions; Amendments" below.
After authentication of the exchange notes by the trustee under the indenture
governing the notes or an authenticating agent, the Company will issue and
deliver $1,000 principal amount of exchange notes in exchange for each $1,000
principal amount of outstanding restricted notes accepted in the exchange offer.
Holders may tender some or all of their restricted notes pursuant to the
exchange offer in denominations of $1,000 and integral multiples thereof.
The form and terms of the exchange notes are identical in all material
respects to the form and terms of the outstanding restricted notes, except that:
- the offering of the exchange notes has been registered under the
Securities Act;
- the exchange notes will not be subject to transfer restrictions; and
- the exchange notes will be issued free of any covenants regarding exchange
and registration rights.
The exchange notes will be issued under and entitled to the benefits of the
indenture that governs the restricted notes.
In connection with the issuance of the restricted notes, the Company
arranged for the restricted notes to be issued and transferable in book-entry
form through the facilities of The Depository Trust Company, acting as a
depositary. The exchange notes will also be issuable and transferable in
book-entry form through DTC.
This document, together with the accompanying Letter of Transmittal, is
initially being sent to all registered holders of restricted notes as of the
close of business on June 28, 2000. The exchange offer for restricted notes is
not conditioned upon any minimum aggregate principal amount being tendered.
However, the exchange offer is subject to certain customary conditions which may
be waived by the Company, and to the terms and provisions of the Registration
Rights Agreement. See "Conditions to the Exchange Offer" below.
The exchange agent is The Bank of New York, which also serves as trustee
under the indenture that governs the notes. The Company will be deemed to have
accepted validly tendered restricted notes when, as and if the Company has given
oral or written notice thereof to the exchange agent. The exchange agent will
act as agent of the tendering holders for the purpose of receiving exchange
notes from the Company and as agent of the Company for the purpose of delivering
exchange notes to such holders. See "Exchange Agent" below.
If any tendered restricted notes are not accepted for exchange because of an
invalid tender or the occurrence of certain other events set forth herein,
certificates for any such unaccepted restricted notes will be returned, at the
Company's cost, to the tendering holder as promptly as practicable after the
expiration of the exchange offer.
6
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Holders who tender restricted notes in the exchange offer will not be
required to pay brokerage commissions or fees or, subject to the instructions in
the Letters of Transmittal, transfer taxes with respect to the exchange of
restricted notes pursuant to the exchange offer. The Company will pay all
charges and expenses, other than certain applicable taxes, in connection with
the exchange offer. See "Solicitation of Tenders, Fees and Expenses" below.
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The exchange offer will expire at 5:00 p.m. New York City time on July 28,
2000 unless the Company, in its sole discretion, extends the exchange offer. The
Company may extend the exchange offer at any time and from time to time by
giving oral or written notice to the exchange agent and by timely public
announcement.
The Company reserves the right, in its sole discretion, to amend the terms
of the exchange offer in any manner. If any of the conditions set forth below
under "Conditions to the Exchange Offer" has occurred and has not been waived by
the Company, the Company expressly reserves the right, in its sole discretion,
by giving oral or written notice to the exchange agent, to:
- delay acceptance of, or refuse to accept, any restricted notes not
previously accepted;
- extend the exchange offer; or
- terminate the exchange offer.
Any such delay in acceptance, extension, termination or amendment will be
followed as promptly as practicable by oral or written notice thereof by the
Company to the registered holders of the restricted notes. If the exchange offer
is amended in a manner determined by the Company to constitute a material
change, the Company will promptly disclose such amendment in a manner reasonably
calculated to inform the holders of such amendment, and the Company will extend
the exchange offer to the extent required by law. If the exchange offer is
terminated, federal law requires that the Company promptly either exchange or
return all restricted notes that have been tendered.
The Company will have no obligation to publish, advise, or otherwise
communicate any delay in acceptance, extension, termination or amendment of the
exchange offer other than by making a timely press release. The Company may also
publicly communicate these matters in any other appropriate manner of its
choosing.
INTEREST ON THE EXCHANGE NOTES
Interest on the exchange notes will accrue from the last interest payment
date on which interest was paid on the restricted notes surrendered in exchange
therefor. The exchange notes will bear interest at a rate of 6 7/8% per annum.
Interest on the exchange notes will be payable semi-annually on March 5(th) and
September 5(th) of each year. Assuming that the exchange offer is consummated
prior to September 5, 2000, as anticipated, interest on the exchange notes will
first become payable beginning on September 5, 2000.
PROCEDURES FOR TENDERING
Only a holder of record of restricted notes or a DTC participant listed on a
DTC securities position listing with respect to the restricted notes may tender
its restricted notes in the exchange offer. To tender restricted notes in the
exchange offer:
- registered holders of certificated restricted notes must complete, sign
and date the Letter of Transmittal, or a facsimile thereof, in accordance
with the instructions contained in this document and in the Letter of
Transmittal. The holder should then mail or otherwise deliver the Letter
of Transmittal, or such facsimile, together with the restricted notes to
be exchanged and
7
<PAGE>
any other required documentation, to the exchange agent, at the address
set forth in this document and in the Letter of Transmittal;
- holders of restricted notes that are DTC participants may follow the
procedures for book-entry transfer as provided for below under "Book-Entry
Transfer" and in the Letter of Transmittal.
To be effective, a tender must be made prior to the expiration of the
exchange offer.
Any beneficial owner whose restricted notes are registered in the name of a
broker, dealer, commercial bank, trust company or other nominee and who wishes
to tender restricted notes in the exchange offer should contact such registered
holder promptly and instruct such registered holder to tender on such beneficial
owner's behalf. If a beneficial owner wishes to tender on its own behalf, such
beneficial owner must, prior to completing and executing the Letter of
Transmittal and delivering its restricted notes, either make appropriate
arrangements to register ownership of the restricted notes in its own name or
obtain a properly completed bond power from the registered holder of such
restricted notes. This transfer of record ownership may take considerable time.
Delivery of documents to DTC in accordance with DTC's procedures will NOT
constitute delivery to the exchange agent.
The tender by a holder of restricted notes will constitute an agreement
between such holder, the Company and the exchange agent in accordance with the
terms and subject to the conditions set forth herein and in the Letter of
Transmittal. If less than all the restricted notes held by a holder of
restricted notes are tendered, a tendering holder should fill in the amount of
restricted notes being tendered in the specified box on the Letter of
Transmittal. The entire amount of restricted notes delivered to the exchange
agent will be deemed to have been tendered unless otherwise indicated.
The Letter of Transmittal includes representations by the tendering holder
to the Company that, among other things:
- any exchange notes received by the tendering holder will be acquired in
the ordinary course of its business;
- the tendering holder has no arrangement or understanding with any person
to participate in the distribution of the exchange notes; and
- the tendering holder is not an "affiliate," as defined in Rule 405 under
the Securities Act, of the Company, or, if it is an affiliate, that it
will comply with the registration and prospectus delivery requirements of
the Securities Act to the extent applicable.
A Letter of Transmittal of a broker-dealer that receives exchange notes for
its own account in exchange for restricted notes that were acquired by it as a
result of market-making or other trading activities must also include an
acknowledgment that the broker-dealer will deliver a copy of this document in
connection with the resale of such exchange notes. By so acknowledging and by
delivering a prospectus, such broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act. See "Plan of
Distribution."
The method of delivery of restricted notes and Letters of Transmittal and
all other required documents or transmittal of an Agent's Message, as described
below under "Book-Entry Transfer," to the exchange agent is at the election and
risk of the holders of restricted notes. Instead of delivery by mail, it is
recommended that holders of restricted notes use an overnight or hand delivery
service. In all cases, sufficient time should be allowed to ensure delivery to
the exchange agent prior to the expiration of the exchange offer. No Letters of
Transmittal or restricted notes should be sent to the Company.
Signatures on a Letter of Transmittal or a notice of withdrawal described in
"Withdrawal of Tenders" below must be guaranteed by a member firm of a
registered national securities exchange or of the National Association of
Securities Dealers, Inc., a commercial bank or trust company having an
8
<PAGE>
office or correspondent in the United States or an "eligible guarantor
institution" within the meaning of Rule 17Ad-15 under the Exchange Act (each, an
"Eligible Institution"), unless the corresponding restricted notes are tendered
- by a registered holder who has not completed the box entitled "Special
Registration Instructions" or the box entitled "Special Delivery
Instructions" in the Letter of Transmittal; or
- for the account of an Eligible Institution.
If a Letter of Transmittal is signed by a person other than the registered
holder, the corresponding restricted notes must be endorsed or accompanied by
appropriate bond powers which authorize such person to tender the restricted
notes on behalf of the registered holder, in either case signed as the name of
the registered holder or holders appears on the restricted notes. If a Letter of
Transmittal or any restricted notes or bond powers are signed or endorsed by
trustees, executors, administrators, guardians, attorneys-in-fact, officers or
corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and unless waived by the Company,
submit evidence satisfactory to the Company of their authority to so act with
such Letter of Transmittal.
All questions as to the validity, form, eligibility, acceptance and
withdrawal of the tendered restricted notes 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 restricted notes not properly tendered or
any restricted notes the Company's acceptance of which would, in the opinion of
counsel for the Company, be unlawful. The Company also reserves the absolute
right to waive any irregularities or conditions of tender as to particular
restricted notes. The Company's interpretation of the terms and conditions of
the Exchange Offer, including the instructions in the Letters of Transmittal,
will be final and binding on all parties. Unless waived, any defects or
irregularities in connection with tenders of restricted notes must be cured
within such time as the Company shall determine.
Although the Company intends to notify tendering holders of defects or
irregularities with respect to tenders of restricted notes, neither the Company,
the exchange agent nor any other person will be under any duty or obligation to
do so, and no person will incur any liability for failure to give such
notification. Restricted notes will not be validly tendered until such
irregularities have been cured or waived. Any restricted notes received by the
exchange agent that the Company determines are not properly tendered or the
tender of which is otherwise rejected by the Company will be returned by the
exchange agent to the tendering holder or other person specified in the
appropriate Letter of Transmittal as soon as practicable following the
expiration of the exchange offer.
The Company reserves the right in its sole discretion:
- to purchase or make offers for any restricted notes that remain
outstanding subsequent to the expiration of the exchange offer;
- to terminate the exchange offer, as set forth in "Conditions to the
Exchange Offer" below; and
- to the extent permitted by applicable law, to purchase restricted notes
during the pendency of the exchange offer in the open market, in privately
negotiated transactions or otherwise.
The terms of any such purchases or offers may differ from the terms of the
exchange offer.
BOOK-ENTRY TRANSFER
The Company understands that the exchange agent will make a request promptly
after the date of this document to establish accounts with respect to the
restricted notes at DTC for the purpose of facilitating the exchange offer. Any
financial institution that is a participant in DTC's system may make book-entry
delivery of restricted notes by causing DTC to transfer such restricted notes
into the Exchange Agent's DTC account in accordance with DTC's Automated Tender
Offer Program
9
<PAGE>
procedures for such transfer. The exchange for tendered restricted notes will
only be made after a timely confirmation of a book-entry transfer of the
restricted notes into the exchange agent's account, and timely receipt by the
exchange agent of an Agent's Message.
The term "Agent's Message" means a message, transmitted by DTC and received
by the exchange agent and forming part of the confirmation of a book-entry
transfer, which states that DTC has received an express acknowledgment from a
participant tendering restricted notes and that such participant has received an
appropriate Letter of Transmittal and agrees to be bound by the terms of the
Letter of Transmittal, and the Company may enforce such agreement against the
participant. Delivery of an Agent's Message will also constitute an
acknowledgement from the tendering DTC participant that the representations
contained in the appropriate Letter of Transmittal and described on page 8 above
are true and correct.
GUARANTEED DELIVERY PROCEDURES
Holders who wish to tender their restricted notes and:
- whose restricted notes are not immediately available,
- who cannot deliver their restricted notes, the Letter of Transmittal or
any other required documents to the exchange agent prior to the expiration
of the exchange offer, or
- who cannot complete the procedure for book-entry transfer on a timely
basis,
may effect a tender if:
1. the tender is made through an Eligible Institution;
2. prior to the expiration of the exchange offer the exchange agent
receives from such Eligible Institution a properly completed and duly
executed Notice of Guaranteed Delivery by facsimile transmittal, mail,
hand delivery or in accordance with DTC's procedures; and
3. certificate(s) representing all tendered restricted notes in proper
form for transfer, together with a properly completed and executed
Letter of Transmittal, or a facsimile thereof and all other documents
required by the Letter of Transmittal, or confirmation of a book-entry
transfer into the exchange agent's account at DTC of restricted notes
delivered electronically, are received by the exchange agent within
three business days after the expiration of the exchange offer.
A Notice of Guaranteed Delivery must state:
- the name and address of the holder;
- if the restricted notes will be tendered by their registered holder, the
certificate number or numbers of such restricted notes;
- the principal amount of such restricted notes tendered;
- that the tender is being made thereby; and
- that the holder guarantees that, within three business days after the
expiration of the exchange offer, a Letter of Transmittal or facsimile
thereof, together with the certificate(s) representing the restricted
notes to be tendered in proper form for transfer and any other documents
required by the Letter of Transmittal, or confirmation of a book-entry
transfer into the exchange agent's account at DTC of restricted notes
delivered electronically, will be deposited by the Eligible Institution
with the exchange agent.
Forms of the Notice of Guaranteed Delivery will be available from the
exchange agent upon request.
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<PAGE>
WITHDRAWAL OF TENDERS
Except as otherwise provided herein, tenders of restricted notes may be
withdrawn at any time prior to the expiration of the exchange offer by delivery
of a written or facsimile transmission notice of withdrawal to the exchange
agent at its address set forth in this document.
Any such notice of withdrawal must:
- specify the name of the person having deposited the restricted notes to be
withdrawn;
- identify the restricted notes to be withdrawn, including the certificate
number or number and principal amount of such restricted notes or, in the
case of restricted notes transferred by book-entry transfer, the name and
number of the account at DTC to be credited;
- be signed by the depositor of the restricted notes in the same manner as
the original signature on the Letter of Transmittal by which such
restricted notes were tendered, including any required signature
guarantee, or be accompanied by documents of transfer sufficient to permit
the registrar to register the transfer of such restricted notes into the
name of the party withdrawing the tender or, in the case of restricted
notes transferred by book-entry transfer, be transmitted by DTC and
received by the exchange agent in the same manner as the Agent's Message
transferring the notes; and
- specify the name in which any such restricted notes are to be registered,
if different from that of the depositor of the restricted notes.
All questions as to the validity, form and eligibility of such withdrawal
notices will be determined by the Company, whose determination shall be final
and binding on all parties. Any restricted notes so withdrawn will be deemed not
to have been validly tendered for purposes of the exchange offer, and no
exchange notes will be issued with respect thereto unless the restricted notes
so withdrawn are validly retendered. Any restricted notes that have been
tendered but 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
restricted notes may be retendered by following one of the procedures described
above under "Procedures for Tendering" at any time prior to the expiration of
the exchange offer.
CONDITIONS TO THE EXCHANGE OFFER
The Company will not be required to accept for exchange, or to exchange
notes for, any restricted notes, and may terminate or amend the exchange offer
before the acceptance of such restricted notes if, in the Company's judgment,
any of the following conditions has occurred:
- the exchange offer, or the making of any exchange by a holder of
restricted notes, violates applicable law or the applicable
interpretations of the SEC staff;
- any action or proceeding shall have been instituted or threatened in any
court or by or before any governmental agency or body with respect to the
exchange offer; or
- there has been adopted or enacted any law, statute, rule or regulation
that can reasonably be expected to impair the ability of the Company to
proceed with the exchange offer.
See "Expiration Date; Extensions; Amendments" above for a discussion of
possible Company actions if any of the foregoing conditions occur.
The foregoing conditions are for the sole benefit of the Company. They may
be asserted by the Company regardless of the circumstances giving rise to any
such condition or may be waived by the Company in whole or in part at any time
and from time to time in its sole discretion. The failure by the Company at any
time to exercise any of the foregoing rights will not be deemed a waiver of any
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<PAGE>
such right, and each such right will be deemed an ongoing right which may be
asserted at any time and from time to time.
EXCHANGE AGENT
The Bank of New York has been appointed as exchange agent for the exchange
offer. Requests for assistance and requests for additional copies of this
document or of the Letter of Transmittal should be directed to the exchange
agent addressed as follows:
<TABLE>
<S> <C>
BY MAIL BY OVERNIGHT OR HAND DELIVERY
The Bank of New York The Bank of New York
101 Barclay Street, 7E 101 Barclay Street
New York, New York 10286 Corporate Trust Services Window
Attention: Tolutope Adeyoju Ground Level
Reorganization Department New York, New York 10286
Attention: Tolutope Adeyoju
Reorganization Department
</TABLE>
FACSIMILE TRANSMISSION:
(212) 815-6339
INFORMATION OR CONFIRMATION BY TELEPHONE:
(212) 815-3738
SOLICITATION OF TENDERS; FEES AND EXPENSES
The principal solicitation pursuant to the exchange offer is being made by
the Company by mail and through the facilities of DTC. Additional solicitations
may be made by officers and regular employees of the Company and its affiliates
in person or by telegraph, telephone, facsimile transmission, electronic
communication or similar methods.
The Company has not retained any dealer-manager in connection with the
exchange offer and will not make any payments to brokers, dealers or other
persons soliciting acceptances of the exchange offer. The Company will, however,
pay the exchange agent reasonable and customary fees for its services and will
reimburse the exchange agent for its reasonable out-of-pocket costs and expenses
incurred in connection with the exchange offer and will indemnify the exchange
agent for all losses and claims incurred by it as a result of the exchange
offer. The Company may also pay brokerage houses and other custodians, nominees
and fiduciaries the reasonable out-of-pocket expenses incurred by them in
forwarding copies of this document, the Letter of Transmittal and related
documents to the beneficial owners of the restricted notes and in handling or
forwarding tenders for exchange.
The Company will pay all expenses incurred in connection with the exchange
offer, including fees and expenses of the trustee, accounting and legal fees,
including the expense of one counsel for the holders of the restricted notes,
and printing costs.
The Company will pay any transfer taxes applicable to the exchange of
restricted notes pursuant to the exchange offer. If, however, a transfer tax is
imposed for any reason other than the exchange of restricted notes pursuant to
the exchange offer, then the amount of any such transfer taxes, whether imposed
on the registered holder thereof or any other person, will be payable by the
tendering holder.
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<PAGE>
ACCOUNTING TREATMENT
The exchange notes will be recorded at the same carrying value as the
restricted notes, as reflected in the Company's accounting records on the date
of the exchange. Accordingly, no gain or loss for accounting purposes will be
recognized by the Company as a result of the consummation of the exchange offer.
The expense of the exchange offer will be amortized by the Company over the term
of the exchange notes.
CONSEQUENCES OF A FAILURE TO EXCHANGE RESTRICTED NOTES
Following consummation of the exchange offer, assuming the Company has
accepted for exchange all validly tendered restricted notes, the Company will
have fulfilled its exchange and registration obligations under the Registration
Rights Agreement. All untendered restricted notes outstanding after consummation
of the exchange offer will continue to be valid and enforceable debt obligations
of the Company, fully and unconditionally guaranteed by Tyco, subject to the
restrictions on transfer set forth in the indenture governing the notes. Holders
of such restricted notes will only be able to offer for sale, sell or otherwise
transfer untendered restricted notes as follows:
- to the Company, although the Company has no obligation to purchase
untendered restricted notes except if they are called for redemption in
accordance with the provisions of the indenture governing the notes;
- pursuant to a registration statement that has been declared effective
under the Securities Act, although the Company will have no obligation,
and does not intend, to file any such registration statement;
- for so long as the restricted notes are eligible for resale pursuant to
Rule 144A under the Securities Act, to a person reasonably believed to be
a qualified institutional buyer, or QIB, within the meaning of Rule 144A,
that purchases for its own account or for the account of a QIB to whom
notice is given that the transfer is being made in reliance on the
exemption from the registration requirements of the Securities Act
provided by Rule 144A;
- pursuant to offers and sales that occur outside the United States to
non-U.S. persons in transactions complying with the provisions of
Regulation S under the Securities Act; or
- pursuant to any other available exemption from the registration
requirements of the Securities Act.
To the extent that restricted notes are tendered and accepted in the
exchange offer, the liquidity of the trading market for untendered restricted
notes could be adversely affected.
ABSENCE OF A PUBLIC MARKET
Although holders of exchange notes who are not "affiliates" of the Company
within the meaning of the Securities Act may resell or otherwise transfer their
exchange notes without compliance with the registration requirements of the
Securities Act, there is no existing market for the exchange notes, and there
can be no assurance as to the liquidity of any markets that may develop for the
exchange notes, the ability of holders of exchange notes to sell their exchange
notes or the prices at which holders would be able to sell their exchange notes.
Future trading prices of the exchange notes will depend on many factors,
including, among other things, prevailing interest rates, Tyco's operating
results and the market for similar securities.
The Initial Purchasers in the private offering have advised the Company that
they intend to make a market in the exchange notes after the exchange offer.
However, they are not obligated to do so, and any market-making may be
discontinued at any time without notice.
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<PAGE>
DESCRIPTION OF THE NOTES AND THE GUARANTEES
The restricted notes and their guarantees were issued and the exchange notes
and their guarantees will be issued under an indenture, dated as of June 9,
1998, as supplemented by supplemental indenture No. 11, dated as of August 31,
1999, in each case among the Company, Tyco and The Bank of New York, as the
trustee. The following description is subject to the detailed provisions of the
indenture, a copy of which can be obtained upon request from Tyco. See "Where
You Can Find More Information." As used in this "Description of the Notes and
the Guarantees," the term "notes" refers to and includes the restricted notes
and the exchange notes. The terms of the restricted notes and the exchange notes
are identical, except that the exchange notes are not subject to restrictions on
transfer. The indenture is subject to, and governed by, the Trust Indenture Act
of 1939. The statements made in this section relating to the indenture and to
the notes and guarantees of the notes to be issued under the indenture are
summaries, and do not purport to be complete. For a full description of the
terms of the notes and their guarantees, noteholders should refer to the
indenture, as supplemented by the supplemental indenture. Capitalized terms used
but not defined in this section shall have the respective meanings set forth in
the indenture.
GENERAL
The stated interest rate, aggregate principal amounts and maturity dates of
the notes are as follows:
<TABLE>
<S> <C>
Interest Rate............................................ 6 7/8%
Aggregate Principal Amount............................... $1 billion
Maturity Date............................................ September 5, 2002
</TABLE>
As the exchange offer registration statement was first declared effective on
June 27, 2000, and the exchange offer will not be consummated prior to July 28,
2000, the restricted notes are currently accruing an additional 1% in penalty
interest in accordance with the terms of the registration rights agreement. Upon
consummation of the exchange offer, the interest rate on the notes will revert
to the original 6 7/8% per annum.
Interest is payable semiannually on March 5 and September 5 of each year,
commencing March 5, 2000, to the persons in whose names such notes are
registered at the close of business on February 18 or August 21, respectively,
immediately preceding such interest payment date. Interest on the notes accrues
from August 31, 1999.
The trustee is initially acting as paying agent and registrar, as well as
exchange agent under the exchange offer. The notes may be presented for
registration or transfer and exchange, without any service charge, at the
offices of the registrar. Principal and premium, if any, on the notes are
payable at the office of the trustee. However, note holders may be required to
pay to the Company a sum sufficient to cover any tax or other governmental
charge payable in connection with any such transfer or exchange.
The notes are direct, unsecured and unsubordinated obligations of the
Company and rank equally with other unsecured and unsubordinated obligations of
the Company for money borrowed. The notes are effectively subordinated to all
existing and future indebtedness and other liabilities of the Company's
subsidiaries. The Company's rights and the rights of its creditors, including
holders of notes, to participate in any distribution of assets of any subsidiary
upon the latter's liquidation or reorganization or otherwise will be effectively
subordinated to the claims of the subsidiary's creditors, except to the extent
that the Company or any of its creditors may itself be a creditor of that
subsidiary.
Except as described under "Certain Covenants," the indenture does not limit
other indebtedness or securities which may be incurred or issued by the Company
or any of its subsidiaries or contain financial or similar restrictions on the
Company or any of its subsidiaries. There are no covenants or
14
<PAGE>
provisions contained in the indenture which afford the holders of notes
protection in the event of a highly leveraged transaction, reorganization,
restructuring, merger or similar transaction involving the Company or Tyco. The
consummation of any highly leveraged transaction, reorganization, restructuring,
merger or similar transaction could cause a material decline in the credit
quality of the outstanding notes.
The restricted notes were, and the exchange notes will be, initially issued
in the form of one or more registered global notes and will be deposited with,
or on behalf of, The Depository Trust Company, as depositary, and registered in
the name of DTC's nominee. A description of DTC's procedures with respect to the
global notes is set forth under "Book-Entry, Delivery and Form" below.
The indenture does not limit the aggregate principal amount of debt
securities which may be issued thereunder. As of the date of this document,
$6.75 billion and Y10 billion of debt securities in twelve series have been
issued by the Company and guaranteed by Tyco and are outstanding under the
indenture. The interest rate, aggregate principal amounts and maturity dates of
each of such series of debt securities, other than the restricted notes, are as
follows:
<TABLE>
<CAPTION>
2000 2000 2001 2001 2004 2005 2008 2009
NOTES NOTES NOTES NOTES NOTES NOTES NOTES NOTES
---------- ---------- -------- -------- ------------ -------- ------------ --------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Interest Rate............. Floating 0.57% Floating 6 1/8% 5 7/8% 6 3/8% 6 1/8% 6 1/8%
Aggregate Principal $500 Y10 $500 $750 $400 $750 $400 $400
Amount.................. million billion million million million million million million
Maturity Date............. September September March June November June November January
5, 2000 5, 2000 5, 2001 15, 2001 1, 2004 15, 2005 1, 2008 15, 2009
<CAPTION>
DEALER
REMARKETABLE
2028 2029 SECURITIES(SM)
NOTES NOTES ("DRS.(SM)")*
-------- -------- ---------------
<S> <C> <C> <C>
Interest Rate............. 7% 6 7/8% 6 1/4%**
Aggregate Principal $500 $800 $750
Amount.................. million million million
Maturity Date............. June January June
15, 2028 15, 2029 15, 2013
</TABLE>
----------------------------------
* Dealer remarketable securities(sm)" and ("Drs.(sm)") are service marks of
J.P. Morgan Securities Inc.
** The Dealer remarketable securities will bear interest at the rate of 61/4%
per annum to June 15, 2003. If J.P. Morgan Securities Inc. elects to
remarket the Drs., the interest rate will be reset at a fixed rate until
June 15, 2013 as determined by the remarketing dealer. If J.P. Morgan
Securities Inc. does not elect to remarket the Drs., all Drs. must be
repurchased by the Company on June 15, 2003.
GUARANTEES
Tyco has agreed to unconditionally guarantee the due and punctual payment of
the principal of, premium, if any, and interest on and any other obligations of
the Company under the indenture with respect to the notes when and as the same
shall become due and payable, whether at maturity, upon redemption or otherwise.
Tyco's guarantees are unsecured and unsubordinated obligations of Tyco and will
rank equally with all other unsecured and unsubordinated obligations of Tyco.
The guarantees provide that in the event of a default in payment of principal
of, premium, if any, or interest on a note, the holder of that note may
institute legal proceedings directly against Tyco to enforce the guarantees
without first proceeding against the Company. In addition, as described below
under "Certain Covenants--Limitation on Indebtedness of Subsidiaries,"
subsidiaries of the Company may execute and deliver additional guarantees.
The obligations of Tyco and any other guarantor under their respective
guarantees of any series of notes are limited to the maximum amount which will
not result in the obligations of such guarantors under their guarantees
constituting a fraudulent conveyance or fraudulent transfer under applicable
law. Each guarantor of a series of notes that makes a payment or distribution
under its guarantee shall be entitled to a contribution from each other
guarantor of such notes to the extent permitted by applicable law.
REDEMPTION
OPTIONAL REDEMPTION
The notes will be redeemable, in whole or in part, at the option of the
Company at any time at a redemption price equal to the greater of:
- 100% of the principal amount of such notes, and
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<PAGE>
- as determined by the Quotation Agent, as defined below, the sum of the
present values of the remaining scheduled payments of principal and
interest on the notes to be redeemed, not including any portion of such
payments of interest accrued as of the date of redemption, discounted to
the date of redemption on a semiannual basis, assuming a 360-day year
consisting of twelve 30-day months, at the Adjusted Redemption Treasury
Rate, as defined below, plus 12.5 basis points plus, in each case, accrued
interest thereon to the date of redemption.
Notice of any redemption will be mailed at least 30 days and not more than
60 days before the redemption date to each holder of the 2002 notes to be
redeemed. Unless the Company defaults in the payment of the redemption price, on
or after the redemption date, interest will cease to accrue on the notes or the
portions thereof called for redemption.
"Adjusted Redemption Treasury Rate" means, with respect to any redemption
date, the annual rate equal to the semiannual equivalent yield to maturity or
interpolated, on a 30/360 day count basis, yield to maturity of the Comparable
Redemption Treasury Issue, assuming a price for the Comparable Redemption
Treasury Issue, expressed as a percentage of its principal amount, equal to the
Comparable Redemption Treasury Price for such redemption date.
"Comparable Redemption Treasury Issue" means the United States Treasury
security selected by the Quotation Agent as having a maturity comparable to the
remaining term of the notes 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.
"Comparable Redemption Treasury Price" means, with respect to any redemption
date,
- the average of the Redemption Reference Treasury Dealer Quotations for
such redemption date, after excluding the highest and lowest such
Redemption Reference Treasury Dealer Quotations, unless there is more than
one highest or lowest quotation, in which case only one such highest
and/or lowest quotation shall be excluded, or
- if the Quotation Agent obtains fewer than four such Redemption Reference
Treasury Dealer Quotations, the average of all such Redemption Reference
Treasury Dealer Quotations.
"Quotation Agent" means a Redemption Reference Treasury Dealer appointed as
such agent by the Company.
"Redemption Reference Treasury Dealer" means each of Merrill Lynch, Pierce,
Fenner & Smith Incorporated and four other primary U.S. Government securities
dealers in The City of New York selected by the Company.
"Redemption Reference Treasury Dealer Quotations" means, with respect to
each Redemption Reference Treasury Dealer and any redemption date, the offer
price for the Comparable Redemption Treasury Issue, expressed in each case as a
percentage of its principal amount, for settlement on the redemption date quoted
in writing to the Quotation Agent by such Redemption Reference Treasury Dealer
at 5:00 p.m., New York City time, on the third business day preceding such
redemption date.
REDEMPTION UPON CHANGES IN WITHHOLDING TAXES
The Company may redeem all, but not less than all, of the notes if the
following occurs:
1. After the notes of such series to be redeemed are issued, there is a
change or an amendment in the laws or regulations of Luxembourg or Bermuda
or any political subdivisions or taxing authorities thereof or therein
having power to tax (a "Taxing Authority"), or any change in the application
or official interpretation of such laws or regulations.
16
<PAGE>
2. As a result of the change, the Company or Tyco became or will become
obligated to pay Additional Amounts, as defined below in "Payment of
Additional Amounts," on the next payment date with respect to the notes to
be redeemed.
3. The obligation to pay Additional Amounts cannot be avoided through
the Company's or Tyco's reasonable measures.
4. The Company delivers to the trustee:
- a certificate signed by two directors of the Company or two officers of
Tyco, as the case may be, stating that the obligation to pay Additional
Amounts cannot be avoided by the Company or Tyco taking reasonable
measures available to it; and
- a written opinion of independent legal counsel to the Company or Tyco,
as the case may be, of recognized standing to the effect that the
Company or Tyco, as the case may be, has or will become obligated to
pay Additional Amounts as a result of a change, amendment, official
interpretation or application described above and that the Company
cannot avoid the payment of such Additional Amounts by taking
reasonable measures available to it.
5. Following the delivery of the certificate and opinion described in
paragraph 4 above, the Company provides notice of redemption not less than
30 days, but not more than 60 days, prior to the date of redemption. The
notice of redemption cannot be given more than 60 days before the earliest
date on which the Company or Tyco would be otherwise required to pay
Additional Amounts, and the obligation to pay Additional Amounts must still
be in effect when the notice is given.
Upon the occurrence of each of 1 through 5 above, the Company may redeem the
notes at a redemption price equal to 100% of the principal amount thereof,
together with accrued interest, if any, to the redemption date, plus any
Additional Amounts.
NOTICE OF REDEMPTION
The following notice provisions apply to both the optional redemption of the
notes and the redemption of the notes upon the changes in Luxembourg or Bermuda
withholding taxes, if any, described above.
The Company must deliver by first-class mail, postage prepaid, to each
holder of notes to be redeemed, a notice of redemption specifying the following:
- the redemption price;
- the amount of the notes held by the holder to be redeemed;
- the redemption date;
- the place of payment;
- that payment will be made when the notes are surrendered to the trustee;
- that interest accrued to the date of redemption will be paid as specified
in the notice; and
- that after the redemption date, and unless the Company defaults in the
payment of the redemption price, interest will stop accruing on the notes
or portions thereof to be redeemed.
At least one business day prior to the redemption date specified in the notice
of redemption, the Company will deposit with the trustee or with one or more
paying agents an amount of money sufficient to redeem on the redemption date all
the notes called for redemption. If less than all the notes are to be redeemed,
the trustee will select, in such manner as it shall deem appropriate and fair,
17
<PAGE>
notes of that series to be redeemed. Unless the Company defaults on the
redemption payments, on and after the redemption payments, on and after the
redemption date specified in the notice of redemption:
- interest on the notes called for redemption will cease to accrue; and
- the holders of such notes will have no right in respect of such notes
except the right to receive the redemption price thereof and unpaid
interest to the date fixed for redemption.
PAYMENT OF ADDITIONAL AMOUNTS
Unless otherwise required by Luxembourg or Bermuda law, neither the Company,
Tyco nor any other guarantor will deduct or withhold from payments made with
respect to the notes and their guarantees on account of any present or future
taxes, duties, levies, imposts, assessments or governmental charges of whatever
nature imposed or levied by or on behalf of any Taxing Authority ("Taxes"). In
the event that the Company, Tyco or any other guarantor is required to withhold
or deduct on account of any Taxes from any payment made under or with respect to
any notes or the guarantees, as the case may be, the Company, Tyco or such other
guarantor as the case may be, will pay such additional amounts so that the net
amount received by each holder of notes, including those additional amounts,
will equal the amount that such holder would have received if such Taxes had not
been required to be withheld or deducted. The amounts that the Company, Tyco or
such other guarantor are required to pay to preserve the net amount receivable
by the holders of notes are referred to as "Additional Amounts."
Additional Amounts will not be payable with respect to a payment made to a
holder of notes to the extent:
1. that any such Taxes would not have been so imposed but for the
existence of any present or former connection between such holder and the
relevant Taxing Authority imposing such Taxes, other than the mere receipt
of such payment, acquisition, ownership or disposition of such notes or the
exercise or enforcement of rights under such notes, their guarantees or the
indenture;
2. of any estate, inheritance, gift, sales, transfer, or personal
property Taxes imposed with respect to such notes, except as otherwise
provided in the indenture;
3. that any such Taxes would not have been imposed but for the
presentation of such notes, where presentation is required, for payment on a
date more than 30 days after the date on which such payment became due and
payable or the date on which payment thereof is duly provided for, whichever
is later, except to the extent that the beneficiary or holder thereof would
have been entitled to Additional Amounts had the notes been presented for
payment on any date during such 30-day period; or
4. that such holder would not be liable or subject to such withholding
or deduction of Taxes but for the failure to make a valid declaration of
non-residence or other similar claim for exemption, if:
- the making of such declaration or claim is required or imposed by statute,
treaty, regulation, ruling or administrative practice of the relevant
Taxing Authority as a precondition to an exemption from, or reduction in,
the relevant Taxes; and
- at least 60 days prior to the first payment date with respect to which the
Company or Tyco shall apply this clause 4, the Company or Tyco shall have
notified all holders of notes in writing that they shall be required to
provide such declaration or claim.
Each of the Company, Tyco and any other guarantor of the notes, as
applicable, will also:
- withhold or deduct the Taxes as required;
- remit the full amount of Taxes deducted or withheld to the relevant Taxing
Authority in accordance with all applicable laws;
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- use its reasonable best efforts to obtain from each relevant Taxing
Authority imposing such Taxes certified copies of tax receipts evidencing
the payment of any Taxes deducted or withheld; and
- upon request, make available to the holders of notes, within 60 days after
the date the payment of any Taxes deducted or withheld is due pursuant to
applicable law, certified copies of tax receipts evidencing such payment
by the Company, Tyco or such other guarantor or if, notwithstanding the
Company's, Tyco's or such other guarantor's efforts to obtain such
receipts, the same are not obtainable, other evidence of such payments.
At least 30 days prior to each date on which any payment under or with
respect to the notes is due and payable, if the Company, Tyco or such other
guarantor will be obligated to pay Additional Amounts with respect to such
payment, the Company, Tyco or such other guarantor will deliver to the trustee
an officer's certificate stating the fact that such Additional Amounts will be
payable, the amounts so payable and such other information as is necessary to
enable the trustee to pay such Additional Amounts to holders of such notes on
the payment date.
The foregoing provisions shall survive any termination of the discharge of
the indenture and shall apply MUTATIS MUTANDIS to any jurisdiction in which any
successor to the Company, Tyco or any other guarantor of notes, as the case may
be, is organized or is engaged in business for tax purposes or any political
subdivisions or taxing authority or agency thereof or therein.
In addition, the Company will pay any stamp, issue, registration,
documentary or other similar taxes and duties, including interest, penalties and
Additional Amounts with respect thereto, payable in Luxembourg, Bermuda or the
United States or any political subdivision or taxing authority of or in the
foregoing in respect of the creation, issue, offering, enforcement, redemption
or retirement of any of the notes.
Whenever in the indenture, the notes, their guarantees or in this
"Description of the Notes and the Guarantees" there is mentioned, in any
context, the payment of principal, and premium, if any, redemption price,
interest or any other amount payable under or with respect to any note, such
mention shall be deemed to include the payment of Additional Amounts to the
extent payable in the particular context
BOOK-ENTRY, DELIVERY AND FORM
THE GLOBAL NOTES
The restricted notes are represented by one or more permanent global
certificates in definitive, fully registered form without interest coupons.
Except as described under "Certificated Exchange Notes," the exchange notes
initially will be represented by one or more permanent global certificates in
definitive, fully registered form and
- will be deposited with, or on behalf of, DTC, and registered in the name
of Cede & Co., as DTC's nominee, or
- will remain in the custody of the trustee pursuant to a FAST Balance
Certificate Agreement between DTC and the trustee.
DEPOSITARY PROCEDURES
The following description of the operations and procedures of DTC, Euroclear
and Cedelbank are provided solely as a matter of convenience. These operations
and procedures are solely within the control of the respective settlement
systems and are subject to changes by them from time to time. The Company takes
no responsibility for these operations and procedures and urges investors to
contact the system or their participants directly to discuss these matters.
DTC has advised the Company and Tyco that DTC is a limited-purpose trust
company created to hold securities for its participating organizations
(collectively, the "Participants") and to facilitate the
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clearance and settlement of transactions in those securities between
Participants through electronic book-entry changes in accounts of its
Participants. The Participants include securities brokers and dealers, including
the initial purchasers, banks, trust companies, clearing corporations and
certain other organizations. Access to DTC's system is also available to other
entities such as banks, brokers, dealers and trust companies that clear through
or maintain a custodial relationship with a Participant, either directly or
indirectly (collectively, the "Indirect Participants"). Persons who are not
Participants may beneficially own securities held by or on behalf of DTC only
through the Participants or the Indirect Participants. The ownership interests
in, and transfers of ownership interests in, each security held by or on behalf
of DTC are recorded on the records of the Participants and Indirect
Participants.
DTC has also advised the Company and Tyco that, pursuant to procedures
established by it:
- upon deposit of the global notes representing the exchange notes, DTC will
credit the accounts of Participants with an interest in the global notes;
and
- ownership of the exchange notes will be shown on, and the transfer of
ownership thereof will be effected only through, records maintained by
DTC, with respect to the interests of its Participants, and the records of
DTC's Participants and the Indirect Participants, with respect to the
interests of persons other than Participants in such series of the global
notes.
The laws of some jurisdictions may require that certain purchasers of
securities take physical delivery of such securities in definitive form.
Accordingly, the ability to transfer interests in the exchange notes represented
by global notes to such persons may be limited. In addition, because DTC can act
only on behalf of its participants, who in turn act on behalf of persons who
hold interests through a DTC Participant, the ability of a person having an
interest in exchange notes represented by a global note to pledge or transfer
such interest to persons or entities that do not participate in DTC's system, or
to otherwise take actions in respect of such interest, may be affected by the
lack of a physical definitive security in respect of such interest.
So long as DTC or its nominee is the registered owner of a global note, DTC
or such nominee, as the case may be, will be considered the sole owner or holder
of the exchange notes represented by the global note for all purposes under the
indenture. Except as provided below, owners of beneficial interests in a global
note will not be entitled to have exchange notes represented by such global note
registered in their names, will not receive or be entitled to receive physical
delivery of certificated exchange notes, and will not be considered the owners
or holders thereof under the indenture for any purpose, including with respect
to the giving of any direction, instruction or approval to the trustee under the
indenture. Accordingly, each holder owning a beneficial interest in a global
note must rely on the procedures of DTC and, if such holder is not a DTC
Participant or an Indirect Participant, on the procedures of the Participant
through which such holder owns its interest, to exercise any rights of a holder
of exchange notes under the indenture or such global note. The Company
understands that under existing industry practice, in the event that the Company
requests any action of holders of exchange notes, or a holder that is an owner
of a beneficial interest in a global note desires to take any action that DTC,
as the holder of such global note, is entitled to take, DTC would authorize its
participants to take such action and the participants would authorize holders
owning through participants to take such action or would otherwise act upon the
instruction of such holders. Neither the Company nor the trustee will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of exchange notes by DTC, or for maintaining,
supervising or reviewing any records of DTC relating to such exchange notes.
Except as described below, owners of interests in global notes will not have
notes registered in their names, will not receive physical delivery of notes in
certificated form and will not be considered the registered owners or holders
thereof under the indenture for any purpose.
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Payments in respect of the principal of, and premium, if any, and interest
on the exchange notes represented by the global note registered in the name of
DTC or its nominee on the applicable record date will be payable by the trustee
to DTC or its nominee in its capacity as the registered holder of the global
note representing the exchange notes under the indenture. Under the terms of the
indenture, the Company, Tyco and the trustee may treat the persons in whose
names the exchange notes, including the global notes, are registered as the
owners thereof for the purpose of receiving payments thereon and for any and all
other purposes whatsoever. Payments by the DTC Participants and Indirect
Participants to the owners of beneficial interests in a global note will be
governed by standing instructions and customary industry practice and will be
the responsibility of the Participants or Indirect Participants and DTC.
Consequently, none of the Company, Tyco, the trustee or any agent of the
Company, Tyco or the trustee has or will have any responsibility or liability
for:
- any aspect of DTC's records or any Participant's or Indirect Participant's
records relating to, or payments (including principal premium, if any, and
interest) made on account of, any beneficial ownership interest in the
global notes of any series, or for maintaining, supervising or reviewing
any of DTC's records or any Participant's or Indirect Participant's
records relating to the beneficial ownership interests of the global notes
of such series; or
- any other matter relating to the actions and practices of DTC or any of
its Participants or Indirect Participants.
DTC has advised the Company and Tyco that its current practice, upon receipt
of any payment in respect of securities such as the notes including principal
and interest, is to credit the accounts of the relevant Participants with the
payment on the payment date, in amounts proportionate to their respective
holdings in the principal amount of beneficial interest in the relevant security
as shown on the records of DTC, unless DTC has reason to believe it will not
receive payment on such payment date. Payments by the Participants and the
Indirect Participants to the beneficial owners of the notes will be governed by
standing instructions and customary practices and will be the responsibility of
the Participants or the Indirect Participants and will not be the responsibility
of DTC, the trustee, the Company or Tyco. None of the Company, Tyco or the
trustee will be liable for any delay by DTC or any of its Participants in
identifying the beneficial owners of the notes, and the Company and the trustee
may conclusively rely on and will be protected in relying on instructions from
DTC or its nominee for all purposes.
Subject to compliance with the transfer restrictions applicable to the
notes, if any, transfers between Participants in DTC will be effected in
accordance with DTC's procedures, and transfers between participants in
Euroclear and Cedelbank will be effected in accordance with their respective
notes and operating procedures.
Subject to compliance with the transfer restrictions applicable to the
notes, if any, transfers between the Participants in DTC, on the one hand, and
Euroclear or Cedelbank participants, on the other hand, will be effected through
DTC in accordance with DTC's rules on behalf of Euroclear or Cedelbank, as the
case may be, by its respective depositary; however, such cross-market
transactions will require delivery of instructions to Euroclear or Cedelbank, as
the case may be, by the counterparty in such system in accordance with the rules
and procedures and within the established deadlines (Brussels time) of such
system. Euroclear or Cedelbank, as the case may be, will, if the transaction
meets its settlement requirements, deliver instructions to its respective
depositary to take action to effect final settlement on its behalf by delivering
or receiving interests in the global note in DTC, and making or receiving
payment in accordance with normal procedures for same-day funds settlement
applicable to DTC. Euroclear participants and Cedelbank participants may not
deliver instructions directly to the depositories for Euroclear or Cedelbank.
DTC has advised the Company and Tyco that it will take any action permitted
to be taken by a holder of notes of any series only at the direction of one or
more Participants to whose account DTC has credited the interests in the global
notes of such series and only in respect of such portion of the
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aggregate principal amount of the notes as to which such Participant or
Participants has or have given such direction. However, if there is an event of
default under the notes, DTC reserves the right to exchange the global notes for
legended notes in certificated form, and to distribute such notes to its
Participants.
Although DTC, Euroclear and Cedelbank have agreed to the foregoing
procedures to facilitate transfers of interests in the global notes among
Participants in DTC, Euroclear and Cedelbank, they are under no obligation to
perform or to continue to perform such procedures, and such procedures may be
discontinued at any time. None of the Company, Tyco or the trustee or any of
their respective agents will have any responsibility for the performance by DTC,
Euroclear or Cedelbank or their respective participants or indirect participants
of their respective obligations under the rules and procedures governing their
operations.
DTC management is aware that some computer applications, systems, and the
like for processing data ("Systems") that are dependent upon calendar dates,
including dates before, on, and after January 1, 2000, may encounter "Year 2000
problems." DTC has informed its Participants and other members of the financial
community (the "Industry") that it has developed and is implementing a program
so that its Systems, as the same relate to the timely payment of distributions
(including principal and income payments) to securityholders, book-entry
deliveries, and settlement of trades within DTC ("DTC Services"), continue to
function appropriately. This program includes a technical assessment and a
remediation plan, each of which is complete. Additionally, DTC's plan includes a
testing phase, which is expected to be completed within appropriate time frames.
However, DTC's ability to perform properly its services is also dependent
upon other parties, including but not limited to issuers and their agents, as
well as third party vendors from whom DTC licenses software and hardware, and
third party vendors on whom DTC relies for information of the provision of
services, including telecommunication and electrical utility service providers,
among others. DTC has informed the Industry that it is contacting (and will
continue to contact) third party vendors from whom DTC acquires services to:
(1) impress upon them the importance of such services being year 2000 compliant;
and (2) determine the extent of their efforts for Year 2000 remediation (and, as
appropriate, testing) of their services. In addition, DTC is in the process of
developing such contingency plans as it deems appropriate.
According to DTC, the foregoing information with respect to DTC has been
provided to the Industry for informational purposes only and is not intended to
serve as a representation, warranty, or contract modification of any kind.
CERTIFICATED EXCHANGE NOTES
If:
1. the Company notifies the trustee in writing that DTC is no longer willing
or able to act as a depositary or DTC ceases to registered as a clearing agency
under the Exchange Act, and a successor depositary is not appointed within
90 days of such notice or cessation; or,
2. the Company, at its option, notifies the trustee in writing that it
elects to cause the issuance of exchange notes in definitive form under the
indenture,
upon surrender by DTC of the global notes representing exchange notes,
certificated exchange notes will be issued in the names and denominations
requested by DTC in accordance with its customary procedures. Upon any such
issuance, the trustee is required to register such certificated exchange notes
in the requested names, and cause the notes to be delivered to the registered
holders.
None of the Company, Tyco or the trustee shall be liable for any delay by
DTC or any Participant or Indirect Participant in identifying the beneficial
owners of the related notes and the Company, Tyco and the trustee may
conclusively rely on, and shall be protected in relying on, instructions from
DTC for all purposes.
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CERTAIN COVENANTS
The indenture contains, among others, the covenants described below. Some
capitalized terms used in this section are defined under "Definitions" below.
LIMITATIONS ON LIENS
The Company covenants that, so long as any debt securities issued under the
indenture, including any of the notes, remain outstanding, but subject to
defeasance, as provided in the indenture, it will not, and will not permit any
Restricted Subsidiary to incur any indebtedness which is secured by a mortgage,
pledge, security interest, lien or encumbrance (each a "lien") upon:
- any Principal Property; or
- any shares of stock of or indebtedness issued by any Restricted
Subsidiary,
whether now owned or hereafter acquired, without effectively providing that, for
so long as such lien shall continue in existence with respect to such secured
indebtedness, the debt securities issued under the indenture, including the
notes, together with, if the Company shall so determine, any other indebtedness
of the Company ranking equally with the notes, shall be equally and ratably
secured with, or at the Company's option prior to, such secured indebtedness.
The foregoing restriction shall not apply to:
1. liens that exist when the applicable debt securities are issued;
2. liens on the stock, assets or indebtedness of a person that exist when
such person becomes a Restricted Subsidiary unless created in contemplation of
such Restricted Subsidiary becoming such;
3. liens on any assets or indebtedness of a person that exist when:
- such person is merged into the Company or a Restricted Subsidiary; or
- at the time the Company or a Restricted Subsidiary purchases, leases or
otherwise acquires as an entirety or substantially as an entirety the
assets of such person;
4. liens on any Principal Property that exist:
- when the Company or any Restricted Subsidiary acquired such property;
- to secure the payment or indebtedness for the financing of the purchase
price of such property; or
- to secure indebtedness incurred for the purpose of the financing of all
or any part of improvements or construction on such property, which
indebtedness in each case is incurred before, at the time of, or within
one year after the acquisition of such property, or in the case of real
property, completion of such improvement or construction or commencement
of full operation of such property, whichever is later;
5. liens that secure indebtedness owed by any Restricted Subsidiary to the
Company, Tyco or a subsidiary of the Company or by the Company to Tyco;
6. liens in favor of any country or state, or political subdivision thereof:
- to secure payments pursuant to any contract, statute, rule or regulation;
or
- to secure any indebtedness incurred for the purpose of financing all or
any part of the purchase price, or, in the case of real property, the
cost of construction or improvement, of the Principal Property subject to
such liens, including, but not limited to, liens incurred in connection
with pollution control, industrial revenue or similar financings;
7. liens or deposits under worker's compensation or similar legislation, or
in connection with bids, tenders, contracts, other than for the payment of
money, or leases to which the Company or any Restricted Subsidiary is a party,
or to secure the public or statutory obligations of the Company or any
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Restricted Subsidiary, or in connection with obtaining or maintaining
self-insurance, or to obtain the benefits of any law, regulation or arrangement
pertaining to unemployment insurance, old age pensions, social security or
similar matters, or to secure surety, performance, appeal or customs bonds to
which the Company or any Restricted Subsidiary is a party, or in litigation or
other proceedings in connection with the matters heretofore referred to in this
clause, such as, but not limited to, interpleader proceedings, and other similar
pledges, liens or deposits made or incurred in the ordinary course of business;
8. certain liens in connection with legal proceedings, as provided in the
indenture;
9. liens for certain taxes or assessments, landlord's liens and liens and
charges incidental to the conduct of the business of the Company or any
Restricted Subsidiary, or the ownership of their respective assets, which were
not incurred in connection with the borrowing of money or the obtaining of
advances or credit and which do not, in the opinion of the Board of Directors of
the Company, materially impair the use of such assets in the operation of the
business of the Company or such Restricted Subsidiary or the value of such
Principal Property for the purposes thereof;
10. liens to secure the Company's or any Restricted Subsidiary's obligations
under agreements with respect to spot, forward, future and option transactions,
entered into in the ordinary course of business;
11. liens not permitted by the foregoing clauses 1 to 10, inclusive, if at
the time of, and after giving effect to, the creation or assumption of such
lien, the aggregate amount of all outstanding indebtedness of the Company and
its Restricted Subsidiaries, without duplication, secured by all liens not
permitted by the foregoing clauses 1 through 10, inclusive, together with the
Attributable Debt in respect of Sale and Lease-Back Transactions permitted by
clause 1 under "Limitation on Sale and Lease-Back Transactions" below does not
exceed the greater of $100,000,000 and 10% of Consolidated Net Worth; and
12. any total or partial extension, renewal or replacement of any lien
permitted pursuant to clauses 1 through 11, inclusive, except that the principal
amount of indebtedness secured by such extension, renewal or replacement, unless
otherwise excepted under clauses 1 through 11, shall not exceed the principal
amount of indebtedness of the original permitted lien, and that such extension,
renewal or replacement shall be limited to all or part of the assets, or any
replacement therefor, which secured the original lien, plus improvements and
construction on real property.
LIMITATION ON SALE AND LEASE-BACK TRANSACTIONS
The Company will not, and will not permit any Restricted Subsidiary to,
enter into any Sale and Lease-Back Transaction with respect to a Principal
Property unless;
1. the Company or such Restricted Subsidiary would, at the time of entering
into a Sale and Lease-Back Transaction, be entitled to incur indebtedness
secured by a lien on the Principal Property to be leased in an amount at least
equal to the Attributable Debt in respect of such transaction, without equally
and ratably securing the debt securities issued under the indenture, including
the notes, pursuant to the provisions described under "Limitations on Liens"
above; or
2. the direct or indirect proceeds of the sale of the Principal Property to
be leased are at least equal to their fair value, as determined by the Company's
Board of Directors, and an amount equal to the net proceeds is applied, within
180 days of the effective date of such transaction, to the purchase or
acquisition, or, in the case of real property, commencement of the construction,
of property or assets or to the retirement of the debt securities issued under
the indenture, other than at maturity or pursuant to a mandatory sinking fund or
a mandatory redemption provision, or of Funded Indebtedness of the Company or a
consolidated subsidiary of the Company that ranks on a parity with or senior to
the debt securities issued under the indenture, subject to credits for certain
voluntary retirement of Funded Indebtedness and certain delivery of debt
securities issued under the indenture to the trustee for retirement and
cancellation.
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LIMITATION ON INDEBTEDNESS OF SUBSIDIARIES
1. The Company will not cause or permit any subsidiary of the Company which is
not a guarantor of the notes or any other debt securities issued under the
indenture, directly or indirectly, to create, incur, assume, guarantee or
otherwise in any manner become liable for the payment of or otherwise incur
(collectively, "incur"), any indebtedness, including any Acquired
Indebtedness but excluding any Permitted Subsidiary Indebtedness, unless
such subsidiary simultaneously executes and delivers a supplemental
indenture providing for a guarantee of the debt securities issued under the
indenture, including the notes.
2. Notwithstanding the foregoing, any guarantee by a subsidiary of the Company
of the debt securities issued under the indenture, including any guarantee
by a subsidiary of any of the notes, shall provide by its terms that it, and
all liens securing the same, shall be automatically and unconditionally
released and discharged upon:
- any sale, exchange or transfer, to any person not an Affiliate of the
Company, of all of the Company's equity interests in, or all or
substantially all the assets of, such subsidiary, which transaction is in
compliance with the terms of the indenture and such subsidiary is released
from all guarantees, if any, by it of other indebtedness of the Company or
any subsidiaries of the Company;
- the payment in full of all obligations under the indebtedness described in
clause 1 above giving rise to such guarantee; or
- with respect to indebtedness described in the clause 1 above constituting
guarantees of indebtedness, the release by the holders of such
indebtedness of the guarantee by such subsidiary, including any deemed
release upon payment in full of all obligations under such indebtedness,
provided that:
(A) no other indebtedness, other than Permitted Subsidiary Indebtedness,
has been guaranteed by such subsidiary; or
(B) the holders of all other indebtedness which is guaranteed by such
subsidiary also release the guarantee by such subsidiary, including
any deemed release upon payment in full of all obligations under such
indebtedness.
3. For purposes of this covenant, any Acquired Indebtedness shall not be deemed
to have been incurred until 180 days from the date
(A) the person obligated on such Acquired Indebtedness becomes a subsidiary
of the Company, or
(B) the acquisition of assets in connection with which such Acquired
Indebtedness was assumed is consummated.
DEFINITIONS
"Acquired Indebtedness" means indebtedness of a person:
- existing at the time such person becomes a Restricted Subsidiary; or
- assumed in connection with the acquisition of assets by such person,
in each case, other than indebtedness incurred in connection with, or in
contemplation of, such person becoming a Restricted Subsidiary or such
acquisition, as the case may be.
"Affiliate" means, with respect to any specified person:
- any other person directly or indirectly controlling or controlled by or
under direct or indirect common control with such specified person;
- any other person that owns, directly or indirectly, 10% or more of such
specified person's capital stock or any officer or director of any such
specified person or other person; or
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- any other person 10% or more of the voting stock of which is beneficially
owned or held directly or indirectly by such specified person.
For the purposes of this definition, "control" when used with respect to any
specified person means the power to direct the management and policies of such
person, directly or indirectly, whether through ownership of voting securities,
by contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Attributable Debt" means in connection with a Sale and Lease-Back
Transaction, as of any particular time, the aggregate of present values,
discounted at a rate per annum equal to the average interest borne by all
outstanding debt securities issued under the indenture determined on a weighted
average basis and compounded semiannually, of the obligations of the Company or
any Restricted Subsidiary for net rental payments during the remaining term of
the applicable lease, including any period for which such lease has been
extended or may, at the option of the lessor, be extended. The term "net rental
payments" under any lease of any period shall mean the sum of the rental and
other payments required to be paid in such period by the lessee thereunder, not
including, however, any amounts required to be paid by such lessee, whether or
not designated as rental or additional rental, on account of maintenance and
repairs, reconstruction, insurance, taxes, assessments, water rates or similar
charges required to be paid by such lessee thereunder or any amounts required to
be paid by such lessee thereunder contingent upon the amount of sales,
maintenance and repairs, reconstruction, insurance, taxes, assessments, water
rates or similar charges.
"Consolidated Net Worth" means, at any date, the total assets less the total
liabilities, in each case appearing on the most recently prepared consolidated
balance sheet of the Company and its subsidiaries as of the end of a fiscal
quarter of the Company, prepared in accordance with United States generally
accepted accounting principles as in effect on the date of calculation.
"Consolidated Tangible Assets" means, at any date, the total assets less all
Intangible Assets appearing on the most recently prepared consolidated balance
sheet of the Company and its subsidiaries as of the end of a fiscal quarter of
the Company, prepared in accordance with United States generally accepted
accounting principles as in effect on the date of calculation. "Intangible
Assets" means the amount, if any, which would be stated under the heading "Costs
in Excess of Net Assets of Acquired Companies" or under any other heading
relating to intangible assets separately listed, in each case on the face of the
aforesaid consolidated balance sheet.
"Funded Indebtedness" means any indebtedness maturing by its terms more than
one year from the date of the determination thereof, including any indebtedness
renewable or extendible at the option of the obligor to a date later than one
year from the date of the determination thereof.
"Permitted Subsidiary Indebtedness" means any of the following:
1. indebtedness in an aggregate amount, without duplication, not to exceed,
as of the date of determination, 5% of the Consolidated Tangible Assets
of the Company, excluding any indebtedness described in clauses 2 through
8 below;
2. indebtedness owed to the Company, Tyco or any subsidiary of the Company;
3. obligations under standby letters of credit or similar arrangements
supporting the performance of a Person under a contract or agreement in
the ordinary course of business;
4. obligations as lessee in the ordinary course of business which are
capitalized in accordance with United States generally accepted
accounting principles;
5. Indebtedness that was Permitted Subsidiary Indebtedness at the time that
it was first incurred;
6. Acquired Indebtedness that by its terms is not, at the time it became
Acquired Indebtedness or within 180 days thereafter, callable or
redeemable prior to its stated maturity and that remains outstanding
following such time as the subsidiary of the Company obligated under
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such Acquired Indebtedness in good faith has made or caused to be made an
offer to acquire all such indebtedness, including, without limitation, an
offer to exchange such indebtedness for securities of the Company, on
terms which, in the opinion of an independent investment banking firm of
national reputation and standing, are consistent with market practices in
existence at the time for offers of a similar nature, provided that the
initial expiration date of any such offer shall be not later than the
expiration of the time period set forth in paragraph 3 of the "Limitation
on Indebtedness of Subsidiaries" covenant;
7. indebtedness outstanding on the date of the indenture; and
8. any renewals, extensions, substitutions, refundings, refinancings or
replacements (collectively, a "refinancing") of any indebtedness referred
to in clause 7 of this definition of "Permitted Subsidiary Indebtedness"
of a subsidiary organized under a jurisdiction other than the United
States or any State thereof or the District of Columbia, including any
successive refinancings, so long as the borrower under such refinancing
is such subsidiary and the aggregate principal amount of indebtedness
represented thereby, or if such indebtedness provides for an amount less
than the principal amount thereof to be due and payable upon a
declaration of acceleration of the maturity thereof, the original issue
price of such indebtedness plus any accreted value attributable thereto
since the original issuance of such indebtedness, is not increased by
such refinancing plus the lesser of (A) the stated amount of any premium
or other payment required to be paid in connection with such a
refinancing pursuant to the terms of the indebtedness being refinanced or
(B) the amount of premium or other payment actually paid at such time to
refinance the indebtedness, plus, in either case, the amount of expenses
of such Subsidiary incurred in connection with such refinancing.
"Principal Property" means any manufacturing, processing or assembly plant
or facility or any warehouse or distribution facility which is used by any U.S.
subsidiary of the Company after the date hereof, other than any such plants,
facilities, warehouses or portions thereof, which in the opinion of the Board of
Directors of the Company, are not collectively of material importance to the
total business conducted by the Company and its Restricted Subsidiaries as an
entirety, or which, in each case, has a book value, on the date of the
acquisition or completion of the initial construction thereof by the Company, of
less than 1.5% of Consolidated Tangible Assets.
"Restricted Subsidiary" means any subsidiary of the Company which owns or
leases a Principal Property.
"Sale and Lease-Back Transaction" means an arrangement with any person
providing for the leasing by the Company or a Restricted Subsidiary of any
Principal Property whereby such Principal Property has been or is to be sold or
transferred by the Company or a Restricted Subsidiary to such person; provided,
however, that the foregoing shall not apply to any such arrangement involving a
lease for a term, including renewal rights, for not more than three years.
MERGER, CONSOLIDATION, SALE OR CONVEYANCE
The indenture provides that neither the Company, Tyco nor any other
guarantor will merge or consolidate with any other corporation or will not sell
or convey all or substantially all of its assets to any person, unless:
1. the Company, Tyco or such other guarantor, as the case may be, shall be
the continuing corporation; or
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2. the successor corporation or person that acquires all or substantially
all of the assets of the Company, Tyco or such other guarantor, as the
case may be, shall expressly assume:
- the payment of principal of, premium, if any, and interest on the notes
and all other debt securities issued under the indenture or the
guarantees thereof, as the case may be,
- the observance of all the covenants and agreements under the indenture
to be performed or observed by the Company, Tyco or such other
guarantor, as the case may be; and
and in either case, immediately after such merger, consolidation, sale or
conveyance, the Company, Tyco or such other guarantor, as the case may be, or
such successor corporation or person, as the case may be, shall not be in
default in the performance of the covenants and agreements of the indenture to
be performed or observed by the Company, Tyco or such other guarantor, as the
case may be; provided that the foregoing shall not apply to a guarantor other
than Tyco if in connection with any such merger, consolidation, sale or
conveyance the guarantee of such guarantor is released and discharged pursuant
to paragraph 2 of the "Limitation on Indebtedness of Subsidiaries" covenant
described above.
EVENTS OF DEFAULT
An event of default with respect to a series of notes is defined in the
indenture as being:
1. default for 30 days in payment of any interest on any notes of such
series;
2. default in any payment of principal or sinking fund installment on any
notes of such series;
3. default by the Company, Tyco or any other guarantor in performance of
any other of the covenants or agreements in respect of the notes of such
series and related guarantees or the indenture that continues for
90 days after the Company receives notice of such failure in accordance
with the indenture;
4. default by the Company, Tyco or any other guarantor in the payment at
the final maturity thereof, after the expiration of any applicable grace
period, of principal of, premium, if any, or interest on indebtedness for
money borrowed, other than non-recourse indebtedness, in the principal
amount then outstanding of $50,000,000 or more, or acceleration of any
indebtedness in such principal amount so that it becomes due and payable
prior to the date on which it would otherwise have become due and payable
and such acceleration is not rescinded within ten business days after
notice to the Company in accordance with the indenture;
5. any guarantee of that series of notes ceases to be, or the Company or
any guarantor asserts in writing that such guarantee is not, in full
force and effect and enforceable in accordance with its terms; or
6. certain events involving bankruptcy, insolvency or reorganization of the
Company, Tyco or any Significant Subsidiary Guarantor.
The indenture provides that the trustee shall transmit notice of any uncured
default under the indenture with respect to either series of notes, within
90 days after the occurrence of such default, to the holders of notes of each
affected series, except that the trustee may withhold notice to the holders of
either series of the notes of any default, except in payment of principal of,
premium, if any, or interest on such series of notes, if the trustee considers
it in the interest of the holders of such series of notes to do so.
If an event of default due to:
- the default in the payment of interest, principal or sinking fund
installment with respect to the notes of a series;
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- the default in the performance or breach of any other covenant or
agreement of the Company, Tyco or any guarantor applicable to the notes of
such series but not applicable to all outstanding debt securities issued
under the indenture; or
- a guarantee of a series of notes ceasing to be, or the Company or any
guarantor asserting that a guarantee of a series of notes no longer is, in
full force and effect and enforceable in accordance with its terms,
shall have occurred and be continuing, either the trustee or the holders of not
less than 25% in principal amount of the notes of such series then outstanding
may declare the principal of all notes of such series and interest accrued
thereon to be due and payable immediately.
If an event of default due to:
- a default in the performance of any other of the covenants or agreements
in the indenture applicable to all outstanding debt securities issued
thereunder and then outstanding;
- a default in payment at final maturity or upon acceleration of
indebtedness for money borrowed in the principal amount then outstanding
of $50,000,000 or more; or
- certain events of bankruptcy, insolvency and reorganization of the
Company, Tyco or any Significant Subsidiary Guarantor,
shall have occurred and be continuing, either the trustee or the holders of not
less than 25% in principal amount of all debt securities issued under the
indenture then outstanding, including the notes, treated as one class, may
declare the principal of all such debt securities and interest accrued thereon
to be due and payable immediately.
Under certain circumstances, such declarations may be annulled and past
defaults may be waived, except a non-payment of such debt securities which shall
have become due by acceleration, by the holders of a majority in principal
amount of the outstanding notes of an affected series, voting as a separate
class, or all debt securities outstanding under the indenture, voting as a
single class, as the case may be.
The holders of a majority in principal amount of the outstanding notes of
each affected series shall have the right to direct the time, method and place
of conducting any proceeding for any remedy available to the trustee with
respect to the notes, subject to certain limitations specified in the indenture.
The indenture provides that no holder of notes of any series may institute
any action against the Company under the indenture, except actions for payment
of overdue principal, premium, if any, or interest, unless such holder
previously shall have given to the trustee written notice of default and
continuance thereof and unless the holders of not less than 25% in principal
amount of the notes of such series then outstanding shall have requested the
trustee to institute such action and shall have offered the trustee reasonable
indemnity, and the trustee shall not have instituted such action within 60 days
of such request, and the trustee shall not have received direction inconsistent
with such written request by the holders of a majority in principal amount of
the notes of such series then outstanding.
The indenture requires the annual filing by the Company with the trustee of
a written statement as to compliance with the covenants and agreements contained
in the indenture.
"Significant Subsidiary Guarantor" means any one or more guarantors, other
than Tyco, which, at the date of determination, together with its or their
respective subsidiaries in the aggregate,
- for the most recently completed fiscal year of the Company accounted for
more than 10% of the consolidated revenues of the Company; or
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- at the end of such fiscal year, was the owner, beneficial or otherwise, of
more than 10% of the consolidated assets of the Company, as determined in
accordance with United States generally accepted accounting principles and
reflected on the Company's consolidated financial statements.
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
The Company may discharge or defease its obligations under the indenture as
set forth below.
Under terms satisfactory to the trustee, the Company may discharge the
indenture with respect to any series of notes issued under the indenture which
have not already been delivered to the trustee for cancellation and which have
either become due and payable or are by their terms due and payable within one
year, or which may be called for redemption within one year, by irrevocably
depositing with the trustee cash or direct obligations of the United States as
trust funds in an amount certified to be sufficient to pay at maturity, or upon
redemption, the principal of, premium, if any, and interest and Additional
Amounts, if any, on such series of notes. However, the Company may not thereby
avoid:
- its duty to register the transfer or exchange of such series of notes, or
to replace any mutilated, destroyed, lost or stolen notes;
- the rights of holders of such series of notes to receive from the funds
deposited with the trustee payments of principal and interest, on such
notes, on the stated due dates for such payments; or
- the rights, obligations and immunities of the trustee under the indenture.
If the exact amounts of principal of and interest due on a series can be
determined at the time of making the deposit referred to below, the Company at
its option at any time may also:
1. discharge any and all of its obligations to holders of such series of
notes issued under the indenture ("defeasance"), but may not thereby avoid
its obligations enumerated in the previous paragraph; or
2. be released with respect to such series of notes from the obligations
imposed by the covenants described under the captions "Certain Covenants"
and "Merger, Consolidation, Sale or Conveyance" above and omit to comply
with such covenants without creating an event of default ("covenant
defeasance").
Defeasance or covenant defeasance may be effected only if, among other
things:
1. the Company or Tyco irrevocably deposits with the trustee cash and/or
direct obligations of the United States, as trust funds in an amount
certified by a nationally recognized firm of independent public accountants
or a nationally recognized investment banking firm to be sufficient to pay
each installment of principal and interest and Additional Amounts, if any,
on all outstanding notes of the relevant series on the dates such
installments of principal and interest are due and any mandatory sinking
fund payments with respect to such series;
2. no default or event of default shall have occurred and be continuing
on the date of the deposit referred to in clause 1 or, in respect of certain
events of bankruptcy, insolvency or reorganization, during the period ending
on the 91st day after the date of such deposit, or any longer applicable
preference period; and
3. the Company delivers to the trustee:
(A) an opinion of counsel to the effect that the holders of such series
of notes:
- will not recognize any income, gain or loss for U.S. federal income tax
purposes as a result of such deposit and defeasance or covenant
defeasance, as applicable, and
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- will be subject to U.S. federal income tax on the same amounts and in
the same manner and at the same times as would have been the case if
such deposit and defeasance or covenant defeasance, as applicable, had
not occurred.
Which, in the case of defeasance, must be based on a ruling of the Internal
Revenue Service or a change in U.S. federal income tax law occurring after
the date of the indenture; and
(B) an opinion of counsel to the effect that:
- payments from the defeasance trust will be free and exempt from any and
all withholding and other taxes imposed or levied by or on behalf of
Luxembourg or any political subdivision thereof having the power to
tax, and
- holders of such series of notes will not recognize any income, gain or
loss for Luxembourg income tax and other Luxembourg tax purposes as a
result of such deposit and defeasance or covenant defeasance, as
applicable, and will be subject to Luxembourg income tax and other
Luxembourg tax on the same amounts, in the same manner and at the same
times as would have been the case if such deposit and defeasance or
covenant defeasance, as applicable, had not occurred.
MODIFICATION OF THE INDENTURE
The indenture contains provisions permitting the Company, Tyco and the
trustee, with the consent of the holders of not less than a majority of the
principal amount of all affected series of the debt securities issued under the
indenture at the time outstanding, including the notes, voting as one class, to
modify the indenture or any supplemental indenture or the rights of the holders
of such debt securities. However, without the consent of each holder of debt
securities including the notes, so affected, the indenture cannot be modified
to:
1. extend the final maturity of any of the notes or reduce the principal
amount thereof, or reduce the rate or extend the time of payment of interest
thereon, or reduce any amount payable on redemption thereof, or change the
currency thereof, or impair or affect the right of any holder of the notes
to institute suit for the payment thereof; or
2. reduce the aforesaid percentage in principal amount of debt
securities, the consent of the holders of which is required for any such
modification.
The indenture contains provisions permitting the Company, Tyco and the
trustee, without the consent of any holders of notes, to enter into a
supplemental indenture, among other things, for purposes of curing any ambiguity
or correcting or supplementing any provision contained in the indenture or in
any supplemental indenture or making other provisions in regard to the matters
or questions arising under the indenture or any supplemental indenture as the
Board of Directors of the Company deems necessary or desirable and which does
not adversely affect the interests of the holders of notes in any material
respect. The Company, Tyco and the trustee, without the consent of any holders
of notes, may also enter into a supplemental indenture to establish the form or
terms of any series of debt securities as are not otherwise inconsistent with
any of the provisions of the indenture.
CONCERNING THE TRUSTEE
The trustee may hold notes, act as a depository for funds of, make loans to,
or perform other services for, Tyco, the Company and their respective
subsidiaries as if it were not the trustee.
ENFORCEMENT OF CIVIL LIABILITIES
The Company and Tyco have consented in the indenture to jurisdiction in the
United States federal and state courts in The City of New York and to service of
process in The City of New York in
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any legal suit, action or proceeding brought to enforce any rights under or with
respect to the indenture, the notes and the guarantees. However, substantially
all of the Company's directly held assets consists of shares in its wholly-owned
subsidiary Tyco Group S.a.r.l., a Luxembourg company which, through its
subsidiaries, owns a substantial majority of the assets of the Company. A
substantial majority of Tyco's directly held assets consists of shares in the
Company. Accordingly, any judgment against the Company or Tyco in respect of the
indenture, the notes or the guarantees, including for civil liabilities under
the United States federal securities laws, obtained in any United States federal
or state court may have to be enforced in the courts of Luxembourg. Investors
should not assume that the courts of Luxembourg would enforce judgments of
United States courts obtained against the Company or Tyco predicated upon the
civil liability provisions of the United States federal securities laws or that
such courts would enforce, in original actions, liabilities against the Company
or Tyco predicated solely upon such laws.
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CERTAIN LUXEMBOURG, BERMUDA AND UNITED STATES
FEDERAL INCOME TAX CONSEQUENCES
The following discussion is intended to be a general summary of Luxembourg,
Bermuda and United States federal income tax consequences to holders of notes.
Due to the complexity of the tax laws of these and other taxing jurisdictions,
the uncertainty, in some instances, as to the manner in which such laws apply to
holders and possible changes in law, it is particularly important that each
holder consult with its own tax adviser regarding the tax treatment of the
acquisition, ownership and disposition of notes under the laws of any federal,
state, local or other taxing jurisdiction.
LUXEMBOURG
Under current law, no withholding or deduction is imposed in Luxembourg in
respect of any payment to be made by the Company in respect of the notes.
Holders of notes who are neither resident in Luxembourg nor engaged in a trade
or business through a permanent establishment or permanent representative in
Luxembourg will not be subject to taxes or duties in Luxembourg with respect to
interest payments on, or gains realized on the disposition of, the notes. No
stamp, registration or similar taxes, duties or charges are payable in
Luxembourg in connection with the issue of the notes.
BERMUDA
Under current law, no income, withholding or other taxes or stamp,
registration or other duties are imposed upon the issue, transfer or sale of the
notes or on any payments made in respect of the notes or the guarantees.
UNITED STATES
The following is a general discussion of anticipated U.S. federal income tax
consequences of the ownership and disposition of the notes to holders thereof
and of the exchange of restricted notes for exchange notes pursuant to the
exchange offer. This summary is based upon laws, regulations, rulings and
decisions currently in effect, all of which are subject to change at any time,
possibly with retroactive effect. Moreover, it deals only with purchasers who
hold notes as "capital assets" within the meaning of Section 1221 of the U.S.
Internal Revenue Code of 1986 and does not purport to deal with persons in
special tax situations, such as financial institutions, insurance companies,
regulated investment companies, tax exempt investors, dealers in securities or
currencies, U.S. expatriates, persons holding notes as a hedge against currency
risk or as a position in a "straddle," "hedge," "conversion" or another
integrated transaction for tax purposes, persons who own, directly or
indirectly, 10 percent or more of the voting power of the Company, or U.S.
Holders, as defined below, whose functional currency is not the U.S. dollar.
Further, this discussion does not address the consequences under U.S. federal
estate or gift tax laws or the laws of any U.S. state or locality.
Holders of restricted notes are urged to consult their own tax advisors
concerning the consequences, in their particular circumstances, of the ownership
and disposition of the notes and the exchange of restricted notes for exchange
notes pursuant to the exchange offer under the U.S. federal tax laws and the
laws of any relevant state, local or non-U.S. taxing jurisdiction.
As used in this section, the term "U.S. Holder" means a beneficial owner of
notes that is, for U.S. federal income tax purposes:
- a citizen or resident of the United States,
- a corporation, partnership or other entity, other than a trust, created or
organized in or under the laws of the United States or of any political
subdivision thereof, other than a partnership that is not treated as a
U.S. person under any applicable U.S. Treasury regulations,
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- an estate whose income is subject to U.S. federal income tax regardless of
its source, or
- a trust if, in general, a court within the U.S. is able to exercise
primary jurisdiction over its administration and one or more U.S. persons
have authority to control all of its substantial decisions.
As used in this section, the term "non-U.S. Holder" means a beneficial owner
of notes that is not a U.S Holder for U.S. federal income tax purposes.
THE EXCHANGE OFFER
An exchange of restricted notes for exchange notes pursuant to the exchange
offer should not be treated as an exchange or other taxable event for United
States federal income tax purposes. Accordingly, there should be no United
States federal income tax consequences to holders of restricted notes who
exchange restricted notes for exchange notes pursuant to the exchange offer, and
any holder should have the same adjusted tax basis and holding period in the
exchange notes as it had in the restricted notes immediately before the
exchange.
U.S. HOLDERS
INTEREST AND DISPOSITION GENERALLY
The gross amount of interest paid on the notes will be taxable as ordinary
income for U.S. federal income tax purposes when received or accrued by a U.S.
Holder in accordance with such U.S. Holder's method of tax accounting. While not
entirely clear, any additional amounts paid in respect of withholding taxes in
general should be taxable in the same manner. Interest on the notes will be
income from sources outside the United States and, with certain exceptions, will
be treated as "passive" income for purposes of computing the foreign tax credit
allowable under U.S. federal income tax laws. The rules relating to foreign tax
credits and the timing thereof are extremely complex, and U.S. Holders should
consult their own tax advisers with regard to the availability of foreign tax
credits and the application of the foreign tax credit limitations to their
particular situations.
Upon the sale, redemption or other taxable disposition of a note, a U.S.
Holder will recognize capital gain or loss equal to the difference between the
amount realized, excluding any amount attributable to accrued interest, which
will be taxable as ordinary interest income as described above, or accrued
market discount which is described below, and the U.S. Holder's tax basis in the
notes, generally the U.S. Holder's cost. Such gain or loss will be long term
capital gain or loss if the notes are held for more than one year. The
deductibility of capital losses is subject to certain limitations. For purposes
of foreign tax credits under U.S. federal income tax laws, capital gain or loss
recognized by a U.S. Holder generally will be treated as U.S. source. U.S.
Holders should consult their own tax advisors as to the foreign tax credit
implications of the disposition of notes under U.S. federal income tax laws.
Special rules apply to notes acquired at a market discount or premium, which
are discussed below.
BOND PREMIUM
If a U.S. Holder purchased notes for an amount in excess of the amount
payable at the maturity date of the notes, the U.S. Holder may deduct such
excess as amortizable bond premium over the term of the notes under a
yield-to-maturity formula. The deduction is available only if an election is
made by the purchaser or if such election is in effect. This election is
revocable only with the consent of the U.S. Internal Revenue Service. The
election applies to all obligations owned or subsequently acquired by the U.S.
Holder. The U.S. Holder's adjusted tax basis in the notes will be reduced to the
extent of the deduction of amortizable bond premium. The amortizable bond
premium is treated as an offset to interest income on the notes rather than as a
separate deduction item. A loss upon the disposition of a
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note generally will be treated as foreign source for U.S. foreign tax credit
purposes to the extent of any unamortized bond premium on the notes that could
have been deducted had an election been made.
MARKET DISCOUNT
If a U.S. Holder acquired the notes, other than in an original issue, at a
market discount which equals or exceeds 1/4 of 1% of the stated redemption price
of the notes at maturity multiplied by the number of remaining complete years to
maturity and thereafter recognizes gain upon a disposition, or makes a gift, of
the notes, the lesser of:
1. such gain or, in the case of a gift, appreciation, or
2. the portion of the market discount which accrued on a straight line
basis, or, if the U.S. Holder so elects, on a constant interest rate basis,
while the notes were held by such U.S. Holder
will be treated as ordinary income at the time of the disposition or gift. For
these purposes, market discount means the excess, if any, of the stated
redemption price at maturity over the basis of such notes immediately after
their acquisition by the U.S. Holder. A U.S. Holder may elect to include accrued
market discount in income currently, which would increase the U.S. Holder's
basis in the notes, rather than upon disposition of the notes. This election
once made applies to all market discount obligations acquired on or after the
first taxable year to which the election applies, and may not be revoked without
the consent of the Internal Revenue Service. For U.S. foreign tax credit
purposes, accrued market discount included as ordinary income will be treated as
income from foreign sources.
A U.S. Holder of notes acquired at a market discount generally will be
required to defer the deduction of a portion of the interest on any indebtedness
incurred or maintained to purchase or carry such notes until the market discount
is recognized upon a subsequent disposition of such notes. Such a deferral is
not required, however, if the U.S. Holder elects to include accrued market
discount in income currently.
INFORMATION REPORTING AND BACKUP WITHHOLDING
Non-exempt U.S. Holders may be subject to information reporting with respect
to payments of interest on, and the proceeds of the disposition of, notes.
Non-exempt U.S. Holders who are subject to information reporting and who do not
provide appropriate information when requested may be subject to backup
withholding at a 31% rate. U.S. Holders should consult their tax advisors.
NON-U.S. HOLDERS
INTEREST AND DISPOSITION
In general, and subject to the discussion below under "Information Reporting
and Backup Withholding," a non-U.S. Holder will not be subject to U.S. federal
income or withholding tax with respect to payments of interest on, or gain upon
the disposition of, notes, unless the income, or, in the case of a treaty
resident, attributable to a permanent establishment or a fixed base, or gain is
effectively connected with the conduct by the non-U.S. Holder of a trade or
business in the United States. In that event, such income or gain will generally
be subject to regular U.S. income tax in the same manner as if it were realized
by a U.S. Holder. In addition, if such non-U.S. Holder is a non-U.S.
corporation, such income or gain may be subject to a branch profits tax at a
rate of 30%, or such lower rate provided by an applicable income tax treaty.
INFORMATION REPORTING AND BACKUP WITHHOLDING
If the notes are held by a non-U.S. Holder through a non-U.S., and non-U.S.
related, broker or financial institution, information reporting and backup
withholding generally would not be required.
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Information reporting, and possibly backup withholding, may apply if the notes
are held by a non-U.S. Holder through a U.S., or U.S. related, broker or
financial institution and the non-U.S. Holder fails to provide appropriate
information. Holders should consult their tax advisors.
PLAN OF DISTRIBUTION
Each broker-dealer that receives exchange notes for its own account pursuant
to the exchange offer must acknowledge that it will deliver a prospectus in
connection with any resale of such exchange notes. This document, as it may be
amended or supplemented from time to time, may be used by a broker-dealer in
connection with resales of exchange notes or market-making activities or other
trading activities.
The Company will not receive any proceeds from any sale of exchange notes by
broker-dealers. Exchange notes received by broker-dealers for their own account
pursuant to the exchange offer may be sold from time to time in one or more
transaction in the over-the-counter market, in negotiated transactions, through
the writing of options on the exchange notes 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 at 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 commissions or concessions from any such broker-dealer
or the purchasers of any such exchange notes. Any broker-dealer that resells
exchange notes 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 may be deemed to be an "underwriter" within the meaning of
the Securities Act, and any profit on any such resale of exchange notes and any
commission 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 broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
For a period starting on the date of this prospectus and ending on the close
of business on the earlier to occur of:
1. the date on which all exchange notes held by broker-dealers eligible to
use the prospectus to satisfy their prospectus delivery obligations under
the Securities Act have been sold and
2. the date 180 days after the consummation of the exchange offer,
the Company will make this document, as amended or supplemented, available to
any broker-dealer in connection with any such resale and will send additional
copies of this document and any amendment or supplement to this prospectus to
any broker-dealer that requests such documents.
The Company has agreed to pay all expenses incident to the exchange offer,
including the expense of one counsel for the holders of the restricted notes,
other than commissions or concession of any broker-dealers and will indemnify
the holders of the restricted notes, including any broker-dealers, against
certain liabilities, including liabilities under the Securities Act.
LEGAL MATTERS
Certain U.S. legal matters regarding the notes and Tyco's guarantees of the
notes have been passed upon for Tyco by Kramer Levin Naftalis & Frankel LLP, New
York, New York. Joshua M. Berman, a director and vice president of Tyco, is
counsel to Kramer Levin Naftalis & Frankel LLP and beneficially owns 148,180
common shares of Tyco. Certain matters under the laws of Bermuda related to the
guarantees of Tyco of the notes will be passed upon for Tyco by Appleby
Spurling & Kempe, Hamilton, Bermuda, Bermuda counsel to Tyco. Michael L. Jones,
Secretary of Tyco, is a partner of Appleby Spurling & Kempe. Certain matters
under the laws of Luxembourg related to the notes will be passed upon by
Beghin & Feider in association with Allen & Overy, Luxembourg counsel to the
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Company. Kramer Levin Naftalis & Frankel LLP has relied on Appleby Spurling &
Kempe with respect to matters of Bermuda law and on Beghin & Feider with respect
to matters of Luxembourg law.
EXPERTS
The consolidated financial statements and financial statement schedule of
Tyco as of September 30, 1999 and 1998, and for the years ended September 30,
1999 and 1998 and the nine months ended September 30, 1997 included in Tyco's
Annual Reports on Form 10-K filed on December 13, 1999 and 10-K/A filed on
June 26, 2000, and incorporated by reference in this document, have been audited
by PricewaterhouseCoopers, independent accountants, as set forth in their
reports included therein. In its reports, that firm states that with respect to
certain subsidiaries its opinion is based upon the reports of other independent
accountants, namely Deloitte & Touche LLP (as it relates to the consolidated
statements of operations, changes in stockholders' equity and cash flows of
United States Surgical Corporation and its subsidiaries for the nine-month
period ended September 30, 1997 and the related financial statement schedule for
the nine-month period ended September 30, 1997) and Arthur Andersen LLP (as it
relates to the consolidated balance sheets of AMP Incorporated and subsidiaries
as of September 30, 1998, and the related consolidated statements of income,
shareholders' equity and cash flows for the year ended September 30, 1998 and
the nine months ended September 30, 1997). The consolidated financial statements
and financial statement schedule referred to above have been incorporated herein
in reliance on said reports given on the authority of such firms as experts in
auditing and accounting.
37
<PAGE>
$1,000,000,000
TYCO INTERNATIONAL
GROUP S.A.
OFFER TO EXCHANGE
UP TO $1,000,000,000
6 7/8% NOTES DUE 2002
FOR ANY AND ALL OUTSTANDING
6 7/8% NOTES DUE 2002
FULLY AND UNCONDITIONALLY GUARANTEED BY
[LOGO]
---------------------
PROSPECTUS
---------------------
JUNE 29, 2000
<PAGE>
LETTER OF TRANSMITTAL
TYCO INTERNATIONAL GROUP S.A.
TYCO INTERNATIONAL LTD.
OFFER TO EXCHANGE
6 7/8% NOTES DUE 2002
FOR
6 7/8% NOTES DUE 2002
PURSUANT TO THE PROSPECTUS DATED JUNE 29, 2000
--------------------------------------------------------------------------------
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON JULY 28,
2000, UNLESS THE EXCHANGE OFFER IS EXTENDED.
--------------------------------------------------------------------------------
The Exchange Agent for the Exchange Offer is:
The Bank of New York
<TABLE>
<S> <C> <C>
BY REGISTERED OR CERTIFIED MAIL: FACSIMILE TRANSACTIONS: BY HAND OR OVERNIGHT DELIVERY:
(Eligible Institutions Only)
The Bank of New York (212) 815-6339 The Bank of New York
101 Barclay Street, 7E TO CONFIRM BY TELEPHONE 101 Barclay Street
New York, New York 10286 OR FOR INFORMATION CALL: Corporate Trust Services Window
Attn: Tolutope Adeyoju (212) 815-3738 Ground Level
Reorganization Department New York, New York 10286
Attn: Tolutope Adeyoju
Reorganization Department
</TABLE>
--------------------------------------------------------------------------------
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OR TRANSMISSION TO A FACSIMILE
NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. THE
METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING CERTIFICATES, IS AT THE RISK
OF THE HOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, IS RECOMMENDED. YOU SHOULD READ THE
INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL CAREFULLY BEFORE YOU
COMPLETE THIS LETTER OF TRANSMITTAL.
The undersigned acknowledges that he or she has received the prospectus,
dated June 29, 2000 (the "Prospectus"), of Tyco International Group S.A., a
Luxembourg company (the "Company"), and Tyco International Ltd., a Bermuda
company ("Tyco"), and this Letter of Transmittal and the instructions hereto
(the "Letter of Transmittal"), which together constitute the Company's offer
(the "Exchange Offer") to exchange $1,000 principal amount of its 6 7/8% Notes
due 2002 (the "Exchange Notes"), which have been registered under the Securities
Act of 1933, as amended (the "Securities Act"), pursuant to a Registration
Statement of which the Prospectus is a part, for each $1,000 principal amount of
its outstanding 6 7/8% Notes due 2002 (the "Restricted Notes"), of which
$1,000,000,000 aggregate principal amount is outstanding, upon the terms and
subject to the conditions set forth in the Prospectus. The term "Expiration
Date" shall mean 5:00 p.m. New York City time on July 28, 2000, unless the
Company, in its sole discretion, extends the Exchange Offer, in which case the
term shall mean the latest date and time to which the Exchange Offer is extended
by the Company. Capitalized terms used but not defined herein have the meaning
given to them in the Prospectus.
This Letter of Transmittal is to be used if either (1) certificates
representing Restricted Notes are to be physically delivered to the Exchange
Agent herewith by Holders (as defined below) or (2) tender of Restricted Notes
is to be made by Holders according to the guaranteed delivery procedures set
forth in the Prospectus under "Exchange Offer--Guaranteed Delivery Procedures."
Delivery of this Letter of Transmittal and any other required documents must be
made to the Exchange Agent.
DELIVERY OF DOCUMENTS TO THE DEPOSITORY TRUST COMPANY ("DTC") IN ACCORDANCE
WITH DTC'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
<PAGE>
The term "Holder" as used herein means any person in whose name Restricted
Notes are registered on the books of the Company or any other person who has
obtained a properly completed bond power from the registered holder.
All Holders of Restricted Notes who wish to tender their Restricted Notes
must, prior to the Expiration Date either: (a) complete, sign and deliver this
Letter of Transmittal, or a facsimile thereof, to the Exchange Agent, in person
or to the address or facsimile number set forth above and tender (and not
withdraw) his, her or its Restricted Notes or, (b) if a tender of Restricted
Notes is to be made by book-entry transfer to the account maintained by the
Exchange Agent at DTC, confirm such book-entry transfer, including the delivery
of an Agent's Message (a "Book-Entry Confirmation"), in each case in accordance
with the procedures for tendering described in the Instructions to this Letter
of Transmittal. Holders of Restricted Notes whose certificates are not
immediately available, or who are unable to deliver their certificates or
Book-Entry Confirmation and all other documents required by this Letter of
Transmittal to be delivered to the Exchange Agent on or prior to the Expiration
Date, must tender their Restricted Notes according to the guaranteed delivery
procedures set forth under the caption "Exchange Offer--Guaranteed Delivery
Procedures" in the Prospectus. (See Instruction 2.)
Upon the terms and subject to the conditions of the Exchange Offer, the
acceptance for exchange of the Restricted Notes validly tendered and not
withdrawn and the issuance of the Exchange Notes will be made promptly following
the Expiration Date. For the purposes of the Exchange Offer, the Company shall
be deemed to have accepted for exchange validly tendered Restricted Notes when,
as and if the Company has given written notice thereof to the Exchange Agent.
The undersigned has completed, executed and delivered this Letter of
Transmittal to indicate the action the undersigned desires to take with respect
to the Exchange Offer.
PLEASE READ THIS ENTIRE LETTER OF TRANSMITTAL AND THE PROSPECTUS CAREFULLY
BEFORE CHECKING ANY BOX BELOW. THE INSTRUCTIONS INCLUDED IN THIS LETTER OF
TRANSMITTAL MUST BE FOLLOWED. QUESTIONS AND REQUESTS FOR ASSISTANCE OR FOR
ADDITIONAL COPIES OF THE PROSPECTUS, THIS LETTER OF TRANSMITTAL AND THE NOTICE
OF GUARANTEED DELIVERY MAY BE DIRECTED TO THE EXCHANGE AGENT. SEE INSTRUCTION
12.
HOLDERS WHO WISH TO ACCEPT THE EXCHANGE OFFER AND TENDER THEIR RESTRICTED
NOTES MUST COMPLETE THIS LETTER OF TRANSMITTAL IN ITS ENTIRETY AND COMPLY WITH
ALL OF ITS TERMS.
List below the Restricted Notes to which this Letter of Transmittal relates.
If the space provided below is inadequate, the Certificate Numbers and Principal
Amounts should be listed on a separate signed schedule, attached hereto. The
minimum permitted tender is $1,000 in principal amount of the Restricted Notes.
All other tenders must be in integral multiples of $1,000.
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
DESCRIPTION OF RESTRICTED NOTES 1 2 3
-------------------------------------------------------------------------------------------------------------
CERTIFICATE AGGREGATE PRINCIPAL
<S> <C> <C> <C>
NUMBER(S) PRINCIPAL AMOUNT OF
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S): AMOUNT OF RESTRICTED NOTES
(PLEASE FILL IN, IF BLANK) NOTES TENDERED*
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
Total
-------------------------------------------------------------------------------------------------------------
* Need not be completed by Holders who wish to tender all Restricted Notes listed.
-------------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE>
--------------------------------------------------------------------------------
PLEASE READ CAREFULLY THE ACCOMPANYING INSTRUCTIONS
SPECIAL REGISTRATION INSTRUCTIONS
(SEE INSTRUCTIONS 4, 5 AND 6)
To be completed ONLY if certificates for Restricted Notes in a principal
amount not tendered, or Exchange Notes issued in exchange for Restricted
Notes accepted for exchange, are to be issued in the name of someone other
than the undersigned.
Issue certificate(s) to:
Name(s) ____________________________________________________________________
Address ____________________________________________________________________
(INCLUDE ZIP CODE)
____________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL
SECURITY NUMBER(S))
-------------------------------------------------------------------
-------------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 4, 5 AND 6)
To be completed ONLY if certificates for Restricted Notes in a principal
amount not tendered, or Exchange Notes issued in exchange for Restricted
Notes accepted for exchange, are to be delivered to someone other than the
undersigned.
Deliver certificate(s) to:
Name(s) ____________________________________________________________________
Address ____________________________________________________________________
(INCLUDE ZIP CODE)
____________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL
SECURITY NUMBER(S))
-------------------------------------------------------------------
IMPORTANT: THIS LETTER OF TRANSMITTAL OR A FACSIMILE HEREOF (TOGETHER WITH THE
CERTIFICATE(S) FOR RESTRICTED NOTES AND ALL OTHER REQUIRED DOCUMENTS) OR A
CONFIRMATION OF BOOK-ENTRY TRANSFER AND AGENT'S MESSAGE OF SUCH RESTRICTED NOTES
MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE. IF
GUARANTEED DELIVERY PROCEDURES ARE TO BE COMPLIED WITH, A NOTICE OF GUARANTEED
DELIVERY MUST BE RECEIVED BY THE EXCHANGE AGENT PRIOR TO THE EXPIRATION DATE.
<TABLE>
<S> <C>
HOLDERS WHOSE RESTRICTED NOTES ARE NOT IMMEDIATELY AVAILABLE OR WHO
CANNOT DELIVER THEIR RESTRICTED NOTES AND ALL OTHER DOCUMENTS REQUIRED
HEREBY TO THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE MAY
TENDER THEIR RESTRICTED NOTES ACCORDING TO THE GUARANTEED DELIVERY
PROCEDURES SET FORTH IN THE PROSPECTUS UNDER THE CAPTION "EXCHANGE
OFFER-- GUARANTEED DELIVERY PROCEDURES." (SEE INSTRUCTION 2.)
/ / CHECK HERE IF RESTRICTED NOTES ARE BEING DELIVERED PURSUANT
TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE
EXCHANGE AGENT AND COMPLETE THE FOLLOWING:
NAME(S) OF TENDERING HOLDER(S)
DATE OF EXECUTION OF NOTICE OF GUARANTEED DELIVERY
NAME OF INSTITUTION WHICH GUARANTEES DELIVERY
TRANSACTION CODE NUMBER
/ / CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
AMENDMENTS OR SUPPLEMENTS THERETO.
NAME:
ADDRESS:
</TABLE>
3
<PAGE>
If the undersigned is not a broker-dealer, the undersigned represents that
(1) it is acquiring the Exchange Notes in the ordinary course of its business,
(2) it has no arrangements or understanding with any person, nor does it intend
to engage in, a distribution (as that term is interpreted by the SEC) of
Exchange Notes and (3) it is not an affiliate (as that term is interpreted by
the SEC) of the Company. If the undersigned is a broker-dealer that will receive
Exchange Notes for its own account in exchange for Restricted Notes that were
acquired as a result of market-making activities or other trading activities, it
acknowledges that it will deliver a prospectus in connection with any resale of
such Exchange Notes; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ ACCOMPANYING INSTRUCTIONS CAREFULLY.
Ladies and Gentlemen:
Subject to the terms and conditions of the Exchange Offer, the undersigned
hereby tenders to Tyco International Group S.A. (the "Company") the principal
amount of Restricted Notes indicated above.
Subject to and effective upon the acceptance for exchange of the principal
amount of Restricted Notes tendered hereby in accordance with the terms of the
Exchange Offer described in the prospectus, this Letter of Transmittal and the
accompanying Instructions, the undersigned sells, assigns and transfers to, or
upon the order of, the Company all right, title and interest in and to the
Restricted Notes tendered hereby. The undersigned hereby irrevocably constitutes
and appoints the Exchange Agent as its agent and attorney-in-fact (with full
knowledge that the Exchange Agent also acts as the agent of the Company and as
Trustee and Registrar under the Indenture for the Restricted Notes and the
Exchange Notes) with respect to the tendered Restricted Notes with full power of
substitution (such power of attorney being deemed an irrevocable power coupled
with an interest), subject only to the right of withdrawal described in the
Prospectus, to (1) deliver certificates for such Restricted Notes to the Company
or transfer ownership of such Restricted Notes on the account books maintained
by DTC, together, in either such case, with all accompanying evidences of
transfer and authenticity to, or upon the order of, the Company and (2) present
such Restricted Notes for transfer on the books of the Company and receive all
benefits and otherwise exercise all rights of beneficial ownership of such
Restricted Notes, all in accordance with the terms of the Exchange Offer.
The undersigned acknowledges that the Exchange Offer is being made in
reliance upon interpretative advice given by the staff of the SEC to third
parties in connection with transactions similar to the Exchange Offer, so that
the Exchange Notes issued pursuant to the Exchange Offer in exchange for the
Restricted Notes may be offered for resale, resold and otherwise transferred by
holders thereof (other than a broker-dealer who purchased such Restricted Notes
directly from the Company for resale pursuant to Rule 144A, Regulation S or any
other available exemption under the Securities Act or a person that is an
"affiliate" of the Company within the meaning of Rule 405 under the Securities
Act) without compliance with the registration and prospectus delivery provisions
of the Securities Act, provided that such Exchange Notes are acquired by
non-affiliates of the Company in the ordinary course of such holders' business
and such holders are not participating, do not intend to participate and have no
arrangement or understanding with any person to participate, in the distribution
of such Exchange Notes.
The undersigned agrees that acceptance of any tendered Restricted Notes by
the Company and the issuance of Exchange Notes in exchange therefor shall
constitute performance in full by the Company of its obligations under the
Exchange Offer and Registration Rights Agreement and that, upon the issuance of
the Exchange Notes, the Company will have no further obligations or liabilities
thereunder (except in certain limited circumstances).
The undersigned represents and warrants that (1) the Exchange Notes acquired
pursuant to the Exchange Offer are being acquired in the ordinary course of
business of the person receiving Exchange Notes (which shall be the undersigned
unless otherwise indicated in the box entitled "Special Delivery Instructions"
above) (the "Recipient"), (2) neither the undersigned nor the Recipient (if
different) is engaged in, intends to engage in or has any arrangement or
understanding with any person to participate in the distribution (as that term
is interpreted by the SEC) of such Exchange Notes, and (3) neither the
undersigned nor the Recipient (if different) is an "affiliate" of the Company as
defined in Rule 405 under the Securities Act.
If the undersigned is a broker-dealer, the undersigned further
(1) represents that it acquired Restricted Notes for the undersigned's own
account as a result of market-making activities or other trading activities,
(2) represents that it has not entered into any arrangement or understanding
with the Company or any "affiliate" of the Company (within the meaning of
Rule 405 under the Securities Act) to distribute the Exchange Notes to be
received in the Exchange Offer and (3) acknowledges that it will deliver a
prospectus meeting the requirements of the Securities Act (for which purposes,
the delivery of the Prospectus, as the same may be hereafter supplemented or
amended, shall be sufficient) in connection with any resale of Exchange Notes
received in the Exchange Offer. Such a broker-dealer will not be deemed, solely
by reason of such acknowledgment and prospectus delivery, to admit that it is an
"underwriter" within the meaning of the Securities Act.
4
<PAGE>
The undersigned understands and agrees that the Company reserves the right
not to accept tendered Restricted Notes from any tendering holder if the Company
determines, in its sole and absolute discretion, that such acceptance could
result in a violation of applicable securities laws.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, exchange, assign and transfer the Restricted
Notes tendered hereby and to acquire Exchange Notes issuable upon the exchange
of such tendered Restricted Notes, and that, when the same are accepted for
exchange, the Company will acquire good and unencumbered title thereto, free and
clear of all liens, restrictions, charges and encumbrances and not subject to
any adverse claim. The undersigned also warrants that it will, upon request,
execute and deliver any additional documents deemed to be necessary or desirable
by the Exchange Agent or the Company in order to complete the exchange,
assignment and transfer of tendered Restricted Notes or transfer of ownership of
such Restricted Notes on the account books maintained by a book-entry transfer
facility.
The undersigned understands and acknowledges that the Company reserves the
right in its sole discretion to purchase or make offers for any Restricted Notes
that remain outstanding subsequent to the Expiration Date or, as set forth in
the Prospectus under the caption "Exchange Offer--Procedures for Tendering," to
terminate the Exchange Offer and, to the extent permitted by applicable law,
purchase Restricted Notes in the open market, in privately negotiated
transactions or otherwise. The terms of any such purchases or offers could
differ from the terms of the Exchange Offer.
The undersigned understands that the Company may accept the undersigned's
tender by delivering written notice of acceptance to the Exchange Agent, at
which time the undersigned's right to withdraw such tender will terminate. For
purposes of the Exchange Offer, the Company shall be deemed to have accepted
validly tendered Restricted Notes when, as and if the Company has given oral
(which shall be confirmed in writing) or written notice thereof to the Exchange
Agent.
The undersigned understands that the first interest payment following the
Expiration Date will include unpaid interest on the Restricted Notes accrued
through the date of issuance of the Exchange Notes.
The undersigned understands that tenders of Restricted Notes pursuant to the
procedures described under the caption "Exchange Offer--Procedures for
Tendering" in the Prospectus and in the instructions hereto will constitute a
binding agreement between the undersigned, the Company and the Exchange Agent in
accordance with the terms and subject to the conditions of the Exchange Offer.
If any tendered Restricted Notes are not accepted for exchange pursuant to
the Exchange Offer for any reason, certificates for any such unaccepted
Restricted Notes will be returned, at the Company's cost and expense, to the
undersigned at the address shown below or at a different address as may be
indicated herein under "Special Delivery Instructions" as promptly as
practicable after the Expiration Date.
All authority conferred or agreed to be conferred by this Letter of
Transmittal shall survive the death, incapacity or dissolution of the
undersigned, and every obligation of the undersigned under this Letter of
Transmittal shall be binding on the undersigned's heirs, personal
representatives, successors and assigns. This tender may be withdrawn only in
accordance with the procedures set forth in the prospectus and in this Letter of
Transmittal.
By acceptance of the Exchange Offer, each broker-dealer that receives
Exchange Notes pursuant to the Exchange Offer hereby acknowledges and agrees
that upon the receipt of notice by the Company of the happening of any event
that makes any statement in the Prospectus untrue in any material respect or
that requires the making of any changes in the Prospectus in order to make the
statements therein not misleading (which notice the Company agrees to deliver
promptly to such broker-dealer), such broker-dealer will suspend use of the
Prospectus until the Company has amended or supplemented the Prospectus to
correct such misstatement or omission and has furnished copies of the amended or
supplemented prospectus to such broker-dealer.
Unless otherwise indicated under "Special Registration Instructions," please
issue the certificates representing the Exchange Notes issued in exchange for
the Restricted Notes accepted for exchange and return any certificates for
Restricted Notes not tendered or not exchanged, in the name(s) of the
undersigned. Similarly, unless otherwise indicated under "Special Delivery
Instructions," please send the certificates representing the Exchange Notes
issued in exchange for the Restricted Notes accepted for exchange and any
certificates for Restricted Notes not tendered or not exchanged (and
accompanying documents, as appropriate) to the undersigned at the address shown
below the undersigned's signature(s). In the event that both "Special
Registration Instructions" and "Special Delivery Instructions" are completed,
please issue the certificates representing the Exchange Notes issued in exchange
for the Restricted Notes accepted for exchange in the name(s) of, and return any
certificates for Restricted Notes not tendered or not exchanged to, the
person(s) so indicated. The undersigned understands that the Company has no
obligations pursuant to the "Special Registration Instructions" or "Special
Delivery Instructions" to transfer any Restricted Notes from the name of the
registered Holder(s) thereof if the Company does not accept for exchange any of
the Restricted Notes so tendered.
5
<PAGE>
Holders who wish to tender the Restricted Notes and (1) whose Restricted
Notes are not immediately available or (2) who cannot deliver their Restricted
Notes, this Letter of Transmittal or any other documents required hereby to the
Exchange Agent prior to the Expiration Date, may tender their Restricted Notes
according to the guaranteed delivery procedures set forth in the Prospectus
under the caption "Exchange Offer--Guaranteed Delivery Procedures." (See
Instruction 2.)
--------------------------------------------------------------------------------
PLEASE SIGN HERE WHETHER OR NOT WHETHER OR NOT TENDER IS TO BE
MADE PURSUANT TO THE GUARANTEED DELIVERY PROCEDURES
(PLEASE COMPLETE SUBSTITUTE FORM W-9 HEREIN)
This Letter of Transmittal must be signed by the registered holder(s) as
its (their) name(s) appear on the Restricted Notes, or by person(s)
authorized to become registered holder(s) by a properly completed bond power
from the registered holder(s), a copy of which must be transmitted with this
Letter of Transmittal. If the Restricted Notes to which this Letter of
Transmittal relate are held of record by two or more joint holders, then all
such holders must sign this Letter of Transmittal. If signature is by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative
capacity, then such person must (1) set forth his or her full title below
and (2) unless waived by the Company, submit evidence satisfactory to the
Company of such person's authority so to act. (See Instruction 4.)
----------------------------------------------------------------
(SIGNATURE(S) OF HOLDER(S))
Date: ____________, 2000
Name(s) ____________________________________________________________________
(PLEASE PRINT)
Capacity (full title) ______________________________________________________
Address ____________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone Number _____________________________________________
____________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTION 1)
----------------------------------------------------------------
(AUTHORIZED SIGNATURE)
Date: ____________, 2000
Name of Firm _______________________________________________________________
Capacity (full title) ______________________________________________________
Address ____________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone Number _____________________________________________
--------------------------------------------------------------------------------
6
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
1. GUARANTEE OF SIGNATURES. Signatures on this Letter of Transmittal need
not be guaranteed if (a) this Letter of Transmittal is signed by the registered
holder(s) of the Restricted Notes tendered herewith and such holder(s) have not
completed the box set forth herein entitled "Special Registration Instructions"
or the box entitled "Special Delivery Instructions" or (b) such Restricted Notes
are tendered for the account of a member firm of a registered national
securities exchange or of the National Association of Securities Dealers, Inc.
or a commercial bank or trust company having an office or correspondent in the
United States (each, an "Eligible Institution"). (See Instruction 6.) Otherwise,
all signatures on this Letter of Transmittal or a notice of withdrawal, as the
case may be, must be guaranteed by an Eligible Institution. All signatures on
bond powers and endorsements on certificates must also be guaranteed by an
Eligible Institution.
2. DELIVERY OF THIS LETTER OF TRANSMITTAL AND RESTRICTED NOTES. Certificates
for all physically delivered Restricted Notes or confirmation of any book-entry
transfer to the Exchange Agent at DTC of Restricted Notes tendered by book-entry
transfer, as well as, in the case of physical delivery of Restricted Notes, a
properly completed and duly executed copy of this Letter of Transmittal or
facsimile hereof and any other documents required by this Letter of Transmittal,
must be received by the Exchange Agent at its address set forth herein prior to
5:00 p.m. New York City time on the Expiration Date. The method of delivery of
the tendered Restricted Notes, this Letter of Transmittal and all other required
documents, or book-entry transfer and transmission of an Agent's Message by a
DTC participant, to the Exchange Agent is at the election and risk of the Holder
and the delivery will be deemed made only when actually received by the Exchange
Agent. If Restricted Notes are sent by mail, registered mail with return receipt
requested, properly insured, is recommended. In all cases, sufficient time
should be allowed to ensure timely delivery. No Letter of Transmittal or
Restricted Notes should be sent to the Company or DTC.
The Exchange Agent will make a request to establish an account with respect
to the Restricted Notes at DTC for purposes of the Exchange Offer promptly after
receipt of this Prospectus, and any financial institution that is a participant
in DTC may make book-entry delivery of Restricted Notes by causing DTC to
transfer such Restricted Notes into the Exchange Agent's account at DTC in
accordance with DTC's procedures for transfer. However, although delivery of
Restricted Notes may be effected through book-entry transfer at DTC, an Agent's
Message (as defined in the next paragraph) in connection with a book-entry
transfer and any other required documents, must, in any case, be transmitted to
and received by the Exchange Agent at the address specified on the cover page of
the Letter of Transmittal on or prior to the Expiration Date or the guaranteed
delivery procedures described below must be complied with.
A Holder may tender Restricted Notes that are held through DTC by
transmitting its acceptance through DTC's Automatic Tender Offer Program, for
which the transaction will be eligible, and DTC will then edit and verify the
acceptance and send an Agent's Message to the Exchange Agent for its acceptance.
The term "Agent's Message" means a message transmitted by DTC to, and received
by, the Exchange Agent and forming part of the Book-Entry Confirmation, which
states that DTC has received an express acknowledgment from each participant in
DTC tendering the Restricted Notes and that such participant has received the
Letter of Transmittal and agrees to be bound by the terms of the Letter of
Transmittal and the Company may enforce such agreement against such participant.
Delivery of an Agent's Message will also constitute an acknowledgment from the
tendering DTC participant that the representations and warranties set forth on
page 4 of this Letter of Transmittal are true and correct.
Holders who wish to tender their Restricted Notes and (1) whose Restricted
Notes are not immediately available, or (2) who cannot deliver their Restricted
Notes, this Letter of Transmittal or any other documents required hereby to the
Exchange Agent prior to the Expiration Date or comply with book-entry transfer
procedures on a timely basis must tender their Restricted Notes according to the
guaranteed delivery procedures set forth in the Prospectus. See "Exchange
Offer--Guaranteed Delivery Procedures." Pursuant to such procedure: (1) such
tender must be made by or through an Eligible Institution; (2) prior to the
Expiration Date, the Exchange Agent must have received from the Eligible
Institution a properly completed and duly executed Notice of Guaranteed Delivery
(by facsimile transmission, overnight courier, mail, hand delivery or in
accordance with DTC's procedures) setting forth the name and address of the
Holder of the Restricted Notes, the certificate number or numbers of such
Restricted Notes and the principal amount of Restricted Notes tendered, stating
that the tender is being made thereby and guaranteeing that, within three New
York Stock Exchange trading days after the Expiration Date, this Letter of
Transmittal (or facsimile hereof) or any Agent's Message together with the
certificate(s) representing the Restricted Notes or book-entry transfer, as the
case may be, and any other required documents will be deposited by the Eligible
Institution with the Exchange Agent; and (3) such properly completed and
executed Letter of Transmittal (or facsimile hereof), as well as all other
documents required by this Letter of Transmittal and the certificate(s)
representing all tendered Restricted
7
<PAGE>
Notes in proper form for transfer (or a confirmation of book-entry transfer of
such Restricted Notes into the Exchange Agent's account at DTC), must be
received by the Exchange Agent within three New York Stock Exchange trading days
after the Expiration Date, all in the manner provided in the Prospectus under
the caption "Exchange Offer--Guaranteed Delivery Procedures." Any Holder who
wishes to tender his, her or its Restricted Notes pursuant to the guaranteed
delivery procedures described above must ensure that the Exchange Agent receives
the Notice of Guaranteed Delivery prior to the Expiration Date. Upon request to
the Exchange Agent, a Notice of Guaranteed Delivery will be sent to Holders who
wish to tender their Restricted Notes according to the guaranteed delivery
procedures set forth above.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance of tendered Restricted Notes, and withdrawal of tendered
Restricted Notes will be determined by the Company in its sole discretion, which
determination will be final and binding. All tendering holders, by execution of
this Letter of Transmittal (or facsimile thereof), shall waive any right to
receive notice of the acceptance of the Restricted Notes for exchange. The
Company reserves the absolute right to reject any and all Restricted Notes not
properly tendered or any Restricted Notes the Company's acceptance of which
would, in the opinion of counsel for the Company, be unlawful. The Company also
reserves the right to waive any irregularities or conditions of tender as to
particular Restricted Notes. The Company's interpretation of the terms and
conditions of the Exchange Offer (including the instructions in this Letter of
Transmittal) shall be final and binding on all parties. Unless waived, any
defects or irregularities in connection with tenders of Restricted Notes must be
cured within such time as the Company shall determine. Neither the Company, the
Exchange Agent nor any other person shall be under any duty to give notification
of defects or irregularities with respect to tenders of Restricted Notes, nor
shall any of them incur any liability for failure to give such notification.
Tenders of Restricted Notes will not be deemed to have been made until such
defects or irregularities have been cured to the Company's satisfaction or
waived. Any Restricted Notes 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
pursuant to the Company's determination, unless otherwise provided in this
Letter of Transmittal as soon as practicable following the Expiration Date.
3. INADEQUATE SPACE. If the space provided is inadequate, the certificate
numbers and/or the number of Restricted Notes should be listed on a separate
signed schedule attached hereto.
4. TENDER BY HOLDER. Only a registered Holder of Restricted Notes or a DTC
participant listed on a securities position listing furnished by DTC with
respect to the Restricted Notes may tender its Restricted Notes in the Exchange
Offer. Any beneficial owner of Restricted Notes who is not the registered Holder
and is not a DTC participant and who wishes to tender should arrange with such
registered holder to execute and deliver this Letter of Transmittal on such
beneficial owner's behalf or must, prior to completing and executing this Letter
of Transmittal and delivering his, her or its Restricted Notes, either make
appropriate arrangements to register ownership of the Restricted Notes in such
beneficial owner's name or obtain a properly completed bond power from the
registered holder or properly endorsed certificates representing such Restricted
Notes.
5. PARTIAL TENDERS; WITHDRAWALS. Tenders of Restricted Notes will be
accepted only in integral multiples of $1,000. If less than the entire principal
amount of any Restricted Notes is tendered, the tendering Holder should fill in
the principal amount tendered in the third column of the box entitled
"Description of Restricted Notes" above. The entire principal amount of any
Restricted Notes delivered to the Exchange Agent will be deemed to have been
tendered unless otherwise indicated. If the entire principal amount of all
Restricted Notes is not tendered, then Restricted Notes for the principal amount
of Restricted Notes not tendered and a certificate or certification representing
Exchange Notes issued in exchange for any Restricted Notes accepted will be sent
to the Holder at his, her or its registered address, unless a different address
is provided in the "Special Delivery Instructions" box above on this Letter of
Transmittal or unless tender is made through DTC, promptly after the Restricted
Notes are accepted for exchange.
Except as otherwise provided herein, tenders of Restricted Notes may be
withdrawn at any time prior to the Expiration Date. To withdraw a tender of
Restricted Notes in the Exchange Offer, a written or facsimile transmission
notice of withdrawal must be received by the Exchange Agent at its address set
forth herein prior to the Expiration Date. Any such notice of withdrawal must
(1) specify the name of the person having deposited the Restricted Notes to be
withdrawn (the "Depositor"), (2) identify the Restricted Notes to be withdrawn
(including the certificate number or numbers and principal amount of such
Restricted Notes, or, in the case of Restricted Notes transferred by book-entry
transfer the name and number of the account at DTC to be credited), (3) be
signed by the Depositor in the same manner as the original signature on the
Letter of Transmittal by which such Restricted Notes were tendered (including
any required signature guarantees) or be accompanied by documents of transfer
sufficient to have the Registrar with respect to the Restricted Notes register
the transfer of such Restricted Notes into the name of the person withdrawing
the tender and (4) specify the name in which any such Restricted Notes are to be
registered, if
8
<PAGE>
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
Restricted Notes so withdrawn will be deemed not to have been validly tendered
for purposes of the Exchange Offer and no Exchange Notes will be issued with
respect thereto unless the Restricted Notes so withdrawn are validly retendered.
Any Restricted Notes which have been tendered but which are not accepted for
exchange by the Company 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 Restricted Notes may be
retendered by following one of the procedures described in the Prospectus under
"Exchange Offer--Procedures for Tendering" at any time prior to the Expiration
Date.
6. SIGNATURES ON THE LETTER OF TRANSMITTAL; BOND POWERS AND ENDORSEMENTS. If
this Letter of Transmittal (or facsimile hereof) is signed by the registered
Holder(s) of the Restricted Notes tendered hereby, the signature must correspond
with the name(s) as written on the face of the Restricted Note without
alteration, enlargement or any change whatsoever.
If any of the Restricted Notes tendered hereby are owned of record by two or
more joint owners, all such owners must sign this Letter of Transmittal.
If a number of Restricted Notes registered in different names are tendered,
it will be necessary to complete, sign and submit as many copies of this Letter
of Transmittal as there are different registrations of Restricted Notes.
If this Letter of Transmittal (or facsimile hereof) is signed by the
registered Holder or Holders (which term, for the purposes described herein,
shall include a book-entry transfer facility whose name appears on a security
listing as the owner of the Restricted Notes) of Restricted Notes tendered and
the certificate or certificates for Exchange Notes issued in exchange therefor
is to be issued (or any untendered principal amount of Restricted Notes to be
reissued) to the registered Holder, then such Holder need not and should not
endorse any tendered Restricted Notes, nor provide a separate bond power. In any
other case, such Holder must either properly endorse the Restricted Notes
tendered or transmit a properly completed separate bond power with this Letter
of Transmittal with the signatures on the endorsement or bond power guaranteed
by an Eligible Institution.
If this Letter of Transmittal (or facsimile hereof) is signed by a person
other than the registered Holder or Holders of any Restricted Notes listed, such
Restricted Notes must be endorsed or accompanied by appropriate bond powers in
each case signed as the name of the registered Holder or Holders appears on the
Restricted Notes.
If this Letter of Transmittal (or facsimile hereof) or any Restricted Notes
or bond powers are signed by trustees, executors, administrators, guardians,
attorneys-in-fact, or officers of corporations or others acting in a fiduciary
or representative capacity, such persons should so indicate when signing, and
unless waived by the Company, evidence satisfactory to the Company of their
authority so to act must be submitted with this Letter of Transmittal.
Endorsements on Restricted Notes or signatures on bond powers required by
this Instruction 6 must be guaranteed by an Eligible Institution.
7. SPECIAL REGISTRATION AND DELIVERY INSTRUCTIONS. Tendering Holders should
indicate, in the applicable box or boxes, the name and address to which Exchange
Notes or substitute Restricted Notes for principal amounts not tendered or not
accepted for exchange are to be issued or sent, if different from the name and
address of the person signing this Letter of Transmittal. In the case of
issuance in a different name, the taxpayer identification or social security
number of the person named must also be indicated.
8. BACKUP UNITED STATES FEDERAL INCOME TAX WITHHOLDING AND SUBSTITUTE FORM
W-9. Under the United States federal income tax laws, payments that may be made
by the Company on account of Exchange Notes issued pursuant to the Exchange
Offer may be subject to backup withholding at the rate of 31%. In order to avoid
such backup withholding, each tendering holder should complete and sign the
Substitute Form W-9 included in this Letter of Transmittal and either
(a) provide the correct taxpayer identification number ("TIN") and certify,
under penalties of perjury, that the TIN provided is correct and that (1) the
Holder has not been notified by the United States Internal Revenue Service the
("IRS") that the Holder is subject to backup withholding as a result of failure
to report all interest or dividends or (2) the IRS has notified the Holder that
the Holder is no longer subject to backup withholding; or (b) provide an
adequate basis for exemption. If the tendering Holder has not been issued a TIN
and has applied for one, or intends to apply for one in the near future, such
Holder should write "Applied For" in the space provided for the TIN in Part I of
the Substitute Form W-9, sign and date the Substitute Form W-9 and sign the
Certificate of Payee Awaiting Taxpayer Identification Number. If "Applied For"
is written in Part I, the Company (or the Paying Agent under the Indenture
governing the Exchange Notes) shall retain 31% of payments made to the tendering
Holder during the 60-day period following the date of the Substitute Form W-9.
If the Holder furnishes his, her or its TIN within 60 days after the date of the
Substitute Form W-9, the Company (or the Paying Agent) shall
9
<PAGE>
remit such amounts retained during the 60-day period to the Holder and no
further amounts shall be retained or withheld from payments made to the Holder
thereafter. If, however, the Holder has not provided the Exchange Agent or the
Company with his, her or its TIN within such 60-day period, the Company (or the
Paying Agent) shall remit such previously retained amounts to the IRS as backup
withholding. In general, if a Holder is an individual, the TIN is the social
security number of such individual. If the Exchange Agent or the Company are not
provided with the correct TIN, the Holder may be subject to a $50 penalty
imposed by the IRS.
Certain Holders (including, among others, all corporations and certain
non-United States individuals) are not subject to these backup withholding and
reporting requirements. In order for a non-United States individual to qualify
as an exempt recipient, such Holder must submit a statement (generally, IRS
Form W-8), signed under penalties of perjury, attesting to that individual's
exempt status. Such statements can be obtained from the Exchange Agent. For
further information concerning backup withholding and instructions for
completing the Substitute Form W-9 (including how to obtain a taxpayer
identification number if you do not have one and how to complete the Substitute
Form W-9 if Restricted Notes are registered in more than one name), consult the
enclosed Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9. Failure to complete the Substitute Form W-9 will not, by
itself, cause Restricted Notes to be deemed invalidly tendered, but may require
the Company (or the Paying Agent) to withhold 31% of the amount of any payments
made on account of the Exchange Notes. Backup withholding is not an additional
federal income tax. Rather, the federal income tax liability of a person subject
to backup withholding will be reduced by the amount of tax withheld. If
withholding results in an overpayment of taxes, a refund may be obtained from
the IRS.
9. TRANSFER TAXES. The Company will pay all transfer taxes, if any,
applicable to the exchange of Restricted Notes pursuant to the Exchange Offer.
If, however, certificates representing Exchange Notes or Restricted Notes for
principal amounts not tendered or accepted for exchange are to be delivered to,
or are to be registered in the name of, any person other than the registered
Holder of the Restricted Notes tendered hereby, or if tendered Restricted Notes
are registered in the name of a person other than the person signing this Letter
of Transmittal, or if a transfer tax is imposed for any reason other than the
exchange of Restricted Notes pursuant to the Exchange Offer, then the amount of
any such transfer taxes (whether imposed on the registered Holder or on any
other persons) 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. See the Prospectus under "Exchange Offer--Solicitation
of Tenders; Fees and Expenses."
Except as provided in this Instruction 9, it will not be necessary for
transfer tax stamps to be affixed to the Restricted Notes listed in this Letter
of Transmittal.
10. WAIVER OF CONDITIONS. The Company reserves the right, in its sole
discretion, to amend, waive or modify specified conditions in the Exchange Offer
in the case of any Restricted Notes tendered.
11. MUTILATED, LOST, STOLEN OR DESTROYED RESTRICTED NOTES. Any tendering
Holder whose Restricted Notes have been mutilated, lost, stolen or destroyed
should contact the Exchange Agent at the address indicated herein for further
instructions.
12. REQUESTS FOR ASSISTANCE, COPIES. Requests for assistance and requests
for additional copies of the Prospectus or this Letter of Transmittal may be
directed to the Exchange Agent at the address specified in the Prospectus.
Holders may also contact their broker, dealer, commercial bank, trust company or
other nominee for assistance concerning the Exchange Offer.
(DO NOT WRITE IN SPACE BELOW)
<TABLE>
<CAPTION>
CERTIFICATE TENDERED RESTRICTED NOTES ACCEPTED RESTRICTED NOTES SURRENDERED
-------------------------------- -------------------------------- --------------------------------
<S> <C> <C>
-------------------------------- -------------------------------- --------------------------------
-------------------------------- -------------------------------- --------------------------------
</TABLE>
Received _________ Accepted by _________ Checked by _________
Delivery Prepared by ________ Checked by ________ Date ________
10
<PAGE>
IMPORTANT TAX INFORMATION
Under United States federal income tax laws, to avoid imposition of a 31%
backup withholding with respect to payments made under the Exchange Notes a
Holder whose tendered Restricted Notes are accepted for payment should provide
the Exchange Agent with such Holder's correct TIN on Substitute Form W-9 below
or otherwise establish a basis for exemption from backup withholding. If such
Holder is an individual, the TIN is his social security number. If the Exchange
Agent is not provided with the correct TIN, a $50 penalty may be imposed by the
Internal Revenue Service, and payments made under the Exchange Note may be
subject to backup withholding.
Certain Holders (including, among others, all corporations and certain
non-United States persons) are not subject to these backup withholding and
reporting requirements. Exempt Holders should indicate their exempt status on
Substitute Form W-9. A non-United States person may qualify as an exempt
recipient by submitting to the Exchange Agent a properly completed Internal
Revenue Service Form W-8, signed under penalties of perjury, attesting to that
Holder's exempt status. A Form W-8 can be obtained from the Exchange Agent. See
the enclosed "Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9" for additional instructions.
If backup withholding applies, the Company (or the Paying Agent under the
Indenture governing the Exchange Notes) is required to withhold 31% of any
payments made to the Holder or other payee with respect to the Exchange Notes.
Backup withholding is not an additional United States federal income tax.
Rather, the United States federal income tax liability of persons subject to
backup withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained from the Internal
Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments made with respect to the Exchange
Notes, the Holder should provide the Company (or the Paying Agent under the
Indenture governing the Exchange Notes) with either (a) the Holder's correct TIN
by completing the form below, certifying that the TIN provided on Substitute
Form W-9 is correct (or that such Holder is awaiting a TIN) and that (1) the
Holder has not been notified by the Internal Revenue Service that the Holder is
subject to backup withholding as a result of failure to report all interest or
dividends or (2) the Internal Revenue Service has notified the Holder that the
Holder is no longer subject to backup withholding or (b) an adequate basis for
exemption.
WHAT NUMBER TO GIVE
The Holder is required to give the TIN (e.g., social security number or
employer identification number) of the registered Holder of the Restricted
Notes. If the Restricted Notes are held in more than one name or are held not in
the name of the actual owner, consult the enclosed "Guidelines for Certification
of Taxpayer Identification Number on Substitute Form W-9" for additional
guidance on which number to report.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX
IN PART 2 OF THE SUBSTITUTE FORM W-9
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify, under penalties of perjury, that a Taxpayer Identification Number
has not been issued to me, and that I mailed or delivered an application to
receive a Taxpayer Identification Number to the appropriate Internal Revenue
Service Center or Social Security Administration Office (or I intend to mail
or deliver an application in the near future). I understand that if I do not
provide a Taxpayer Identification Number to the payer, 31% of all payments
made to me on account of the Exchange Notes shall be retained until I provide
a Taxpayer Identification Number within 60 days, such retained amounts shall
be remitted to the Internal Revenue Service as backup withholding and 31% of
all reportable payments made to me thereafter will be withheld and remitted to
the Internal Revenue Service until I provide a Taxpayer Identification Number.
Signature
--------------------------------------------- Date
-------------------------- , 2000
11
<PAGE>
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF) AND ALL OTHER
REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT
ON OR PRIOR TO THE EXPIRATION DATE.
TO BE COMPLETED BY ALL TENDERING HOLDERS
(SEE INSTRUCTION 8)
<TABLE>
<S> <C> <C>
--------------------------------------------------------------------------------------------------------------
PAYER'S NAME: THE BANK OF NEW YORK
-------------------------------------------------------------------------------------------------------------
PART 1--PLEASE PROVIDE YOUR TIN ON THE TIN: -------------------------
LINE AT RIGHT AND CERTIFY BY SIGNING Social Security Number or
AND DATING BELOW Employer Identification Number
-------------------------------------------------------------------------------
PART 2--TIN Applied For / /
-------------------------------------------------------------------------------
SUBSTITUTE CERTIFICATION--UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT:
(1) the number shown on this form is my correct taxpayer identification number
FORM W-9 (or I
Department of the Treasury am waiting for a number to be issued to me),
Internal Revenue Service (2) I am not subject to backup withholding either because (i) I am exempt from
Payor's Request For backup withholding, (ii) I have not been notified by the Internal Revenue
Taxpayer Identification Service ("IRS") that I am subject to backup withholding as a result of a
Number ("TIN") and failure to report all interest or dividends, or (iii) the IRS has notified
Certification me that I am no longer subject to backup withholding, and
(3) any other information provided on this form is true and correct.
Signature Date , 2000
You must cross out item (2) in the certification above if you have been notified by the IRS that you are
subject to backup withholding because of underreporting interest or dividends on your tax return and you have
not been notified by the IRS that you are no longer subject to backup withholding.
--------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY IN CERTAIN CIRCUMSTANCES
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY AMOUNTS PAID TO YOU ON ACCOUNT OF THE
EXCHANGE NOTES. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF
TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
12
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
6 7/8% NOTES DUE 2002
OF
TYCO INTERNATIONAL GROUP S.A.
As set forth in the prospectus dated June 29, 2000 (the "Prospectus") of
Tyco International Group S.A. (the "Company") and Tyco International Ltd.
("Tyco") and in the related Letter of Transmittal (the "Letter of Transmittal"),
this form or a form substantially equivalent to this form must be used to accept
the Exchange Offer (as defined below) if the certificates for the outstanding
6 7/8% Notes due 2002 (the "Restricted Notes") of the Company and all other
documents required by the Letter of Transmittal cannot be delivered to the
Exchange Agent by the Expiration Date of the Exchange Offer or compliance with
book-entry transfer procedures cannot be effected on a timely basis. Such form
may be delivered by hand or transmitted by facsimile transmission, telex or mail
to the Exchange Agent no later than the Expiration Date, and must include a
signature guarantee by an Eligible Institution as set forth below. Capitalized
terms used herein but not defined herein have the meanings ascribed thereto in
the Prospectus.
The Exchange Agent for the Exchange Offer is:
The Bank Of New York
<TABLE>
<CAPTION>
BY REGISTERED OR CERTIFIED MAIL FACSIMILE TRANSMISSIONS: BY HAND OR OVERNIGHT DELIVERY
<S> <C> <C>
The Bank of New York (Eligible Institutions Only) THE BANK OF NEW YORK
101 Barclay Street, 7E (212) 815-6339 101 BARCLAY STREET
New York, New York 10286 TO CONFIRM BY TELEPHONE CORPORATE TRUST SERVICES WINDOW
Attn: Tolutope Adeyoju OR FOR INFORMATION CALL: GROUND LEVEL
Reorganization Department (212) 815-3738 NEW YORK, NEW YORK 10286
ATTN: TOLUTOPE ADEYOJU
REORGANIZATION DEPARTMENT
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OR TRANSMISSION TO A FACSIMILE
NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. THE
METHOD OF DELIVERY OF ALL DOCUMENTS, INCLUDING CERTIFICATES, IS AT THE RISK OF
THE HOLDER. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, IS RECOMMENDED. YOU SHOULD READ THE INSTRUCTIONS
ACCOMPANYING THE LETTER OF TRANSMITTAL CAREFULLY BEFORE YOU COMPLETE THIS NOTICE
OF GUARANTEED DELIVERY.
This Notice of Guaranteed Delivery is not to be used to guarantee
signatures. If a signature on a Letter of Transmittal is required to be
guaranteed by an Eligible Institution under the instructions thereto, such
signatures must appear in the applicable space provided on the Letter of
Transmittal for Guarantee of Signature(s).
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.
NEW YORK CITY TIME ON JULY 28, 2000 UNLESS THE EXCHANGE OFFER IS EXTENDED.
<PAGE>
Ladies and Gentlemen:
The undersigned acknowledges receipt of the Prospectus and the related
Letter of Transmittal which describes the Company's offer (the "Exchange Offer")
to exchange $1,000 in principal amount of its 6 7/8% Notes due 2002 (the
"Exchange Notes") for each $1,000 in principal amount of its 6 7/8% Notes due
2002 (the "Restricted Notes"). The undersigned hereby tenders to the Company the
aggregate principal amount of Restricted Notes set forth below on the terms and
conditions set forth in the Prospectus and the related Letter of Transmittal
pursuant to the guaranteed delivery procedure set forth in the "Exchange
Offer--Guaranteed Delivery Procedures" section in the Prospectus.
The undersigned understands that no withdrawal of a tender of Restricted
Notes may be made on or after the Expiration Date. The undersigned understands
that for a withdrawal of a tender of Restricted Notes to be effective, a written
notice of withdrawal that complies with the requirements of the Exchange Offer
must be timely received by the Exchange Agent at one of its addresses or by
facsimile specified on the cover of this Notice of Guaranteed Delivery prior to
the Expiration Date.
The undersigned understands that the exchange of Restricted Notes for
Exchange Notes pursuant to the Exchange Offer will be made only after timely
receipt by the Exchange Agent of (1) such Restricted Notes (or Book-Entry
Confirmation of the transfer of such Restricted Notes into the Exchange Agent's
account at The Depository Trust Company ("DTC")) and (2) if Restricted Notes are
to be physically delivered, a Letter of Transmittal (or facsimile thereof) with
respect to such Restricted Notes, properly completed and duly executed, with any
required signature guarantees, this Notice of Guaranteed Delivery and any other
documents required by the Letter of Transmittal or, in the case of book-entry
transfer, a properly transmitted Agent's Message. The term "Agent's Message"
means a message transmitted by DTC to, and received by, the Exchange Agent and
forming part of the confirmation of a book-entry transfer, which states that DTC
has received an express acknowledgment from a participant in DTC tendering the
Restricted Notes and that such participant has received the Letter of
Transmittal and agrees to be bound by the terms of the Letter of Transmittal and
the Company may enforce such agreement against such participant.
All authority conferred or agreed to be conferred by this Notice of
Guaranteed Delivery shall not be affected by, and shall survive, the death or
incapacity of the undersigned, and every obligation of the undersigned under
this Notice of Guaranteed Delivery shall be binding on the heirs, executors,
administrators, trustees in bankruptcy, personal and legal representatives,
successors and assigns of the undersigned.
2
<PAGE>
--------------------------------------------------------------------------------
PLEASE COMPLETE
<TABLE>
<S> <C>
Principal Amount of Restricted Notes Name(s) of Registered Holder(s):
Tendered for Exchange: $
Restricted Note Certificate No.(s)
(if available):
If Restricted Notes will be tendered by book-entry transfer, provide the following
information:
DTC Account Number:
Date:
</TABLE>
PLEASE SIGN HERE
<TABLE>
<S> <C>
Signature(s) of Owner(s) or Authorized
Signatory Date
Area Code and Telephone Number:
</TABLE>
--------------------------------------------------------------------------------
This Notice of Guaranteed Delivery must be signed by the registered
Holder(s) of Restricted Notes exactly as its (their) name(s) appear on
certificates for Restricted Notes or on a security position listing as the owner
of Restricted Notes, or by person(s) authorized to become registered Holder(s)
by endorsements and documents transmitted with this Notice of Guaranteed
Delivery. If signature is by a trustee, executor, administrator, guardian,
attorney-in-fact, officer or other person acting in a fiduciary or
representative capacity, such person must provide the following information.
--------------------------------------------------------------------------------
PLEASE PRINT NAME(S) AND ADDRESS(ES)
Name(s):
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
Capacity:
-------------------------------------------------------------------------------
Address(es):
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
----------------------------------------------------------------------------
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED
3
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a member firm of a registered national securities exchange
or of the National Association of Securities Dealers, Inc. or a commercial bank
or trust company having an office or a correspondent in the United States, or
otherwise an "eligible guarantor institution" within the meaning of
Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), hereby (1) represents that each holder of Restricted Notes on
whose behalf this tender is being made "own(s)" the Restricted Notes covered
hereby within the meaning of Rule 13d-3 under the Exchange Act, (2) represents
that such tender of Restricted Notes complies with Rule 14e-4 of the Exchange
Act and (3) guarantees that, within three New York Stock Exchange trading days
from the expiration date of the Exchange Offer, a properly completed and duly
executed Letter of Transmittal (or a facsimile thereof), together with
certificates representing the Restricted Notes covered hereby in proper form for
transfer (or confirmation of the book-entry transfer of such Restricted Notes
into the Exchange Agent's account at DTC, pursuant to the procedure for
book-entry transfer set forth in the Prospectus) and required documents will be
deposited by the undersigned with the Exchange Agent.
The undersigned acknowledges that it must deliver the Letter of Transmittal
and Restricted Notes tendered hereby to the Exchange Agent within the time
period set forth above and the failure to do so could result in financial loss
to the undersigned.
<TABLE>
<S> <C>
Name of Firm Authorized Signature
Address Title
Zip Code (Please Type or Print)
Area Code and Telephone No. Dated:
</TABLE>
NOTE: DO NOT SEND CERTIFICATES FOR RESTRICTED NOTES WITH THIS FORM. CERTIFICATES
FOR RESTRICTED NOTES SHOULD ONLY BE SENT WITH YOUR LETTER OF TRANSMITTAL.
4
