As filed with the United States Securities and Exchange Commission July 17,
1998.
Registration No.____________
============================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
STEWART ENTERPRISES, INC.
(Exact name of registrant as specified in its charter)
LOUISIANA 110 VETERANS MEMORIAL BOULEVARD 72-0693290
(State or other METAIRIE, LOUISIANA 70005 (I.R.S. Employer
jurisdiction of (504) 837-5880 Identification Number)
incorporation or (Address, including zip code, and
organization) telephone number, including area code, of
registrant's principal executive offices)
JOSEPH P. HENICAN, III COPY TO:
CHIEF EXECUTIVE OFFICER AND L.R. MCMILLAN, II
VICE CHAIRMAN OF THE BOARD JONES, WALKER, WAECHTER,
STEWART ENTERPRISES, INC. POITEVENT, CARRERE & DENEGRE, L.L.P.
P.O. BOX 19925 201 ST. CHARLES AVENUE, 51ST FLOOR
NEW ORLEANS, LOUISIANA 70179 NEW ORLEANS, LOUISIANA 70170-5100
(504) 837-5880 (504) 582-8188
(Name, address, including zip
code, and telephone number,
including area code, of agent
for service)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this registration statement
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box.
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If any of the securities being registered on this form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933 (the "Securities Act"), other than securities offered only in
connection with dividend or interest reinvestment plans, please check the
following box. X
---
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering.
---
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering.
---
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box.
---
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
maximum maximum
Title of each Amount offering aggregate
class of securities to be price per offering Amount of
to be registered registered(1) unit(2) price(2) registration fee(3)
<S> <C> <C> <C> <C>
Class A Common Stock (no par value
per share)(4) $500,000,000 100% $500,000,000 $147,500
Preferred Stock
Debt Securities
</TABLE>
(1) Such indeterminate principal amount of Debt Securities, and such
indeterminate number of shares of Class A Common Stock and Preferred
Stock as may from time to time be issued at indeterminate prices. Such
amount represents the principal amount of any Debt Securities issued at,
or at a premium to, their principal amounts, the issue price rather than
the principal amount of any Debt Securities issued at an original issue
discount, the stated value of any Prefered Stock, and the amount computed
pursuant to Rule 457(c) for any Class A Common Stock.
(2) Estimated solely for the purpose of calculating the registration fee;
certain information regarding the proposed maximum offering prices has
been omitted pursuant to Instruction II.D of Form S-3 and will be
determined from time to time by the registrant in connection with its
issuance of the securities registered hereunder.
(3) Calculated pursuant to Rule 457(o) promulgated under the Securities Act
of 1933.
(4) Also includes such indeterminate number of shares of Class A Common Stock
as may be issued upon conversion of or exchange for any class or series
of Preferred Stock that provides for conversion or exchange into Class A
Common Stock.
________________
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(A), MAY
DETERMINE.
<PAGE>
SUBJECT TO COMPLETION, DATED JULY 17, 1998
PROSPECTUS
$500,000,000
Stewart Enterprises, Inc.
Class A Common Stock
Preferred Stock
Debt Securities
Stewart Enterprises, Inc. (the "Company") may offer from time to time (i)
shares of class A common stock ("Class A Common Stock"), (ii) shares of
preferred stock ("Preferred Stock"), and (iii) debt securities ("Debt
Securities") consisting of debentures, notes and/or other evidences of
indebtedness in one or more series, in an aggregate amount not to exceed
$500,000,000 (or the U.S. dollar equivalent thereof if any such securities are
denominated in a foreign currency or currency unit). The Class A Common Stock,
Preferred Stock, and Debt Securities (collectively, the "Securities") may be
offered, separately or together, in one or more series or classes, in amounts,
at prices and on terms to be determined at the time of sale and set forth in an
accompanying supplement to this Prospectus (a "Prospectus Supplement"). The
Debt Securities will rank pari passu with all other unsubordinated and
unsecured indebtedness of the Company. The Company will receive all of the net
proceeds from the sale of the Securities.
The Securities may be denominated in U.S. dollars or in another currency or
currency unit (such as the European Currency Unit), and the principal of (and
premium, if any, on) and interest on the Securities may be payable in U.S.
dollars or such foreign currency or currency unit. The specific terms of the
Securities in respect to which this Prospectus is being delivered will be set
forth in the applicable Prospectus Supplement and will include, where
applicable, among other things (i) in the case of Class A Common Stock, the
number of shares offered and the initial public offering price thereof; (ii) in
the case of Preferred Stock, the number of shares offered and the designation
and stated value, any dividend, liquidation, redemption, conversion, voting or
other rights and preferences, and the initial public offering price thereof;
and (iii) in the case of Debt Securities, the specific designation, aggregate
principal amount, currency or currency unit in which the principal and any
premium or interest may be payable, authorized denominations, maturity, any
premium, any interest rate (which may be fixed or variable), any interest
payment dates, any optional or mandatory redemption terms, and any other terms
of such series. The Prospectus Supplement will also contain information, where
applicable, about certain United States federal income tax considerations
relating to the Securities covered by the Prospectus Supplement.
The Company may sell the Securities directly to one or more purchasers or to
or through underwriters, dealers or agents. If any underwriters, dealers or
agents are involved in the sale of the Securities, the accompanying Prospectus
Supplement will set forth their names, the principal amounts, if any, to be
purchased by underwriters, any applicable fees, commissions or discounts, and
the net proceeds to the Company.
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF SECURITIES UNLESS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is ________, 1998.
<PAGE>
IN CONNECTION WITH AN OFFERING OF SECURITIES, THE UNDERWRITERS, IF ANY, MAY
OVER-ALLOT OR EFFECT TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICES
OF THE SECURITIES AT LEVELS ABOVE THOSE WHICH MIGHT OTHERWISE PREVAIL IN THE
OPEN MARKET. SUCH TRANSACTIONS MAY BE EFFECTED ON ANY SECURITIES EXCHANGE ON
WHICH SUCH SECURITIES MAY BE LISTED, IN THE OVER-THE-COUNTER MARKET OR
OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934 (the "Exchange Act") and, in accordance therewith, files
reports, proxy statements and other information with the Securities and
Exchange Commission (the "Commission"). Such reports, proxy statements and
other information may be inspected and copied at the public reference
facilities maintained by the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the following regional offices of the Commission: 7 World
Trade Center, New York, New York 10048 and 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material may be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. The Commission maintains an
Internet web site that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission (http://www.sec.gov). Such reports, proxy statements and other
information may also be inspected at the National Association of Securities
Dealers, Inc. at 1735 K Street, N.W., Washington, D.C. 20006.
The Company has filed with the Commission a registration statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933 with respect to the Securities
offered by this Prospectus. This Prospectus does not contain all the
information set forth in the Registration Statement, certain parts of which are
omitted in accordance with the rules and regulations of the Commission. For
further information with respect to the Company and the Securities offered
hereunder, reference is made to the Registration Statement. Statements
contained in this Prospectus as to the contents of any contract or other
document are not necessarily complete and, where such contract or other
document is an exhibit to the Registration Statement, each such statement is
qualified in all respects by the provisions of such exhibit, to which reference
is hereby made for a full statement of the provisions thereof.
DOCUMENTS INCORPORATED BY REFERENCE
The following documents filed by the Company with the Commission are hereby
incorporated by reference into this Prospectus (the Company's Exchange Act file
number is 0-19508): (i) the Company's Annual Report on Form 10-K for the fiscal
year ended October 31, 1997, filed January 29, 1998; (ii) the description of
the Company's Class A Common Stock set forth in its Registration Statement on
Form 8-A under the Exchange Act dated September 5, 1991; (iii) the Company's
Quarterly Reports on Form 10-Q for the quarter ended January 31, 1998, filed
March 17, 1998; and for the quarter ended April 30, 1998, filed June 15, 1998;
and (iv) the Company's Current Reports on Form 8-K, dated December 17, 1997,
filed December 18, 1997; dated March 10, 1998, filed March 10, 1998; dated
April 8, 1998, filed April 9, 1998; dated April 17, 1998, filed April 17, 1998;
dated April 21, 1998, filed April 24, 1998; dated May 15, 1998, filed May 15,
1998; and dated June 9, 1998, filed June 10, 1998.
All reports and other documents subsequently filed by the Company pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of
this Prospectus and prior to the termination of this offering shall be deemed
to be incorporated by reference herein and to be a part hereof from the date of
filing of such reports and documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
to the extent that a statement contained herein or in any other document
subsequently filed which also is or is deemed to be incorporated by reference
herein modifies or supersedes such statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus has been delivered, upon written or oral request, a copy of any or
all of the documents incorporated herein by reference (other than exhibits to
such documents unless such exhibits are specifically incorporated by reference
into such documents). Requests should be directed to Stewart Enterprises, Inc.,
Attention: Kenneth C. Budde, 110 Veterans Memorial Boulevard, Metairie,
Louisiana 70005, telephone (504) 837-5880.
THE COMPANY
Stewart Enterprises, Inc. (the "Company") is the third largest provider of
products and services in the death care industry in North America and currently
operates in North America, South America, Europe and the Pacific Rim. The
Company is a leader in the industry's trend toward consolidation and has
acquired most of its current operations through acquisitions.
The Company provides a complete range of death care products and services
both at and prior to the time of need. The Company's funeral homes and
cemeteries are located primarily in metropolitan areas and are generally
organized in "clusters," which are groups of integrated funeral homes and
cemeteries. The Company also develops combined cemetery and funeral home
facilities, whereby the funeral home is located at and operated in conjunction
with the cemetery. The Company believes that it owns and operates one or more
of the premier death care facilities in each of its principal markets. The
Company also believes that it is an industry leader in the marketing and sale
of prearranged funeral and cemetery services and products.
The Company has an experienced management team and a decentralized
organizational structure that allows local funeral home directors and cemetery
managers to best serve their location's particular needs. The company has
three principal objectives: (i) to provide the highest level of quality,
service and value to each family it serves; (ii) to attract, retain and reward
highly qualified individuals to operate its businesses; and (iii) to pursue a
strategy of disciplined internal and external growth, with the ultimate goal of
enhancing shareholder value.
The Company's business was founded by the Stewart family in 1910, and the
Company was incorporated as a Louisiana corporation in 1970. The Company's
principal executive offices are located at 110 Veterans Memorial Boulevard,
Metairie, Louisiana 70005, and its telephone number is 504-837-5880.
USE OF PROCEEDS
Unless otherwise described in the accompanying Prospectus Supplement, the
net proceeds from the sale of Securities will be used by the Company for
general corporate purposes, which may include the repayment of outstanding
indebtedness, acquisitions, capital expenditures and working capital.
RATIO OF EARNINGS TO FIXED CHARGES
The Company's ratio of earnings to fixed charges was as follows for the
years and period indicated:
<TABLE> SIX MONTHS
<CAPTION> ENDED
YEARS ENDED OCTOBER 31, APRIL 30,
---------------------------------------------------- ----------
1993 1994 1995 1996 1997 1998
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
5.15 5.30 2.72(1) 3.98 3.65(2) .70(3)
</TABLE>
_______
(1)Pretax earnings from continuing operations for fiscal year 1995 includes a
non-recurring, non-cash charge to earnings of $17.3 million in connection
with the vesting of the Company's performance-based stock options. Excluding
the charge, the Company's ratio of earnings to fixed charges for fiscal 1995
would be 3.43.
(2)Excluding the cumulative effect of a change in accounting principles.
(3)Pretax earnings from continuing operations for the six months ended April
30, 1998 includes a non-recurring, non-cash charge to earnings of $76.8
million in connection with the vesting of the Company's performance-based
stock options. Excluding the charge, the Company's ratio of earnings to
fixed charges for such period would be 4.33. Because of the stock option
charge, pretax earnings during the six-month period were insufficient to
cover fixed charges, and $6.3 million of pretax earnings would be required
to eliminate the deficiency.
_______________
For purposes of computing the ratio of earnings to fixed charges, earnings
consist of pretax earnings from continuing operations plus fixed charges
(excluding interest capitalized during the period). Fixed charges consist of
interest expense, capitalized interest, amortization of debt expense and
discount or premium relating to any indebtedness and the portion of rental
expense that management believes to be representative of the interest component
of rental expense.
During the periods presented the Company had no preferred stock outstanding.
Therefore, the ratio of earnings to combined fixed charges and preference
dividends was the same as the ratio of earnings to fixed charges for each of
the periods presented.
DESCRIPTION OF CLASS A COMMON STOCK
GENERAL
As of the date of this Prospectus, the Company's Articles of Incorporation
authorize the issuance of an aggregate of 150,000,000 shares of Class A Common
Stock, no par value per share, and 5,000,000 shares of Class B Common Stock, no
par value per share. As of June 30, 1998, 94,184,203 shares of Class A Common
Stock and 3,555,020 shares of Class B Common Stock were outstanding.
CLASS A AND CLASS B COMMON STOCK
Voting Rights. With respect to all matters submitted to a vote of the
shareholders, the record holders of the Class A Common Stock are entitled to
one vote per share and the record holders of Class B Common Stock are entitled
to ten votes per share. Except as may otherwise be required by law or by the
Articles of Incorporation, the holders of the Class A and Class B Common Stock
vote together as a single class.
There is no provision in the Articles of Incorporation for cumulative voting
with respect to the election of directors. Accordingly, the holders of more
than 50% of the total voting power can, if they choose to do so, elect all of
the directors. As of June 30, 1998, Frank B. Stewart, Jr., Chairman of the
Board of the Company, was the record holder of 7,784,268 shares of Class A
Common Stock and all of the shares of Class B Common Stock, having in the
aggregate approximately 33.4% of the total voting power of the Company.
Other Rights. Subject to the rights of the holders of any outstanding
shares of Preferred Stock, holders of Class A and Class B Common Stock are
entitled to receive such dividends, in cash, securities or property, as may
from time to time be declared by the Board of Directors. In the event of any
voluntary or involuntary liquidation, dissolution, or winding up of the
Company, after payment has been made to the holders of Preferred Stock of the
full amount to which they are entitled, the holders of Class A and Class B
Common Stock are entitled to share ratably, according to the number of shares
held by them, in all remaining assets of the Company available for
distribution. Shares of Class A and Class B Common Stock are not redeemable
and have no subscription, conversion (except as described below) or preemptive
rights.
Transferability and Convertibility. The Class A Common Stock is freely
transferable, subject to applicable securities laws. The transfer of Class B
Common Stock is prohibited by the Articles of Incorporation unless such stock
is transferred to a "Permitted Transferee," which is defined in the Articles of
Incorporation to include, among others, the spouse, lineal descendants and
executor of any authorized holder of Class B Common Stock.
To provide liquidity to holders of Class B Common Stock, the Articles of
Incorporation provide that each share of Class B Common Stock is convertible at
any time at the option of the record holder into one share of Class A Common
Stock. A shareholder desiring to sell an equity interest represented by Class
B Common Stock could thereby convert and sell, subject to applicable securities
laws, shares of Class A Common Stock. Shares of Class B Common Stock will be
automatically converted into an equal number of shares of Class A Common Stock
upon transfer to any person other than a Permitted Transferee. Once converted,
shares of Class B Common Stock must be canceled and may not be reissued.
DESCRIPTION OF PREFERRED STOCK
GENERAL
The Company's Articles of Incorporation authorize the issuance of 5,000,000
shares of Preferred Stock, par value $1.00 per share. As of the date of this
Prospectus, no shares of Preferred Stock are outstanding. Subject to
limitations prescribed by law, the Board of Directors is authorized at any time
to issue one or more series of Preferred Stock, to determine the designation
and size of any such series, and to establish the rights and preferences of the
shares of any such series. The particular terms of any series of Preferred
Stock offered hereunder will be described in the applicable Prospectus
Supplement.
The summary of terms of the Company's Preferred Stock contained in this
Prospectus does not purport to be complete and is subject to, and qualified in
its entirety by, the provisions of the Company's Articles of Incorporation and
the articles of amendment relating to each series of the Preferred Stock that
will be filed as an exhibit to or incorporated by reference in the Registration
Statement of which this Prospectus is a part at or prior to the time of
issuance of such series.
The Board of Directors is authorized to determine, and the Prospectus
Supplement shall set forth, (i) the respective preferences, limitations and
relative rights as between each series of Preferred Stock and the Class A and
Class B Common Stock, and (ii) the variations in the preferences, limitations
and relative rights as between different series of Preferred Stock.
DESCRIPTION OF DEBT SECURITIES
The following description of the Debt Securities sets forth certain general
terms and provisions of the Debt Securities to which any Prospectus Supplement
may relate ("Offered Debt Securities"). The particular terms of the Offered
Debt Securities and the extent to which such general provisions may apply will
be described in a Prospectus Supplement relating to such Offered Debt
Securities.
The Debt Securities will be issued under an Indenture dated as of December
1, 1996, between the Company and Citibank, N.A., as trustee (the "Trustee"), as
supplemented by the First Supplemental Indenture dated as of April 24, 1998,
between the Company and the Trustee (as supplemented, the "Indenture"). The
Indenture is filed as an exhibit to the Registration Statement of which this
Prospectus is a part. The statements under this caption relating to the Debt
Securities and the Indenture are summaries only and do not purport to be
complete. Such summaries make use of terms defined in the Indenture, which
terms are capitalized herein. Wherever such terms are used herein or particular
provisions of the Indenture are referred to herein, such terms or provisions
are incorporated by reference as part of the statements made herein, and such
statements are qualified in their entirety by such reference. The italicized
parenthetical references below refer to the section numbers in the Indenture,
unless otherwise indicated.
General. The Indenture does not limit the aggregate principal amount of Debt
Securities that can be issued thereunder and provides that Debt Securities may
be issued from time to time thereunder in one or more series, in each case in
such form and with such terms as are established for such series in or pursuant
to Board Resolutions or indentures supplemental to the Indenture. (Sections 201
and 301) The aggregate principal amount of Debt Securities currently
outstanding under the Indenture is $300,000,000, and the aggregate principal
amount of Debt Securities that may be offered and sold pursuant to this
Prospectus is limited to $500,000,000, which is the amount of Securities
registered under the Registration Statement of which this Prospectus is a part.
All Debt Securities will be unsecured obligations of the Company, will rank
senior in priority to any subordinated indebtedness of the Company, and will
rank pari passu with all other unsecured indebtedness of the Company.
The Company is a holding company and conducts substantially all of its
business through its Subsidiaries. Accordingly, the ability of the Company to
meet its obligations under the Indenture and the Debt Securities will depend
primarily upon the earnings of its Subsidiaries and upon the receipt by the
Company of dividends or other payments from its Subsidiaries. None of the
Company's Subsidiaries is prohibited under the Indenture from entering into
agreements limiting its ability to make distributions to the Company. The
obligations of the Company under the Debt Securities will not be guaranteed by
any of the Subsidiaries of the Company. Any right of the Company to participate
in any distribution of the assets of its Subsidiaries upon the liquidation,
reorganization or insolvency thereof would be subject to the prior claims of
creditors (including trade creditors) and preferred stockholders (if any) of
such Subsidiaries, except to the extent the claims of the Company itself as a
creditor or preferred stockholder of its Subsidiaries may be recognized. As a
result, the Debt Securities will be structurally subordinated to any
indebtedness or preferred stock of the Company's Subsidiaries. Except as
described below, the Indenture does not limit the amount of other indebtedness
or securities that may be issued by the Company or its Subsidiaries, nor does
it restrict transactions between the Company and its affiliates, the payment of
dividends and other distributions by the Company to its stockholders, the
making of investments by the Company or the transfer of assets by the Company
to its Subsidiaries.
Unless otherwise indicated in a Prospectus Supplement, the Debt Securities
will not benefit from any covenant or other provision that would afford Holders
of such Debt Securities special protection in the event of either a change in
control of the Company or a highly leveraged transaction involving the Company,
except for any such protection provided by the provisions described below under
"-Limitation on Liens" or "-Limitation on Sale/Leaseback Transactions."
Reference is made to the Prospectus Supplement for the following terms of
the Offered Debt Securities: (i) the title and aggregate principal amount of
the Offered Debt Securities; (ii) the date or dates on which the Offered Debt
Securities will mature; (iii) the rate or rates (which may be fixed or
variable) per annum, if any, at which the Offered Debt Securities will bear
interest or the method of determining such rate or rates; (iv) the date or
dates from which such interest, if any, will accrue, the date or dates at which
such interest, if any, will be payable and the record date or dates for the
interest payable on any Offered Debt Securities on any interest payment date;
(v) the place or places at which and the manner in which the principal of, or
premium or interest on, the Offered Debt Securities will be payable and the
place or places at which the Offered Debt Securities may be surrendered for
transfer or registration; (vi) the price or prices (expressed as a percentage
of the aggregate principal amount thereof) at which the Offered Debt Securities
will be offered; (vii) the terms for redemption or early payment, if any,
including any mandatory or optional sinking fund or analogous provision, and
(if applicable) provisions relating to the assignment of the Company's rights
under the Indenture; (viii) whether the Offered Debt Securities will be issued
in fully registered form or in bearer form or any combination thereof; (ix)
whether the Offered Debt Securities will be issued in the form of one or more
global securities and whether such global securities are to be issuable in
temporary global form or permanent global form; (x) the denominations in which
the Offered Debt Securities will be issuable; (xi) if other than U.S. dollars,
the currency, currencies or currency unit or units in which the Offered Debt
Securities will be denominated and in which the principal of, and premium (if
any) and interest on, the Offered Debt Securities will be payable; (xii)
whether, and the terms and conditions on which, the Company or a Holder may
elect that payment of principal of, or premium or interest on, such Offered
Debt Securities is to be made in a currency or currencies or currency unit or
units other than that in which such Offered Debt Securities are denominated;
(xiii) if the amount of payments of principal of, or premium or interest on,
the Offered Debt Securities may be determined with reference to an index, the
manner in which such amounts shall be determined; (xiv) information with
respect to book-entry procedures, if any; and (xv) any other specific terms of
the Offered Debt Securities (which terms shall not be inconsistent with the
provisions of the Indenture). Reference is also made to the Prospectus
Supplement for information with respect to any additional covenants that may be
included in the terms of the Offered Debt Securities. (Section 301)
Offered Debt Securities may be sold at a discount (which may be substantial)
below their stated principal amount and may bear no interest or interest at a
rate which at the time of issuance is below market rates. Any material United
States federal income tax consequences and other special considerations
applicable thereto will be described in the Prospectus Supplement relating to
any such Offered Debt Securities.
No service charge will be made for any registration of transfer or exchange
of the Debt Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge payable in connection therewith.
(Section 305)
If any Offered Debt Securities are sold for any foreign currency or currency
unit or if the principal of, or premium or interest on, any Offered Debt
Securities is payable in any foreign currency or currency unit, the
restrictions, elections, tax consequences, specific terms and other information
with respect to such Offered Debt Securities and such foreign currency or
currency unit will be set forth in the Prospectus Supplement relating thereto.
The Indenture and the Offered Debt Securities will be governed by and
construed in accordance with the laws of the State of New York. (Section 113)
Limitation on Liens. The Indenture provides that the Company and its
Subsidiaries will not issue, create, incur, assume or suffer to exist any Lien
securing Debt on any property or asset without making effective provision
whereby any and all Debt Securities of any series then or thereafter
outstanding will be secured by a Lien equally and ratably with (or, at the
Company's option, prior to) any and all obligations thereby secured for so long
as any such obligations shall be so secured. The foregoing restriction will
not, however, apply to the Company and its Subsidiaries with respect to: Liens
existing on the date of the Indenture (or provided for in after-acquired
property clauses under the terms of agreements existing on such date); Liens on
any property or other assets to secure Debt incurred for the purpose of (a)
financing all or any part of the consideration used to acquire such property or
other assets and incurred prior to, at the time of, or within 12 months after,
such acquisition or (b) financing all or any part of the cost of construction,
improvement, development or expansion of such property or other assets
including, without limitation, Liens to secure Debt incurred in connection with
the construction, installation or financing of pollution control or abatement
facilities or other forms of industrial revenue or development bond financing,
which Liens extend solely to the property which is the subject thereof; Liens
on any property or other assets existing at the time of acquisition thereof by
the Company or its Subsidiaries, including acquisition through merger,
consolidation or the purchase of property or other assets, provided that such
Liens do not extend to other property or assets of the Company or its
Subsidiaries; Liens resulting from a judgment or award contested in good faith;
Liens to secure Debt issued or guaranteed by the United States or any state or
any department, agency or instrumentality of the United States or any state,
which Liens extend solely to the property that is the subject thereof; Liens
upon receivables and other assets or properties and the proceeds thereof that
may be granted or arise in connection with the transfer, securitization or
factoring of some or all of the Company's and its Subsidiaries' receivables;
Liens that secure only Debt owing by a Subsidiary to the Company or by the
Company to a Subsidiary or by a Subsidiary to another Subsidiary; Liens
required by any contract or statute in order to permit the Company or a
Subsidiary to perform any contract or subcontract made by it with or at the
request of the United States, any State or any department, agency or
instrumentality of either; Liens arising out of pledges or deposits under
worker's compensation laws, unemployment insurance, old age pensions or other
social security or retirement benefits or similar legislation; Liens imposed by
law, such as carriers', warehousemen's, landlords', materialmen's, repairmen's
and mechanics' liens and other similar liens arising in the ordinary course of
business; certain Liens for taxes, assessments or governmental charges or
levies; and Liens to secure Debt incurred to extend, refinance, renew, replace
or refund (or successive extensions, refinancings, renewals, replacements or
refundings) of any Debt secured by any Lien referred to in the foregoing
clauses so long as the principal amount of such Debt so secured is not
increased. (Section 1005)
Notwithstanding the foregoing, the Company and its Subsidiaries may, without
equally and ratably securing the Debt Securities of any series, issue, assume
or guarantee Debt secured by Liens in addition to those permitted by the
foregoing paragraph and renew, extend or replace such Liens, provided that the
aggregate principal amount of Debt so secured by any such Lien plus any
Attributable Debt (as defined below) does not at any one time exceed 15% of
Consolidated Net Tangible Assets as shown on the balance sheet of the Company
as of the end of the most recent fiscal quarter prior to the incurrence of the
Debt for which a balance sheet is available.
"Capitalized Lease Obligation" of any Person means any obligation that is
required to be classified and accounted for as a capital lease on a balance
sheet of such Person in accordance with generally accepted accounting
principles. (Section 101)
"Consolidated Net Tangible Assets" means the total amount of assets (less
applicable reserves and other properly deductible items) of the Company and its
Subsidiaries on a consolidated basis after deducting therefrom: (i) all current
liabilities (excluding any thereof which are by their terms extendable or
renewable at the option of the obligor thereon to a time more than twelve
months after the time as of which the amount thereof is being computed) and
(ii) all goodwill, trade names, trademarks, patents, unamortized debt discount
and other like intangible assets. (Section 101)
"Debt" means (without duplication), with respect to the Company and its
Subsidiaries, all obligations of the Company and its Subsidiaries, whether
evidenced by bonds, debentures, notes or other similar instruments, for
repayment of borrowed money, provided, that if the Debt is nonrecourse, the
amount of Debt shall be limited to the value of the assets securing the Debt,
all Capitalized Lease Obligations of the Company and its Subsidiaries, all Debt
of other Persons secured by a Lien on any asset of the Company or its
Subsidiaries, whether or not such Debt is assumed by the Company or its
Subsidiaries, and all Debt of other Persons guaranteed, directly or indirectly,
by the Company or its Subsidiaries to the extent of such guarantee. (Section
101)
"Lien" means, with respect to any property or assets, any mortgage or deed
of trust, pledge, charge, security interest, assignment, encumbrance,
conditional sale or other title retention agreement; provided, however, that
Lien shall not include a trust established for the purpose of defeasing any
Debt pursuant to the terms evidencing or providing for the issuance of such
Debt if the assets of such trust are limited to cash and U.S. Government
Obligations. (Section 101)
"Senior Indebtedness" means Debt of the Company that ranks at least pari
passu with the Debt Securities. (Section 101)
"Subsidiary" of a Person means any corporation more than 50% of the
outstanding securities having ordinary voting power of which is owned, directly
or indirectly, by such Person or by one or more of its Subsidiaries, or by such
Person and one or more of its Subsidiaries, or any partnership or similar
business organization more than 50% of the ownership interests having ordinary
voting power of which shall at the time be so owned. For the purposes of this
definition, securities or ownership interests "having ordinary voting power"
means securities or other equity interests that ordinarily have voting power
for the election of directors, or persons having management power with respect
to the Person, whether at all times or only so long as no senior class of
securities has such voting power by reason of any contingency. (Section 101)
Limitation on Sale/Leaseback Transactions. The Indenture provides that the
Company and its Subsidiaries will not enter into any Sale/Leaseback Transaction
with any Person (other than the Company and its Subsidiaries) unless either:
(i) the Company and its Subsidiaries would be entitled to incur Debt, in a
principal amount equal to the Attributable Debt with respect to such
Sale/Leaseback Transaction, secured by a Lien on the property subject to such
Sale/Leaseback Transaction pursuant to the covenant described under
"-Limitation on Liens" above without equally and ratably securing the Debt
Securities pursuant to such covenant; (ii) after the date of the original
issuance of the Offered Debt Securities and within a period commencing six
months prior to the effective date of such Sale/Leaseback Transaction and
ending six months thereafter, the Company or its Subsidiaries has expended or
will expend for any property (including amounts expended for the acquisition
thereof, and for additions, alterations, improvements and repairs thereto) an
amount equal to all or a portion of the net proceeds received from such
transaction and elects to designate such amount as a credit against the
application of the restrictions set forth hereunder and under "-Limitation on
Liens" to such transaction (with any such amount not being so designated to be
applied as set forth in (iii) below); or (iii) the Company, during or
immediately after the expiration of the six months after the effective date of
any such Sale/Leaseback Transaction, applies to the voluntary defeasance or
retirement of the Debt Securities of any series or any of the Company's other
Senior Indebtedness an amount equal to the greater of the net proceeds of the
sale or transfer of the property leased in such transaction or the Attributable
Debt as determined by the Company in an officer's certificate delivered to the
Trustee at the time of entering into such transaction (in either case adjusted
to reflect the remaining term of the lease and any amount utilized by the
Company or its Subsidiaries as set forth in (ii) above), less an amount equal
to the principal amount of the Debt Securities of any series delivered within
six months after the date of such arrangement to the Trustee for retirement and
cancellation, excluding retirements of Debt Securities of any series or of any
Senior Indebtedness pursuant to mandatory sinking fund or mandatory prepayment
provisions or by payment at maturity. (Section 1006)
"Attributable Debt," when used in connection with a Sale/Leaseback
Transaction, means, at the time of determination, the then present value of the
total net amount of rent required to be paid under the lease in respect of such
Sale/Leaseback Transaction during the remaining term thereof (including any
period for which such lease has been extended) or until the earlier date on
which the lessee may terminate such lease upon payment of a penalty or a lump-
sum termination payment (in which case the total net rent shall include such
penalty or termination payment), computed by discounting from the respective
due dates to such dates such total net amount of rent at the actual interest
factor included in such rent or implicit in the terms of the applicable
Sale/Leaseback Transaction, as determined in good faith by the Company. For
purposes of the foregoing definition, rent shall not include amounts required
to be paid by the lessee, whether or not designated as rent or additional rent,
on account of or contingent upon the amount of sales or deliveries, maintenance
and repair, insurance, taxes, assessments, water rates and similar charges.
(Section 101)
"Sale/Leaseback Transaction" means any arrangement with any Person providing
for the leasing by the Company or its Subsidiaries, for a period of more than
three years of any property or assets, which property or assets have been or
are to be sold or transferred by the Company or its Subsidiaries to such Person
in contemplation of such leasing. (Section 101)
Events of Default. Unless otherwise provided in a Prospectus Supplement with
respect to any series of Debt Securities, the following shall constitute Events
of Default under the Indenture with respect to the Debt Securities of such
series issued under such Indenture: (i) failure to pay principal of, or
premium, if any, on, any Debt Security of such series when due at final
maturity; (ii) failure to pay any interim principal payment or any interest on
any Debt Security of such series when due, and continuance of such default for
a period of 30 days; (iii) failure to deposit any mandatory sinking fund
payment or analogous obligation, when due, in respect of the Debt Securities of
such series, and continuance of such default for a period of 30 days; (iv)
failure to observe or perform any other covenant of the Company in the
Indenture (other than a covenant included in the Indenture for the benefit of a
series of Debt Securities other than such series), continued for a period of 60
days after written notice of such failure as provided in the Indenture; (v)
certain events of bankruptcy, insolvency or reorganization; (vi) failure to pay
at final maturity, or upon the declaration of acceleration of payment of, Debt
for borrowed money of the Company or any Subsidiary of the Company (other than
a failure to pay being contested in good faith by the Company or its
Subsidiaries with respect to Debt consisting of an obligation to pay all or
part of the acquisition consideration of an acquired business or asset) of $10
million or more (whether the Debt now exists or is hereafter created) as a
result of the occurrence of one or more events of default as defined in any
mortgages, indentures or instruments under which such Debt may have been issued
or by which such Debt may have been secured, and the failure to pay is not
cured or the acceleration is not rescinded, annulled or cured, in any case
prior to the expiration of 30 days after the date the failure to pay or
acceleration occurred; and (vii) any other Event of Default as may be specified
with respect to Debt Securities of such series. (Section 501)
If an Event of Default (except for an Event of Default described in clause
(v) above) with respect to any outstanding series of Debt Securities occurs and
is continuing, either the Trustee or the Holders of at least 25% in principal
amount of the outstanding Debt Securities of such series may declare the unpaid
principal amount (or, if the Debt Securities of that series are discounted Debt
Securities, such portion of the principal amount as may be specified in the
terms of that series) of all the Debt Securities of the applicable series and
the interest, if any, accrued thereon to be due and payable immediately. If an
Event of Default with respect to Debt Securities of any series at any time
outstanding described in clause (v) above occurs and is continuing, then the
principal amount of all the Debt Securities of such series will be immediately
due and payable without any act on the part of the Trustee or any Holder. At
any time after a declaration or occurrence of acceleration has been made, but
before a judgment or decree based on acceleration has been obtained, the
Holders of a majority in principal amount of the outstanding Debt Securities of
such series may, under certain circumstances, rescind and annul such
acceleration and its consequences; provided that no such rescission or
annulment shall extend to or otherwise affect any subsequent default or impair
any right consequent thereon. (Section 502) Depending on the terms of other
indebtedness of the Company outstanding from time to time, an Event of Default
under the Indenture may give rise to cross defaults on such other indebtedness
of the Company.
The Indenture provides that the Trustee will, within 90 days after the
occurrence of a default (defined herein) in respect of any series of Debt
Securities, give to the Holders of the Debt Securities of such series notice of
all uncured and unwaived defaults known to it; provided, however, that, except
in the case of a default in the payment of the principal of (or premium, if
any) or any interest on, or any sinking fund installment with respect to, any
Debt Securities of such series, the Trustee will be protected in withholding
such notice if it in good faith determines that the withholding of such notice
is in the interest of the Holders of the Debt Securities of such series; and
provided, further, that such notice shall not be given until at least 30 days
after the occurrence of a default in the performance, or breach, of any
covenant or warranty of the Company under such Indenture other than for the
payment of the principal of (or premium, if any) or any interest on, or any
sinking fund installment with respect to, any Debt Securities of such series.
For the purpose of this provision, "default" with respect to Debt Securities of
any series means any event which is, or after notice or lapse of time, or both,
would become, an Event of Default with respect to the Debt Securities of such
series. (Section 602)
The Holders of a majority in principal amount of the outstanding Debt
Securities of any series (or, in certain cases, all outstanding Debt Securities
under the Indenture) have the right, subject to certain limitations, to direct
the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee with respect to the Debt Securities of such series (or of all
outstanding Debt Securities under the Indenture). (Section 511) The Indenture
provides that in case an Event of Default shall occur and be continuing, the
Trustee shall exercise such of its rights and powers under the Indenture and
use the same degree of care and skill in their exercise as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs. (Section 601) Subject to such provisions, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders of the Debt Securities unless they
shall have offered to the Trustee reasonable security or indemnity against the
costs, expenses and liabilities that might be incurred by it in compliance with
such request or direction. (Section 603)
The Holders of a majority in principal amount of the outstanding Debt
Securities of any series (or, in certain cases, all Debt Securities outstanding
under the Indenture) may, on behalf of the Holders of all Debt Securities of
such series (or of all Debt Securities outstanding under the Indenture), waive
any past default under the Indenture, except a default in the payment of the
principal of (or premium, if any) or interest on any Debt Security or in
respect of a provision which under the applicable Indenture cannot be modified
or amended without the consent of the Holder of each outstanding Debt Security
affected. (Section 512) The Holders of a majority in principal amount of the
outstanding Debt Securities affected thereby may, on behalf of the Holders of
all such Debt Securities, waive compliance by the Company with certain
restrictive provisions of the Indenture. (Section 1008)
The Company is required to furnish to the Trustee annually a statement as to
the performance by the Company of certain of its obligations under the
Indenture and as to any default in such performance. (Section 1007)
Modification of the Indenture. Modifications of and amendments to the
Indenture may be made by the Company and the Trustee with the consent of the
Holders of a majority in principal amount of the outstanding Debt Securities
under the Indenture affected thereby; provided, however, that no such
modification or amendment may, without the consent of the Holder of each
outstanding Debt Security affected thereby (i) change the Stated Maturity date
of the principal of, or any installment of principal of or interest on, any
Debt Security; (ii) reduce the principal amount of, or the premium (if any) or
interest on, any Debt Security; (iii) change the place or currency, currencies,
or currency unit or units of payment of principal of, or premium (if any) or
interest on, any Debt Security; (iv) alter the method of computation of any
amount payable on redemption, repayment or purchase, if any; (v) impair the
right to institute suit for the enforcement of any payment on or with respect
to any Debt Security; or (vi) reduce the percentage in principal amount of
outstanding Debt Securities the consent of the Holders of which is required for
modification or amendment of the Indenture or for waiver of compliance with
certain provisions of the Indenture or for waiver of certain defaults. (Section
902)
The Indenture provides that the Company and the Trustee may, without the
consent of any Holders of Debt Securities, enter into supplemental indentures
for the purposes, among other things, of (i) adding to the Company's covenants
or adding additional Events of Default for the protection of the Holders of the
Debt Securities, (ii) establishing the form or terms of Debt Securities of any
series, (iii) evidencing the acceptance of appointment by a successor trustee,
(iv) securing Debt Securities of any series, (v) evidencing the assumption by a
successor Person of the obligations of the Company or (vi) curing ambiguities
or inconsistencies in the Indenture, provided that such action to cure
ambiguities or inconsistencies shall not adversely affect the interests of the
Holders of the Debt Securities. (Section 901)
Limitations on Mergers, Consolidations and Sale of Assets. The Indenture
provides that the Company will not consolidate with or merge into any Person,
or sell, lease, convey, transfer or otherwise dispose of all or substantially
all of its assets to any Person, unless: (i) the Person formed by or surviving
such consolidation or merger (if other than the Company), or to which such
sale, lease, conveyance, transfer or other disposition shall be made
(collectively, the "Successor"), is a corporation, partnership or trust
organized and existing under the laws of the United States or any State thereof
or the District of Columbia, and the Successor assumes by supplemental
indenture in a form satisfactory to the Trustee all of the obligations of the
Company under the Indenture and the Debt Securities; (ii) immediately after
giving effect to such transaction and treating any Debt that becomes an
obligation of the Company or its Subsidiaries as a result thereof as having
been incurred by the Company or its Subsidiaries at the time of such
transaction, no Event of Default, and no event which, after notice or lapse of
time or both, would become an Event of Default, shall have occurred and be
continuing; (iii) if, as a result of such transaction, property or assets of
the Company or its Subsidiaries would become subject to a Lien prohibited by
the provisions described under "-- Limitation on Liens," the Company or the
Successor shall have secured the Debt Securities as required by that covenant;
and (iv) the Company shall have delivered to the Trustee an Officer's
Certificate and Opinion of Counsel, each stating that such merger,
consolidation, sale or conveyance and such supplemental indenture, if any,
complies with the Indenture. (Section 801) Upon any such consolidation, merger
or asset transfer, the Successor shall be substituted for the Company and,
thereafter (except in the case of a lease) the Company shall be relieved of all
obligations and covenants under the Indenture and the Debt Securities. (Section
802)
Discharge and Defeasance. The Company may terminate its obligations under
the Indenture, other than its obligation to pay the principal of (and premium,
if any) and interest on the Debt Securities of any series and certain other
obligations, if it: (i) irrevocably deposits or causes to be irrevocably
deposited with the Trustee as trust funds cash or U.S. Government Obligations,
or a combination thereof, maturing as to principal and interest sufficient to
pay the principal of, any premium on, any interest on, and any mandatory
sinking fund payments in respect of, all outstanding Debt Securities of such
series on the Stated Maturity of such payments or on any Redemption Date; (ii)
delivers to the Trustee an Opinion of Counsel to the effect that the Holders of
Debt Securities of such series will not recognize income, gain or loss for
United States federal income tax purposes as a result of such deposit,
satisfaction and discharge and will be subject to United States federal income
tax on the same amount and in the same manner and at the same time as would
have been the case if such deposit, satisfaction and discharge had not
occurred; and (iii) complies with any additional conditions specified to be
applicable with respect to the covenant defeasance of Debt Securities of such
series. (Section 401)
The terms of any series of Debt Securities may also provide for legal
defeasance. In such case, if the Company: (i) irrevocably deposits or causes to
be irrevocably deposited cash or U.S. Government Obligations or a combination
thereof as described above; (ii) delivers to the Trustee the Opinion of Counsel
as described above, except that the opinion must state that it is based on a
ruling by the Internal Revenue Service or other change since the date of the
Indenture under applicable Federal income tax law; (iii) makes a request to the
Trustee to be discharged from its obligations on the Debt Securities of such
series; and (iv) complies with any additional conditions specified to be
applicable with respect to legal defeasance of Debt Securities of such series,
then the Company shall be deemed to have paid and discharged the entire
indebtedness on all the outstanding Debt Securities of such series, and the
obligations of the Company under the Indenture and the Debt Securities of such
series, to pay the principal of (and premium, if any) and interest on the Debt
Securities of such series shall cease, terminate and be completely discharged,
and the Holders thereof shall thereafter be entitled only to payment out of the
cash or U.S. Government Obligations deposited with the Trustee as aforesaid,
unless the Company's obligations are revived and reinstated because the Trustee
is unable to apply such trust fund by reason of any legal proceeding, order or
judgment. (Sections 403 and 404)
Notwithstanding the foregoing, no discharge or defeasance described above
shall affect the following obligations to or rights of the Holders of any
series of Debt Securities: (i) rights of registration of transfer and exchange
of Debt Securities of such series; (ii) rights of substitution of mutilated,
defaced, destroyed, lost or stolen Debt Securities of such series, if
applicable; (iii) rights of Holders of Debt Securities of such series to
receive payments of principal thereof and premium and interest, if any, thereon
when due and to receive mandatory sinking fund payments, if any, thereon when
due from the trust funds held by the Trustee; (iv) the rights, obligations,
duties and immunities of the Trustee; (v) the rights of holders of Debt
Securities of such series as beneficiaries with respect to property deposited
with the Trustee payable to all or any of them; and (vi) the obligations of the
Company to maintain an office or agency in respect of Debt Securities of such
series.
"U.S. Government Obligations" is defined in the Indenture as direct
noncallable obligations of, or noncallable obligations the payment of principal
of and interest on which is guaranteed by, the United States of America, or to
the payment of which obligations or guarantees the full faith and credit of the
United States of America is pledged, or beneficial interests in a trust the
corpus of which consists exclusively of money or such obligations or a
combination thereof. (Section 101)
Form, Exchange, Registration and Transfer. Debt Securities are issuable in
definitive form as Registered Debt Securities, as Bearer Debt Securities or
both. (Section 301) Reference is made to the Prospectus Supplement for the
terms relating to the form, exchange, registration and transfer of Bearer Debt
Securities (which may be more or less restrictive than terms described herein
for Registered Debt Securities) and Debt Securities issuable in temporary or
permanent global forms.
Registered Debt Securities of any series will be exchangeable for other
Registered Debt Securities of the same series and of a like aggregate principal
amount and tenor of different authorized denominations. (Section 305)
Registered Debt Securities may be presented for registration of transfer
(with the form of transfer endorsed thereon duly executed), at the office of
the Security Registrar or at the office of any transfer agent designated by the
Company for such purpose with respect to any series of Debt Securities and
referred to in an applicable Prospectus Supplement, without service charge and
upon payment of any taxes and other governmental charges as described in the
Indenture. Such transfer or exchange will be effected upon the Security
Registrar in accordance with the terms of the Indenture. The Company has
appointed the Trustee as Security Registrar. (Section 305) If a Prospectus
Supplement refers to any transfer agents (in addition to the Security
Registrar) initially designated by the Company with respect to any series of
Debt Securities, the Company may at any time rescind the designation of any
such transfer agent or approve a change in the location through which any such
transfer agent acts, except that if Debt Securities of a series are issuable
solely as Registered Debt Securities, the Company will be required to maintain
a transfer agent in each Place of Payment for such series. The Company may at
any time designate additional transfer agents with respect to any series of
Debt Securities. (Section 1002)
In the event of any redemption in part, the Company shall not be required
to: (i) issue, register the transfer of or exchange Registered Debt Securities
of any series during a period beginning at the opening of business 15 days
prior to the mailing of a notice of redemption and ending on the close of
business on the day of mailing of the relevant notice of redemption; or (ii)
register the transfer of or exchange any Registered Debt Security, or portion
thereof, called for redemption, except the unredeemed portion of any Registered
Debt Security being redeemed in part. (Section 305)
Payment and Paying Agents. Unless otherwise indicated in an applicable
Prospectus Supplement, payment of principal of and any premium and interest on
Registered Debt Securities will be made in the designated currency or currency
unit at the office of such Paying Agent or Paying Agents as the Company may
designate from time to time, except that, at the option of the Company, payment
of any interest may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register. Unless
otherwise indicated in an applicable Prospectus Supplement, payment of any
installment of interest on Registered Debt Securities will be made to the
Person in whose name such Registered Debt Security is registered at the close
of business on the Regular Record Date for such interest. (Section 307)
Unless otherwise indicated in an applicable Prospectus Supplement, the
Corporate Trust Office of the Trustee in New York, New York, will be designated
as a Paying Agent for the Company for payments with respect to Debt Securities
which are issuable solely as Registered Debt Securities. The Company may at any
time designate additional Paying Agents or rescind the designation of any
Paying Agent or approve a change in the office through which any Paying Agent
acts, except that the Company will be required to maintain a Paying Agent in
each Place of Payment for such series. (Section 1002)
All moneys paid by the Company to a Paying Agent for the payment of
principal of and any premium or interest on any Debt Security which remain
unclaimed at the end of two years after such principal, premium or interest
shall have become due and payable will (subject to applicable escheat laws) be
repaid to the Company, and the Holder of such Debt Security or any coupon will
thereafter look only to the Company for payment thereof. (Section 1003)
Global Securities. The Offered Debt Securities of a series may be issued in
whole or in part in the form of one or more global securities ("Global
Securities") that will be issued to and registered in the name of the
depositary (the "Depositary") identified in the Prospectus Supplement, or its
nominee, relating to such series. Global Securities may be issued in either
registered or bearer form and in either temporary or permanent form. Unless and
until a Global Security is exchanged in whole or in part for the individual
Debt Securities represented thereby, such Global Security may not be
transferred except as a whole by the Depositary to its nominee, or by a nominee
of such Depositary to such Depositary or another nominee of such Depositary, or
by such Depositary or any such nominee to a successor Depositary or nominee of
such successor Depositary. (Section 204)
The specific terms of the depositary arrangement with respect to a series of
Offered Debt Securities will be described in the Prospectus Supplement relating
to such series. The Company anticipates that the following provisions will
generally apply to depositary arrangements.
Upon the issuance of a Global Security, the Depositary or its nominee will
credit, on its book-entry registration and transfer system, the respective
principal amounts of the individual Debt Securities represented by such Global
Security to the accounts of persons that have accounts with the Depositary.
Such accounts shall be designated by the dealers, underwriters or agents with
respect to such Debt Securities or by the Company if such Debt Securities are
offered and sold directly by the Company. Ownership of beneficial interests in
a Global Security will be limited to persons that have accounts with the
Depositary ("Participants") or persons that may hold interests through
Participants. Ownership of beneficial interests in such Global Security will be
shown on, and the transfer of that ownership will be effected only through,
records maintained by the Depositary or its nominee (with respect to interests
of Participants) and the records of Participants (with respect to interests of
persons other than Participants). The laws of some states require that certain
purchasers of securities take physical delivery of such securities in
definitive form. Such limits and such laws may impair the ability to transfer
beneficial interests in a Global Security.
So long as the Depositary or its nominee is the registered owner of a Global
Security, such registered owner will be considered the sole owner or holder of
the Debt Securities represented by such Global Security for all purposes under
the Indenture. Except as provided below, owners of beneficial interests in a
Global Security will not be entitled to have any of the individual Debt
Securities represented by such Global Security registered in their names, will
not receive or be entitled to receive physical delivery of any such Debt
Securities in definitive form and will not be considered the owners or holders
thereof under the Indenture.
Payments of principal of and premium, if any, and interest, if any, on Debt
Securities represented by a Global Security registered in the name of the
Depositary or its nominee will be made to the Depositary or its nominee, as the
case may be, as the registered owner of the Global Security representing such
Debt Securities. None of the Company, the Trustee, any Paying Agent or the
Security Registrar for such Debt Securities will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests of the Global Security for such Debt
Securities or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
The Company expects that the Depositary or its nominee, immediately upon
receipt of any payment of principal, premium or interest in respect of a Global
Security, will credit Participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal amount
of such Global Security as shown on the records of the Depositary or its
nominee. The Company also expects that payments by Participants to owners of
beneficial interests in such Global Security held through such Participants
will be governed by standing instructions and customary practices, as is now
the case with securities held for the accounts of customers in bearer form or
registered in "street name." Such payments will be the sole responsibility of
such Participants.
The Company has no control over the practices of the Depositary or the
Participants, and there can be no assurance that these practices will not be
changed. If the Depositary for a series of Debt Securities is at any time
unwilling, unable or ineligible to continue as depositary and a successor
depositary is not appointed by the Company by the effective date of the
resignation of the Depositary, the Company will issue individual Debt
Securities of such series in exchange for the Global Security representing such
series of Debt Securities. In addition, the Company may at any time and in its
sole discretion, subject to any limitations described in the Prospectus
Supplement relating to such Debt Securities, determine not to have any Debt
Securities of a series represented by one or more Global Securities and, in
such event, will issue individual Debt Securities of such series in exchange
for the Global Security representing such series of Debt Securities. In any
such instance, an owner of a beneficial interest in a Global Security will be
entitled to physical delivery of individual Debt Securities of the series
represented by such Global Security equal in principal amount to such
beneficial interest and to have such Debt Securities registered in its name.
Individual Debt Securities of such series so issued will be issued in
denominations, unless otherwise specified by the Company, of $1,000 and
integral multiples thereof.
Meetings. The Indenture contains provisions for convening meetings of the
Holders of Debt Securities of a series. (Section 1301) A meeting may be called
at any time by the Trustee, and also, upon request, by the Company or the
Holders of at least 10% in principal amount of the Outstanding Debt Securities
of such series, in any such case upon notice given as described under
"-Notices" below. (Section 1302) Except for any consent that must be given by
the Holder of each Outstanding Debt Security affected thereby, as described
under "-Modification of the Indenture" above, any resolution presented at a
meeting or adjourned meeting at which a quorum is present may be adopted by the
affirmative vote of the Holders of a majority in principal amount of the
Outstanding Debt Securities of that series; provided, however, that except for
any consent that must be given by the Holder of each Outstanding Debt Security
affected thereby, as described under "-Modification of the Indenture" above,
any resolution with respect to any request, demand, authorization, direction,
notice, consent, waiver or other action that may be made, given or taken by the
Holders of a specified percentage, which is less than a majority in principal
amount of the Outstanding Debt Securities of a series, may be adopted at a
meeting or adjourned meeting duly reconvened at which a quorum is present by
the affirmative vote of the Holders of such specified percentage in principal
amount of the Outstanding Debt Securities of that series. Subject to the
proviso set forth above, any resolution passed or decision taken at any meeting
of Holders of Debt Securities of any series duly held in accordance with the
Indenture will be binding on all Holders of Debt Securities of that series and
any related coupons. The quorum at any meeting called to adopt a resolution,
and at any reconvened meeting, will be Persons holding or representing a
majority in principal amount of the Outstanding Debt Securities of a series.
(Section 1304)
Notices. Notices to Holders of Registered Debt Securities will be given by
mail to the addresses of such Holders as they appear in the Security Register.
(Section 107)
The Trustee. The Indenture contains certain limitations on the right of the
Trustee, as a creditor of the Company, to obtain payment of claims in certain
cases and to realize on certain property received with respect to any such
claims, as security or otherwise. (Section 613) The Trustee is permitted to
engage in other transactions, except that if it acquires any conflicting
interest (as defined), it must eliminate such conflict or resign. (Section 608)
The Trustee may make loans to the Company and its Subsidiaries and
affiliates from time to time in the ordinary course of business and at
prevailing interest rates. In addition, the Trustee may from time to time serve
as a depositary of funds of, and perform other services for, the Company and
its Subsidiaries and affiliates.
PLAN OF DISTRIBUTION
The Company may sell the Securities directly to one or more purchasers or to
or through underwriters, dealers or agents. Any such underwriters, dealers or
agents involved in the offer and sale of Securities will be named in the
Prospectus Supplement relating thereto. The Prospectus Supplement with respect
to such Securities will set forth the terms of the offering of the Securities,
including the purchase price of the Securities and the proceeds to the Company
from such sale, any underwriting discounts and other items constituting
underwriters' compensation, any initial public offering price and any discounts
or concessions allowed or reallowed or paid to dealers and any securities
exchanges on which the Securities may be listed.
The distribution of the Securities may be effected from time to time in one
or more transactions at a fixed price or prices, which may be changed, or at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices. The Prospectus Supplement
will describe the method of distribution of the Securities.
If underwriters are used in the sale, the Securities will be acquired by the
underwriters for their own account and may be resold from time to time in one
or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. The
Securities may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more of
such firms. If an underwriting syndicate is used, the managing underwriter or
underwriters will be set forth on the cover of the Prospectus Supplement.
Unless otherwise set forth in the Prospectus Supplement, the obligations of the
underwriters to purchase the Securities will be subject to certain conditions
precedent, and the underwriters will be obligated to purchase all the
Securities if any are purchased. Any initial public offering price and any
discounts or concessions allowed or reallowed or paid to dealers may be changed
from time to time.
If a dealer is used in an offering of Securities, the Company will sell such
Securities to the dealer, as principal. The dealer may then resell such
Securities to the public at varying prices to be determined by such dealer at
the time of sale. The terms of the transaction will be set forth in the
Prospectus Supplement relating thereto.
Any agent involved in the offer or sale of the Securities in respect of
which this Prospectus is delivered will be named, and any commissions payable
by the Company to such agent will be set forth (or the method by which such
commissions may be determined), in the Prospectus Supplement. Unless otherwise
indicated in the Prospectus Supplement, any such agent will be acting on a best
efforts basis for the period of its appointment.
If so indicated in the Prospectus Supplement, the Company will authorize
agents, underwriters or dealers to solicit offers by certain specified
institutions to purchase Securities from the Company at the public offering
price set forth in the Prospectus Supplement pursuant to delayed delivery
contracts providing for payment and delivery on a specified date in the future.
Such contracts will be subject only to those conditions set forth in the
Prospectus Supplement, and the Prospectus Supplement will set forth the
commission payable by the Company for solicitation of such contracts.
Dealers and agents named in a Prospectus Supplement may be deemed to be
underwriters (within the meaning of the Securities Act of 1933) of the
Securities. Underwriters, dealers and agents may be entitled under agreements
entered into with the Company to indemnification by the Company against certain
civil liabilities, including liabilities under the Securities Act of 1933, or
to contribution with respect to payments which the underwriters, dealers or
agents may be required to make in respect thereof. Underwriters, dealers and
agents may be customers of, engage in transactions with, or perform services
for the Company in the ordinary course of business.
There can be no assurance that a secondary market will be created for any of
the Securities or, if such a market is created, that it will continue.
LEGAL MATTERS
The validity of the Securities will be passed upon for the Company by Jones,
Walker, Waechter, Poitevent, Carrere & Denegre, L.L.P., New Orleans, Louisiana.
EXPERTS
The consolidated balance sheets of the Company as of October 31, 1996 and
1997 and the related consolidated statements of earnings, shareholders' equity
and cash flows for each of the three years in the period ended October 31,
1997, and the financial statement schedule incorporated by reference in this
Registration Statement, have been audited by PricewaterhouseCoopers LLP,
independent accountants, as stated in their reports with respect thereto, and
are incorporated by reference herein in reliance upon the authority of such
firm as experts in accounting and auditing.
NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE
HEREBY AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE UNDERWRITERS.
NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL
UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION THAT THERE HAS NOT BEEN ANY CHANGE
IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER OR SOLICITATION BY ANYONE IN ANY STATE IN WHICH SUCH OFFER
OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH THE PERSON MAKING SUCH OFFER OR
SOLICITATION IS NOT QUALIFIED TO DO SO OR TO ANYONE TO WHOM IT IS UNLAWFUL TO
MAKE SUCH OFFER OR SOLICITATION.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C>
Available Information 2
Documents Incorporated by Reference 2
The Company 3
Use of Proceeds 3
Ratio of Earnings to Fixed Charges 4
Description of Class A Common Stock 4
Description of Preferred Stock 5
Description of Debt Securities 5
Plan of Distribution 14
Legal Matters 15
Experts 15
$500,000,000
LOGO
STEWART
ENTERPRISES, INC.
CLASS A COMMON STOCK
PREFERRED STOCK
DEBT SECURITIES
PROSPECTUS
JULY 17, 1998
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. Other Expenses of Issuance and Distribution.
The estimated fees and expenses payable by the Company in connection with
the issuance and distribution of the Securities registered hereunder are as
follows:
Registration Fee $ 147,500
Printing Costs 120,000
Legal Fees and Expenses 150,000
Accounting Fees and Expenses 100,000
Rating Agents' Fees 250,000
Blue Sky Fees and Expenses 20,000
Trustee's and Registrar's Fees 15,000
Miscellaneous 97,500
---------
Total $ 900,000
=========
ITEM 15. Indemnification of Directors and Officers.
Section 83 of the Louisiana Business Corporation Law gives Louisiana
corporations broad powers to indemnify their present and former directors and
officers and those of affiliated corporations against expenses incurred in the
defense of any lawsuit to which they are made parties by reason of being or
having been such directors or officers; gives a director or officer who
successfully defends an action the right to be so indemnified, subject to
specific conditions and exclusions; and authorizes Louisiana corporations to
buy directors' and officers' liability insurance. Such indemnification is not
exclusive of any other rights to which those indemnified may be entitled under
any by-law, agreement, authorization of shareholders or otherwise.
The Company's By-laws make mandatory the indemnification of directors and
officers permitted by the Louisiana Business Corporation Law. The standard to
be applied in evaluating any claim for indemnification (excluding claims for
expenses incurred in connection with the successful defense of any proceeding
or matter therein for which indemnification is mandatory without reference to
any such standard) is whether the claimant acted in good faith and in a manner
he reasonably believed to be in, or not opposed to, the best interests of the
corporation. With respect to any criminal action or proceeding, the standard
is that the claimant had no reasonable cause to believe the conduct was
unlawful. No indemnification is permitted in respect of any claim, issue or
matter as to which a director or officer shall have been adjudged by a court of
competent jurisdiction to be liable for willful or intentional misconduct or to
have obtained an improper personal benefit, unless, and only to the extent that
the court shall determine upon application that, in view of all the
circumstances of the case, he is fairly and reasonably entitled to indemnity
for such expenses which the court shall deem proper.
The Company has in effect a directors' and officers' liability insurance
policy that provides for indemnification of its officers and directors against
losses arising from claims asserted against them in their capacities as
officers and directors, subject to limitations and conditions set forth in such
policy.
The Company has entered into indemnity agreements with each of its directors
and executive officers, pursuant to which the Company has agreed under certain
circumstances to purchase and maintain directors' and officers' liability
insurance, unless such insurance is not reasonably available or, in the
reasonable judgment of the Board of Directors, there is insufficient benefit to
the Company from such insurance. The agreements also provide that the Company
will indemnify each director and executive officer against any costs and
expenses, judgments, settlements and fines incurred in connection with any
claim involving him by reason of his position as director or officer that are
in excess of the coverage provided by any such insurance, provided that he
meets certain standards of conduct.
The Underwriters have also agreed to indemnify the directors and certain of
the Company's officers against certain liabilities under the Securities Act of
1933, as amended, or to contribute to payments that such directors and officers
may be required to make in respect thereof.
ITEM 16. Exhibits.
1.1 - Form of Equity Underwriting Agreement*
1.2 - Form of Debt Underwriting Agreement*
4.1 - Amended and Restated Articles of Incorporation of the Company, as
amended (incorporated by reference to Exhibit 3.1 to the Company's
Quarterly Report on Form 10-Q for the quarter ended January 31,
1996)
4.2 - By-laws of the Company, as amended (incorporated by reference to
Exhibit 3.2 to the Company's Annual Report on Form 10-K for the
fiscal year ended October 31, 1997)
4.3 - Specimen of Class A Common Stock certificate (incorporated by
reference to Exhibit 4.2 to Amendment No. 3 to the Company's
Registration Statement on Form S-1 (Registration No. 33-42336) filed
with the Commission on October 7, 1991)
4.4 - Indenture dated as of December 1, 1996 between the Company and
Citibank, N.A., as trustee (incorporated by reference to Exhibit 4
to the Company's Registration Statement on Form S-3 (Registration
No. 333-14467) filed with the Commission on October 18, 1996), as
supplemented by the First Supplemental Indenture dated as of April
24, 1998 between the Company and Citibank, N.A., as trustee
(incorporated by reference to Exhibit 4.1 to the Company's Current
Report on Form 8-K filed with the Commission on April 24, 1998)
5 - Opinion of Jones, Walker, Waechter, Poitevent, Carrere & Denegre,
L.L.P.
12 - Computation of ratio of earnings to fixed charges
23.1 - Consent of PricewaterhouseCoopers LLP
23.2 - Consent of Jones, Walker, Waechter, Poitevent, Carrere &
Denegre, L.L.P. (included in Exhibit 5)
24 - Power of Attorney (included in the signature pages to this
Registration Statement)
25 - Statement of Eligibility of Trustee on Form T-1 (incorporated by
reference to Exhibit 25 to the Company's Registration Statement on
Form S-3 (Registration No. 333-14467) filed with the Commission on
October 18, 1996)
____________
*To be filed by amendment.
ITEM 17. Undertakings.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of this registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this registration
statement or any material change to such information in this
registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's Annual Report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it had reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New Orleans, State of Louisiana, on July 16,
1998.
STEWART ENTERPRISES, INC.
By: /s/ Joseph P. Henican, III
Joseph P. Henican, III
Chief Executive Officer and
Vice Chairman of the Board
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
immediately below constitutes and appoints Frank B. Stewart, Jr., Joseph P.
Henican, III, William E. Rowe and Kenneth C. Budde, or any one of them, his
true and lawful attorney-in-fact and agent, with full power of substitution,
for him and in his name, place and stead, in any and all capacities, to sign
any and all amendments (including post-effective amendments) to this
Registration Statement, including any registration statement relating to the
same offering filed pursuant to Rule 462(b) under the Securities Act of 1933,
and to file the same with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto said attorney-in-fact and agent full power and authority to do and perform
each and every act and thing requisite and necessary to be done, as fully to
all intents and purposes as he might or could do in person, hereby ratifying
and confirming all that said attorney-in-fact and agent or his substitute or
substitutes may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
</TABLE>
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
<S> <C> <C>
/s/ Frank B. Stewart, Jr. Chairman of the Board July 16, 1998
Frank B. Stewart, Jr.
/s/ Joseph P. Henican, III Chief Executive Officer and July 16, 1998
Joseph P. Henican, III Vice Chairman of the Board
(Principal Executive Officer)
/s/ William E. Rowe President, Chief Operating July 16, 1998
William E. Rowe Officer and Director
/s/ Kenneth C. Budde Executive Vice President, President - July 16, 1998
Kenneth C. Budde Corporate Division, Chief Financial
Officer, Assistant Secretary
and Director
/s/ Darwin C. Fenner Director July 16, 1998
Darwin C. Fenner
/s/ John P. Laborde Director July 16, 1998
John P. Laborde
/s/ James W. McFarland Director July 16, 1998
James W. McFarland
/s/ Michael O. Read Director July 16, 1998
Michael O. Read
/s/ Dwight A. Holder Director July 16, 1998
Dwight A. Holder
</TABLE>
<PAGE>
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION
5 - Opinion of Jones, Walker, Waechter, Poitevent, Carrere &
Denegre, L.L.P.
12 - Computation of ratio of earnings to fixed charges
23.1 - Consent of PricewaterhouseCoopers LLP
23.2 - Consent of Jones, Walker, Waechter, Poitevent, Carrere &
Denegre, L.L.P. (included in Exhibit 5)
24 - Power of Attorney (included in the signature pages to this
Registration Statement)
JONES, WALKER Exhibit 5
WAECHTER, POITEVENT TO REGISTRATION STATEMENT
CARRERE & DENEGRE, L.L.P.
July 17, 1998
Stewart Enterprises, Inc.
110 Veterans Memorial Boulevard
Metairie, LA 70005
RE: Registration Statement on Form S-3
Stewart Enterprises, Inc. (the "Company")
Gentlemen:
We have acted as counsel to Stewart Enterprises, Inc. (the "Company")
in connection with the preparation of a registration statement on Form S-3
(the "Registration Statement") filed by the Company with the Securities
and Exchange Commission (the "Commission") on the date hereof relating to
the registration of the Company's debt securities ("Debt Securities"),
preferred stock ("Preferred Stock"), and Class A Common Stock ("Class A
Common Stock" and, collectively with the Debt Securities and Preferred
Stock, the "Securities") which may be issued from time to time in one or
more series in an aggregate amount not to exceed $500,000,000.
In rendering the opinions expressed below, we have examined original,
photostatic or certified copies of (i) the Company's Restated Articles of
Incorporation and Bylaws, each as amended to date, (ii) an Indenture dated
as of December 1, 1996 between the Company and Citibank, N.A. (the
"Trustee") as supplemented by a First Supplemental Indenture dated as of
April 24, 1998 between the Company and the Trustee (as supplemented, the
"Indenture") and (iii) such other records of the Company, certificates of
the Company's officers and public officials, and other documents as we
have deemed relevant. In such examination, we have assumed the
genuineness ofall signatures, the conformity to original documents of all
documents submitted to us as certified or photostatic copies and the
authenticity of the originals of such documents. We have also assumed the
legal capacity of all persons other than the Company signing such
documents and the authority of all persons signing on behalf of parties
thereto other than the Company.
Based upon the foregoing and subject to the following
qualifications and comments, we are of the opinion that:
1. The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Louisiana and has all
requisite corporate power and authority to issue the Securities.
2. Each series of Debt Securities to be issued under the Indenture
has been duly authorized by the Company's Board of Directors and will be
valid and binding obligations of the Company (except that the
enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer, or similar
laws or court decisions affecting the enforcement of creditors' rights
generally, public policy considerations that may limit the rights of
parties to obtain certain remedies, and except that the remedy of specific
performance and injunctive and other forms of equitable relief may be
subject to equitable defenses and to the discretion of the court before
which any proceeding therefor may be brought) when: (i) the
Registration Statement, as finally amended, shall have become effective
under the Securities Act of 1933, as amended (the "Act"); (ii) the
Company's Board of Directors, the Securities Pricing Committee thereof, or
an officer or officers duly authorized by such committee, shall have taken
all necessary corporate action to approve the issuance of such Debt
Securities and to establish the terms and conditions thereof; and (iii)
such Debt Securities shall have been duly executed by the Company and
authenticated as provided in the Indenture and shall have been duly
delivered to the purchasers thereof against payment of the agreed
consideration therefor in accordance with the applicable underwriting,
purchase or similar agreement.
3. The Class A Common Stock to be issued has been duly authorized
by the Company's Board of Directors and will be legally issued, fully paid
and non-assessable when: (i) the Registration Statement, as finally
amended, shall have become effective under the Act; (ii) the Company's
Board of Directors or the Securities Pricing Committee thereof shall have
taken all necessary corporate action to approve the issuance of the Class
A Common Stock; and (iii) such shares of Class A Common Stock shall have
been duly registered and delivered to the purchasers thereof against
payment of the agreed consideration therefor in accordance with the
applicable underwriting, purchase or similar agreement.
4. Each series of Preferred Stock will be legally issued, fully
paid and non-assessable when (i) the Registration Statement, as finally
amended, shall have become effective under the Act; (ii) the Company's
Board of Directors or the Securities Pricing Committee thereof shall have
taken all necessary corporate action to establish the terms and approve
the issuance of such series of Preferred Stock; (iii) Articles of
Amendment setting forth the terms of such series of Preferred Stock shall
have been duly executed, acknowledged and recorded and shall have become
effective in accordance with the Louisiana Business Corporation Law; and
(iv) such shares of Preferred Stock shall have been duly registered and
delivered to the purchasers thereof against payment of the agreed
consideration therefor in accordance with the applicable underwriting,
purchase or similar agreement.
The opinions rendered herein are limited to currently applicable
United States federal law and the laws of the States of New York and
Louisiana and assume that, as of any relevant time, there will not have
occurred any change in law affecting the validity or enforceability of the
Debt Securities. We assume no obligation to revise or supplement this
opinion should such currently applicable laws be changed by legislative
action, judicial decision or otherwise. We express no opinion as to the
application of the securities or blue sky laws of the various states to
the sale of any Debt Securities.
We consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us in the prospectus
forming a part thereof under the caption "Legal Matters." In giving this
consent, we do not admit that we are within the category of persons whose
consent is required under Section 7 of the Securities Act of 1933, as
amended, or the general rules and regulations of the Commission.
Yours very truly,
JONES, WALKER, WAECHTER,
POITEVENT, CARRERE & DENEGRE, L.L.P.
By: /S/ L.R. McMillan, II
------------------------------
L.R. McMillan, II
Exhibit 12
STEWART ENTERPRISES, INC.
AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
(DOLLARS IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
YEARS ENDED OCTOBER 31, SIX MONTHS
ENDED
1993 1994 1995 1996 1997 APRIL 30, 1998
<S> <C> <C> <C> <C> <C> <C>
Earnings (loss) from continuing
operations before income taxes $ 29,569 $ 42,198 $ 41,500 (1) $ 82,075 $ 106,477 (2) $ (6,260) (3)
Fixed charges:
Interest expense 6,540 8,877 22,815 26,051 38,031 20,027
Interest portion of lease expense 585 935 1,343 1,522 2,181 1,173
-------- -------- -------- --------- --------- --------
Total fixed charges 7,125 9,812 24,158 27,573 40,212 21,200
Earnings from continuing operations
before income taxes and fixed
charges $ 36,694 $ 52,010 $ 65,658 (1) $ 109,648 $ 146,689 (2) $ 14,940 (3)
======== ======== ======== ========= ========= ========
Ratio of earnings to fixed charges 5.15 5.30 2.72 (1) 3.98 3.65 (2) .70 (3)
======== ======== ======== ========= ========= ========
</TABLE>
(1) Includes a non-recurring, non-cash charge of $17,252 ($10,869 after-tax)
recorded in connection with the vesting of the Company's performance-based
stock options. Excluding the charge, the Company's ratio of earnings to
fixed charges would be 3.43.
(2) Excludes cumulative effect of change in accounting principles of $2,324
(net of $2,230 income tax benefit).
(3) Includes a non-recurring, non-cash charge of $76,762 ($50,279 after-tax)
recorded in connection with the vesting of the Company's performance-based
stock options. Excluding the charge, the Company's ratio of earnings to
fixed charges would be 4.33. As a result of this charge, the Company's
earnings through the first six months of fiscal year 1998 were insufficient
to cover its fixed charges, and an additional $6.3 million in pretax earnings
would have been required to eliminate the coverage deficiency.
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in the registration statement
of Stewart Enterprises, Inc. on Form S-3 of our reports, which includes an
explanatory paragraph related to changes in the Company's method of
accounting for cemetery sales and its method of accounting for funeral
services investment trust fund earnings, dated December 16, 1997 on our
audits of the consolidated financial statements and financial statement
schedule of Stewart Enterprises, Inc. and Subsidiaries, as of October 31,
1997 and 1996 and for each of the three years in the period ended October
31, 1997. We also consent to the reference to our firm under the caption
"Experts."
/s/ PRICEWATERHOUSECOOPERS, LLP
New Orleans, Louisiana
July 16, 1998
