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<PAGE>1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Form 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report: October 1, 1996
AT&T CAPITAL CORPORATION
A Delaware Commission File I.R.S. Employer
Corporation No. 1-11237 No. 22-3211453
44 Whippany Road, Morristown, New Jersey 07962-1983
Telephone Number (201) 397-3000
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Form 8-K October 1, 1996
Item 1. CHANGES IN CONTROL OF THE REGISTRANT
On October 1, 1996, AT&T Capital Corporation (the "Registrant") consummated
a merger (the "Merger") with Antigua Acquisition Corporation, a Delaware
corporation ("Merger Sub"), pursuant to an Agreement and Plan of Merger (the
"Merger Agreement") among the Registrant, AT&T Corp. ("AT&T"), the former
indirect owner of approximately 86% of the Registrant's outstanding common
stock, par value $.01 per share (the "Common Stock"), Hercules Limited, a Cayman
Islands corporation ("Holdings"), and Merger Sub, a majority-owned subsidiary of
Holdings. Pursuant to the Merger Agreement, Merger Sub was merged with and into
the Registrant, with the Registrant continuing its corporate existence under
Delaware law as the surviving corporation (the "Surviving Corporation"). As a
result of the Merger, stockholders of the Registrant have the right to receive
$45 in cash for each outstanding share of the Registrant's Common Stock (other
than shares held by the Registrant or Holdings or any subsidiary of Holdings).
Twenty-seven members of the Registrant's senior management (the "Management
Offerees") were offered the opportunity to participate in the Management Share
Exchange (as defined below). Immediately prior to the effective time of the
Merger, Merger Sub consummated a share exchange (the "Management Share
Exchange") with certain members of the Registrant's management (the "Management
Investors"), including Thomas C. Wajnert, Chairman of the Board and Chief
Executive Officer of the Registrant, and 23 other members of the Registrant's
senior management, in which those Management Investors exchanged an aggregate of
650,441 shares of the Registrant's Common Stock (or approximately $29 million in
value, based on the $45 per share price to which such Management Investors would
have otherwise been entitled in connection with the Merger) for newly issued
shares of Merger Sub's common stock of equal value (which became shares of
Surviving Corporation's common stock upon consummation of the Merger). Of the
three Management Offerees who did not elect to participate in the Management
Share Exchange, two of such persons (both of whom participated in the
Registrant's Corporate Leadership Team) ceased their employment with the
Registrant after the consummation of the Merger.
As a result of the Merger and the Management Share Exchange, all of the
outstanding Common Stock of the Registrant is currently directly or indirectly
owned by (i) the Management Investors and (ii) GRS Holding Company Limited, a
private United Kingdom holding corporation engaged in the U.K. rail leasing
business ("GRSH"), which on a fully diluted basis is approximately 85%
beneficially owned by Nomura International plc ("Nomura"), a wholly owned
subsidiary of The Nomura Securities Co., Ltd., and 9.5% beneficially owned by
Babcock & Brown Holdings Inc., a San Francisco based leasing, asset and project
financing advisory company. The Management Investors own approximately 3.3% of
the Common Stock (or approximately 5.5% on a fully diluted basis), and GRSH
indirectly owns approximately 96.7% of the Common Stock (or approximately 94.5%
on a fully diluted basis).
The total amount of funds required to consummate the Merger (the "Merger
Consideration") was approximately $2,160 million, which amount represents the
sum of the aggregate purchase price for the outstanding shares of the
Registrant's Common Stock and the aggregate amount needed to cash-out the
Registrant's stock options in accordance with the Merger
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Form 8-K October 1, 1996
Agreement. The Merger Consideration was funded by (i) a loan (the "Interim
Loan") from Goldman Sachs Credit Partners L.P. in the amount of approximately
$1,255 million, which loan bears interest at an annual fixed rate of 5.6375%,
matures on October 30, 1996 and was repaid by the Registrant on October 15, 1996
from a portion of the proceeds of offerings of equipment receivable-backed
securities by affiliates of the Registrant (the "Asset Securitization"), and
(ii) equity contributions (collectively, the "Equity Contributions") received
from (a) capital contributions made to Merger Sub by Holdings in the aggregate
amount of $871 million (b) the Management Share Exchange by the Management
Investors of approximately $29 million and (c) the settlement of approximately
$5 million of recourse loans to senior executives. The Interim Loan contains
certain customary representations, warranties, defaults and covenants, including
a restriction on dividend payments by the Registrant, as well as a mandatory
prepayment requirement based on the Registrant's receipt of proceeds from the
Asset Securitization.
Following the effective time of the Merger, the Registrant's Board of
Directors increased from two to six and includes Hiromi Yamaji, Guy Hands, John
Appleton, Jeff Nash and David Banks, all of whom are currently officers,
directors or affiliates of Nomura, and Thomas C. Wajnert, the Chairman of the
Board and Chief Executive Officer of the Registrant. The current intention is
that the Board of Directors of the Registrant will be increased shortly after
the Merger to include a total of eight members, with at least one of the two
additional directors being a person whose principal occupation is related to
Nomura and/or Holdings or certain of their affiliates. Also, within three to six
months after the Merger, the Board of Directors will be further increased to a
total of eleven members, with at least two of the three additional directors
expected to be persons independent of the Registrant, Nomura and Holdings.
The Registrant anticipates that Nomura and certain of its affiliates will
receive customary banking and other fees from the Surviving Corporation from
time to time for services rendered to the Surviving Corporation and its
affiliates, including, without limitation, securitization transactions,
acquisitions, dispositions and other transactions.
A copy of the Registrant's press release dated October 1, 1996 is attached
hereto as Exhibit No. 99 and is incorporated herein by reference.
Item 5. OTHER EVENTS
In anticipation of a $200 million issuance of preferred securities by an
affiliate of the Registrant, which is expected to close by October 31, 1996,
this Form 8-K includes the Registrant's unaudited consolidated financial
statements and related notes at and for the nine months ended September 30,
1996. In addition, unaudited pro forma financial statements and related
explanatory notes reflecting the impact of the Merger and related transactions
have been included under Item 7. Financial Statements and Exhibits of this Form
8-K. The unaudited pro forma consolidated balance sheet is presented assuming
the Merger and the related transactions occurred as of September 30, 1996. The
unaudited pro forma consolidated statements of income reflect the effects of the
Merger and the related transactions as if the Merger and such related
transactions had occurred on January 1, 1995.
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Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Dollars in Thousands, except per share amounts)
(Unaudited)
For the Three Months For the Nine Months
Ended September 30, Ended September 30,
1996 1995 1996 1995
-------- -------- -------- --------
Revenues:
Finance revenue $ 52,393 $ 46,793 $ 149,357 $ 127,825
Capital lease revenue 169,148 150,427 492,357 428,097
Rental revenue on
operating leases (A) 179,894 141,800 505,380 411,169
Equipment sales 24,012 10,375 72,608 27,356
Other revenue, net 45,162 46,486 150,792 146,204
-------- -------- --------- ---------
Total Revenues 470,609 395,881 1,370,494 1,140,651
-------- -------- --------- ---------
Expenses:
Interest 120,288 106,086 350,359 300,891
Operating and
administrative 126,762 116,456 375,172 351,443
Depreciation on
operating leases 117,394 88,328 329,336 259,487
Cost of equipment
sales 21,018 9,896 61,677 25,195
Provision for credit
losses 22,918 20,681 71,454 60,359
-------- -------- --------- ---------
Total Expenses 408,380 341,447 1,187,998 997,375
-------- -------- --------- ---------
Income before income
taxes 62,229 54,434 182,496 143,276
Provision for income
taxes 21,762 21,962 67,206 57,810
-------- -------- --------- ---------
Net Income $ 40,467 $ 32,472 $ 115,290 $ 85,466
======== ======== ========= =========
(Continued)
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Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Continued)
(Dollars in Thousands, except per share amounts)
(Unaudited)
For the Three Months For the Nine Months
Ended September 30, Ended September 30,
1996 1995 1996 1995
-------- -------- -------- -------
Earnings per common
share and common share
equivalent:
Earnings Per Share $ .85 $ .69 $ 2.43 $ 1.82
======== ======== ======== ========
Weighted average shares
outstanding (thousands): 47,565 47,195 47,497 47,063
======== ======== ======== ========
(A) Includes $22,821 and $26,174 for the three months ended September 30,
1996 and 1995, respectively, and $67,224 and $66,398 for the nine
months ended September 30, 1996 and 1995, respectively, from AT&T
Corp.("AT&T") and its affiliates.
The accompanying notes are an integral part of these consolidated financial
statements.
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Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands)
September 30,
1996 December 31,
(Unaudited) 1995
---------- ------------
ASSETS:
Cash and cash equivalents $ 18,574 $ 3,961
Net investment in finance
receivables 2,017,835 1,800,636
Net investment in capital
leases 6,503,112 6,187,131
Investment in operating
leases, net of accumulated
depreciation of $716,763 in
1996 and $642,728 in 1995 1,284,868 1,117,636
Deferred charges and other assets 427,211 431,895
---------- ----------
Total Assets $10,251,600 $ 9,541,259
========== ==========
LIABILITIES AND SHAREOWNERS' EQUITY:
Liabilities:
Short-term notes, less
unamortized discount of
$271 in 1996 and $9,698 in
1995 $ 3,021,459 $ 2,212,351
Deferred income taxes 498,927 555,296
Income taxes and other payables 545,467 581,000
Payables to AT&T and affiliates 71,478 360,429
Medium- and long-term debt 4,896,467 4,716,058
Commitments and contingencies
----------- -----------
Total Liabilities $ 9,033,798 $ 8,425,134
----------- -----------
(Continued)
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Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Continued)
(Dollars in Thousands)
September 30,
1996 December 31,
(Unaudited) 1995
------------- ------------
Shareowners' Equity:
Common stock, one cent par value:
Authorized 100,000,000 shares,
issued and outstanding, 47,097,447
shares in 1996 and 46,968,810 shares
in 1995 $ 471 $ 470
Additional paid-in capital 786,163 783,244
Recourse loans to senior executives (20,923) (20,512)
Foreign currency translation
adjustments (2,804) (2,173)
Retained earnings 454,895 355,096
---------- ----------
Total Shareowners' Equity 1,217,802 1,116,125
---------- ----------
Total Liabilities and
Shareowners' Equity $10,251,600 $ 9,541,259
========== ==========
The accompanying notes are an integral part of these consolidated
financial statements.
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Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
For The Nine Months
Ended September 30,
1996 1995*
---------- ----------
CASH FLOW FROM OPERATING ACTIVITIES:
Net income $ 115,290 $ 85,466
Noncash items included in income:
Depreciation and amortization 344,459 303,412
Deferred taxes (17,034) 30,983
Provision for credit losses 71,454 60,359
Gain on receivables securitizations (5,041) -
Gain on SBA and other loan sales (8,833) (7,467)
(Increase) decrease in deferred charges and
other assets (63,976) 74,293
Decrease in income taxes and
other payables (109,789) (32,583)
Increase (decrease) in payables to AT&T and
affiliates 1,782 (3,170)
----------- -----------
Net Cash Provided by Operating Activities 328,312 511,293
----------- -----------
CASH FLOW FROM INVESTING ACTIVITIES:
Purchase of businesses, net of cash acquired - (292,590)
Purchase of finance asset portfolios (148,109) (14,937)
Financings and lease equipment purchases (4,170,561) (3,819,016)
Principal collections from customers,
net of amounts included in income 3,041,912 2,871,692
Cash proceeds from receivables securitizations 128,830 81,475
Cash proceeds from SBA and other loan sales 119,890 92,047
----------- -----------
Net Cash Used for Investing Activities $(1,028,038) $(1,081,329)
----------- -----------
(Continued)
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Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Continued)
(Dollars in Thousands)
(Unaudited)
For The Nine Months
Ended September 30,
1996 1995*
------------ -----------
CASH FLOW FROM FINANCING ACTIVITIES:
Increase (decrease)in short-term notes, net $ 790,842 $ (224,397)
Additions to medium and long-term debt 1,288,102 1,604,370
Repayments of medium and long-term debt (1,101,718) (906,495)
(Decrease) increase in payables to AT&T
and affiliates (247,397) 56,164
Dividends paid (15,490) (14,070)
--------- ---------
Net Cash Provided by Financing
Activities 714,339 515,572
--------- ---------
Net Increase (decrease) in Cash and Cash
Equivalents 14,613 (54,464)
Cash and Cash Equivalents at Beginning of Period 3,961 54,464
--------- ---------
Cash and Cash Equivalents at End of Period $ 18,574 $ 0
========= =========
Non-Cash Investing and Financing Activities:
In the first nine months of 1996 and 1995, the Company entered into capital
lease obligations of $24,456 and $20,496, respectively, for equipment that was
subleased.
In the first nine months of 1996 and 1995, the Company assumed debt of $3,384
and $472,952, respectively, in conjunction with acquisitions.
* Certain 1995 amounts have been restated to conform to the 1996
presentation.
The accompanying notes are an integral part of these consolidated financial
statements.
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Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The accompanying unaudited consolidated financial statements have been
prepared by AT&T Capital Corporation and its subsidiaries ("AT&T Capital" or the
"Company") pursuant to the rules and regulations of the Securities and Exchange
Commission ("SEC") and, in the opinion of management, include all adjustments,
consisting of normal recurring adjustments, necessary for a fair presentation of
the results of operations, financial position and cash flows for each period
shown. The results for interim periods are not necessarily indicative of
financial results for the full year. These unaudited consolidated financial
statements should be read in conjunction with the audited consolidated financial
statements and notes thereto included in the Company's Annual Report on Form
10-K for the year ended December 31, 1995 and the current year's previously
issued Form 10-Qs.
2. Shareowners' Equity
On April 19, 1996 and July 19, 1996, the Company's Board of Directors
declared dividends of $.11 per share. The dividends were paid on May 31, 1996
and August 30, 1996, respectively, to shareowners of record as of the close of
business on May 10, 1996 and August 9, 1996, respectively.
3. Recent Pronouncements
Effective January 1, 1996, the Company adopted Statement of Financial
Accounting Standards ("SFAS") No. 123, "Accounting for Stock-Based
Compensation". This statement establishes financial accounting and reporting
standards for stock-based employee compensation plans. It allows companies to
choose either 1) a fair value method of valuing stock-based compensation plans
which will affect reported net income, or 2) to continue to follow the existing
accounting rules for stock option accounting but disclose what the impacts would
have been had the fair value method been adopted. The Company adopted the
disclosure alternative which requires annual disclosure of the pro forma net
income and earnings per share amounts assuming the fair value method was adopted
on January 1, 1995. As a result, the adoption of this standard did not have any
impact on the Company's consolidated financial statements.
In June 1996, the Financial Accounting Standards Board issued SFAS No.
125, "Accounting for Transfers and Servicing of Financial Assets and
Extinguishments of Liabilities". This statement requires that liabilities
and derivatives incurred or obtained by transferors as part of a transfer
of financial assets be initially measured at fair value, if practical. It
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<PAGE>11
Form 8-K October 1, 1996
also requires that servicing assets and other retained interests in the
transferred assets be measured by allocating the previous carrying amount
between the assets sold, if any, and retained interests, if any, based on their
relative fair values at the date of the transfer. This statement is effective
for transfers and servicing of financial assets and extinguishment of
liabilities occurring after December 31, 1996 and application is prospective.
Management does not expect the adoption of this standard to have a material
impact on the Company's consolidated financial statements.
4. Recent Events
On September 20, 1995, AT&T announced a plan to pursue the public or
private sale of its remaining 86% interest in AT&T Capital. On such date, AT&T
also announced a plan to separate (the "Separation") into three publicly-held
stand-alone global businesses (AT&T, Lucent Technologies Inc. ("Lucent") and NCR
Corporation ("NCR"). In connection with the Separation, AT&T spun-off its entire
remaining equity interest in Lucent to AT&T shareowners on September 30, 1996.
The Separation is targeted by AT&T to be completed by the end of 1996, subject
to certain conditions. For a more detailed discussion of AT&T's restructuring
plans see Note 16 to the consolidated financial statements included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1995.
In the second quarter of 1996, the Company executed an Operating Agreement
with each of Lucent and NCR, and entered into letter agreements with Lucent and
NCR regarding the applicability to Lucent and NCR of specified provisions of the
License Agreement and the Intercompany Agreement between the Company and AT&T.
The full texts of such Operating Agreements and letter agreements with Lucent
and NCR have been filed with the SEC.
The Company has paid a sales assistance fee ("SAF") to Lucent, which fee is
related to the volume of the Company's Lucent-related business. Under the terms
of its Operating Agreement with the Company, Lucent is prohibited from accepting
a SAF from any other provider of leasing services. In early 1996, following
Lucent's request, the Company agreed to pay a substantial increase in the SAF
for 1995, both as an absolute amount and as a percentage of volumes attributable
to Lucent. After giving effect to the increase, the SAF paid by the Company to
Lucent for 1995 was approximately double the 1994 fee. The Company and Lucent
recently agreed to a modified formula for calculating the SAF for the remaining
years of the term of Lucent's Operating Agreement (retroactive to January 1,
1996). The revised formula is expected to result in aggregate annual SAF which
are approximately double the amounts that would have been paid if the pre-1995
formula had been maintained.
On June 5, 1996, AT&T Capital entered into an Agreement and Plan of Merger
("the Merger Agreement") dated as of June 5, 1996, with AT&T, Hercules Limited
("Hercules") and Antigua Acquisition Corporation ("Antigua"). Hercules is owned
by Hercules Holdings (UK) Limited, which in turn is a wholly-owned subsidiary of
GRS Holding Company, Ltd., a U.K. rail leasing business.
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<PAGE>12
Form 8-K October 1, 1996
On September 30, 1996 the Company, pursuant to a Gross Profit Tax Deferral
Interest Free Loan Agreement (the "GPTD Agreement") between the Company and
AT&T, made a payment of $247.4 million to AT&T for full repayment of such loans.
The GPTD Agreement required the Company to repay such loans immediately prior to
the Company no longer being a member of AT&T's consolidated group for federal
income tax purposes. Also on September 30, 1996, pursuant to the Merger
Agreement, the Company made a $35.0 million payment to AT&T in exchange for AT&T
assuming all tax liabilities associated with Federal and combined state taxes
for periods prior to the consummation of the merger ("the Merger").
5. Subsequent Events
On October 1, 1996, the Merger was consummated and AT&T Capital's
shareowners received the rights to $45 in cash for each outstanding share of the
Company's common stock. The total purchase price for the Company's outstanding
shares and stock options was approximately $2,160 million. Upon consummation of
the Merger, Merger Sub, a wholly-owned subsidiary of Hercules, was merged with
and into the Company. In the future, it is expected that the Company will
increase its utilization of lease and loan receivable securitizations as a
source of debt financing. For the pro forma impacts of the Merger, refer to Item
7. Financial Statements and Exhibits included in this Form 8-K.
The Merger and the related transactions had a significant impact on the
Company's financial position and results of operations. Had the Merger and
related transactions occurred on September 30, 1996, the Company's total assets,
debt, total liabilities and shareowners' equity would have been $8.1 billion,
$6.6 billion, $7.4 billion and $.7 billion, respectively, and the net income for
the three and nine months ended September 30, 1996 would have been $86.0 million
and $160.8 million, respectively. Such related transactions include: (i) Tax
Deconsolidation from AT&T, as defined in the Company's 1995 Annual Report on
Form 10-K, (ii) effects of an Internal Revenue Service Code of 1986, Section
338(h)(10) election, (iii) deferred tax effects relating to the Merger and the
Section 338(h)(10) election and similar elections under certain state and local
laws, (iv) the $3.1 billion (Portfolio Assets of $3.4 billion, less residuals
not securitized) securitization of lease and loan receivables (which includes
$.3 billion of receivables previously sold and recently repurchased by the
Company) which occurred on October 15, 1996, (v) the purchase of outstanding
common stock pursuant to the Merger Agreement, and (vi) the issuance of
short-term notes and the incurrence of liabilities for payments under certain
benefit plans, other payments to certain employees and for Merger related
transaction costs.
The consolidated financial statements reflect, and the future consolidated
financial statements of the Company will reflect, the historical cost of the
Company's assets and liabilities. Adjustments to the Company's consolidated
financial statements to reflect the fair value
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Form 8-K October 1, 1996
of the Company's assets and liabilities as of the merger date ("push down"
accounting) will not be reflected due to the existence of substantial publicly
traded debt of the Company.
Item 7. FINANCIAL STATEMENTS AND EXHIBITS
(b) Pro Forma Financial Information
(1) Unaudited Pro Forma Consolidated Balance Sheet as of September
30, 1996
(2) Unaudited Pro Forma Consolidated Statement of Income for the
twelve months ended December 31, 1995
(3) Unaudited Pro Forma Consolidated Statement of Income for the nine
months ended September 30, 1996
(c) Exhibits
2 Certificate of Merger, filed October 1, 1996.
3(i) Restated Certificate of Incorporation of AT&T Capital Corporation,
filed September 27, 1996.
(ii) AT&T Capital Corporation Amended and Restated By-Laws,
dated October 1, 1996.
99 AT&T Capital Corporation Press Release issued October 1, 1996.
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Form 8-K October 1, 1996
AT&T Capital Corporation and Subsidiaries
UNAUDITED PRO FORMA FINANCIAL INFORMATION
The following unaudited pro forma consolidated balance sheet and
statements of income of AT&T Capital Corporation ("Capital" or the "Company")
are based on the historical Consolidated Financial Statements of AT&T Capital
Corporation and Subsidiaries at September 30, 1996 and for the nine months then
ended and for the year ended December 31, 1995. On June 5, 1996, the Company
entered into an Agreement and Plan of Merger (the "Merger Agreement"). The
Merger was consummated on October 1, 1996 (the "Merger"). The pro forma
consolidated balance sheet is presented assuming the Merger and the related
transactions (Tax Deconsolidation from AT&T, as defined in the Company's 1995
Annual Report on Form 10-K, effects of an Internal Revenue Code of 1986, Section
338(h)(10) election, deferred tax effects relating to the Merger and the Section
338(h)(10) election and similar elections under certain state and local laws,
issuance of $200 million preferred securities of a consolidated entity, a $3.1
billion (Portfolio Assets of $3.4 billion, less residuals not securitized)
initial securitization of lease and loan receivables (which includes $.3 billion
of receivables previously sold and recently repurchased by the Company), the
purchase of outstanding common stock pursuant to the Merger Agreement, the
issuance of short-term notes to fund both payments under certain benefit plans
and other payments to certain employees and Merger related transaction costs)
occurred as of September 30, 1996. The pro forma consolidated statements of
income reflect the effects of the Merger and the related transactions (Tax
Deconsolidation from AT&T, an anticipated increase in the Company's borrowing
costs, issuance of the above-mentioned preferred securities of a consolidated
entity, the reduction in revenues and expenses associated with the
above-mentioned securitization, the termination of certain contracts and
agreements between the Company and AT&T which will increase operating and
administrative expenses, and other increases in operating and administrative
expenses) as if the Merger and such related transactions had occurred on January
1, 1995.
The pro forma consolidated financial statements reflect, and the future
consolidated financial statements of the Company will reflect, the historical
cost of the Company's assets and liabilities. Adjustments to the Company's
consolidated financial statements to reflect the fair value of the Company's
assets and liabilities as of the Merger date ("push down" accounting) will not
be made due to the existence of substantial publicly traded debt of the Company.
The following pro forma financial information is unaudited and should be
read in conjunction with the accompanying notes thereto and with the
Consolidated Financial Statements included in the Company's 1995 Annual Report
on Form 10-K, second quarter 1996 Quarterly Report on Form 10-Q and the
consolidated financial statements included in Item 5 - Other Events included in
this Form 8-K. The pro forma financial information is not necessarily indicative
of either the financial position or the results of operations that would have
been achieved had the Merger and the related transactions actually occurred on
the dates referred to above, nor is it necessarily indicative of the results of
future operations, because such unaudited pro forma financial information is
based on estimates of financial effects that may prove to be inaccurate over
time.
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Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
(Dollars in Thousands)
September 30, PRO FORMA
1996(1) ADJUSTMENTS(2) PRO FORMA
---------- -------------- ---------
ASSETS:
Cash and cash equivalents $ 18,574 $ 18,574
Net investment in finance
receivables 2,017,835 $ (108,300)(7) 1,909,535
Net investment in capital
leases 6,503,112 (2,725,900)(7) 3,777,212
Net investment in operating
leases, net of accumulated
depreciation 1,284,868 1,284,868
Deferred charges and other assets 427,211 167,150 (3) 860,861
266,500 (7)
Receivable from AT&T - 280,000 (3) 280,000
----------- ------------ ----------
Total Assets $10,251,600 $(2,120,550) $8,131,050
=========== ============ ==========
LIABILITIES AND SHAREOWNERS' EQUITY:
Liabilities:
Short-term notes $ 3,021,459 $ (200,000)(4) 1,514,859
60,800 (5)
11,300 (6)
(1,378,700)(7)
Deferred income taxes 498,927 (498,927)(3) -
Income taxes and other payables 545,467 263,500 (3) 756,467
(32,700)(5)
(19,800)(7)
Payables to AT&T and affiliates 71,478 71,478
Medium and long-term debt 4,896,467 4,896,467
Commitments and contingencies
---------- -------- ----------
Total Liabilities $ 9,033,798 (1,794,527) $7,239,271
Company-obligated preferred
securities of subsidiary $200,000 (4) $200,000
(Continued)
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<PAGE>16
Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
(Dollars in Thousands)
(Continued)
September 30, PRO FORMA
1996 (1) ADJUSTMENTS(2) PRO FORMA
----------- -------------- ---------
Shareowners' Equity:
Common stock $ 471 $ 429 (7) $ 900
Additional paid-in capital 786,163 682,577 (3) 624,206
(844,534)(7)
Recourse loans to senior executives (20,923) 5,500 (7) (15,423)
Foreign currency translation
adjustments (2,804) (2,804)
Retained earnings 454,895 (28,100)(5) 84,900
(11,300)(6)
(330,595)(7)
---------- ---------- ---------
Total Shareowners' Equity 1,217,802 (526,023) 691,779
---------- ---------- ---------
Total Liabilities and
Shareowners' Equity $10,251,600 $(2,120,550) $8,131,050
========== =========== =========
The accompanying explanatory notes are an integral part of this pro forma
consolidated balance sheet.
<PAGE>
<PAGE>17
Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
EXPLANATORY NOTES TO THE UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
At September 30, 1996
(Dollars in Thousands)
(1) The historical balance sheet at September 30, 1996 reflects the issuance of
short-term notes to (a) repay the $247.4 million interest-free loans AT&T Corp.
("AT&T") made to the Company pursuant to the Gross Profit Tax Deferral Interest
Free Loan Agreement and (b) fund the payment of $35.0 million to AT&T in
exchange for AT&T assuming all tax liabilities associated with Federal and
combined state taxes for periods prior to the Merger.
(2) The pro forma consolidated balance sheet reflects a significant
securitization of lease and loan receivables effected on October 15, 1996 in
connection with the financing of the Merger but does not reflect the Company's
proposed future strategy of increasing the periodic securitization of lease and
loan receivables as a funding source subsequent to the Merger. The amount of
lease and loan receivables currently anticipated to be securitized annually is
expected to be approximately 30% of annual financing volumes.
(3) Reflects the election under Section 338(h)(10) of the Internal Revenue
Service Code and similar elections under certain state and local laws. Under
these elections the Merger is deemed to be an asset sale for tax purposes
resulting in the Company being able to reflect its assets and liabilities at
fair value for tax purposes (i.e. a step-up in basis), and the excess Merger
consideration over book basis is tax deductible over time. Such an adjustment
substantially eliminates existing deferred tax liabilities at the Merger date
and creates a net deferred tax asset. The pro forma tax adjustment is calculated
using an assumed combined Federal and state statutory income tax rate of
approximately 39.0%.
In addition, AT&T has agreed to reimburse the Company for lost tax depreciation
in the amount of approximately $280 million. The lost tax depreciation resulted
from the Section 338 (h)(10) election and the related deemed sale of assets for
tax purposes. This amount is offset by an increase in the Company's current tax
liability. The Company is also entitled to a tax deduction for the cash-out of
the Company's stock options by Hercules. The tax benefit of such payment is
reflected as a reduction to the Company's current tax liability of $16.5
million.
(4) Reflects the issuance of $200 million preferred securities of a consolidated
entity of the Company assuming that (i) the securities are perpetual in nature,
and (ii) the net cash proceeds are used to repay short-term notes. This
transaction is expected to occur by October 31, 1996.
(5) Reflects the issuance of short-term notes to fund the accelerated payout and
additional amounts due under the Company's Share Performance Incentive Plan
("SPIP"), payments to certain officers of the Company to waive certain of their
rights under the Company's Leadership Severance Plan and certain other
termination and other payments and the related tax effect at the assumed
combined Federal and state statutory income tax rate of 39.55%.
<PAGE>
<PAGE>18
Form 8-K October 1, 1996
(6) Reflects the issuance of short-term notes to fund the Company's Merger
transaction costs of approximately $11.3 million.
(7) Reflects the $3.1 billion asset securitization of lease and loan receivables
which occurred on October 15, 1996, the purchase of Company common stock, and
the issuance of new common stock. The pro forma balance sheet reflects the
associated: (i)reduction in the net investment in finance receivables and
capital leases to reflect the assets sold, (ii) an increase in deferred charges
and other assets reflecting the reclassification of equipment residual values
associated with the assets sold and establishment of a cash collateral account,
(iii) a net reduction of short-term notes reflecting the cash proceeds received
from the asset securitization net of the amount required to purchase Company
common stock, (iv) a net decrease in income taxes and other payables to adjust
securitization-related reserves, (vi) an increase in common stock to reflect the
new capitalization structure of the Company, (vii) the reduction of additional
paid in capital resulting from the retirement of common stock acquired, net of
the effects of the Section 338(h)(10) election under the I.R.S. Code and the
deferred tax effects relating to the Merger and such election, (viii) the
reduction of recourse loans to senior executives to reflect the settlement of
such loans, and (ix) the reduction of retained earnings to reflect the
retirement of the Company common stock. Included in this asset securitization is
a $24.0 million payment to Nomura for services provided and expenses incurred
($3.0 million of which was paid to Babcock & Brown) in connection with this
securitization.
Proceeds of $1,255 million received under an Interim Loan together with the
equity contribution relating to the Merger (approximately $860 million), were
used to purchase outstanding common stock of the Company. The Interim Loan was
repaid using a portion of the proceeds of the October 15, 1996 initial
securitization.
<PAGE>
<PAGE>19
Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
(Dollars in Thousands, except per share amounts)
For the Year
Ended
December 31, Pro Forma
1995 Adjustments(1) Pro Forma
------------ ----------- ---------
Revenues:
Finance revenue $ 174,523 $ (13,500)(4)$ 161,023
Capital lease revenue 586,141 (304,400)(4) 281,741
Rental revenue on operating
leases 560,964 560,964
Equipment sales 48,724 48,724
Other revenue, net 206,683 15,300 (4) 247,083
25,100 (5)
--------- --------- ---------
Total Revenues 1,577,035 (277,500) 1,299,535
--------- --------- ---------
Expenses:
Interest 411,040 7,400 (2) 347,840
(70,600)(3)
Operating and
administrative 473,663 5,900 (6) 479,563
Depreciation on operating
leases 354,509 354,509
Cost of equipment sales 43,370 43,370
Provision for credit
losses 86,214 86,214
--------- --------- ---------
Total Expenses 1,368,796 (57,300) 1,311,496
--------- --------- ---------
Company-obligated preferred
securities of subsidiary 18,000 (7) 18,000
Income (Loss) before income taxes 208,239 (238,200) (29,961)
Provision (benefit) for income taxes 80,684 (94,208)(8) (13,524)
--------- -------- ----------
Net Income (Loss) $ 127,555 $(143,992) $ (16,437)
========= ========= ==========
Primary earnings (loss) per share $ .60 $ (0.18)
--------- ----------
Number of shares (000's) (9) 212,319 90,000
--------- ----------
Fully diluted earnings (loss) per
share $ .60 $ (0.18)
--------- ----------
Number of shares (000's) (9) 213,548 92,158
--------- ----------
The accompanying explanatory notes are an integral part of this pro forma
consolidated income statement
<PAGE>
<PAGE>20
Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
EXPLANATORY NOTES TO THE UNAUDITED PRO FORMA
CONSOLIDATED STATEMENT OF INCOME
For the Year Ended December 31, 1995
(Dollars in Thousands)
(1) The unaudited pro forma consolidated statement of income for the year ended
December 31, 1995 does not reflect the Company's proposed future strategy of
increasing the periodic securitization of lease and loan receivables as a
funding source subsequent to the Merger. The amount of lease and loan
receivables currently anticipated to be securitized annually is expected to be
30% of annual financing volumes. In addition, the pro forma consolidated
statement of income does not reflect nonrecurring items such as (i) the $84.9
million after-tax gain associated with the $3.1 billion securitization of lease
and loan receivables, which occurred on October 15, 1996, (ii) the $28.1 million
after-tax expense relating to accelerated payout of the Company's SPIP related
to the Merger and other payments to certain officers of the Company, and (iii)
the $11.3 million after-tax expense relating to the Company's Merger related and
other transaction costs. See Notes 5, 6, and 7 to the pro forma consolidated
balance sheet.
Since the recurring effects of securitizing lease and loan receivables as well
as the underlying assumptions can be material, the following 1995 pro forma
adjustments and pro forma net income would have resulted assuming (i) the gain
relating to the October 15, 1996 asset securitization is included in the results
of operations, (ii) various levels of such asset securitization, and (iii) other
securitization and other pro forma assumptions have been adjusted for such
change in securitization levels, but otherwise remain constant:
For the Year
Ended
December 31, Pro Forma
1995 Adjustments Pro Forma
----------- ----------- ----------
Net income, pro forma
adjustments and the pro
forma net income as shown
in the pro forma consolidated
statement of income for the
year ended December 31, 1995 $127,555 $(143,992) $(16,437)
======= ========= =======
Securitization sensitivity (in
$250 million increments), including
the non-recurring gain:
$3,057 million $127,555 $ (59,100) $ 68,455
$2,807 million $127,555 $ (57,900) $ 69,655
$2,557 million $127,555 $ (56,400) $ 71,155
$2,307 million $127,555 $ (54,800) $ 72,755
$2,057 million $127,555 $ (53,200) $ 74,355
$1,807 million $127,555 $ (51,600) $ 75,955
<PAGE>
<PAGE>21 Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
EXPLANATORY NOTES TO THE UNAUDITED PRO FORMA
CONSOLIDATED STATEMENT OF INCOME
For the Year Ended December 31, 1995
(Dollars in Thousands)
(Continued)
(2) The Merger will likely increase the Company's borrowing costs. While it is
difficult to predict the response of investors to the Company's medium and
long-term note and commercial paper programs and, therefore, it is difficult to
quantify such effect of the Merger with reasonable accuracy, the Company has
estimated an increase in borrowing costs of 20 basis points relating to its
commercial paper program and 25 basis points relative to its medium and
long-term debt issuances. The increase in interest expense was calculated using
the 1995 average commercial paper balance outstanding and the 1995 issuances of
medium and long-term debt multiplied by the respective incremental interest
costs. To illustrate the Company's sensitivity to interest rates, had the
increase in such borrowing costs been 10 basis points lower or higher than the
above mentioned respective increases, the Company's interest expense adjustment
would have been $4.1 million or $10.7 million, respectively.
(3) Reflects the net reduction of interest expense as a result of the following
items, as adjusted for the increased borrowing costs as a result of the Merger.
See (2) above.
Interest Expense
Item Increase (Decrease)
- -------------------------------------------- -------------------
- - Net proceeds from the proposed $3.1 billion
asset securitization of lease and loan
receivables and the issuance of preferred
securities net of amounts used to purchase
outstanding Company common stock $ (94,000)
- - Repayment of the interest free loans AT&T
made to the Company pursuant to the Gross
Profit Tax Deferral Interest Free Loan
Agreement* 14,600
- - Securitization reserves recorded at
present value 2,400
- - Payment to AT&T to assume all tax
liabilities of Federal and combined state
taxes for periods prior to the Merger 2,100
- - Fund the accelerated payout and additional
amounts due under the Company's SPIP
and other payments 3,600
- - Merger related and other transaction
costs 700
---------
<PAGE>
<PAGE>22
Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
EXPLANATORY NOTES TO THE UNAUDITED PRO FORMA
CONSOLIDATED STATEMENT OF INCOME
For the Year Ended December 31, 1995
(Dollars in Thousands)
(Continued)
Net reduction in interest expense $ (70,600)
=========
* The amount is calculated using the 1995 average outstanding interest-free
loan balance.
(4) Reflects the net reduction in the Company's capital lease and finance
revenue as a result of the securitization. In addition, the Company will
recognize the interest income on the cash collateral account as well as the
excess spread amount (since it was recorded at its present value) both of which
are associated with such securitization.
(5) Reflects the recognition of the expected servicing fees associated with
servicing the securitized lease and loan receivables.
(6) Reflects the incremental recurring costs in the Company's operating and
administrative expenses, including services for telecommunications, certain
information processing, travel, human resource, real estate, express mail and
insurance services as a result of the Company no longer being entitled to the
discounts applicable to AT&T and its subsidiaries or received directly from
AT&T. In addition, the amount includes annual fees of $3.0 million that will be
paid to Nomura.
(7) Reflects dividends to be paid on preferred securities issued by a
consolidated entity of the Company.
(8) Reflects the tax effect of the foregoing estimated adjustments at the
assumed combined Federal and state statutory income tax rate of 39.55%.
(9) The number of shares used for the historical earnings per share was restated
to reflect the 4.5 to 1 stock split. The number of shares outstanding following
the Merger was 90 million.
<PAGE>
<PAGE>23
Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF INCOME
(Dollars in Thousands, except per share amounts)
For the Nine
Months Ended
September 30, Pro Forma
1996 Adjustments(1)Pro Forma
------------ ----------- ---------
Revenues:
Finance revenue $ 149,357 $ (7,300)(4) $142,057
Capital lease revenue 492,357 (165,200)(4) 327,157
Rental revenue on operating
leases 505,380 505,380
Equipment sales 72,608 72,608
Other revenue, net 150,792 8,300 (4) 172,692
13,600 (5)
---------- ---------- ---------
Total Revenues 1,370,494 (150,600) 1,219,894
---------- ---------- ---------
Expenses:
Interest 350,359 9,900 (2) 309,059
(51,200)(3)
Operating and
administrative 375,172 4,400 (6) 379,572
Depreciation on operating
leases 329,336 329,336
Cost of equipment
sales 61,677 61,677
Provision for credit
losses 71,454 71,454
--------- --------- ----------
Total Expenses 1,187,998 (36,900) 1,151,098
--------- --------- ---------
Company-obligated preferred
securities of subsidiary - 13,500 (7) 13,500
Income (Loss) before income taxes 182,496 (127,200) 55,296
Provision (benefit) for income taxes 67,206 (50,308)(8) 16,898
-------- --------- ---------
Net Income (Loss) $115,290 $(76,892) $ 38,398
======== ========= =========
Primary Earnings Per Share $ .54 $ 0.43
-------- ---------
Number of shares (000's) (9) 213,737 90,000
-------- ---------
Fully diluted earnings per share $ .54 $ 0.42
-------- ---------
Number of shares (000's) (9) 214,020 92,158
-------- ---------
The accompanying explanatory notes are an integral part of this pro forma
consolidated income statement.
<PAGE>
<PAGE>24
Form 8-K October 1, 1996
AT&T CAPITAL CORPORATION AND SUBSIDIARIES
EXPLANATORY NOTES TO THE UNAUDITED PRO FORMA
CONSOLIDATED STATEMENT OF INCOME
For the Nine Months Ended September 30, 1996
(Dollars in Thousands)
(1) The unaudited pro forma consolidated statement of income for the nine months
ended September 30, 1996 does not reflect the effects of the Company's proposed
future strategy of increasing the periodic securitization of lease and loan
receivables as a funding source subsequent to the Merger. The amount of lease
and loan receivables currently anticipated to be securitized annually is
expected to be 30% of annual financing volume. In addition, the September 30,
1996 pro forma consolidated income statement does not reflect non-recurring
items. See Note 1 to the pro forma consolidated income statement for the year
ended December 31, 1995 and Notes 5, 6, and 7 to the pro forma consolidated
balance sheet.
Since the recurring effects of securitizing lease and loan receivables as well
as the underlying assumptions can be material, Note 1 to the pro forma
consolidated income statement for the year ended December 31, 1995 illustrates
such sensitivity. In addition, the impacts of the October 15, 1996 initial
securitization on the historical financial statements decreases over time as the
balance of the securitized lease and loan receivables outstanding amortizes. For
example, the reduction to finance and capital lease revenue for the nine months
ended September 30, 1996 was less than three quarters of what the reduction was
for the year ended 1995.
(2) The Merger will likely increase the Company's borrowing costs. While it is
difficult to predict the response of investors to the Company's medium and
long-term note and commercial paper programs and, therefore, it is difficult to
quantify the effect of such Merger with reasonable accuracy, the Company has
estimated an increase in borrowing costs of 20 basis points relating to its
commercial paper program and 25 basis points relative to its medium and long
term debt issuances. The increase in interest expense was calculated using the
1996 average commercial paper balance outstanding and the 1995 full year and the
year-to-date September 30, 1996 issuances of medium and long-term debt
multiplied by the respective incremental interest costs. To illustrate the
Company's sensitivity to interest rates, had the increase in such borrowing
costs been 10 basis points lower or higher than the above mentioned respective
increases, the Company's interest expense adjustment would have been $5.7
million or $14.1 million, respectively.
(3) Reflects the net reduction of interest expense as a result of the following
items, as adjusted for the increased borrowing costs as a result of the Merger.
See (2) above.
Interest Expense
Item Increase (Decrease)
- -------------------------------------------- -------------------
- - Net proceeds from the proposed $3.1 billion
asset securitization of lease and loan
receivables and the issuance of preferred
securities net of amounts used to
purchase outstanding Company common stock $ (67,700)
<PAGE>
<PAGE>25
Form 8-K October 1, 1996
- - Repayment of the interest free loans
AT&T made to the Company pursuant to
the Gross Profit Tax Deferral Interest
Free Loan Agreement* 10,600
- - Securitization reserves recorded at
present value 1,300
- - Payment to AT&T to assume all tax
liabilities of Federal and combined state
taxes for periods prior to the Merger 1,500
- - Fund the accelerated payout and additional
amounts due under the Company's SPIP and
other payments 2,600
- - Merger related and other transaction
costs 500
---------
Net reduction in interest expense $ (51,200)
=========
* The amount is calculated using the 1996 average outstanding
interest-free loan balance.
(4) Reflects the reduction in the Company's capital lease and finance revenue as
a result of the securitization. In addition, the Company will recognize the
interest income on the cash collateral account as well as the excess spread
amount (since it was recorded at its present value) both of which are associated
with such securitization.
(5) Reflects the recognition of the expected servicing fees associated with
servicing the securitized lease and loan receivables.
(6) Reflects the incremental recurring costs in the Company's operating and
administrative expenses, including services for telecommunications, certain
information processing, travel, human resource, real estate, express mail and
insurance services as a result of the Company no longer being entitled to the
discounts applicable to AT&T and its subsidiaries or received directly from
AT&T. In addition, the amount includes annual fees of $3.0 million that will be
paid to Nomura.
(7) Reflects dividends to be paid on preferred securities issued by a
consolidated entity of the Company.
(8) Reflects the tax effect of the foregoing estimated adjustments at the
assumed combined Federal and state statutory income tax rate of 39.55%.
(9) The number of shares used for the historical earnings per share was restated
to reflect the 4.5 to 1 stock split. The number of shares outstanding following
the Merger was 90 million.
<PAGE>
<PAGE>26
Form 8-K October 1, 1996
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AT&T CAPITAL CORPORATION
/s/ Edward M. Dwyer
-----------------------
By: Edward M. Dwyer
Senior Vice President and
Chief Financial Officer
October 15, 1996
<PAGE>
<PAGE>27
Form 8-K October 1, 1996
EXHIBIT INDEX
Exhibit No.
2 Certificate of Merger, filed October 1, 1996.
3(i) Restated Certificate of Incorporation of AT&T Capital
Corporation, filed September 27, 1996.
(ii) AT&T Capital Corporation Amended and Restated By-Laws,
dated October 1, 1996.
99 AT&T Capital Corporation Press Release issued October 1, 1996.
<PAGE>
<PAGE>
CERTIFICATE OF MERGER
OF
ANTIGUA ACQUISITION CORPORATION
INTO
AT&T CAPITAL CORPORATION
UNDER SECTION 251 OF THE
GENERAL CORPORATION LAW
OF THE STATE OF DELAWARE
Pursuant to Section 251(c) of the General Corporation Law of the
State of Delaware, AT&T Capital Corporation, a Delaware corporation (the
"Corporation"), hereby certifies the following information relating to the
merger of Antigua Acquisition Corporation, a Delaware Corporation ("Merger
Sub"), with and into the Corporation (the "Merger"):
FIRST: The names of the constituent corporations in
the Merger (the "Constituent Corporations") and their states of
incorporation are as follows:
Name State
AT&T Capital Corporation Delaware
Antigua Acquisition Corporation Delaware
SECOND: The Agreement and Plan of Merger, dated as of June 5,
1996, among the Corporation, AT&T Corp., a New York corporation, Hercules
Limited, a Cayman Island corporation, and Merger Sub (as amended by the First
Amendment to the Agreement and Plan of Merger, dated as of August 20, 1996, the
"Merger Agreement"), setting forth the terms and conditions of the Merger, has
been approved, adopted, certified, executed and acknowledged by each of the
Constituent Corporations in
<PAGE>
<PAGE>
2
accordance with the provisions of Section 251 of the General Corporation Law of
the State of Delaware. Written consent has been given in accordance with Section
228 of the General Corporation Law of the State of Delaware and written notice
has been given in accordance with such Section.
THIRD: The name of the surviving corporation in the
Merger shall be AT&T Capital Corporation (the "Surviving
Corporation").
FOURTH: The certificate of incorporation of the Corporation as in
effect immediately prior to the Merger shall be the restated certificate of
incorporation of the Surviving Corporation, except that Articles First through
Twelfth are hereby deleted in their entirety and replaced with the provisions
set forth in Annex A hereto.
FIFTH: The executed Merger Agreement is on file at the principal
place of business of the Surviving Corporation, located at 44 Whippany road,
Morristown, New Jersey 07962.
SIXTH: A copy of the Merger Agreement will be
furnished by the Surviving Corporation, on request and without
cost, to any stockholder of record of either of the Constituent
Corporations.
SEVENTH: This Certificate of Merger, and the Merger provided for
herein, shall be effective as of the time of filing with the Secretary of State
of Delaware on October 1, 1996.
<PAGE>
<PAGE>
3
IN WITNESS WHEREOF, this Certificate of Merger has been executed
on the 1st day of October, 1996.
AT&T CAPITAL CORPORATION
By: /s/ Thomas C. Wajnert
--------------------------
Thomas C. Wajnert
Chairman and Chief
Executive Officer
<PAGE>
<PAGE>
RESTATED CERTIFICATE OF INCORPORATION
OF
AT&T CAPITAL CORPORATION
AT&T CAPITAL CORPORATION, a Delaware corporation, the original
Certificate of Incorporation of which was filed with the Secretary of State of
the State of Delaware on December 21, 1992, HEREBY CERTIFIES that this Restated
Certificate of Incorporation restating, integrating and amending its Certificate
of Incorporation was duly proposed by its Board of Directors and adopted by its
stockholders in accordance with Sections 242 and 245 of the General Corporation
Law of the State of Delaware.
FIRST: The name of the Corporation is: AT&T Capital Corporation
(the "Corporation").
SECOND: The registered office of the Corporation is located at
1013 Centre Road, in the City of Wilmington, County of New Castle, in the State
of Delaware. The name of its registered agent at such address is The
Prentice-Hall Corporation System, Inc.
THIRD: The purpose of the Corporation is to engage in any lawful
act or activity for which a corporation may be organized under the General
Corporation Law of the State of Delaware (the "GCL") .
FOURTH: The total number of shares of stock which the Corporation
shall have authority to issue is 150,000,000 shares of Common Stock, each having
a par value of $.0l per share, and 10,000,000 shares of Preferred Stock, each
having a par value of $.0l per share.
FIFTH: A. The business and affairs of the Corporation shall be
managed by or under the direction of a Board of Directors consisting of not
fewer than two nor more than fifteen directors, the exact number of directors to
be determined from time to time by resolution adopted by affirmative vote of a
majority of the total number of directors that the Corporation would have if
there were no vacancies in the Board of Directors (the "Whole Board"). A
director shall hold office until the next annual meeting of stockholders and
until his successor shall be elected, subject, however, to prior death,
resignation, retirement, disqualification or removal from office. Subject to the
rights of the holders of any series of Preferred Stock, any vacancy on the Board
of Directors may be filled only in accordance with Section 223 of the GCL.
Election of directors need not be by written ballot unless the By-Laws so
provide. Any director elected to fill a vacancy not resulting from an increase
in the number of directors shall have the same remaining term as that of his
predecessor.
B. Notwithstanding the foregoing, whenever the holders of any one
or more series of Preferred Stock issued by the Corporation shall have the
right, voting separately by class or series, to elect one or more directors at
an annual or special meeting of stockholders, the election, term of office,
filling of vacancies and other features of such directorships shall be governed
by the terms of this Restated Certificate of Incorporation applicable thereto
(including the resolutions adopted by the Board of Directors pursuant to Article
FOURTH). The number of directors that may be elected by the holders of any such
<PAGE>
<PAGE>
series of Preferred Stock shall be in addition to the number of directors fixed
by or pursuant to Section A of this Article FIFTH.
SIXTH: A. The Corporation shall indemnify to the fullest extent
permitted under and in accordance with the GCL, as it currently exists or as it
may hereafter be amended, any person who was or is a party to (or witness in) or
is threatened to be made a party to (or witness in) any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative, by reason of the fact that he is or was or has agreed to become a
director or officer of the Corporation, or is or was a director or officer of
the Corporation serving (or who has agreed to serve) at the request of the
Corporation as a director, officer, trustee, employee or agent of or in any
other capacity with respect to another corporation, partnership, joint venture,
trust or other enterprise (in any of the foregoing capacities, a "Representative
of the Corporation"), or by reason of any action alleged to have been taken or
omitted in such capacity, and may indemnify to the same extent any person who
was or is a party to (or witness in) or is threatened to be made a party to (or
witness in) any such action, suit or proceeding by reason of the fact that he is
or was or has agreed to become an employee or agent of the Corporation, or is or
was an employee or agent of the Corporation serving (or who has agreed to serve)
at the request of the Corporation as a Representative of the Corporation,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by him in connection with such
action, suit or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe his conduct was unlawful.
B. Expenses (including attorney fees) incurred in defending any
civil, criminal, administrative or investigative action, suit or proceeding
shall (in the case of any action, suit or proceeding against a director or
officer of the Corporation) or may (in the case of any action, suit or
proceeding against an employee, agent or Representative of the Corporation) be
paid by the corporation in advance of the final disposition of such action, suit
or proceeding as authorized by the Board of Directors upon receipt of an
undertaking by or on behalf of the indemnified person to repay such amount if it
shall ultimately be determined that such person is not entitled to be
indemnified by the Corporation as authorized in this Article SIXTH.
C. The indemnification and other rights set forth in this Article
SIXTH shall not be exclusive of any provisions with respect thereto in the
By-Laws or any other contract or agreement between the Corporation and any
officer, director, employee or agent or Representative of the Corporation, and
shall inure to the benefit of the estate or personal representative of any
person indemnified hereunder.
D. Neither the amendment nor repeal of Section A, B or C of this
Article SIXTH nor the adoption of any provision of this Restated Certificate of
Incorporation inconsistent with such Section A, B or C shall eliminate or reduce
the effect of Sections A, B and C of this Article SIXTH in respect of any matter
arising or relating to any actions or omissions occurring prior to such
amendment, repeal or adoption of an inconsistent provision or in respect of any
cause of action, suit or claim relating to any such matter that would have given
rise to a right of indemnification or right to receive payments of expenses
pursuant to
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Section A, B or C of this Article SIXTH if such provision had not been so
amended or repealed or if a provision inconsistent therewith had not been so
adopted.
E. No director of the Corporation shall be personally liable to
the Corporation or any of its stockholders for monetary damages for breach of
fiduciary duty as a director, except for any matter in respect of which such
director (a) shall be liable under Section 174 of the GCL or any amendment
thereto or successor provision thereto, or (b) shall be liable by reason that,
in addition to any and all other requirements for liability, he:
(i) shall have breached his duty of loyalty to the Corporation or
its stockholders;
(ii) shall not have acted in good faith or, in failing to act,
shall not have acted in good faith;
(iii) shall have acted in a manner involving intentional
misconduct or a knowing violation of law or, in failing to act, shall have acted
in a manner involving intentional misconduct or a knowing violation of law; or
(iv) shall have derived an improper personal benefit.
If the GCL is amended to authorize corporate action further eliminating or
limiting the personal liability of directors, then the liability of a director
of the Corporation shall be eliminated or limited to the fullest extent
permitted by the GCL as so amended. Neither the amendment nor repeal of this
Section E nor the adoption of any provision of this Restated Certificate of
Incorporation inconsistent with this Section E shall eliminate or reduce the
effect of this Section E in respect of any matter arising or relating to any
actions or omissions occurring prior to such amendment, repeal or adoption of an
inconsistent provision.
SEVENTH: A. Any action required or permitted to be taken by the
stockholders of the Corporation may be effected without a meeting of such
stockholders by a consent in writing by such stockholders in accordance with
Section 228 of the GCL.
B. At any annual meeting or special meeting of stockholders of
the Corporation, only such business shall be conducted as shall have been
brought before such meeting in the manner provided in the By-Laws.
C. The Board of Directors shall have the express power, without a
vote of stockholders, to adopt any By-Law consistent with this Restated
Certificate of Incorporation and all By-Laws adopted by vote of the stockholders
of the Corporation, and to amend, alter or repeal the By-Laws of the Corporation
other than any By-Laws adopted by vote of the stockholders of the Corporation,
except to the extent that the By-Laws or this Restated Certificate of
Incorporation otherwise provide. The Board of Directors may exercise such power
upon the affirmative vote of a majority of the whole Board. Stockholders may
adopt any By-Law, or amend, alter or repeal the By-Laws of the Corporation, in
each case consistent with this Restated Certificate of Incorporation, upon the
affirmative vote of the holders of at least a majority of the voting power of
the Voting Stock then outstanding, voting together as a single class.
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EIGHTH: The Corporation reserves the right to amend or repeal any
provision contained in this Restated Certificate of Incorporation in the manner
now or hereafter prescribed by the laws of the State of Delaware, and all rights
herein conferred upon stockholders or directors are granted subject to this
reservation.
IN WITNESS WHEREOF, AT&T Capital Corporation has caused this
Certificate to be signed on this 26th day of September, 1996 in its name and
attested by its duly authorized officers.
AT&T CAPITAL CORPORATION
By: /s/ Jeff Nash
-------------------------
Name: Jeff Nash
Title: Secretary
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AT&T CAPITAL CORPORATION
AMENDED AND RESTATED
BY-LAWS
OCTOBER 1, 1996
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BY-LAWS
OF
ANTIGUA ACQUISITION CORPORATION
(hereinafter called the "Company")
ARTICLE I
OFFICES
Section 1. Registered Office. The registered office of the
Company shall be in the City of Dover, County of Kent, State of Delaware.
Section 2. Other Offices. The Company may also have offices at
such other places both within and without the State of Delaware as the Board of
Directors may from time to time determine.
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 1. Place of Meetings. Meetings of the stockholders for
the election of directors or for any other purpose shall be held at such time
and place, either within or without the State of Delaware, as shall be
designated from time to time by the Board of Directors and stated in the notice
of the meeting or in a duly executed waiver of notice thereof. Each meeting of
the stockholders shall be chaired by the Chairman of the Board of Directors or
his designee.
Section 2. Annual Meeting. The Annual Meeting of Stockholders
shall be held on such date and at such time as shall be designated from time to
time by the Board of Directors and stated in the notice of the meeting, at which
meeting the stockholders shall elect by a plurality vote a Board of Directors,
and transact such other business as may properly be brought before the meeting.
Written notice of the Annual Meeting stating the place, date and hour of the
meeting shall be given to each stockholder entitled to vote at such meeting not
less than ten nor more than sixty days before the date of the meeting. Any
previously scheduled Annual Meeting of Stockholders may be postponed by
resolution of the Board of Directors upon notice given on or prior to the date
previously scheduled for such meeting.
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Section 3. Special Meetings. Unless otherwise prescribed by law
or by the Restated Certificate of Incorporation of the Company Special Meetings
of Stockholders, for any purpose or purposes, may be called by (i) the Chairman
of the Board of Directors, (ii) the Chief Executive Officer, (iii) the Secretary
or (iv) the Chairman of the Executive Committee, and shall be called by any such
officer at the request in writing of a majority of the entire Board of
Directors. Such request shall state the purpose or purposes of the proposed
meeting. Written notice of a Special Meeting of Stockholders stating the place,
date and hour of the meeting and the purpose or purposes for which the meeting
is called shall be given not less than ten nor more than sixty days before the
date of the meeting to each stockholder entitled to vote at such meeting. Except
as otherwise required by law or by the Restated Certificate of Incorporation, no
business shall be transacted at any Special Meeting of Stockholders other than
the items of business stated in the notice of meeting. If the Chairman of a
Special Meeting of Stockholders determines that any business proposed to be
conducted at such meeting was not properly brought before such meeting in
accordance with the foregoing procedures, the Chairman shall declare to such
meeting that such business was not properly brought before such meeting, and
such business shall not be transacted.
Section 4. Quorum. Except as otherwise provided by law or by the
Restated Certificate of Incorporation or any agreement executed by the Company's
stockholders, the holders of a majority of the capital stock issued and
outstanding and entitled to vote thereat, present in person or represented by
proxy, shall constitute a quorum at all meetings of the stockholders for the
transaction of business. If, however, such quorum shall not be present or
represented at any meeting of the stockholders, the stockholders entitled to
vote thereat, present in person or represented by proxy, shall have power to
adjourn the meeting from time to time, without notice other than announcement at
the meeting of the place, date and hour of the adjourned meeting, until a quorum
shall be present or represented. At such adjourned meeting at which a quorum
shall be present or represented, any business may be transacted which might have
been transacted at the meeting as originally noticed. If the adjournment is for
more than thirty days, or if after the adjournment a new record date is fixed
for the adjourned meeting, a notice of the adjourned meeting shall be given to
each stockholder entitled to vote at the meeting.
Section 5. Voting. Unless otherwise required by law, the Restated
Certificate of Incorporation, these By-Laws or any agreement executed by the
Company's stockholders, any question brought before any meeting of stockholders
shall be decided by the vote of the holders of a majority of the stock
represented and entitled to vote thereat. Each stockholder represented at a
meeting of stockholders shall be entitled to cast one vote for each share of the
capital stock entitled to vote thereat held by such stockholder or such other
vote, if any, as shall be set forth in the Restated Certificate of
Incorporation. Such votes may be cast in person or by duly executed proxy but no
proxy shall be voted on or after three years from its date, unless such proxy
provides for a longer period. The Board of Directors, in its discretion, or the
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officer of the Company presiding at a meeting of stockholders, in his
discretion, may require that any votes cast at such meeting shall be cast by
written ballot.
Section 6. List of Stockholders Entitled to Vote. The Secretary
of the Company shall prepare and make, at least ten days before every meeting of
stockholders, a complete list of the stockholders entitled to vote at the
meeting, arranged in alphabetical order, and showing the address of each
stockholder and the number of shares registered in the name of each stockholder.
Such list shall be open to the examination of any stockholder, for any purpose
germane to the meeting, during ordinary business hours, for a period of at least
ten days prior to the meeting, either at a place within the city where the
meeting is to be held, which place shall be specified in the notice of the
meeting, or, if not so specified, at the place where the meeting is to be held.
The list shall also be produced and kept at the time and place of the meeting
during the whole time thereof, and may be inspected by any stockholder of the
Company who is present.
Section 7. Stock Ledger. The stock ledger of the Company shall be
the only evidence as to who are the stockholders entitled to examine the stock
ledger, the list required by Section 6 of this Article II or the books of the
Company, or to vote in person or by proxy at any meeting of stockholders.
Section 8. Business at Annual Meetings. No business may be
transacted at an Annual Meeting of Stockholders, other than business that is
either (a) specified in the notice of meeting (or any supplement thereto) given
by or at the direction of the Board of Directors (or any duly authorized
committee thereof), (b) otherwise properly brought before the Annual Meeting of
Stockholders by or at the direction of the Board of Directors (or any duly
authorized committee thereof) or (c) otherwise properly brought before the
Annual Meeting of Stockholders by any stockholder of the Company who is a
stockholder of record on the date of the giving of the notice provided for in
this Section 8 and on the record date for the determination of stockholders
entitled to vote at such annual meeting.
ARTICLE III
DIRECTORS
Section 1. Number and Election of Directors. The Board of
Directors shall consist of not less than two nor more than fifteen members, the
exact number of which shall be fixed from time to time by resolution adopted by
the affirmative vote of a majority of the total number of directors that the
Company would have if there were no vacancies in the Board of Directors. Any
director may resign at any time by delivering a written notice of resignation,
signed by such director, to the Board of Directors or the Chief Executive
Officer. Unless otherwise specified therein, such resignation shall take effect
upon delivery. Directors need not be stockholders.
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Section 2. Vacancies. Any vacancy on the Board of Directors may
be filled in accordance with Section 223 of the General Corporation Law of the
State of Delaware.
Section 3. Duties and Powers. The business of the Company shall
be managed by or under the direction of the Board of Directors which may
exercise all such powers of the Company and do all such lawful acts and things
as are not by statute or by the Restated Certificate of Incorporation or by
these By-Laws directed or required to be exercised or done by the stockholders.
Section 4. Meetings. The Board of Directors of the Company may
hold meetings, both regular and special, either within or without the State of
Delaware. Each meeting of the Board of Directors shall be chaired by the
Chairman of the Board of Directors, who shall be a director chosen by a majority
of the entire Board, or, in his absence, by the Vice Chairman of the Board of
Directors, if any, who shall also be a director chosen by a majority of the
entire Board, or, in their absence, by such director as shall be chosen by a
majority of the directors in attendance at such meeting. Regular meetings of the
Board of Directors may be held without notice at such time and at such place as
may from time to time be determined by the Board of Directors. Special meetings
of the Board of Directors may be called by the Chairman, the Vice Chairman, the
Chief Executive Officer, the President or any director. Notice thereof stating
the place, date and hour of the meeting shall be given to each director either
by mail not less than forty-eight (48) hours before the date of the meeting, by
telephone or telegram on twenty-four (24) hours' notice, or on such shorter
notice as the person or persons calling such meeting may deem necessary or
appropriate in the circumstances.
Section 5. Quorum. Except as may be otherwise specifically
provided by law, the Restated Certificate of Incorporation or these By-Laws, at
all meetings of the Board of Directors, a majority of the entire Board of
Directors shall constitute a quorum for the transaction of business and the act
of a majority of the directors present at any meeting at which there is a quorum
shall be the act of the Board of Directors. If a quorum shall not be present at
any meeting of the Board of Directors, the directors present thereat may adjourn
the meeting from time to time, without notice other than announcement at the
meeting, until a quorum shall be present.
Section 6. Actions by Consent. Unless otherwise provided by the
Restated Certificate of Incorporation or these By-Laws, any action required or
permitted to be taken at any meeting of the Board of Directors or of any
committee thereof may be taken without a meeting, by written consent of all the
members of the Board of Directors or such committee, as the case may be, which
consent may be executed in counterparts, and the writing or writings shall be
filed with the minutes of proceedings of the Board of Directors or such
committee.
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Section 7. Meetings by Means of Conference Telephone. Unless
otherwise provided by the Restated Certificate of Incorporation or these
By-Laws, members of the Board of Directors of the Company, or any committee
thereof, may participate in a meeting of the Board of Directors or such
committee by means of a conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other,
and participation in a meeting pursuant to this Section 7 shall constitute
presence in person at such meeting.
Section 8. Committees. The Board of Directors may, by resolution
passed by a majority of the entire Board of Directors, designate one or more
committees, each committee to consist of one or more of the directors of the
Company. The Board of Directors may designate one or more directors as alternate
members of any committee, who may replace any absent or disqualified member at
any meeting of any such committee. In the absence or disqualification of a
member of a committee, and in the absence of a designation by the Board of
Directors of an alternate member to replace the absent or disqualified member,
the member or members thereof present at any meeting and not disqualified from
voting, whether or not he or they constitute a quorum, may unanimously appoint
another member of the Board of Directors to act at the meeting in the place of
any absent or disqualified member. Any committee, to the extent allowed by law
and provided in the resolution establishing such committee or in the charter for
such Committee approved by the Board of Directors from time to time, shall have
and may exercise all the powers and authority of the Board of Directors in the
management of the business and affairs of the Company. Each committee shall keep
regular minutes and report to the Board of Directors when appropriate.
Section 9. Compensation. The directors may be paid their
expenses, if any, of attendance at each meeting of the Board of Directors and
may be paid a fixed sum for attendance at each meeting of the Board of Directors
or a stated salary or retainer as director. No such payment shall preclude any
director from serving the Company in any other capacity and receiving
compensation therefor. Members of special or standing committees may be allowed
like compensation for attending committee meetings or acting as chairman of any
committee.
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ARTICLE IV
OFFICERS
Section 1. General. The officers of the Company shall be chosen
by the Board of Directors and shall include a Chief Executive Officer, a
Secretary and a Treasurer. The Board of Directors, in its discretion, may also
choose one or more other officers. Any number of offices may be held by the same
person, unless otherwise prohibited by law, the Restated Certificate of
Incorporation or these By-Laws. The officers of the Company need not be
stockholders of the Company nor need such officers be directors of the Company.
The Chairman of the Board of Directors, in such capacity, shall not be
considered an officer of the Company.
Section 2. Election. The Board of Directors shall elect the
officers of the Company who shall hold their offices for such terms and shall
exercise such powers and perform such duties as shall be determined from time to
time by the Board of Directors; and all officers of the Company shall hold
office until their successors are chosen and qualified, or until their earlier
death, resignation or removal. Subject to the next sentence, any vacancy by
death, resignation, removal or otherwise occurring in any office of the Company
shall be filled by the Board of Directors. The Company's Chief Executive
Officer, and any officer designated by the Chief Executive Officer, may appoint
and remove officers of the Company from time to time; provided, however, that
the following officers can be elected or removed only by the Board of Directors
or its Executive Committee: the Chief Executive Officer, any senior or executive
vice president, the Secretary and the Treasurer
Section 3. Voting Securities Owned by the Company. Powers of
attorney, proxies, waivers of notice of meeting, consents and other instruments
relating to securities owned by the Company may be executed in the name of and
on behalf of the Company by the Chief Executive Officer, the Treasurer or the
Secretary and any such officer may, in the name of and on behalf of the Company,
take all such action as any such officer may deem advisable to vote in person or
by proxy at any meeting of security holders of any Company in which the Company
may own securities and at any such meeting shall possess and may exercise any
and all rights and powers incident to the ownership of such securities and
which, as the owner thereof, the Company might have exercised and possessed if
present. The Board of Directors may, by resolution, from time to time confer
like powers upon any other person or persons.
Section 4. Chief Executive Officer. The Chief Executive Officer
shall be the chief executive officer of the Company, shall have general and
active supervision, and plenary power, over all the business and affairs of the
Company, subject to the control of the Board of Directors, shall be responsible
for the general management and direction of all the business and affairs of the
Company to execute, in the name and on behalf of the Company, all bonds,
mortgages, contracts and other instruments of the Company which may be
authorized by the Board of Directors. The Chief Executive
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Officer shall also perform such other duties and may exercise such other powers
as are incident to his office or as from time to time may be assigned to him by
these By-Laws or by the Board of Directors.
Section 5. Secretary. The Secretary shall attend all meetings of
the Board of Directors and all meetings of stockholders and record all the
proceedings thereat in a book or books to be kept for that purpose; the
Secretary shall also perform like duties for each standing committee when
required by such committee. The Secretary shall give, or cause to be given,
notice of all meetings of the stockholders and special meetings of the Board of
Directors, and shall perform such other duties as may be prescribed by the Board
of Directors, the Chairman of the Board of Directors, or the Chief Executive
Officer. If the Secretary shall be unable or shall refuse to cause to be given
notice of any meeting of the stockholders or special meeting of the Board of
Directors, and if there be no Assistant Secretary, then the Board of Directors,
the Chairman of the Board of Directors, or the Chief Executive Officer may
choose another officer to cause such notice to be given. The Secretary shall
have custody of the seal of the Company and the Secretary or any Assistant
Secretary, if there be one, shall have authority to affix the same to any
instrument requiring it and when so affixed, it may be attested by the signature
of the Secretary or by the signature of any such Assistant Secretary. The Board
of Directors may give general authority to any other officer to affix the seal
of the Company and to attest the affixing by his signature. The Secretary shall
see that all books, reports, statements, certificates and other documents and
records required by law to be kept or filed are properly kept or filed, as the
case may be. In addition, the Secretary shall, promptly upon receipt of a
request for indemnification from any person pursuant to Section 3 of Article
VIII, advise the Board of Directors in writing of the receipt of such request.
Section 6. Treasurer. Subject at all times to the control of the
Board of Directors and the Chief Executive Officer, the Treasurer shall have
custody of, and be responsible for, the corporate funds and securities and shall
invest the same in his discretion and shall keep full and accurate accounts of
receipts and disbursements in books belonging to the Company and shall deposit
all moneys and other valuable effects in the name and to the credit of the
Company in such depositories as may be designated by the Board of Directors. The
Treasurer shall disburse the funds of the Company as may be ordered by the Board
of Directors, taking proper vouchers for such disbursements, and shall render to
the Chief Executive Officer or the President, and the Board of Directors, at its
regular meetings, or when the Board of Directors so requires, an account of all
his transactions as Treasurer and of the financial condition of the Company. The
Treasurer shall perform such other duties and have such other powers as the
Board of Directors or the Chief Executive Officer from time to time may
prescribe.
Section 7. Assistant Secretaries. Except as may be otherwise
provided in these By-Laws, Assistant Secretaries, if there be any, shall perform
such duties and have such powers as from time to time may be assigned to them by
the Board of
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Directors, the Chief Executive Officer, or the Secretary, and in the absence of
the Secretary or in the event of his disability or refusal to act, shall perform
the duties of the Secretary, and when so acting, shall have all the powers of
and be subject to all the restrictions upon the Secretary.
Section 8. Assistant Treasurers. Assistant Treasurers, if there
be any, shall perform such duties and have such powers as from time to time may
be assigned to them by the Board of Directors, the Chief Executive Officer, or
the Treasurer, and in the absence of the Treasurer or in the event of his
disability or refusal to act, shall perform the duties of the Treasurer, and
when so acting, shall have all the powers of and be subject to all the
restrictions upon the Treasurer.
Section 9. Other Officers. Such other officers as the Board of
Directors may choose shall perform such duties and have such powers as from time
to time may be assigned to them by the Board of Directors. The Board of
Directors may delegate to any other officer of the Company the power to choose
such other officers and to prescribe their respective duties and powers.
Section 10. Removal and Resignation; Vacancies. Any officer may
be removed for or without cause at any time by the Board of Directors. Any
officer may resign at any time by delivering a written notice of resignation,
signed by such officer, to the Board of Directors or the Chief Executive
Officer. Unless otherwise specified therein, such resignation shall take effect
upon delivery.
ARTICLE V
STOCK
Section 1. Form of Certificates. Every holder of stock in the
Company shall be entitled to have a certificate signed, in the name of the
Company (i) by the Chief Executive Officer and (ii) by the Treasurer or an
Assistant Treasurer, or the Secretary or an Assistant Secretary of the Company,
certifying the number of shares owned by him in the Company.
Section 2. Signatures. Where a certificate is countersigned by
(i) a transfer agent other than the Company or its employee, or (ii) a registrar
other than the Company or its employee, any other signature on the certificate
may be facsimile. In case any officer, transfer agent or registrar who has
signed or whose facsimile signature has been placed upon a certificate shall
have ceased to be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the Company with the same effect as
if he or it were such officer, transfer agent or registrar at the date of issue.
Section 3. Lost Certificates. The Board of Directors may direct a
new certificate to be issued in place of any certificate theretofore issued by
the Company
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alleged to have been lost, stolen or destroyed, upon the making of an affidavit
of that fact by the person claiming the certificate of stock to be lost, stolen
or destroyed. When authorizing such issue of a new certificate, the Board of
Directors may, in its discretion and as a condition precedent to the issuance
thereof, require the owner of such lost, stolen or destroyed certificate, or his
legal representative, to advertise the same in such manner as the Board of
Directors shall require and/or to give the Company a bond in such sum as it may
direct as indemnity against any claim that may be made against the Company with
respect to the certificate alleged to have been lost, stolen or destroyed.
Section 4. Transfers. Stock of the Company shall be transferable
in the manner prescribed by law and in these By-Laws. Transfers of stock shall
be made on the books of the Company only by the person named in the certificate
or by his attorney lawfully constituted in writing and upon the surrender of the
certificate therefor, which shall be cancelled before a new certificate shall be
issued.
Section 5. Record Date. In order that the Company may determine
the stockholders entitled to notice of or to vote at any meeting of stockholders
or any adjournment thereof, or entitled to receive payment of any dividend or
other distribution or allotment of any rights, or entitled to exercise any
rights in respect of any change, conversion or exchange of stock, or for the
purpose of any other lawful action, the Board of Directors may fix, in advance,
a record date, which shall not be more than sixty days nor less than ten days
before the date of such meeting, nor more than sixty days prior to any such
other corporate action. A determination of stockholders of record entitled to
notice of or to vote at a meeting of stockholders shall apply to any adjournment
of the meeting; provided, however, that the Board of Directors may fix a new
record date for the adjourned meeting.
Section 6. Beneficial Owners. The Company shall be entitled to
recognize the exclusive right of a person registered on its books as the owner
of shares to receive dividends, and to vote as such owner, and for all other
purposes, and shall not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other person, whether or not
it shall have express or other notice thereof, except as otherwise provided by
law.
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ARTICLE VI
NOTICES
Section 1. Notices. Whenever written notice is required by law,
the Restated Certificate of Incorporation or these By-Laws to be given to any
director, member of a committee or stockholder, such notice may be given by
mail, addressed to such director, member of a committee or stockholder, at his
address as it appears on the records of the Company, with postage thereon
prepaid, and such notice shall be deemed to be given at the time when the same
shall be deposited in the United States mail. Written notice may also be given
personally or by telegram, facsimile, telex, cable or nationally recognized
overnight courier.
Section 2. Waivers of Notice. Whenever any notice is required by
law, the Restated Certificate of Incorporation or these By-Laws, to be given to
any director, member of a committee or stockholder, a waiver thereof in writing,
signed by the person or persons entitled to said notice, whether before or after
the time stated therein, and, in the case of a waiver of notice of a meeting,
whether or not the business to be transacted at or the purposes of such meeting
is set forth in such waiver, shall be deemed equivalent thereto. The attendance
of any person at any meeting, in person or, in the case of a meeting of
stockholders, by proxy, shall constitute a waiver of notice of such meeting
except where such person attends such meeting for the express purpose of
objecting at the beginning of such meeting to the transaction of any business on
the grounds that such meeting is not duly called or convened.
ARTICLE VII
GENERAL PROVISIONS
Section 1. Dividends. Dividends upon the capital stock of the
Company, subject to the provisions of the Restated Certificate of Incorporation,
if any, may be declared by the Board of Directors or the Executive Committee at
any regular or special meeting, and may be paid in cash, in property, or in
shares of capital stock. Before payment of any dividend, there may be set aside
out of any funds of the Company available for dividends such sum or sums as the
Board of Directors or the Executive Committee from time to time, in its absolute
discretion, deems proper as a reserve or reserves to meet contingencies, or for
equalizing dividends, or for repairing or maintaining any property of the
Company, or for any proper purpose, and the Board of Directors or the Executive
Committee may modify or abolish any such reserve.
Section 2. Disbursements. All checks or demands for money and
notes of the Company shall be signed by such officer or officers or such other
person or persons as may be provided by these By-laws or as the Board of
Directors may from time to time designate or approve.
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Section 3. Fiscal Year. The fiscal year of the Company shall be
the calendar year unless otherwise fixed by resolution of the Board of
Directors.
Section 4. Corporate Seal. The corporate seal shall have
inscribed thereon the name of the Company, the year of its organization and the
words "Corporate Seal--Delaware". The seal may be used by causing it or a
facsimile thereof to be impressed or affixed or reproduced or otherwise.
ARTICLE VIII
INDEMNIFICATION
Section 1. Power to Indemnify in Actions, Suits or Proceedings
other Than Those by or in the Right of the Company. Subject to Section 3 of this
Article VIII, the Company shall, to the fullest extent permitted by applicable
law, indemnify any person who was or is a party to (or witness in) or is
threatened to be made a party to (or witness in) any threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative or
investigative (other than an action or suit by or in the right of the Company)
by reason of the fact that he is or was or has agreed to become a director or
officer of the Company, or is or was a director or officer of the Company
serving (or has agreed to serve) at the request of the Company as a director or
officer, employee, trustee or agent of or in any other capacity with respect to
another Company, partnership, joint venture, trust, employee benefit plan or
other enterprise (in any of the foregoing capacities, a "Representative of the
Company"), or by reason of any action alleged to have been taken or omitted in
such capacity, and may indemnify any person who was or is a party to (or witness
in) or is threatened to be made a party to (or witness in) any such action, suit
or proceeding by reason of the fact that he is or was or has agreed to become an
employee or agent of the Company, or is or was serving (or has agreed to serve)
at the request of the Company as a Representative of the Company, costs,
charges, expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement (collectively, "Expenses") actually and reasonably incurred by him
in connection with such action, suit or proceeding and any appeal therefrom, if
he acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Company, and, with respect to any criminal
action or proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which he reasonably believed to be in or not opposed to
the best interests of the Company, and, with respect to any criminal action or
proceeding, have reasonable cause to believe that his conduct was unlawful.
Section 2. Power to Indemnify in Actions, Suits or Proceedings by
or in the Right of the Company. Subject to Section 3 of this Article VIII, the
Company shall, to the fullest extent permitted by applicable law, indemnify any
person who was or is a
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party to (or witness in) or is threatened to be made a party to (or witness in)
any threatened, pending or completed action, suit or proceeding by or in the
right of the Company to procure a judgment in its favor by reason of the fact
that he is or was or has agreed to become a director or officer of the Company,
or is or was a director or officer of the Company serving (or has agreed to
serve) at the request of the Company as a Representative of the Company, or by
reason of any action alleged to have been taken or omitted in such capacity, and
may indemnify any person who was or is a party to (or witness in) or is
threatened to be made a party to (or witness in) any such action, suit or
proceeding by reason of the fact that he is or was or has agreed to become an
employee or agent of the Company, or is or was an employee or agent of the
Company serving (or has agreed to serve) at the request of the Company as a
Representative of the Company, against Expenses actually and reasonably incurred
by him in connection with the defense or settlement of such action or suit if he
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Company; except that no indemnification
shall be made in respect of any claim, issue or matter as to which such person
shall have been adjudged to be liable to the Company unless and only to the
extent that the Delaware Court of Chancery or the court in which such action or
suit was brought shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, such person is
fairly and reasonably entitled to indemnity for such Expenses which the Delaware
Court of Chancery or such other court shall deem proper.
Section 3. Authorization of Indemnification; Procedures. Any
indemnification under this Article VIII (unless ordered by a court) shall be
made by the Company only as authorized in the specific case upon a determination
that indemnification of the person seeking indemnification is proper in the
circumstances because he has met the applicable requirements set forth in
Section 1 or Section 2 of this Article VIII, as the case may be. A person,
seeking indemnification under this Article VIII shall submit to the Secretary of
the Company a written request including such documentation and information as is
reasonably available to person and reasonably necessary to determine whether and
to what extent such person is entitled to indemnification (the "Supporting
Documentation"). In the case of indemnification sought pursuant to the first
sentence of subsection (I) of paragraph A of the Sixth Article of the Company's
Restated Certificate of Incorporation ("Mandatory Indemnification), such
determination shall be made not later than 60 calendar days after receipt by the
Company of such request together with the Supporting Documentation (i) by the
Board of Directors by a majority vote of a quorum consisting of directors who
were not parties to such action, suit or proceeding, or (ii) if such a quorum is
not obtainable, or, even if obtainable a quorum of disinterested directors so
directs, by independent legal counsel in a written opinion, or (iii) by majority
vote of the stockholders. If no such determination has been made within 60
calendar days after receipt by the Company of the request therefor together with
the Supporting Documentation, such person shall be deemed entitled to Mandatory
Indemnification, unless (x) such person misrepresented or failed to disclose a
material fact in making the request for indemnification or in the Supporting
Documentation, or (y) such
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indemnification is prohibited by law. Notwithstanding the foregoing, to the
extent that a director or officer of the Company has been successful on the
merits or otherwise in defense of any action, suit or proceeding described
above, or in defense of any claim, issue or matter therein, he shall be
indemnified against Expenses actually and reasonably incurred by him in
connection therewith, without the necessity of authorization in the specific
case. If a determination shall have been made or deemed to have been made,
pursuant to this Section 3, or pursuant to the preceding sentence is not
required to be made, that any person seeking Mandatory Indemnification is
entitled to such indemnification, the Company shall be obligated to pay the
amounts constituting such indemnification within five days after such
determination has been made or deemed to have been made and shall be
conclusively bound by such determination unless (A) such person misrepresented
or failed to disclose a material fact in making the request for indemnification
or in the Supporting Documentation or (B) such indemnification is prohibited by
law. In the event that (x) advancement of Expenses is not timely made pursuant
to Section 6 or (y) payment of Mandatory Indemnification is not made within five
calendar days after a determination of entitlement to indemnification has been
made or deemed to have been made such person shall be entitled to seek judicial
enforcement, in any court of competent jurisdiction, of the Company's
obligations to pay such advancement of Expenses or Mandatory Indemnification.
Notwithstanding the foregoing, the Company may bring an action, in an
appropriate court in the State of Delaware or any other court of competent
jurisdiction, contesting the right of any person to receive Mandatory
Indemnification hereunder due to the occurrence of an event or a condition
described in subclause (A) or (B) of the second preceding sentence (a
"Disqualifying Event"); provided, however, that in any such action the Company
shall have the burden of proving the occurrence of such Disqualifying Event.
Section 4. Good Faith Defined. For purposes of any determination
under Section 3 of this Article VIII, a person shall be deemed to have acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the Company, or, with respect to any criminal action or
proceeding, to have had no reasonable cause to believe his conduct was unlawful,
if his action is based on the records or books of account of the Company or
another enterprise, or on information supplied to him by the officers of the
Company or another enterprise in the course of their duties, or on the advice of
legal counsel for the Company or another enterprise or on information or records
given or reports made to the Company or another enterprise by an independent
certified public accountant or by an appraiser or other expert selected with
reasonable care by the Company or another enterprise, unless the Company shall
sustain the burden of proof that such person had actual knowledge that such
records, books of account, information, advice or reports were incorrect in a
material respect. The term "another enterprise" as used in this Section 4 shall
mean any other corporation or any partnership, joint venture, trust, employee
benefit plan or other enterprise of which such person is or was serving at the
request of the Company as a Representative of the Company. The provisions of
this Section 4 shall not be deemed to be exclusive or to limit in any way the
circumstances in which a person may
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be deemed to have met the applicable standard of conduct set forth in Sections 1
or 2 of this Article VIII, as the case may be.
Section 5. Actions for Mandatory Indemnification. Notwithstanding
any contrary determination in the specific case under Section 3 of this Article
VIII, and notwithstanding the absence of any determination thereunder, any
director or officer shall, after the 60 calendar day period referred to in
Section 3 of this Article VIII has elapsed, be entitled to seek an adjudication
of his entitlement to Mandatory Indemnification under this Article VIII either,
at his sole option, in (i) any court of competent jurisdiction in the State of
Delaware or (ii) an arbitration to be conducted by a single arbitrator pursuant
to the then applicable rules of the American Arbitration Association. The basis
of any such indemnification shall be a determination by such court or arbitrator
that indemnification of the director or officer is proper in the circumstances
because he has met the applicable requirements set forth in Sections 1 or 2 of
this Article VIII, as the case may be. It shall be a defense to any such
adjudication (other than an adjudication brought to enforce a claim for the
advance of Expenses under Section 6 of this Article VIII where the required
undertaking, if any, has been received by the Company) that the claimant has not
met the requirements set forth in Section 1 or 2 of this Article VIII, but the
burden of proving such defense shall be on the Company. Neither a contrary
determination in the specific case under Section 3 of this Article VIII nor the
absence of any determination thereunder shall be a defense to such claim for
indemnification or create a presumption that the director or officer seeking
indemnification has not met any applicable requirement for Mandatory
Indemnification. The Company shall be precluded from asserting in any judicial
proceeding or arbitration commenced pursuant to this Section 5 that the
procedures and presumptions of this Article VIII are not valid, binding and
enforceable and shall stipulate in any such court or before any such arbitrator
that the Company is bound by all the provisions of this Article. Notice of any
adjudication for Mandatory Indemnification pursuant to this Section 5 shall be
given to the Company promptly upon the filing of the application for such
adjudication. If successful, in whole or in part, the director or officer
seeking Mandatory Indemnification shall also be entitled to be paid the expenses
of prosecuting such adjudication.
Section 6. Expenses Payable in Advance. Expenses incurred by a
director or officer in defending or investigating any threatened or pending
action, suit or proceeding shall be paid by the Company in advance of the final
disposition of such action, suit or proceeding within five business days after
the receipt by the Company of a statement or statements from such director or
officer requesting such advance or advances from time to time. Such statement or
statements shall reasonably evidence such Expenses and shall include or be
accompanied by (i) a certificate of such director of officer to the effect that
such person in good faith believes that he is entitled to be indemnified by the
Company pursuant to this Article VIII for such Expenses and (ii) an undertaking
by or on behalf of such director or officer to repay such amount or amounts if
it shall ultimately be determined that he is not entitled to be indemnified by
the Company as authorized in this Article VIII. Such Expenses incurred by other
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employees and agents of the Company may be so paid upon such terms and
conditions, if any, as the Board of Directors deems appropriate. The Board of
Directors may authorize the Company's counsel to represent such person in any
action, suit or proceeding, whether or not the Company is a party to such
action, suit or proceeding.
Section 7. Nonexclusivity of Indemnification and Advancement of
Expenses. The indemnification and advancement of Expenses provided by or granted
pursuant to this Article VIII shall not be deemed exclusive of any other rights
to which those seeking indemnification or advancement of Expenses may be
entitled under the Restated Certificate of Incorporation, any By-Law, agreement,
contract, vote of stockholders or disinterested directors or pursuant to the
direction (howsoever embodied) of any court of competent jurisdiction or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding such office, it being the policy of the Company
that indemnification of the persons specified in Sections 1 and 2 of this
Article VIII shall be made to the fullest extent permitted by law. The
provisions of this Article VIII shall not be deemed to preclude the
indemnification of any person who is not specified in Sections 1 or 2 of this
Article VIII but whom the Company has the power or obligation to indemnify under
the provisions of the General Corporation Law of the State of Delaware, or
otherwise.
Section 8. Insurance. The Company may, to the fullest extent
permitted by applicable law, purchase and maintain insurance on behalf of any
person who is or was or has agreed to become a director, officer, employee or
agent of the Company, or is or was a director, officer, employee or agent of the
Company serving at the request of the Company as a Representative of the Company
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such, whether or not the Company would
have the power or the obligation to indemnify him against such liability under
the provisions of this Article VIII.
Section 9. Certain Definitions. For purposes of this Article
VIII, references to "fines" shall include any excise taxes assessed on or
against a person with respect to any employee benefit plan; and references to
"serving at the request of the Company" shall include any service as a director,
officer, employee or agent of the Company which imposes duties on, or involves
services by, such director, officer, employee or agent with respect to an
employee benefit plan, its participants or beneficiaries; and a person who acted
in good faith and in a manner he reasonably believed to be in the interest of
the participants and beneficiaries of an employee benefit plan shall be deemed
to have acted in a manner "in or not opposed to the best interests of the
Company" as referred to in this Article VIII.
Section 10. Survival of Indemnification and Advancement of
Expenses; Contract Right. The indemnification and advancement of Expenses
provided by, or granted pursuant to, this Article VIII shall continue as to a
person who has ceased to be a director, officer, employee or agent and shall
inure to the benefit of the heirs, executors and administrators of such a
person. The indemnification provisions of this
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Article VIII shall be deemed to be a contract between the Company and each
director, officer, employee and agent who serves in any such capacity at any
time while these provisions are in effect, and any repeal or modification
thereof shall not affect any right or obligation then existing with respect to
any state of facts then or previously existing or any action, suit or proceeding
previously or thereafter brought or threatened based in whole or in part upon
any such state of facts. Such a "contract right" may not be modified
retroactively without the consent of such director, officer, employee or agent.
Section 11. Limitation on Indemnification. Notwithstanding
anything contained in this Article VIII to the contrary, except for proceedings
to enforce rights to indemnification (which shall be governed by Section 5
hereof), the Company shall not be obligated to indemnify any director or officer
in connection with a proceeding (or part thereof) initiated by such person
unless such proceeding (or part thereof) was authorized or consented to by the
Board of Directors of the Company.
Section 12. Severability. If this Article VIII or any portion
hereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Company shall nevertheless indemnify each director or
officer and may indemnify each employee or agent of the Company as to Expenses
with respect to any action, suit or proceeding, whether civil, criminal,
administrative or investigative, including an action by or in the right of the
Company, to the fullest extent permitted by any applicable portion of this
Article VIII that shall not have been invalidated and to the fullest extent
permitted by applicable law.
ARTICLE IX
AMENDMENTS
Section 1. Amendments. The Board of Directors shall have the
express power, without a vote of stockholders, to adopt any By-Law, and to
amend, alter or repeal these By-Laws, except to the extent that these By-Laws or
the Restated Certificate of Incorporation otherwise provide. The Board of
Directors may exercise such power upon the affirmative vote of a majority of the
entire Board of Directors. Stockholders may not adopt any By-Law, nor amend,
alter or repeal these By-Laws of the Company, except upon the affirmative vote
of the holders of at least a majority of the votes entitled to be cast by the
holders of all then outstanding shares of stock of the Company entitled to vote
generally in the election of directors, voting together as a single class.
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ARTICLE X
CONSTRUCTION
Section 1. Construction. In the event of any conflict between the
provisions of these By-Laws as in effect from time to time and the provisions of
the Restated Certificate of Incorporation of the Company as in effect from time
to time, the provisions of such Restated Certificate of Incorporation shall be
controlling.
Section 2. Entire Board of Directors. As used in this Article X
and in these By-Laws generally, the term "entire Board of Directors" means the
total number of directors which the Company would have if there were no
vacancies in the Board of Directors.
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Form 8-K October 1, 1996
Exhibit 99
Consortium Completes Purchase of AT&T Capital
For Immediate Release: October 1, 1996
- --------------------------------------
Morristown, NJ - AT&T Capital Corporation today announced the completion of
its merger with a majority-owned subsidiary of GRS Holding Company Ltd.
("GRSH"), owner of a U.K. rail leasing company. Following the merger, the
company is owned by a leasing consortium composed of certain members of AT&T
Capital's senior management, led by Chairman and CEO Tom Wajnert and GRSH.
As a result of the merger, stockholders of AT&T Capital will receive $45 in
cash for each outstanding share of the company's common stock. Instructions
concerning the exchange of shares for cash will be mailed shortly to the
company's stockholders of record by First Chicago Trust Company of New York, the
paying agent.
The company will continue under the name, "AT&T Capital Corporation" and
will maintain its headquarters in Morristown, New Jersey.
