As filed with the Securities and Exchange Commission on September 20, 1996
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
MK RAIL CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 82-0461010
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1200 Reedsdale Street
Pittsburgh, Pennsylvania 15233
(412) 237-2250
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
Michael A. Wolf
President and Chief Executive Officer
MK Rail Corporation
1200 Reedsdale Street
Pittsburgh, Pennsylvania 15233
(412) 237-2250
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
Copies to:
David G. Edwards, Esq.
Doepken Keevican & Weiss Professional Corporation
37th Floor, USX Tower
600 Grant Street
Pittsburgh, Pennsylvania 15219
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement as
determined by market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [x]
<PAGE>
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
Proposed
Maximum Maximum
Title of each class of Amount to Offering Price Aggregate Amount of
Securities to be registered be Registered Per Share (1) Offering Price (1) Registration Fee
- --------------------------- ------------- ------------- ------------------ ----------------
<C> <C> <C> <C> <C>
Common Stock, par value
$.01 per share. . . . . . . . 11,149,000 $5.41 $60,316,090 $20,799
<FN>
(1) Estimated solely for the purpose of calculating the registration fee
pursuant to Rule 457(c) at $5.41 per share on the basis of the average of the
high and low reported sales prices on September 17, 1996.
</FN>
</TABLE>
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
<PAGE>
Subject to Completion, Dated September 20, 1996
PROSPECTUS
11,149,000 Shares
MK Rail Corporation
Common Stock
(par value $.01 per share)
----------------
This Prospectus relates to 11,149,000 shares (the "Shares") of
common stock, par value $.01 per share (the "Common Stock"), of MK Rail
Corporation, a Delaware corporation (the "Company" or "MK Rail"), which may be
offered and sold from time to time by the selling stockholders named herein (the
"Selling Stockholders"). See "Selling Stockholders." This Prospectus does not
relate to the sale or issuance by the Company of any Common Stock. The Common
Stock which is offered will be offered for the respective accounts of the
Selling Stockholders, who will acquire Common Stock of the Company pursuant to a
Plan of Reorganization for Morrison Knudsen Corporation, a Delaware corporation
("MKC"), submitted as part of MKC's bankruptcy filing in the United States
Bankruptcy Court for the District of Delaware, which plan was confirmed on
August 26, 1996 and became effective September 11, 1996. The Company will not
receive any proceeds from the sale of Common Stock by the Selling Stockholders.
The distribution of the Shares by the Selling Stockholders
shall be effected directly by means of ordinary brokers' transactions or, in
cash or exchange transactions, to one or more institutional purchasers or
through sales agents in one or more transactions by means of ordinary brokers'
transactions, block transactions (which may involve crosses) in accordance with
the rules of Nasdaq, privately negotiated transactions or a combination of such
methods of sale, in each case at market prices prevailing at the time of sale or
at negotiated prices acceptable to the Selling Stockholders. See "Plan of
Distribution." The Company will pay the expenses of registration of the Shares.
The Selling Stockholders will pay all fees and expenses of their own legal
counsel and accountants and all commissions or transfer taxes, if any.
The Company's Common Stock is traded on the Nasdaq National
Market System under the symbol "MKRL."
----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY
STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
----------------
THE INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR
AMENDMENT. A REGISTRATION STATEMENT RELATING TO THESE SECURITIES
1
<PAGE>
HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY
NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION
STATEMENT BECOMES EFFECTIVE. THE PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO
SELL OR THE SOLICITATION OF ANY OFFER TO BUY NOR SHALL THERE BE ANY SALE OF
THESE SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY
SUCH STATE.
----------------
The date of this Prospectus
is __________, 1996
2
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information filed by MK Rail with the Commission can be
inspected and copied at the public reference facilities maintained by the
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and should be
available at the Commission's Regional Offices at Seven World Trade Center, 13th
Floor, New York, New York 10048, and 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such material also can be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. The Commission also maintains a
"web site" that contains reports, proxy and information statements and other
information regarding registrants that file electronically with the Commission.
The address of such site is "http://www.sec.gov".
In addition, the Company's Common Stock is traded on the
Nasdaq National Market System under the symbol "MKRL" and such documents
described herein can also be inspected by contacting the Market Operations
Department of Nasdaq at 80 Merritt Boulevard, Trumbull, Connecticut 06611.
This Prospectus constitutes a part of a Registration Statement
filed by the Company with the Commission under the Securities Act of 1933, as
amended (the "Securities Act"). This Prospectus omits certain of the information
contained in the Registration Statement in accordance with the rules and
regulations of the Commission. Reference is hereby made to the Registration
Statement and related exhibits for further information with respect to the
Company and the Common Stock. Statements contained herein concerning the
provisions of any document are not necessarily complete and, in each instance,
reference is made to the copy of such document filed as an exhibit to the
Registration Statement or otherwise filed with the Commission. Each such
statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed with the Commission by MK Rail
(File No. 0- 23802) pursuant to the Exchange Act or the Securities Act, as
applicable, are incorporated by reference in this Prospectus:
1. MK Rail's Annual Report on Form 10-K for the Year ended December 31,
1995.
2. MK Rail's Quarterly Report on Form 10-Q for the Quarter ended March
31, 1996.
3. MK Rail's Quarterly Report on Form 10-Q for the Quarter ended June 30,
1996.
3
<PAGE>
4. MK Rail's Current Report on Form 8-K filed with the Commission on July
3, 1996.
5. MK Rail's Current Report on Form 8-K filed with the Commission on
September 10, 1996.
Each document filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus
and prior to the termination of the offering of the Common Stock pursuant hereto
shall be deemed to be incorporated by reference in this Prospectus and to be a
part of this Prospectus from the date of filing of such document. Any statement
contained in this Prospectus or in a document incorporated or deemed to be
incorporated by reference in this Prospectus shall be deemed to be modified or
superseded for purposes of the Registration Statement and this Prospectus to the
extent that a statement contained in this Prospectus, or in any subsequently
filed document that also is or is deemed to be incorporated by reference in this
Prospectus, modifies or supersedes such statement. Any such statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of the Registration Statement or this Prospectus.
The Company will provide without charge to each person to whom
a copy of this Prospectus is delivered, upon the request of any such person, a
copy of any or all of the documents which are incorporated herein by reference,
other than exhibits to such documents (unless such exhibits are specifically
incorporated by reference into such documents). Requests for such copies should
be directed to MK Rail Corporation, 1200 Reedsdale Street, Pittsburgh,
Pennsylvania 15233 to the attention of Timothy R. Wesley, Vice President of
Investor and Public Relations, telephone (412) 237-2250.
4
<PAGE>
THE COMPANY
MK Rail Corporation is a Delaware corporation formed in April
1993 to acquire certain assets of the Rail Systems Group of MKC, including its
Locomotive Division. MK Rail and its subsidiaries design, manufacture and
distribute engineered locomotive components; provide locomotive fleet
maintenance and locomotive overhaul services; and manufacture switcher
locomotives.
The principal executive offices of the Company are located at
1200 Reedsdale Street, Pittsburgh, Pennsylvania 15233 and the Company's
telephone number is (412) 237-2250.
USE OF PROCEEDS
The Common Stock sold pursuant to this Prospectus will be sold
by the Selling Stockholders for their own accounts and the Company will not
receive proceeds from such sales.
SELLING STOCKHOLDERS
MKC owns all of the stock of Morrison Knudsen Corporation, an
Ohio corporation ("Morrison Knudsen"). Morrison Knudsen presently holds all
11,149,000 shares (the "Shares") of the outstanding Common Stock of the Company
(representing approximately 63.5% of the Company's outstanding Common Stock) to
be registered pursuant to this Registration Statement. However, prior to the
effective date of this Registration Statement, the Shares will be distributed to
creditors of MKC and, in certain circumstances, to those of its existing
stockholders who purchase a portion of the rights of its creditors.
This distribution to creditors and existing MKC stockholders
is being made pursuant to a Plan of Reorganization for MKC submitted as part of
its bankruptcy filing under Chapter 11 of the Bankruptcy Code in the United
States Bankruptcy Court for the District of Delaware (the "MKC Plan of
Reorganization"). The MKC Plan of Reorganization was confirmed by the Bankruptcy
Court on August 26, 1996 and became effective on September 11, 1996. Pursuant to
the MKC Plan of Reorganization, all 11,149,000 shares of the Company's Common
Stock currently held of record by Morrison Knudsen are to be transferred by
Morrison Knudsen to MKC's creditors and those of MKC's existing stockholders who
purchase a portion of the rights of these creditors.
In connection with the MKC Plan of Reorganization, MKC sought
and obtained from the Bankruptcy Court an order to the effect that (i) the offer
and sale of the Company's Common Stock under the MKC Plan of Reorganization is
exempt from registration under the Securities Act and state securities laws
pursuant to section 1145(a)(1) of the Bankruptcy Code and (ii) the offer and
sale of the securities included in the aggregate consideration through or upon
the exercise of rights granted to existing stockholders of MKC to purchase the
Company's Common Stock are exempt from registration under the Securities Act and
state securities laws pursuant to section 1145(a)(2) of the Bankruptcy Code.
This order of the Bankruptcy Court is premised in
5
<PAGE>
part on a determination by the Bankruptcy Court that MK Rail is "participating
in a joint plan" with MKC as such phrase is used in section 1145(a)(1) of the
Bankruptcy Code.
The Company is filing this Registration Statement to register
for resale the shares distributed to the persons receiving stock of the Company
as a part of the MKC Plan of Reorganization.
The following table is completed with information for the
present holder of the Shares, Morrison Knudsen, and indicates the number of
shares of Common Stock beneficially owned by Morrison Knudsen as of September
20, 1996. Prior to the effective date of this Registration Statement, this table
will be amended to set forth the names of the persons who receive Shares in
connection with the MKC Plan of Reorganization and to include the required
information as to their share holdings.
<TABLE>
<CAPTION>
Minimum Percentage
Number of Shares Maximum Number of Minimum Number of of Common Stock
Name Owned Prior to the Shares to be Sold in Shares to be Owned Owned After the
Offering (1) the Offering After the Offering Offering (1)
------------ ------------ ------------------ ------------
<S> <C> <C> <C> <C>
Morrison Knudsen 11,149,000 11,149,000 0 0%
<FN>
(1) Calculated pursuant to Rule 13d-3(d) of the 1934 Act. Under such
Rule, shares subject to options, warrants, rights or conversion
privileges exercisable within 60 days are deemed outstanding for the
purpose of calculating the number and percentage owned by such
person, but not deemed outstanding for the purpose of calculating the
percentage owned by each other person listed. At September 20, 1996
there were 17,562,793 shares of Common Stock issued and outstanding.
</FN>
</TABLE>
PLAN OF DISTRIBUTION
The Shares may be offered and sold by the Selling Stockholders
pursuant to this Prospectus from time to time directly by means of ordinary
brokers' transactions or, in cash or exchange transactions, to one or more
institutional purchasers or through sales agents by means of (i) ordinary
brokers' transactions, (ii) block transactions (which may involve crosses) in
accordance with the rules of Nasdaq, in which the Selling Stockholders' agents
may attempt to sell the Shares as agent but may position and resell all or a
portion of the Shares as principal, (iii) privately negotiated transactions or
(iv) a combination of any such methods of sale, in each case at market prices
prevailing at the time of sale or at negotiated prices acceptable to the Selling
Stockholders. In connection therewith, distributors' or sellers' commissions may
be paid or allowed which will not exceed those customary in the types of
transactions involved. If any sales agent of the Selling Stockholders purchases
the Shares as principal, it may resell such shares by any of the methods of sale
described above.
6
<PAGE>
The can be no assurances that the Selling Stockholders will sell any
or all of the Shares offered hereunder.
DESCRIPTION OF CAPITAL STOCK
General
The authorized capital stock of the Company consists of 55 million
shares of Common Stock, par value $0.01 per share, and 10 million shares of
preferred stock, par value $0.01 per share (the "Preferred Stock"). As of
September 20, 1996, 17,562,793 shares of Common Stock were outstanding. As of
such date, 10,000 shares of Preferred Stock were outstanding, all of which were
Class B Preferred Stock (the "Class B Preferred Stock").
The following is a description of the terms of the capital stock of
the Company. This description does not purport to be complete and is qualified
in its entirety by reference to the Company's Amended and Restated Certificate
of Incorporation (the "Certificate of Incorporation"), Amended and Restated
Bylaws (the "Bylaws"), Certificates of Designation of Preferred Stock for its
Class B Preferred Stock and Series C Junior Participating Preferred Stock (the
"Certificates of Designation"), and the Rights Agreement dated January 19, 1996,
as amended (the "Rights Agreement"), which have been incorporated by reference
as exhibits to the Registration Statement of which this Prospectus is a part and
are incorporated by reference herein.
Common Stock
Description of Common Stock. The holders of Common Stock are entitled
to one vote per share on all matters submitted to a vote of the stockholders of
the Company. In addition, such holders are entitled to receive ratably such
dividends, if any, as may be declared from time to time by the Board of
Directors out of funds legally available therefor, subject to the payment of
preferential dividends with respect to any Preferred Stock that from time to
time may be outstanding. In the event of the dissolution, liquidation or
winding-up of the Company, the holders of Common Stock are entitled to share
ratably in all assets remaining after payment of all liabilities of the Company
and subject to the prior distribution rights of the holders of any Preferred
Stock that may be outstanding at that time. The holders of Common Stock do not
have cumulative voting rights or preemptive or other rights to acquire or
subscribe for additional shares of Common Stock or other securities except
pursuant to the Rights Agreement as described under "Description of Capital
Stock--Rights Agreement." All outstanding shares of Common Stock are, and when
issued the shares of Common Stock offered hereby will be, fully paid and
nonassessable.
Stockholders Agreement. In anticipation of the MKC bankruptcy filing,
on June 20, 1996, the Company and Morrison Knudsen entered into a Stockholders
Agreement (the "Stockholders Agreement"). Under the Stockholders Agreement,
which was amended by an amendment dated as of July 25, 1996, the Company agreed
to provide registration rights to persons receiving stock of the Company as a
part of the MKC Plan of Reorganization. Morrison Knudsen also agreed under the
Stockholders Agreement that the Common Stock of the Company held by it would be
subject to certain standstill and voting provisions for a specified period. The
standstill provisions generally prohibit the solicitation of proxies, initiation
or inducement of
7
<PAGE>
tender offers, and other efforts to influence or control the management or
policies of the Company. The voting provisions generally require that the Common
Stock will be voted in favor of the Company's nominees to its Board (which is to
consist of at least seven members, of which a majority are to be outside
directors).
In general, the period during which the standstill and voting
provisions are in effect will end on the earlier of the date two years after the
date (the "Distribution Date") Morrison Knudsen distributes the Common Stock in
accordance with the MKC Plan of Reorganization, or the date on which Registrable
Securities represent less than 15% of the Company's outstanding shares of Common
Stock; provided, that if a Stockholders Meeting is required to be held (as
described below), the time period during which the voting provisions are in
effect will expire on the date of the meeting, if earlier than the second
anniversary of the Distribution Date, and the time period during which the
standstill provisions are in effect will expire 90 days before the meeting. The
term "Registrable Securities" is generally defined to mean the stock of the
Company held by Morrison Knudsen or its transferees, other than transferees
receiving the stock in a registered public offering or in "ordinary trading
transactions" within the meaning of Section 1145(b)(1) of the Bankruptcy Code.
Common Stock of the Company that is distributed as part of the MKC
Plan of Reorganization will be subject to transfer restrictions under which
transferees must agree to be bound by the provisions of the Stockholders
Agreement, other than transferees receiving the stock in registered public
offerings or in "ordinary trading transactions" within the meaning of Section
1145(b)(1) of the U.S. Bankruptcy Code, in each case so long as the transferor
does not know the specific identity of the transferee prior to the transfer and
the transferee is not assigned any rights under the Stockholders Agreement.
Accordingly, purchasers of the Company's Common Stock pursuant to this
Registration Statement will not be subject to the standstill provisions (so long
as the seller of the shares does not know the specific identity of the purchaser
prior to the sale and the transferee is not assigned any rights under the
Stockholders Agreement).
See also "Description of Capital Stock--Proposed Amendment to
Certificate of Incorporation."
Common Stock Dividends. The timing, amount and form of future
dividends, if any, will depend, among other things, upon the effect of
applicable restrictions on the payment of dividends, results of operations,
financial condition, cash requirements, prospects and other factors deemed
relevant by the Board of Directors of MK Rail. Under the Amended and Restated
Loan and Security Agreement dated as of September 10, 1996 between the Company
and BankAmerica Business Credit, Inc. (the "Loan Agreement"), the Company is
prohibited from paying dividends on its Common Stock.
Furthermore, the Board cannot declare or pay dividends in respect of
the Company's Common Stock if any deficiency exists in the payment of cumulated
dividends (whether or not declared) in respect of any Preferred Stock now or
hereafter authorized and issued. The Loan Agreement does not permit the Company
to fully pay dividends on the outstanding shares of Class B Preferred Stock at
the rate at which dividends cumulate thereon. Accordingly, unless and until the
Loan Agreement is amended to permit, or the lender by waiver permits, the
payment of
8
<PAGE>
cumulated dividends on the Class B Preferred Stock, a deficiency will exist in
the payment of dividends thereon, which will preclude the payment of dividends
on the Common Stock.
The Common Stock is listed on Nasdaq. Chase Mellon Shareholder
Services, L.L.C. is the registrar and transfer agent for the Common Stock.
Preferred Stock
General. The Board has the authority to issue 10 million shares of
Preferred Stock in one or more series and to fix the designation, relative
powers, preferences and rights, and qualifications, limitations and restrictions
of all shares of each such series, including without limitation dividend rates,
preemptive rights, conversion rights, voting rights, redemption and sinking fund
provisions, liquidation preferences and the number of shares constituting each
such series, without any further vote or action by the stockholders. The
issuance of Preferred Stock could decrease the amount of earnings and assets
available for distribution to holders of Common Stock or adversely affect the
rights and powers, including voting rights, of the holders of Common Stock. The
issuance of Preferred Stock could also have the effect of delaying, deferring or
preventing a change in control of the Company without further action by the
stockholders.
As of September 20, 1996, the Board had authorized the issuance of
(i) 10,000 shares of Class A Preferred Stock, all of which shares were retired
and cannot be reissued, (ii) 10,000 shares of Class B Preferred Stock, all of
which shares were outstanding as of such date, and (iii) 1.6 million shares of
Series C Junior Participating Preferred Stock (the "Series C Preferred Stock")
in connection with the Rights Agreement (see "Description of Capital
Stock--Rights Agreement"), none of which shares have been issued as of such
date. Set forth below is a description of the Class B Preferred Stock and Series
C Preferred Stock, which descriptions are qualified by reference to the
Certificates of Designations therefor.
Class B Preferred Stock. On September 12, 1995, the Board of
Directors authorized the issuance of 10,000 shares of Class B Preferred Stock.
On May 15, 1996, the Company issued all 10,000 authorized shares to The Fidelity
& Casualty Company of New York.
The Class B Preferred Stock earns dividends at the rate per annum of
$10 per share. Dividends accrue from the date of issuance whether or not
declared, and are cumulative. The Board has no obligation to declare dividends
on the Class B Preferred Stock. The Class B Preferred Stock has a liquidation
value of $100 per share plus all dividends accrued and unpaid (whether or not
declared).
The Class B Preferred Stock is subject to redemption at the Company's
option at any time and must be redeemed on the earliest to occur of (i)
September 1, 1999, (ii) the date 90% or more of the Common Stock is purchased by
a previously unaffiliated party, (iii) the date of the merger of the Company
into another corporation or similar transaction as a result of which 90% or more
of the Common Stock is acquired by, or exchanged for or converted into
securities of a previously unaffiliated party a majority of the shares of which
will not, immediately following the transaction, be held by persons who held
Common Stock immediately prior to the transaction in substantially
9
<PAGE>
the same proportions, (iv) eighteen months after the date a majority (but less
than 90%) of the Common Stock is purchased by a previously unaffiliated party,
(v) eighteen months after the date of the merger of the Company into another
corporation or similar transaction as a result of which a majority (but less
than 90%) of the Common Stock is acquired by, or exchanged for or converted into
securities of a previously unaffiliated party a majority of the shares of which
will not, immediately following the transaction, be held by persons who held
Common Stock immediately prior to the transaction in substantially the same
proportions, or (vi) the date assets of the Company are sold which have a fair
market value equal to 80% of the fair market value of all of the assets of the
Company immediately prior to such transaction (as determined by an independent
appraiser acceptable to the Company and a majority of the holders of the shares
of Class B Preferred Stock then outstanding). In any case, the redemption price
is equal to $100 per share plus all dividends accrued and unpaid on each share
(whether or not declared) through the redemption date. Except as otherwise
provided by law, the holders of the Class B Preferred Stock have no voting
rights.
Series C Preferred Stock. On January 19, 1996, the Board of Directors
authorized the issuance of 1,600,000 shares of new Class C Preferred Stock in
connection with the Rights Agreement. None of such shares have been issued as of
September 20, 1996, nor are any such shares expected to be issued unless and
until the rights under the Rights Agreement are triggered.
See "Description of Capital Stock--Rights Agreement."
Subject to the rights of the holders of any shares of any other
series of Preferred Stock, ranking prior and superior to the Series C Preferred
Stock with respect to dividends, the holders of shares of Series C Preferred
Stock, are entitled to receive, when, as and if declared by the Board of
Directors out of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of March, June, September and December in each
year (each such date being referred to herein as a "Quarterly Dividend Payment
Date"), in an amount per share (rounded to the nearest cent) equal to the
greater of (a) $1 or (b) subject to certain provisions for adjustment in the
event the Company shall at any time declare or pay any dividend on the Common
Stock payable in shares of Common Stock or effect a subdivision or combination
or consolidation of the outstanding shares of the Common Stock, 100 times the
aggregate per share amount of all cash dividends, and 100 times the aggregate
per share amount (payable in kind) of all non-cash dividends or other
distributions, other than a dividend payable in shares of Common Stock or a
subdivision of the outstanding shares of Common Stock, declared on the Common
Stock since the immediately preceding Quarterly Dividend Payment Date or, since
the first issuance of any share or fraction of a share of Series C Preferred
Stock.
Dividends begin to accrue and are cumulative on outstanding shares of
Series C Preferred Stock from the Quarterly Dividend Payment Date next preceding
the date of issue of such shares.
Subject to the provisions for adjustment in the event the Company
shall at any time declare or pay any dividend on the Common Stock payable in
shares of Common Stock, or effect a subdivision or combination or consolidation
of the outstanding shares of Common Stock, each share of Series C Preferred
Stock entitles the holder thereof to 100 votes on all matters submitted to a
vote of the stockholders of the Company.
10
<PAGE>
Whenever quarterly dividends or other dividends or distributions
payable on the Series C Preferred Stock are in arrears, thereafter and until all
accrued and unpaid dividends and distributions, whether or not declared, on
shares of Series C Preferred Stock outstanding are paid in full, the Company can
not declare or pay dividends, or make any other distributions, on any shares of
stock ranking junior to or on a parity with the Series C Preferred Stock or
redeem or purchase or otherwise acquire for consideration shares of any stock
ranking junior to or on a parity with the Series C Preferred Stock.
Upon any liquidation, dissolution, or winding up of the Company, the
Company can not make any distribution (1) to the holder of shares of stock
ranking junior (either as to dividends or upon liquidation, dissolution, or
winding up) to the Series C Preferred Stock unless, prior thereto, the holders
of shares of Series C Preferred Stock shall have received $100 per share, plus
an amount equal to accrued and unpaid dividends provided that the holders of
shares of Series C Preferred Stock are entitled to receive an aggregate amount
per share, subject to adjustment, equal to 100 times the aggregate amount to be
distributed per share to holders of shares of Common Stock, or (2) to the
holders of shares of stock ranking on a parity with the Series C Preferred
Stock, except distributions made ratably on the Series C Preferred Stock and all
such parity stock in proportion to the total amounts to which the holders of all
such shares are entitled upon such liquidation, dissolution, or winding up. In
the event the Company declares or pays any dividend on the Common Stock payable
in shares of Common Stock, or effects a subdivision or combination or
consolidation of the outstanding shares of Common Stock into a greater or lesser
number of shares of Common Stock, then in each such case the aggregate amount to
which holders of shares of Series C Preferred Stock were entitled immediately
prior to such event under the proviso in clause (1) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately after such
event and the denominator of which is the number of shares of Common Stock that
were outstanding immediately prior to such event.
If the Company enters into any consolidation, merger, combination, or
other transaction in which the shares of Common Stock are exchanged for or
changed into other stock or securities, cash, and/or any other property, then
each share of Series C Preferred Stock will also be similarly exchanged or
changed into an amount per share, subject to the provision for adjustment
hereinafter set forth, equal to 100 times the aggregate amount of stock,
securities, cash, and/or any other property (payable in kind), as the case may
be, into which or for which each share of Common Stock is changed or exchanged.
If the Company declares or pays any dividend on the Common Stock payable in
shares of Common Stock, or effects a subdivision or combination or consolidation
of the outstanding shares of Common Stock (by reclassification or otherwise than
by payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then the amount set forth in the preceding
sentence with respect to the exchange or change of shares of Series C Preferred
Stock is to be adjusted by multiplying such amount by a fraction, the numerator
of which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of shares of Common Stock
that were outstanding immediately prior to such event.
The shares of Series C Preferred Stock are not redeemable.
11
<PAGE>
Rights Agreement
Effective as of January 19, 1996, the Board of Directors of the
Company adopted a Stockholder Rights Plan and declared that a dividend of one
share purchase right ("Right") be distributed on each outstanding share of the
Company's Common Stock to stockholders of record as of the close of business on
January 30, 1996. The complete terms of the Rights are set forth in a Rights
Agreement (the "Rights Agreement") dated January 19, 1996 between the Company
and Chase Mellon Shareholder Services, L.L.C. Each Right entitles the registered
holder to purchase from the Company one one-hundredth of a share of Series C
Junior Participating Preferred Stock, par value $0.01 per share ("Series C
Preferred Stock"), or, in certain circumstances, shares of Common Stock, other
securities, and/or cash or other property, at a purchase price of $16.00 per
share of Series C Preferred Stock (or, when applicable, Common Stock,
securities, cash, and/or other property), subject to adjustment. All Rights
expire on January 30, 2006.
The Company is entitled to redeem the Rights at a price of $.001 per
Right until the Rights are triggered.
On April 5, 1996, the Company entered into an Amendment to the Rights
Agreement (the "First Amendment"). The First Amendment provides that certain
creditors of Morrison Knudsen or MKC (collectively, "MK") will not be deemed to
be affiliates or associates of each other or of MK (and thus will not be treated
as having common ownership of the Company's Common Stock for purposes of
calculating beneficial ownership under the Rights Agreement) solely by reason of
any negotiations among such creditors and/or MK in connection with a
restructuring or reorganization of MK. The First Amendment also confers upon the
Company's Board of Directors exclusive authority to interpret and administer the
Rights Agreement and to make all determinations deemed necessary or advisable
for its administration, including a determination to redeem or not redeem the
Rights, to exchange or not exchange the Rights or to supplement or amend the
Rights Agreement.
On June 20, 1996, the Company entered into a Second Amendment to the
Rights Agreement (the "Second Amendment"). As a result of the Second Amendment,
the Rights will be exercisable and will trade separately from the Company's
Common Stock if a person or a group of persons becomes the beneficial owner of
15 percent or more of the Company's Common Stock (rather than 10 percent or
more, as was previously provided), or if a person commences a tender offer or
exchange offer, the consummation of which would result in such person being the
beneficial owner of 15 percent or more of the Common Stock (rather than 10
percent or more, as was previously provided). The Second Amendment also provides
that a merger of MK will not constitute a "change of control event" as defined
in the Rights Agreement, provided certain conditions are satisfied, including
prompt distribution of the Company's Common Stock. In addition, the Second
Amendment permits the solicitation of votes and the voting with respect to the
plan of reorganization of MK.
Effective as of July 25, 1996, the Company entered into a Third
Amendment to the Rights Agreement (the "Third Amendment"). The Third Amendment
provides that the equity
12
<PAGE>
holders of MKC who receive shares of the Company's Common Stock will be deemed
to be creditors of MK for purposes of the Rights Agreement.
Proposed Amendment to Certificate of Incorporation
The Stockholders Agreement (described under "Description of Capital
Stock--Common Stock--Stockholders Agreement") provides that not more than 120
days nor less than 90 days prior to the second anniversary of the Distribution
Date, the holders of stock of the Company subject to the standstill and voting
provisions can, at their option, request in writing (an "Election Request") that
the Company hold a meeting of stockholders, which meeting, if effectively
requested, is to be held as closely as practicable to the second anniversary of
the Distribution Date. At the meeting (assuming the proposed amendment to the
Company's Amended and Restated Certificate of Incorporation described herein is
adopted and approved), the stockholders of the Company are to be entitled to
vote to fill vacancies and/or newly created positions on the Board of Directors
of the Company, which vacancies and/or newly created positions, when filled,
will constitute a majority of the Company's Board of Directors. In general, an
Election Request will not be effective unless it has been executed by holders of
Registrable Securities constituting at least 15% of the outstanding Common Stock
of the Company.
Section 3 of the Seventh Article of the Amended and Restated
Certificate of Incorporation of the Company as in effect provides that subject
to the rights, if any, of the holders of any series of Preferred Stock to elect
additional directors, under circumstances specified in any Certificate of
Designations for any class or series of Preferred Stock, newly created
directorships resulting from an increase in the number of directors and any
vacancies on the Board will be filled solely by the affirmative vote of a
majority of the remaining directors then in office, even though less than a
quorum of the Board, or by a sole remaining director. The Board of the Company
will be unable to hold a Stockholders Meeting in accordance with an Election
Request unless Section 3 of the Seventh Article is amended in accordance with
the proposal. As presently in effect, that Section gives exclusive authority to
fill vacancies and newly created directorships to the Board and does not give
the Board the ability to delegate that authority to the stockholders.
Accordingly, in the Stockholders Agreement it was agreed that the
Board of Directors of the Company would propose to the stockholders of the
Company, and recommend approval of, an amendment to the Company's Amended and
Restated Certificate of Incorporation that would permit vacancies on the Board
or newly created directorships to be filled, at the sole option of the Board, by
the stockholders of the Company at a meeting of the stockholders called by the
Board. Neither the proposed amendment nor the holding of a special stockholders
meeting will eliminate the classification of the Board of the Company, and the
nomination procedures ordinarily in effect for stockholders meetings at which
directors are elected will be in effect with respect to any stockholders meeting
that is held. The Board has recommended that the Company's stockholders approve
at the Company's scheduled October 30, 1996 Annual Meeting of Stockholders this
amendment to the Company's Amended and Restated Certificate of Incorporation.
Certain Anti-takeover Provisions
13
<PAGE>
In addition to the Rights Agreement (described under "Description of
Capital Stock-Rights Agreement"), which could have the effect of deterring a
hostile takeover, the Company is subject to the "business combination" statute
of the Delaware General Corporation Law (the "DGCL"). In general, Section 203 of
the DGCL prohibits a publicly held Delaware corporation from engaging in a
"business combination" with an "interested stockholder" for a period of three
years after the date of the transaction in which the person became an
"interested stockholder," unless (a) prior to such date the Board of Directors
of the corporation approved either the "business combination" or the transaction
which resulted in the stockholder becoming an "interested stockholder," (b) upon
consummation of the transaction which resulted in the stockholder becoming an
"interested stockholder," the "interested stockholder" owned at least 85% of the
voting stock of the corporation outstanding at the time the transaction
commenced, excluding for purposes of determining the number of shares
outstanding those shares owned (i) by persons who are directors and also
officers and (ii) employee stock plans in which employee participants do not
have the right to determine confidentially whether shares held subject to the
plan will be tendered in a tender or exchange offer, or (c) on or subsequent to
such date the "business combination" is approved by the Board of Directors and
authorized at an annual or special meeting of stockholders by the affirmative
vote of at least 66 2/3% of the outstanding voting stock which is not owned by
the "interested stockholder." A "business combination" includes mergers, certain
stock or asset sales and certain other transactions resulting in a financial
benefit to, or increase in voting power held by, the "interested stockholders."
An "interested stockholder" is a person who, together with affiliates and
associates, owns (or if such person is an affiliate or associate of the
corporation within three years, did own) 15% or more of the corporation's voting
stock.
The Company's Bylaws establish an advance notice procedure for
stockholders to make nominations of candidates for election as directors, or to
bring other business before an annual meeting of stockholders of the Company.
The Bylaws provide that only persons who are nominated by, or at the direction
of, the Board of Directors of the Company or any committee designated by the
Board of Directors of the Company, or by a stockholder who has given timely
written notice to the Secretary of the Company prior to the meeting at which
directors are to be elected, will be eligible for election as directors of the
Company. The Bylaws also provide that in order to properly submit any business
to an annual meeting of stockholders, a stockholder must give timely written
notice to the Secretary of the Company of such stockholder's intention to bring
such business before such meeting. Generally, for notice of stockholder
nominations or other business to be made at an annual meeting to be timely under
the Bylaws, such notice must be received by the Company not less than 60
calendar days prior to the annual meeting; provided, however, that in the event
public announcement of the date of the annual meeting is not made at least 75
calendar days prior to the date of the annual meeting, notice by the stockholder
to be timely must be received no later than the close of business on the 10th
calendar day following the date on which public announcement is first made.
Under the Bylaws, a stockholder's notice must also contain certain information
specified in the Bylaws.
The provisions described above, together with certain terms of the
Company outstanding Preferred Stock and its ability to issue additional
Preferred Stock, may have the effect of delaying stockholder actions with
respect to certain business combinations and the election of new members of the
Board of Directors of the Company.
14
<PAGE>
LEGAL MATTERS
The validity of the Common Stock being offering hereby will be
passed upon for the Company by Doepken Keevican & Weiss Professional
Corporation, Pittsburgh, Pennsylvania. Michael A. Weiss, who is a partner at
Doepken Keevican & Weiss Professional Corporation, serves as the Secretary and
General Counsel of the Company.
EXPERTS
The financial statements and the related financial statement schedule
incorporated in this prospectus by reference from the Company's Annual Report on
Form 10-K for the year ended December 31, 1995 have been audited by Deloitte &
Touche, independent auditors, as stated in their reports which are incorporated
herein by reference, and have been so incorporated in reliance upon the reports
of such firm given upon their authority as experts in accounting and auditing.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses in connection with the
issuance and distribution of the Common Stock being registered. These costs do
not include fees and expenses of the legal counsel and accountants of the
Selling Stockholders or commissions and transfer taxes, if any, all of such
costs to be borne solely by the Selling Stockholders. Morrison Knudsen has
agreed to reimburse the Company for the offering expenses not in excess of
$75,000. All of the amounts shown are estimates, except the SEC registration
fee.
Registration fee ..................................... $20,799
Blue Sky fees and expenses ........................... 5,000
Printing and engraving expenses ...................... 6,000
Legal fees and expenses .............................. 30,000
Accounting fees and expenses ......................... 6,000
Miscellaneous ........................................ 7,201
-----
Total ................................................ $75,000 .
=======
Item 15. Indemnification of Directors and Officers.
The Restated Certificate of Incorporation of the Company provides
that a director of the Company shall not be personally liable to the Company or
its stockholders for monetary damages for breach of fiduciary duty as a director
except for liability (i) for any breach of the director's duty of loyalty to the
Company or its stockholders, (ii) for acts or omissions not in good faith or
which involve intentional misconduct or a knowing violation of law, (iii) under
Section 174 of the Delaware General Corporation Law ("DGCL") or (iv) for any
transaction from which the director derived any improper personal benefit.
II-1
<PAGE>
The Restated Certificate of Incorporation and Restated Bylaws of the
Company provide that to the full extent permitted by law the Company shall
indemnify and advance expenses to any person who is or was a director, officer,
employee or fiduciary of the Company or was serving at the request of a
director, officer, employee or fiduciary of the Company against liabilities
which may be incurred by such person by reason of (or arising in part from) such
capacity.
Section 145 of the DGCL authorizes the indemnification of directors
and officers against liability incurred by reason of being a director or officer
and against expenses (including attorneys' fees), judgments, fines and amounts
paid in settlement actually and reasonably incurred in connection with any
action, suit, or proceeding seeking to establish such liability, in the case of
third-party claims, if the officer or director 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 in the case of actions by or in the right of the
corporation, if the officer or director 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 if such officer or director shall not have been adjudged liable
to the corporation, unless, despite the adjudication of liability, a court
otherwise determines. Indemnification also is authorized with respect to any
criminal action or proceeding where, in addition to the above, the officer or
director has no reasonable cause to believe his conduct was unlawful.
The above discussion of the Company's Restated Certificate of
Incorporation, Restated Bylaws and Section 145 of the DGCL is only a summary and
is qualified in its entirety by the full text of each of the foregoing.
The Company has entered into indemnification agreements with its
officers and directors. Such agreements provide contractually for mandatory
indemnification to the maximum extent permitted or required by statute and
include a separate indemnity provision, subject to limitations of applicable
law, providing for substantially broader indemnity rights than those presently
available by statute or the Restated Certificate of Incorporation of the
Company.
The Company has purchased insurance against certain losses arising
from claims which may be asserted against its directors and officers, including
claims under the Securities Act.
Item 16. Exhibits.
Exhibit No. Description
3.01[1] Form of Amended and Restated Certificate of Incorporation
3.02[1] Form of Amended and Restated Bylaws
4.01[2] Rights Agreement, dated as of January 19, 1996 between MK Rail
Corporation and Chemical Mellon Shareholder Services L.L.C., as Rights
Agent
4.02[3] Amendment to Rights Agreement, dated as of April 5, 1996 between MK
Rail Corporation and Chase Mellon Shareholder Services L.L.C.
(formerly Chemical Mellon Shareholder Services L.L.C.), as Rights
Agent
4.03[4] Second Amendment to Rights Agreement, dated as of June 20, 1996
between MK Rail Corporation and Chase Mellon Shareholder Services
II-2
<PAGE>
L.L.C. (formerly Chemical Mellon Shareholder Services L.L.C.), as
Rights Agent
4.04[5] Third Amendment to Rights Agreement, dated as of July 25, 1996
between MK Rail Corporation and Chase Mellon Shareholder Services
L.L.C. (formerly Chemical Mellon Shareholder Services L.L.C.), as
Rights Agent
4.05[6] Stockholders Agreement dated as of June 20, 1996 between MK Rail
Corporation and Morrison Knudsen Corporation
4.06[7] Amendment dated as of July 25, 1996 to Stockholders Agreement
between MK Rail Corporation and Morrison Knudsen Corporation
5.1* Opinion of Doepken Keevican & Weiss Professional Corporation
23.1* Consent of Deloitte & Touche LLP, independent auditors
23.2*Consent of Doepken Keevican & Weiss Professional Corporation (included
in Exhibit 5.1)
- -----------------
* Filed herewith
1. Incorporated by reference to the Company's Registration Statement on
Form S-1 filed with the Commission February 24, 1994.
2. Incorporated by reference to the Company's Registration Statement on
Form 8-A filed with the Commission January 25, 1996.
3. Incorporated by reference to Amendment No. 1 to Form 8-A filed with
the Commission April 24, 1996.
4. Incorporated by reference to Amendment No. 2 to Form 8-A filed with
the Commission June 20, 1996.
5. Incorporated by reference to Amendment No. 3 to Form 8-A filed with
the Commission July 3, 1996.
6. Incorporated by reference to the Company's Amendment No. 2 on Form 8-K
dated July 3, 1996.
7. Incorporated by reference to the Company's Current Report on Form 8-K
dated September 10, 1996.
Item 17. Undertakings.
The undersigned Registrant hereby undertakes:
(a) (1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the Registration Statement;
II-3
<PAGE>
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
Registration Statement or any material change to such information
in the Registration Statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) of
this section do not apply if the Registration Statement is on
Form S-3, Form S-8 or Form F-3, and the information required to
be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to section 13 or section
15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold
at the termination of the offering.
(b) That, for purposes of determining any liability under the
Securities Act of 1933, each filing of the Registrant's annual report pursuant
to section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plan's annual report pursuant to
section 15(d) of the Securities Exchange Act of 1934) that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Pittsburgh, State of Pennsylvania on the 19th day of
September, 1996.
MK RAIL CORPORATION
By:/s/Michael A. Wolf
-------------------
Michael A. Wolf
President and Chief Executive Officer
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Michael A. Wolf and William D. Grab, and
each of them, with full power to act without the other, his true and lawful
attorney-in-fact and agent, with full power of substitution and resubstitution,
for him and in his name, place and stead, in any and all capacities to sign any
or all amendments to this Registration Statement, including post-effective
amendments, and to file the same with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in connection therewith, as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents of any of them, or any substitute or substitutes,
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Name/Signature Title Date
-------------- ----- ----
/s/ Michael A. Wolf President and Chief Executive September 19, 1996
- ------------------------- Officer and Director (Principal
Michael A. Wolf Executive Officer)
/s/ William D. Grab Vice President, Controller and September 19, 1996
- ------------------------- Principal Accounting Officer
William D. Grab (Principal Financial and
Accounting Officer)
/s/ John C. Pope Chairman of the Board September 19, 1996
- -------------------------
John C. Pope
/s/ Gilbert E. Carmichael Vice Chairman of the Board September 19, 1996
- -------------------------
Gilbert E. Carmichael
/s/ Lee B. Foster II Director September 19, 1996
- -------------------------
Lee B. Foster II
/s/ James P. Miscoll Director September 19, 1996
- -------------------------
James P. Miscoll
/s/ Nicholas J. Stanley Director September 19, 1996
- -------------------------
Nicholas J. Stanley
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
5.1 Opinion and Consent of Doepken Keevican & Weiss P.C.
23.1 Consent of Deloitte & Touche LLP
<PAGE>
EXHIBIT 5.1
September 20, 1996
MK Rail Corporation
1200 Reedsdale Street
Pittsburgh, PA 15233
RE: MK Rail Corporation
Ladies and Gentlemen:
We have acted as counsel for MK Rail Corporation, a Delaware
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended, of 11,149,000 shares of the Company's $.01
par value common stock ("Common Stock"), to be offered by certain selling
stockholders of the Company ("Selling Stockholders") upon the terms and subject
to the conditions set forth in the Company's Registration Statement on Form S-3
(the "Registration Statement") covering the Shares to be filed with the
Securities and Exchange Commission.
In connection therewith, we have examined the Registration
Statement, the Certificate of Incorporation and Bylaws of the Company, each as
amended to date, resolutions of the Board of Directors of the Company and such
other documents, records, opinions, certificates and papers as we have deemed
necessary or appropriate in order to give the opinion hereinafter set forth.
In our examination, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals and
the conformity of all documents submitted to us as copies to the originals
thereof. As to the accuracy of certain factual matters, we have relied on the
certificates of officers of the Company and certificates, letters, telegrams or
statements of public officials.
Based upon and subject to the foregoing, we are pleased to
advise you that it is our opinion that the shares of Common Stock proposed to be
sold by the Selling Stockholders have been duly and validly authorized for
issuance and are fully paid and non-assessable shares of Common Stock.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement, and to the use of our name under the caption
"Legal Matters."
Very truly yours,
/s/ DOEPKEN KEEVICAN & WEISS
-----------------------------
DOEPKEN KEEVICAN & WEISS
PROFESSIONAL CORPORATION
<PAGE>
EXHIBIT 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in this Registration Statement of
MK Rail Corporation on Form S-3 of our reports dated February 27, 1996 (except
for Notes 4 and 9 as to which the date is March 22, 1996) appearing in the
Annual Report on Form 10-K of MK Rail Corporation for the year ended December
31, 1995 and to the reference to us under the heading "Experts" in the
Prospectus, which is part of this Registration Statement.
/s/ Deloitte & Touche LLP
- -------------------------
DELOITTE & TOUCHE LLP
Pittsburgh, Pennsylvania
September 20, 1996
