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Registration No. 333-893
Filed pursuant to Rule 424(b)(3)
PROSPECTUS
[LOGO] THOMAS&BETTS
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OFFER TO EXCHANGE ITS
6 1/2% NOTES DUE 2006
WHICH HAVE BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
6 1/2% NOTES DUE 2006
THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON APRIL 12, 1996, UNLESS EXTENDED.
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Thomas & Betts Corporation, a New Jersey corporation (the "Company"), hereby
offers, upon the terms and subject to the conditions set forth in this
Prospectus (as the same may be amended or supplemented from time to time, the
"Prospectus") and in the accompanying Letter of Transmittal (which together
constitute the "Exchange Offer"), to exchange up to $150,000,000 aggregate
principal amount of its 6 1/2% Notes due 2006 (the "New Notes"), which have
been registered under the Securities Act of 1933, as amended (the "Securities
Act"), pursuant to a Registration Statement (as defined herein) of which this
Prospectus constitutes a part, for a like principal amount of its outstanding
6 1/2% Notes due 2006 (the "Old Notes"), of which $150,000,000 aggregate
principal amount is outstanding.
The terms of the New Notes are identical in all material respects to the
terms of the Old Notes, except that (i) the New Notes have been registered
under the Securities Act and therefore will not be subject to certain
restrictions on transfer applicable to the Old Notes and will not be entitled
to registration rights and (ii) the New Notes will not provide for any
increase in the interest rate thereon. In that regard, the Old Notes provide
that, if the Exchange Offer is not consummated by July 28, 1996, the interest
rate borne by the Old Notes will increase by 0.50% per annum following July
28, 1996 until the Exchange Offer is consummated. See "Description of the Old
Notes." The New Notes are being offered for exchange in order to satisfy
certain obligations of the Company under the Registration Rights Agreement,
dated as of January 30, 1996 (the "Registration Rights Agreement"), between
the Company and the Initial Purchasers (as defined herein) of the Old Notes.
The New Notes will be issued under the same Indenture (as defined herein) as
the Old Notes and the New Notes and the Old Notes will constitute a single
series of debt securities under the Indenture. In the event that the Exchange
Offer is consummated, any Old Notes which remain outstanding after
consummation of the Exchange Offer and the New Notes issued in the Exchange
Offer will vote together as a single class for purposes of determining whether
holders of the requisite percentage in outstanding principal amount of Notes
(as defined herein) have taken certain actions or exercised certain rights
under the Indenture. The New Notes and the Old Notes are collectively referred
to herein as the "Notes." See "Description of the New Notes" and "Description
of the Old Notes."
Interest on the New Notes is payable semiannually on January 15 and July 15
of each year (each, an "Interest Payment Date"), commencing on the first such
date following the original issuance date of the New Notes. The New Notes will
mature on January 15, 2006. The New Notes are not entitled to any sinking fund
and are not redeemable prior to maturity.
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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.
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The date of this Prospectus is March 4, 1996.
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The Company is making the Exchange Offer in reliance on the position of the
staff of the Division of Corporation Finance of the Securities and Exchange
Commission (the "Commission") as set forth in No-Action Letters issued to
Morgan Stanley & Co. Incorporated (available June 5, 1991) (the "Morgan
Stanley Letter"), Exxon Capital Holdings Corp. (available April 13, 1988), and
Shearman & Sterling (available July 2, 1993), and certain other interpretive
letters addressed to third parties in other transactions. However, the Company
has not sought its own interpretive letter and there can be no assurance that
the staff of the Division of Corporation Finance of the Commission would make
a similar determination with respect to the Exchange Offer as it has in such
interpretive letters to third parties. Based on these interpretations by the
staff of the Division of Corporation Finance, and subject to the two
immediately following sentences, the Company believes that New Notes issued
pursuant to this Exchange Offer in exchange for Old Notes may be offered for
resale, resold and otherwise transferred by a holder thereof (other than a
holder who is a broker-dealer) without further compliance with the
registration and prospectus delivery requirements of the Securities Act,
provided that such New Notes are acquired in the ordinary course of such
holder's business and that such holder is not participating, and has no
arrangement or understanding with any person to participate, in a distribution
(within the meaning of the Securities Act) of such New Notes. However, any
holder of Old Notes that is an "affiliate" of the Company or that intends to
participate in the Exchange Offer for the purpose of distributing New Notes,
or any broker-dealer who purchased Old Notes from the Company to resell
pursuant to Rule 144A under the Securities Act ("Rule 144A") or any other
available exemption under the Securities Act, (a) will not be able to rely on
the interpretations of the staff of the Division of Corporation Finance of the
Commission set forth in the Morgan Stanley Letter and the other above-
mentioned interpretive letters, (b) will not be permitted or entitled to
tender such Old Notes in the Exchange Offer and (c) must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any sale or other transfer of such Old Notes unless such sale
is made pursuant to an exemption from such requirements. In addition, as
described below, if any broker-dealer holds Old Notes acquired for its own
account as a result of market-making or other trading activities and exchanges
such Old Notes for New Notes, then such broker-dealer must deliver a
prospectus meeting the requirements of the Securities Act in connection with
any resales of such New Notes.
Each holder of Old Notes who wishes to exchange Old Notes for New Notes in
the Exchange Offer will be required to represent that (i) it is not an
"affiliate" of the Company, (ii) any New Notes to be received by it are being
acquired in the ordinary course of its business, (iii) it has no arrangement
or understanding with any person to participate in a distribution (within the
meaning of the Securities Act) of such New Notes, and (iv) if such holder is
not a broker-dealer, such holder is not engaged in, and does not intend to
engage in, a distribution (within the meaning of the Securities Act) of such
New Notes. Each broker-dealer that receives New Notes for its own account
pursuant to the Exchange Offer must acknowledge that it acquired the Old Notes
for its own account as the result of market-making activities or other trading
activities and must agree that it will deliver a prospectus meeting the
requirements of the Securities Act in connection with any resale of such New
Notes. The Letter of Transmittal states that by so acknowledging and by
delivering a prospectus, a broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act. Based on the
position taken by the staff of the Division of Corporation Finance of the
Commission in the interpretive letters referred to above, the Company believes
that broker-dealers who acquired Old Notes for their own accounts, as a result
of market-making activities or other trading activities ("Participating
Broker-Dealers") may fulfill their prospectus delivery requirements with
respect to the New Notes received upon exchange of such Old Notes (other than
Old Notes which represent an unsold allotment from the original sale of the
Old Notes) with a prospectus meeting the requirements of the Securities Act,
which may be the prospectus prepared for an exchange offer so long as it
contains a description of the plan of distribution with respect to the resale
of such New Notes. Accordingly, this Prospectus, as it may be amended or
supplemented from time to time, may be used by a Participating Broker-Dealer
during the period referred to below in connection with resales of New Notes
received in exchange for Old Notes where such Old Notes were acquired by such
Participating Broker-Dealer for its own account as a result of market-making
or other trading activities. Subject to certain provisions set forth in the
Registration Rights Agreement, the Company has agreed that this Prospectus, as
it may be amended or supplemented from time to time, may be used by a
Participating Broker-Dealer in connection with resales of such New Notes for a
period ending 90 days (subject to extension under certain limited
circumstances described below) after the
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Expiration Date (as defined below) or, if earlier, when all such New Notes
have been disposed of by such Participating Broker-Dealer. However, a
Participating Broker-Dealer who intends to use this Prospectus in connection
with the resale of New Notes received in exchange for Old Notes pursuant to
the Exchange Offer must notify the Company, or cause the Company to be
notified, on or prior to the Expiration Date, that it is a Participating
Broker-Dealer. Such notice may be given in the space provided for that purpose
in the Letter of Transmittal or may be delivered to the Exchange Agent at one
of the addresses set forth herein under "The Exchange Offer--Exchange Agent."
See "Plan of Distribution." Any Participating Broker-Dealer who is an
"affiliate" of the Company may not rely on such interpretive letters and must
comply with the registration and prospectus delivery requirements of the
Securities Act in connection with any resale transaction. See "The Exchange
Offer--Resales of New Notes."
In that regard, each Participating Broker-Dealer who surrenders Old Notes
pursuant to the Exchange Offer will be deemed to have agreed, by execution of
the Letter of Transmittal, that, upon receipt of notice from the Company of
the occurrence of any event or the discovery of any fact which makes any
statement contained or incorporated by reference in this Prospectus untrue in
any material respect or which causes this Prospectus to omit to state a
material fact necessary in order to make the statements contained or
incorporated by reference herein, in light of the circumstances under which
they were made, not misleading or of the occurrence of certain other events
specified in the Registration Rights Agreement, such Participating Broker-
Dealer will suspend the sale of New Notes pursuant to this Prospectus until
the Company has amended or supplemented this Prospectus to correct such
misstatement or omission and has furnished copies of the amended or
supplemented Prospectus to such Participating Broker-Dealer or the Company has
given notice that the sale of the New Notes may be resumed, as the case may
be. If the Company gives such notice to suspend the sale of the New Notes, it
shall extend the 90-day period referred to above during which Participating
Broker-Dealers are entitled to use this Prospectus in connection with the
resale of New Notes by the number of days during the period from and including
the date of the giving of such notice to and including the date when
Participating Broker-Dealers shall have received copies of the amended or
supplemented Prospectus necessary to permit resales of the New Notes or to and
including the date on which the Company has given notice that the sale of New
Notes may be resumed, as the case may be.
The New Notes will be a new issue of securities for which there currently is
no market. Although the Initial Purchasers have informed the Company that they
each currently intend to make a market in the New Notes, they are not
obligated to do so, and any such market making may be discontinued at any time
without notice. Accordingly, there can be no assurance as to the development
or liquidity of any market for the New Notes. The Company currently does not
intend to apply for listing of the New Notes on any securities exchange or for
quotation through the National Association of Securities Dealers Automated
Quotation System.
Any Old Notes not tendered and accepted in the Exchange Offer will remain
outstanding and will be entitled to all the rights and will be subject to the
limitations applicable thereto under the Indenture (except for those rights
which terminate upon consummation of the Exchange Offer). Following
consummation of the Exchange Offer, the holders of Old Notes will continue to
be subject to the existing restrictions upon transfer thereof and the Company
will have no further obligation to such holders (other than to the Initial
Purchasers under certain limited circumstances) to provide for registration
under the Securities Act of the Old Notes held by them. To the extent that Old
Notes are tendered and accepted in the Exchange Offer, a holder's ability to
sell untendered Old Notes could be adversely affected. See "Summary--Certain
Consequences of a Failure to Exchange Old Notes."
THIS PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION. HOLDERS OF OLD NOTES ARE URGED TO READ THIS PROSPECTUS AND THE
RELATED LETTER OF TRANSMITTAL CAREFULLY BEFORE DECIDING WHETHER TO TENDER
THEIR OLD NOTES PURSUANT TO THE EXCHANGE OFFER.
Old Notes may be tendered for exchange on or prior to 5:00 p.m., New York
City time, on April 12, 1996 (such time on such date being hereinafter called
the "Expiration Date"), unless the Exchange Offer is extended by the Company
(in which case the term "Expiration Date" shall mean the latest date and time
to which the Exchange Offer is extended). Tenders of Old Notes may be
withdrawn at any time on or prior to the Expiration
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Date. The Exchange Offer is not conditioned upon any minimum principal amount
of Old Notes being tendered for exchange. However, the Exchange Offer is
subject to certain events and conditions which may be waived by the Company
and to the terms and provisions of the Registration Rights Agreement. Old
Notes may be tendered in whole or in part in a principal amount of $1,000 and
integral multiples thereof. The Company has agreed to pay all expenses of the
Exchange Offer. See "The Exchange Offer--Fees and Expenses." Each New Note
will bear interest from the most recent date to which interest has been paid
or duly provided for on the Old Note surrendered in exchange for such New Note
or, if no such interest has been paid or duly provided for on such Old Note,
from January 30, 1996. Holders of the Old Notes whose Old Notes are accepted
for exchange will not receive accrued interest on such Old Notes for any
period from and after the last Interest Payment Date to which interest has
been paid or duly provided for on such Old Notes prior to the original issue
date of the New Notes or, if no such interest has been paid or duly provided
for, will not receive any accrued interest on such Old Notes, and will be
deemed to have waived the right to receive any interest on such Old Notes
accrued from and after such Interest Payment Date or, if no such interest has
been paid or duly provided for, from and after January 30, 1996.
This Prospectus, together with the Letter of Transmittal, is being sent to
all registered holders of Old Notes as of March 4, 1996.
The Company will not receive any cash proceeds from the issuance of the New
Notes offered hereby. No dealer-manager is being used in connection with this
Exchange Offer. See "Use of Proceeds" and "Plan of Distribution."
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 may be inspected and copied at the public
reference facilities maintained by the Commission at Room 1024, 450 Fifth
Street, N.W., Judiciary Plaza, Washington, D.C. 20549, and at the Commission's
Regional Offices in New York (Seven World Trade Center, 13th Floor, New York,
New York 10048), and Chicago (Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661). Copies of these materials may be obtained from
the Public Reference Section of the Commission, 450 Fifth Street, N.W.,
Washington, D.C. 20549, at prescribed rates. Reports, proxy statements and
other information concerning the Company may also be inspected at the offices
of the New York Stock Exchange, 20 Broad Street, New York, New York 10005.
This Prospectus constitutes a part of a registration statement on Form S-4
(together with all amendments thereto, the "Registration Statement") filed by
the Company with the Commission under the Securities Act. This Prospectus,
which forms a part of the Registration Statement, does not contain all the
information set forth in the Registration Statement, certain parts of which
have been omitted in accordance with the rules and regulations of the
Commission. Reference is hereby made to the Registration Statement and related
exhibits and schedules filed therewith for further information with respect to
the Company and the New Notes offered hereby. 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 or
incorporated by reference as an exhibit to the Registration Statement or
otherwise filed by the Company with the Commission and each such statement is
qualified in its entirety by such reference. The Registration Statement and
the exhibits and schedules thereto may be inspected and copied at the public
reference facilities maintained by the Commission at the addresses set forth
above.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed with the Commission by the Company
pursuant to the Exchange Act are incorporated herein by reference: (i) the
Company's Annual Report on Form 10-K for the fiscal year ended January 1,
1995, (ii) the Company's Quarterly Reports on Form 10-Q for the quarters ended
April 2, 1995,
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July 2, 1995 and October 1, 1995, (iii) the Company's Current Reports on Form
8-K dated December 12, 1995, January 17, 1996 and February 12, 1996 and (iv)
the Company's Current Report on Form 8-K/A dated January 22, 1996.
All documents filed by the Company with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act after the date hereof and prior
to the termination of the Exchange Offer for the New Notes shall be deemed to
be incorporated by reference into this Prospectus and to be a part hereof from
the respective dates of filing of such documents. Any statement contained
herein or in a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement or
document so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus. Subject to the
foregoing, all information appearing in this Prospectus is qualified in its
entirety by the information appearing in the documents incorporated herein by
reference.
As used herein, the terms "Prospectus" and "herein" mean this Prospectus,
including the documents incorporated or deemed to be incorporated herein by
reference, as the same may be amended, supplemented or otherwise modified from
time to time. Statements contained in this Prospectus as to the contents of
any contract or other document referred to are not necessarily complete and in
each instance reference is made to the copy of such contract or other
document, copies of which are available from the Company as described below,
each such statement being qualified in all respects by such reference.
The Company will furnish without charge to each person to whom this
Prospectus is delivered, upon request, a copy of any and all of the documents
described above other than exhibits to such documents which are not
specifically incorporated by reference in such documents. Written or telephone
requests should be directed to: Thomas & Betts Corporation, Office of the
Corporate Secretary, 1555 Lynnfield Road, Memphis, Tennessee 38119 (telephone
number (901) 682-7766).
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SUMMARY
The following summary is qualified in its entirety by, and is subject to, the
detailed information, consolidated financial statements and notes thereto, and
pro forma financial information contained elsewhere and incorporated by
reference in this Prospectus. Unless otherwise indicated or unless the context
otherwise requires, all references in this Prospectus to the Company include
Thomas & Betts Corporation and its subsidiaries.
THE COMPANY
Thomas & Betts Corporation ("Thomas & Betts" or the "Company") designs,
manufactures and markets on a global basis electrical and electronic
connectors, components and related accessories and other products, with
manufacturing facilities and marketing activities in North America, Europe and
Asia. The Company's products are sold worldwide through electrical, electronic
and HVAC distributors, mass merchandisers, catalogs and home centers, and
directly to original equipment manufacturer ("OEM") markets. In North America,
the Company is one of the largest manufacturers of electrical connectors,
components and accessories for industrial, commercial and residential
construction, renovation and maintenance applications, and is a leading
supplier of transmission poles, towers and industrial lighting products to the
electric utility and telecommunications industries. On a worldwide basis, the
Company designs and manufactures electronic connectors and flat cable, which
are sold primarily to OEMs in the automotive, computer, office equipment, test
equipment, instrumentation, industrial automation and telecommunications
industries.
The Company operates in three business segments. Electrical Construction and
Maintenance Components are sold primarily in North America, and manufactured
and assembled at facilities located in the United States, Puerto Rico, Canada
and Mexico. Electronics/OEM Components are sold in North America, Europe and
Asia, and manufactured at facilities in the United States, Europe, Mexico,
Japan and Singapore. Other Products and Components--principally heaters,
heating/ventilation systems, components for transmission and distribution of
electric power, transmission poles and towers, and telecommunications
products--are sold primarily in North America and manufactured in the United
States.
Thomas & Betts' objective is to continue to achieve profitable growth by
offering its distributors and its OEM and end-user customers a broad family of
high-quality products and state-of-the-art distribution services and by
maintaining a leadership position in the market segments that it serves. Its
strategy for achieving this objective consists of the following elements:
. designing continuous improvements and making customer-specific
modifications in widely used products--allowing value to be added to
mature product lines;
. selectively acquiring product lines that complement the Company's
existing product lines--allowing the Company to reduce significantly the
time required by the Company to bring new products to its markets;
. expanding the use and features of the Company's state-of-the-art
Distributor/Manufacturer Integration ("DMI") system--allowing the Company
to provide its distributors with an inventory and distribution management
system that achieves significant transaction cost savings for both the
Company and its distributors; and
. globally locating and coordinating manufacturing facilities and marketing
personnel--allowing the Company to achieve low-cost manufacturing and
provide worldwide service to those of its OEM customers with globally
dispersed operations.
Selective acquisitions have been made to broaden Thomas & Betts' business
worldwide. In 1992, the Company acquired American Electric, a leading
manufacturer of a broad range of electrical products and accessories, as a
result of which the Company's sales approximately doubled. Since the
acquisition of American
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Electric, the Company has made 13 acquisitions involving complementary product
lines. Recent examples include: the $51 million acquisition of Commander
Electrical Products, Inc., a Canadian manufacturer of electrical outlet boxes,
in August 1994; the $35 million acquisition of Catamount Manufacturing, Inc.
("Catamount"), a manufacturer of cable ties, in October 1995; and the $221
million acquisition of Amerace Corporation ("Amerace"), a manufacturer of
electrical components for the utility and industrial markets, in January 1996.
Amerace had sales of approximately $200 million in 1994. In addition, in August
1994, the Company completed the purchase, for approximately $50 million, of a
29% interest in Leviton Manufacturing Co., Inc. ("Leviton"), a private company
that is the largest U.S. manufacturer of wiring devices.
THE EXCHANGE OFFER
The Exchange Offer.......... Up to $150,000,000 aggregate principal amount of
New Notes are being offered in exchange for a
like aggregate principal amount of Old Notes. Old
Notes may be tendered for exchange in whole or in
part in a principal amount of $1,000 and integral
multiples thereof. The Company is making the
Exchange Offer in order to satisfy its
obligations under the Registration Rights
Agreement relating to the Old Notes. For a
description of the procedures for tendering Old
Notes, see "The Exchange Offer--Procedures for
Tendering Old Notes."
Expiration Date............. 5:00 p.m., New York City time, on April 12, 1996
(such time on such date being hereinafter called
the "Expiration Date") unless the Exchange Offer
is extended by the Company (in which case the
term "Expiration Date" shall mean the latest date
and time to which the Exchange Offer is
extended). See "The Exchange Offer--Expiration
Date; Extensions; Amendments."
Certain Conditions to the
Exchange Offer.............
The Exchange Offer is subject to certain condi-
tions. The Company reserves the right in its sole
and absolute discretion, subject to applicable
law and the terms of the Registration Rights
Agreement, at any time and from time to time, (i)
to delay the acceptance of the Old Notes for ex-
change, (ii) to terminate the Exchange Offer if
certain specified conditions have not been satis-
fied, (iii) to extend the Expiration Date of the
Exchange Offer and retain all Old Notes tendered
pursuant to the Exchange Offer, subject, however,
to the right of holders of Old Notes to withdraw
their tendered Old Notes, or (iv) to waive any
condition or otherwise amend the terms of the Ex-
change Offer in any respect. See "The Exchange
Offer--Expiration Date; Extensions; Amendments"
and "--Certain Conditions to the Exchange Offer."
Withdrawal Rights........... Tenders of Old Notes may be withdrawn at any time
on or prior to the Expiration Date by delivering
a written notice of such withdrawal to the Ex-
change Agent in conformity with certain proce-
dures set forth below under "The Exchange Offer--
Withdrawal Rights."
Procedures for Tendering Tendering holders of Old Notes must complete and
Old Notes.................. sign a Letter of Transmittal in accordance with
the instructions contained therein and forward
the same by mail, facsimile or hand delivery, to-
gether with any other required documents, to the
Exchange Agent (as defined below), either with
the Old Notes to be tendered or in compliance
with the specified procedures for guaranteed de-
livery of Old
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Notes. Certain brokers, dealers, commercial
banks, trust companies and other nominees may
also effect tenders by book-entry transfer. Hold-
ers of Old Notes registered in the name of a bro-
ker, dealer, commercial bank, trust company or
other nominee are urged to contact such person
promptly if they wish to tender Old Notes pursu-
ant to the Exchange Offer. See "The Exchange Of-
fer--Procedures for Tendering Old Notes." Letters
of Transmittal and certificates representing Old
Notes should not be sent to the Company. Such
documents should only be sent to the Exchange
Agent. Questions regarding how to tender and re-
quests for information should be directed to the
Exchange Agent. See "The Exchange Offer--Exchange
Agent."
Resales of New Notes........ The Company is making the Exchange Offer in reli-
ance on the position of the staff of the Division
of Corporation Finance of the Commission as set
forth in certain No-Action Letters issued to Mor-
gan Stanley & Co. Incorporated (available June 5,
1991) (the "Morgan Stanley Letter"), Exxon Capi-
tal Holdings Corp. (available April 13, 1988),
and Shearman & Sterling (available July 2, 1993),
and certain other interpretive letters addressed
to third parties in other transactions. However,
the Company has not sought its own interpretive
letter and there can be no assurance that the
staff of the Division of Corporation Finance of
the Commission would make a similar determination
with respect to the Exchange Offer as it has in
such interpretive letters to third parties. Based
on these interpretations by the staff of the Di-
vision of Corporation Finance, and subject to the
two immediately following sentences, the Company
believes that New Notes issued pursuant to this
Exchange Offer in exchange for Old Notes may be
offered for resale, resold and otherwise trans-
ferred by a holder thereof (other than a holder
who is a broker-dealer) without further compli-
ance with the registration and prospectus deliv-
ery requirements of the Securities Act, provided
that such New Notes are acquired in the ordinary
course of such holder's business and that such
holder is not participating, and has no arrange-
ment or understanding with any person to partici-
pate, in a distribution (within the meaning of
the Securities Act) of such New Notes. However,
any holder of Old Notes that is an "affiliate" of
the Company or that intends to participate in the
Exchange Offer for the purpose of distributing
the New Notes, or any broker-dealer who purchased
the Old Notes from the Company to resell pursuant
to Rule 144A or any other available exemption un-
der the Securities Act, (a) will not be able to
rely on the interpretations of the staff of the
Division of Corporation Finance of the Commission
set forth in the Morgan Stanley Letter and the
other above-mentioned interpretive letters, (b)
will not be permitted or entitled to tender such
Old Notes in the Exchange Offer and (c) must com-
ply with the registration and prospectus delivery
requirements of the Securities Act in connection
with any sale or other transfer of such Old Notes
unless such sale is made pursuant to an exemption
from such requirements. In addition, as described
below, if any broker-dealer holds Old Notes ac-
quired
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for its own account as a result of market-making
or other trading activities and exchanges such
Old Notes for New Notes, then such broker-dealer
must deliver a prospectus meeting the require-
ments of the Securities Act in connection with
any resales of such New Notes.
Each holder of Old Notes who wishes to exchange
Old Notes for New Notes in the Exchange Offer
will be required to represent that (i) it is not
an "affiliate" of the Company, (ii) any New Notes
to be received by it are being acquired in the
ordinary course of its business, (iii) it has no
arrangement or understanding with any person to
participate in a distribution (within the meaning
of the Securities Act) of such New Notes, and
(iv) if such holder is not a broker-dealer, such
holder is not engaged in, and does not intend to
engage in, a distribution (within the meaning of
the Securities Act) of such New Notes. Each bro-
ker-dealer that receives New Notes for its own
account pursuant to the Exchange Offer must ac-
knowledge that it acquired the Old Notes for its
own account as the result of market-making activ-
ities or other trading activities and must agree
that it will deliver a prospectus meeting the re-
quirements of the Securities Act in connection
with any resale of such New Notes. The Letter of
Transmittal states that by so acknowledging and
by delivering a prospectus, a broker-dealer will
not be deemed to admit that it is an "underwrit-
er" within the meaning of the Securities Act.
Based on the position taken by the staff of the
Division of Corporation Finance of the Commission
in the interpretive letters referred to above,
the Company believes that broker-dealers who ac-
quired Old Notes for their own accounts as a re-
sult of market-making activities or other trading
activities ("Participating Broker-Dealers") may
fulfill their prospectus delivery requirements
with respect to the New Notes received upon ex-
change of such Old Notes (other than Old Notes
which represent an unsold allotment from the
original sale of the Old Notes) with a prospectus
meeting the requirements of the Securities Act,
which may be the prospectus prepared for an ex-
change offer so long as it contains a description
of the plan of distribution with respect to the
resale of such New Notes. Accordingly, this Pro-
spectus, as it may be amended or supplemented
from time to time, may be used by a Participating
Broker-Dealer in connection with resales of New
Notes received in exchange for Old Notes where
such Old Notes were acquired by such Participat-
ing Broker-Dealer for its own account as a result
of market-making or other trading activities.
Subject to certain provisions set forth in the
Registration Rights Agreement and to the limita-
tions described below under "The Exchange Offer--
Resale of New Notes", the Company has agreed that
this Prospectus, as it may be amended or supple-
mented from time to time, may be used by a Par-
ticipating Broker-Dealer in connection with re-
sales of such New Notes for a period ending 90
days (subject to extension under certain limited
circumstances) after the Expiration Date or, if
earlier, when all such New Notes have been dis-
posed of by such Participating Broker-
9
<PAGE>
Dealer. However, a Participating Broker-Dealer
who intends to use this Prospectus in connection
with the resale of New Notes received in exchange
for Old Notes pursuant to the Exchange Offer must
notify the Company, or cause the Company to be
notified, on or prior to the Expiration Date,
that it is a Participating Broker-Dealer. Such
notice may be given in the space provided for
that purpose in the Letter of Transmittal or may
be delivered to the Exchange Agent at one of the
addresses set forth herein under "The Exchange
Offer--Exchange Agent." See "Plan of Distribu-
tion." Any Participating Broker-Dealer who is an
"affiliate" of the Company may not rely on such
interpretive letters and must comply with the
registration and prospectus delivery requirements
of the Securities Act in connection with any re-
sale transaction. See "The Exchange Offer--Re-
sales of New Notes."
Exchange Agent.............. The exchange agent with respect to the Exchange
Offer is First Trust of New York, National Asso-
ciation (the "Exchange Agent"). The addresses,
and telephone and facsimile numbers of the Ex-
change Agent are set forth in "The Exchange Of-
fer--Exchange Agent" and in the Letter of Trans-
mittal.
Use of Proceeds............. The Company will not receive any cash proceeds
from the issuance of the New Notes offered here-
by. See "Use of Proceeds."
Certain United States
Federal Income Tax
Considerations.............
Holders of Old Notes should review the informa-
tion set forth under "Certain United States Fed-
eral Income Tax Considerations" prior to
tendering Old Notes in the Exchange Offer.
THE NEW NOTES
Securities Offered.......... Up to $150,000,000 aggregate principal amount of
the Company's 6 1/2% Notes due 2006 which have
been registered under the Securities Act.
The New Notes will be issued and the Old Notes
were issued under an Indenture, dated as of Janu-
ary 15, 1992 (the "Indenture"), between the Com-
pany and First Trust of New York, National Asso-
ciation, as Trustee (successor trustee to Morgan
Guaranty Trust Company of New York) (the "Trust-
ee"). The New Notes and any Old Notes which re-
main outstanding after consummation of the Ex-
change Offer will constitute a single series of
debt securities under the Indenture and, accord-
ingly, will vote together as a single class for
purposes of determining whether holders of the
requisite percentage in outstanding principal
amount thereof have taken certain actions or ex-
ercised certain rights under the Indenture. See
"Description of the New Notes--General."
The terms of the New Notes are identical in all
material respects to the terms of the Old Notes,
except that (i) the New Notes have been regis-
tered under the Securities Act and therefore are
not subject to certain restrictions on transfer
applicable to the Old Notes and will
10
<PAGE>
not be entitled to registration rights or other
rights under the Registration Rights Agreement
and (ii) the New Notes will not provide for any
increase in the interest rate thereon. See "The
Exchange Offer--Purpose of the Exchange Offer,"
"Description of the New Notes" and "Description
of the Old Notes."
Maturity Date............... January 15, 2006.
Interest Payment Dates...... January 15 and July 15 of each year, commencing
on the first such date following the original is-
suance of the New Notes.
Denominations............... The New Notes will be issued in minimum denomina-
tions of $1,000 and integral multiples of $1,000
in excess thereof.
Redemption.................. The New Notes may not be redeemed prior to matu-
rity.
Sinking fund................ None.
Ranking..................... The New Notes will constitute senior unsecured
indebtedness of the Company and will rank pari
passu with all other unsecured and unsubordinated
indebtedness of the Company. See "Capitalization"
and "Description of the New Notes--General."
Absence of Market for the The New Notes will be a new issue of securities
New Notes.................. for which there currently is no market. Although
Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated and J.P. Morgan Secu-
rities Inc., as representatives for the initial
purchasers of the Old Notes (the "Initial Pur-
chasers"), have informed the Company that they
each currently intend to make a market in the New
Notes, they are not obligated to do so, and any
such market making may be discontinued at any
time without notice. Accordingly, there can be no
assurance as to the development or liquidity of
any market for the New Notes. The Company cur-
rently does not intend to apply for listing of
the New Notes on any securities exchange or for
quotation through the National Association of Se-
curities Dealers Automated Quotation System.
For further information regarding the New Notes, see "Description of the New
Notes."
11
<PAGE>
CERTAIN CONSEQUENCES OF A FAILURE TO EXCHANGE OLD NOTES
The Old Notes have not been registered under the Securities Act or any state
securities laws and therefore may not be offered, sold or otherwise
transferred except in compliance with the registration requirements of the
Securities Act and any other applicable securities laws, or pursuant to an
exemption therefrom or in a transaction not subject thereto, and in each case
in compliance with certain other conditions and restrictions, including the
Company's and the Trustee's right in certain cases to require the delivery of
opinions of counsel, certifications and other information prior to any such
transfer. Old Notes which remain outstanding after consummation of the
Exchange Offer will continue to bear a legend reflecting such restrictions on
transfer. In addition, upon consummation of the Exchange Offer, holders of Old
Notes which remain outstanding will not be entitled to any rights to have such
Old Notes registered under the Securities Act or to any similar rights under
the Registration Rights Agreement (subject to certain limited exceptions
applicable solely to the Initial Purchasers). The Company currently does not
intend to register under the Securities Act any Old Notes which remain
outstanding after consummation of the Exchange Offer (subject to such limited
exceptions, if applicable).
To the extent that Old Notes are tendered and accepted in the Exchange
Offer, a holder's ability to sell untendered Old Notes could be adversely
affected. In addition, although the Old Notes are eligible for trading in the
Private Offerings, Resale and Trading through Automatic Linkages ("PORTAL")
market, and Old Notes which remain outstanding after the consummation of the
Exchange Offer will continue to be so eligible, to the extent that Old Notes
are tendered and accepted in connection with the Exchange Offer, any trading
market for Old Notes which remain outstanding after the Exchange Offer could
be adversely affected.
The New Notes and any Old Notes which remain outstanding after consummation
of the Exchange Offer will constitute a single series of debt securities under
the Indenture and, accordingly, will vote together as a single class for
purposes of determining whether holders of the requisite percentage in
outstanding principal amount thereof have taken certain actions or exercised
certain rights under the Indenture. See "Description of the New Notes--
General."
The Old Notes provide that, if the Exchange Offer is not consummated by July
28, 1996, the interest rate borne by the Old Notes will increase by 0.50% per
annum following July 28, 1996 until the Exchange Offer is consummated. See
"Description of the Old Notes." Following consummation of the Exchange Offer,
the Old Notes will not be entitled to any increase in the interest rate
thereon. The New Notes will not be entitled to any such increase in the
interest rate thereon.
12
<PAGE>
RECENT ACQUISITIONS
The Company has expanded its business and product line through internal
development and acquisitions. On January 2, 1996 the Company completed the
acquisition of Amerace, a subsidiary of Eagle Industrial Products Corporation,
for a purchase price of $221 million in cash. Amerace is a leading
manufacturer of electrical components, including (i) cables, connectors and
related products for electric utilities; (ii) electrical control products sold
as components to the machine tool and process control industry; (iii)
electrical connectors for specialized industrial and construction uses; and
(iv) specialized lighting products. Amerace's most significant products are
power and distribution connectors and components sold under its Elastimold
brand name, which has a significant share of the U.S. market for these
products and a growing international presence through export and joint
ventures in Taiwan, Belgium and Japan. Amerace's Hendrix Wire & Cable division
produces products for use in underground and overhead residential electrical
power distribution. Amerace's MRS Power Systems division serves the electrical
interconnect and trolley electrification markets. Amerace's Electronic
Components division manufacturers and distributes timing and relay devices and
connector components to the industrial markets. Amerace had sales of
approximately $200 million in 1994 and sales of approximately $167 million
during the first nine months of 1995. Amerace has manufacturing facilities in
Hackettstown, New Jersey; Milford, New Hampshire; Albuquerque, New Mexico;
Punta Gorda and Brooksville, Florida; Ontario, Canada; and Berkshire, England,
as well as various office and warehouse facilities. The Company expects that
the combination of Amerace's products with its own existing utility package
will enable it to further penetrate international markets. See "Selected
Consolidated Historical and Pro Forma Financial Information."
On October 27, 1995, the Company completed the $35 million acquisition of
Catamount, a manufacturer of cable ties, wire connectors, tubing and nylon
hardware products, and related electrical products. The purchase price
consisted of approximately $22 million in the Company's Common Stock and the
assumption or retirement of approximately $13 million in debt. Catamount had
sales of approximately $28 million in 1994. On January 5, 1996 the Company
completed the $8.5 million acquisition of certain assets of Bowers
Manufacturing Corporation ("Bowers"), a manufacturer of metallic and non-
metallic electrical outlet boxes and surface raceway systems, from Masco
Corporation. The acquisition complements the Company's existing STEEL CITY,
UNION and IBERVILLE box lines in the United States and Canada.
USE OF PROCEEDS
The Company will not receive any cash proceeds from the issuance of the New
Notes offered hereby. In consideration for issuing the New Notes in exchange
for Old Notes as described in this Prospectus, the Company will receive Old
Notes in like principal amount. The Old Notes surrendered in exchange for the
New Notes will be retired and cancelled. Accordingly, the issuance of the New
Notes will not result in any change in the indebtedness of the Company.
The net proceeds to the Company from the sale of the Old Notes was
approximately $148.4 million. The Company used the net proceeds to refinance a
portion of the outstanding debt under the Company's revolving credit facility
established by the Credit Agreement, dated as of March 29, 1995, as amended,
between the Company and Morgan Guaranty Trust Company of New York, as Agent.
The debt refinanced would have expired on March 29, 2000 and had a weighted
average interest rate of 5.98% on December 31, 1995.
13
<PAGE>
CAPITALIZATION
The following table sets forth: (i) the cash position and the capitalization
of the Company on a consolidated basis as of October 1, 1995, (ii) the pro
forma cash position and capitalization of the Company on a consolidated basis
as of such date after giving effect to the acquisition of Amerace as if such
acquisition had occurred on such date, and (iii) the adjusted pro forma cash
position and capitalization of the Company on a consolidated basis as of such
date after giving effect to the acquisition of Amerace and the sale of the Old
Notes and the application of the estimated net proceeds therefrom as if such
transactions had occurred on such date. The information presented below should
be read in conjunction with the historical and pro forma financial information
incorporated by reference or included elsewhere in this Prospectus. The
exchange of the New Notes for the Old Notes will have no effect on the cash
position or capitalization of the Company.
<TABLE>
<CAPTION>
AS OF OCTOBER 1, 1995
----------------------------------
PRO FORMA,
HISTORICAL PRO FORMA AS ADJUSTED
---------- ---------- -----------
(IN THOUSANDS)
<S> <C> <C> <C>
Cash, cash equivalents and short-term
investments................................. $105,544 $ 105,544 $ 105,544
======== ========== ==========
Short-term debt:
Current maturities of long-term debt...... $ 9,452 $ 9,452 $ 9,452
Short-term borrowings..................... 13,731 13,731 13,731
-------- ---------- ----------
Total short-term debt................... $ 23,183 $ 23,183 $ 23,183
======== ========== ==========
Long-term debt (less current maturities):
6 1/2% Notes due 2006..................... $ -- $ -- $ 150,000
Revolving credit facility................. 137,000 357,550 209,191
8 1/4% Notes due January 2004............. 124,364 124,364 124,364
5.10% Notes due February 23, 1996......... 20,000 20,000 20,000
Other borrowings.......................... 18,800 18,800 18,800
International borrowings.................. 30,497 30,497 30,497
Industrial revenue bonds.................. 14,105 14,105 14,105
Other..................................... 8,539 8,539 8,539
Less: current portion..................... (9,452) (9,452) (9,452)
-------- ---------- ----------
Total long-term debt.................... 343,853 564,403 566,044
-------- ---------- ----------
Shareholders' equity:
Common stock.............................. 9,857 9,857 9,857
Additional paid-in capital................ 172,224 172,224 172,224
Retained earnings......................... 396,456 396,456 396,456
Unrealized gain on marketable securities.. 1,344 1,344 1,344
Foreign currency translation adjustment... 3,872 3,872 3,872
Cost of treasury stock.................... (2,289) (2,289) (2,289)
-------- ---------- ----------
Total shareholders' equity.............. 581,464 581,464 581,464
-------- ---------- ----------
Total capitalization.................... $925,317 $1,145,867 $1,147,508
======== ========== ==========
</TABLE>
14
<PAGE>
SELECTED CONSOLIDATED HISTORICAL AND PRO FORMA FINANCIAL INFORMATION
The following tables set forth selected consolidated historical financial
information and pro forma financial information of the Company. The historical
information in these tables should be read in conjunction with the disclosures
in the sections captioned "Management's Discussion and Analysis of Results of
Operations and Financial Condition" and the consolidated financial statements
of the Company and related notes thereto incorporated by reference in this
Prospectus from the Company's Annual Report on Form 10-K for the year ended
January 1, 1995 and the Company's Quarterly Reports on Form 10-Q for each of
the first three quarters of the fiscal year ended December 31, 1995. The
unaudited pro forma financial information should be read in conjunction with
the unaudited pro forma financial statements, including the related notes
thereto, the aforementioned consolidated financial statements of the Company,
and the financial statements of Amerace, including the related notes thereto,
incorporated by reference in this Prospectus from the Company's Current Report
on Form 8-K/A dated January 22, 1996. The exchange of the New Notes for the
Old Notes will have no effect on the cash position or capitalization of the
Company.
The historical information set forth below was selected or derived from the
historical financial statements and notes thereto of the Company. The
unaudited historical interim period financial information, in the opinion of
management, includes all adjustments (consisting of normal recurring accruals)
necessary for a fair presentation for the periods shown. Historical results
for the nine months ended October 1, 1995 are not necessarily indicative of
results to be expected for the full year.
The unaudited pro forma financial information set forth below gives effect
to (i) the acquisition of Amerace and the debt incurred in connection
therewith and (ii) the sale of $150 million aggregate principal amount of the
Old Notes and the application of the net proceeds therefrom as described under
"Use of Proceeds", as if they each had occurred on October 1, 1995 with regard
to Balance Sheet Data, and on January 3, 1994 with regard to all other data.
The pro forma financial information presented is not necessarily indicative of
actual results that would have been achieved had the acquisition of Amerace
been completed on the dates assumed and do not purport to project the
Company's financial position at any future date or its results of operations
for any future period. As illustrated below, the acquisition of Amerace and
the debt incurred in connection therewith will have a material impact on the
financial position and results of operations of the Company.
<TABLE>
<CAPTION>
FISCAL YEAR ENDED NINE MONTHS ENDED
---------------------------------------------- --------------------------------
PRO PRO
HISTORICAL FORMA(1) HISTORICAL FORMA(1)
---------------------------------- ---------- --------------------- ----------
DECEMBER 31, JANUARY 2, JANUARY 1, JANUARY 1, OCTOBER 2, OCTOBER 1, OCTOBER 1,
1992 1994 1995 1995 1994 1995 1995
------------ ---------- ---------- ---------- ---------- ---------- ----------
(IN THOUSANDS, EXCEPT PER SHARE DATA AND RATIOS)
<S> <C> <C> <C> <C> <C> <C> <C>
STATEMENT OF EARNINGS
DATA:
Net sales............... $939,548 $957,509 $1,076,165 $1,276,265 $787,376 $903,831 $1,070,331
-------- -------- ---------- ---------- -------- -------- ----------
Costs and expenses:
Costs of sales......... 605,517 628,577 710,864 862,963 524,440 594,873 720,247
Marketing, general and
administrative........ 201,818 211,430 229,897 253,597 169,781 185,874 205,024
Research and
development........... 17,368 18,664 20,787 24,987 15,312 17,251 21,251
Amortization of
intangibles........... 13,498 11,780 11,040 14,422 8,488 7,380 9,917
Provision for
restructured
operations............ 15,000 -- 79,011 79,011 79,011 -- --
-------- -------- ---------- ---------- -------- -------- ----------
Total.................. 853,201 870,451 1,051,599 1,234,980 797,032 805,378 956,439
-------- -------- ---------- ---------- -------- -------- ----------
Earnings (loss) from
operations............. 86,347 87,058 24,566 41,285 (9,656) 98,453 113,892
Other income (expense)--
net.................... (33,364) (27,116) (24,072) (35,208) (18,735) (14,981) (21,532)
-------- -------- ---------- ---------- -------- -------- ----------
Earnings (loss) from
continuing operations
before income taxes.... 52,983 59,942 494 6,077 (28,391) 83,472 92,360
Income taxes (benefit).. 12,403 16,353 (1,393) 3,092 (10,712) 26,722 31,423
-------- -------- ---------- ---------- -------- -------- ----------
Earnings (loss) from
continuing operations
before cumulative
effect of change in
accounting for income
taxes.................. 40,580 43,589 1,887 $ 2,985 (17,679) 56,750 $ 60,937
========== ==========
Earnings from
discontinued operations
net of income tax
expense................ 10,343 11,322 7,350 7,350 --
Gain on sale of
discontinued
operations, net of
income tax expense of
$40,492................ -- -- 58,583 58,583 --
-------- -------- ---------- -------- --------
Earnings before
cumulative effect of
change in accounting
for income tax......... 50,923 54,911 67,820 48,254 56,750
Cumulative effect of
change in accounting
for income taxes....... -- 1,628 -- -- --
-------- -------- ---------- -------- --------
Net earnings(2)......... $ 50,923 $ 56,539 $ 67,820 $ 48,254 $ 56,750
======== ======== ========== ======== ========
Ratio of earnings to
fixed charges(3)....... 2.2x 2.6x .96x 1.0x .3x 4.0x 3.3x
SHARE DATA(4):
Earnings (loss) from
continuing operations
per share.............. $ 2.17 $ 2.31 $ .10 $ .15 $ (.90) $ 2.89 $ 3.10
Earnings per share...... 2.72 3.00 3.51 2.51 2.89
Dividends per share..... 2.24 2.24 2.24 2.24 1.68 1.68 1.68
Average shares
outstanding............ 18,717 18,837 19,304 19,304 19,216 19,642 19,642
OTHER DATA:
Depreciation and
amortization........... $ 46,722 $ 48,998 $ 53,532 $ 69,213 $ 38,525 $ 41,421 $ 53,532
Purchases of property,
plant and equipment.... 38,232 28,044 59,109 66,309 36,683 61,663 68,663
</TABLE>
15
<PAGE>
<TABLE>
<CAPTION>
PRO FORMA
HISTORICAL (1)
-------------------------------------------------------- ----------
DECEMBER 31, JANUARY 2, JANUARY 1, OCTOBER 2, OCTOBER 1, OCTOBER 1,
1992 1994 1995 1994 1995 1995
------------ ---------- ---------- ---------- ---------- ----------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Cash and cash
equivalents............ $ 41,764 $ 72,509 $ 69,671 $ 88,974 $ 53,496 $ 53,496
Marketable securities... 56,568 31,543 52,569 43,022 52,048 52,048
Working capital......... 264,804 283,626 253,649 259,625 296,554 320,513
Property, plant &
equipment--net......... 296,138 296,004 275,525 257,057 300,988 393,980
Intangible assets--net.. 314,298 311,059 323,228 332,930 316,315 451,599
Total assets............ 1,117,063 1,133,182 1,208,212 1,212,595 1,238,261 1,559,238
Short-term debt,
including current
maturities of long-term
debt................... 43,287 27,897 18,659 24,521 23,183 23,183
Long-term debt, less
current maturities..... 420,345 393,502 319,519 321,423 343,853 566,044
Shareholders' equity.... 463,062 480,832 553,043 545,010 581,464 581,464
</TABLE>
- --------
(1) The unaudited pro forma financial information contained herein differs
from that contained in the Company's Current Report on Form 8-K/A dated
January 22, 1996, because it gives effect to the refinancing of a portion
of the indebtedness under the Company's revolving credit facility with the
net proceeds from the sale of the Old Notes at an interest rate of 6 1/2%.
The interest rate utilized for the purposes of calculating pro forma
interest expense on the revolving credit facility was 6.125%.
(2) Historical net earnings for the fiscal year ended January 1, 1995 include
a pretax gain from the sale of the Company's Vitramon subsidiary of $99.1
million, a pretax charge of $79.0 million for restructuring of the
Company's operations, and a pretax operating write-down of $10.6 million
for previously vacated facilities, each of which was recorded in the third
quarter of 1994.
(3) The ratio of earnings to fixed charges represents the number of times
fixed charges are covered by earnings. For purposes of computing this
ratio, earnings consist of earnings from continuing operations before
income taxes, plus fixed charges and less undistributed earnings from
unconsolidated investees. Fixed charges consist of interest expense and
such portion of rental expense which the Company estimates to be
representative of the interest factor attributable to such rental expense.
The Company's ratios for the year ended January 1, 1995 and the nine
months ended October 2, 1994 were .96x and .3x, both on an historical
basis, inadequate to cover fixed charges by $1.4 million and $17.6
million, respectively. This inadequacy was largely due to a provision for
restructured operations of $79.0 million provided in the third quarter of
that year.
(4) On February 7, 1996, the Board of Directors of the Company approved a 2
for 1 split of the Company's Common Stock that will be effective April 9,
1996 with respect to shareholders of record on March 8, 1996. The Share
Data included herein does not give effect to such stock split.
16
<PAGE>
BUSINESS OF THE COMPANY
GENERAL
Thomas & Betts designs, manufactures and markets on a global basis
electrical and electronic connectors, components and related accessories and
other products, with manufacturing facilities and marketing activities in
North America, Europe and Asia. The Company's products are sold worldwide
through electrical, electronic and HVAC distributors, mass merchandisers,
catalogs and home centers, and directly to original equipment manufacturer
("OEM") markets. In North America, the Company is one of the largest
manufacturers of electrical connectors, components and accessories for
industrial, commercial and residential construction, renovation and
maintenance applications, and is a leading supplier of transmission poles,
towers and industrial lighting products to the electric utility and
telecommunications industries. On a worldwide basis, the Company designs and
manufactures electronic connectors and flat cable, which are sold primarily to
OEMs in the automotive, computer, office equipment, test equipment,
instrumentation, industrial automation and telecommunications industries.
The Company operates in three business segments. Electrical Construction and
Maintenance Components are sold primarily in North America, and manufactured
and assembled at facilities located in the United States, Puerto Rico, Canada
and Mexico. Electronics/OEM Components are sold in North America, Europe and
Asia, and manufactured at facilities in the United States, Europe, Mexico,
Japan and Singapore. Other Products and Components--principally heaters,
heating/ventilation systems, components for transmission and distribution of
electric power, transmission poles and towers, and telecommunications
products--are sold primarily in North America and manufactured in the United
States.
Thomas & Betts' objective is to continue to achieve profitable growth by
offering its distributors and its OEM and end-user customers a broad family of
high-quality products and state-of-the-art distribution services and by
maintaining a leadership position in the market segments that it serves. Its
strategy for achieving this objective consists of the following elements:
. designing continuous improvements and making customer-specific
modifications in widely used products--allowing value to be added to
mature product lines;
. selectively acquiring product lines that complement the Company's
existing product lines--allowing the Company to reduce significantly the
time required by the Company to bring new products to its markets;
. expanding the use and features of the Company's state-of-the-art
Distributor/Manufacturer Integration ("DMI") system--allowing the Company
to provide its distributors with an inventory and distribution management
system that achieves significant transaction cost savings for both the
Company and its distributors; and
. globally locating and coordinating manufacturing facilities and marketing
personnel--allowing the Company to achieve low-cost manufacturing and
provide worldwide service to those of its OEM customers with globally
dispersed operations.
Selective acquisitions have been made to broaden Thomas & Betts' business
worldwide. In 1992, the Company acquired American Electric, a leading
manufacturer of a broad range of electrical products and accessories, as a
result of which the Company's sales approximately doubled. Since the
acquisition of American Electric, the Company has made 13 acquisitions
involving complementary product lines. Recent examples include: the $51
million acquisition of Commander Electrical Products, Inc., a Canadian
manufacturer of electrical outlet boxes, in August 1994; the $35 million
acquisition of Catamount, a manufacturer of cable ties, in October 1995; and
the $221 million acquisition of Amerace, a manufacturer of electrical
components for utility and industrial markets, in January 1996. Amerace had
sales of approximately $200 million in 1994. In addition, in August 1994, the
Company completed the purchase, for approximately $50 million, of a 29%
interest in Leviton, a private company that is the largest U.S. manufacturer
of wiring devices.
The Company was established in 1898 as a sales agency for electrical wires
and raceways and was incorporated in New Jersey in 1917. The Company's
executive offices are located at 1555 Lynnfield Road, Memphis, Tennessee
38119, telephone number (901) 682-7766.
17
<PAGE>
ELECTRICAL CONSTRUCTION AND MAINTENANCE COMPONENTS
The Company's electrical construction and maintenance components market
includes industrial, commercial and residential construction and renovation
companies, electrical contractors, and maintenance, repair and overhaul
operations ("MRO") customers. Total Electrical Construction and Maintenance
Components sales were $441.5, $453.0 and $526.5 million, or 47%, 47% and 49%
of the Company's total sales, for 1992, 1993 and 1994, respectively.
The Company designs, manufactures and markets thousands of different
electrical connectors, components and other products for industrial,
commercial and residential construction applications, including (i) fittings
and accessories for electrical raceways; (ii) fastening products, such as
plastic and metallic ties for bundling wire and flexible tubing; (iii)
terminals for small wires and power cables; (iv) power connectors, such as
compression and mechanical connectors for high current power and grounding
applications; (v) indoor and outdoor switch and outlet boxes, covers and
accessories; (vi) floor boxes; (vii) metal framing used as structural supports
for conduits, cable trays, electrical enclosures and lighting raceways; (viii)
ground rods and clamps; (ix) products for outdoor security, roadway and
adverse and hazardous location lighting; (x) circuit breakers, safety switches
and meter centers; and (xi) other products, including insulation products,
wire markers and application tooling products.
The Company markets its electrical components under various brand names.
These brand names and the related products include THOMAS & BETTS, T&B and
CATAMOUNT electrical products and electricians' supply products, TY-RAP, TY-
FAST and CATAMOUNT cable ties, STEEL CITY, BOWERS, IBERVILLE and UNION switch
and outlet boxes, covers and conduit fittings, STA-KON terminals, STEEL CITY
floor boxes and wire management systems, PERFECT-LINE outdoor lampholders and
boxes and covers, BLACKBURN and COLOR-KEYED power connectors and grounding
devices, T&B electricians' supplies, wire connectors, tools and accessories,
KINDORF and SUPERSTRUT metal framing products, AMERICAN ELECTRIC LIGHTING and
HAZLUX lighting products, THOMAS & BETTS and ZINSCO circuit breakers, safety
switches and meter centers, T&B, CANSTRUT and ELECTROTRAY cable tray, E-Z-CODE
wire markers and ANCHOR meter sockets.
In North America, the Company's components for industrial, commercial and
residential construction and industrial MRO customers are sold through
electrical distributors and retail outlets such as home centers and mass
merchants. The Company has relationships with over 2,000 national, regional
and independent distributors and buying groups with locations across North
America. The Company believes that it has strong relationships with its
distributors as a result of the breadth and quality of its product line,
innovative service programs, product innovation, competitive pricing and brand
name recognition among its customers. The Company has a network of factory and
independent sales representatives who work with distributors, end users and
retail outlets to increase demand for its products.
The Company also manufactures and distributes its components outside the
United States. Certain of the Company's standard components are sold in
countries where they conform to the applicable local electrical requirements,
while other components are specifically designed and manufactured to conform
to local standards. The Company also markets electrical components through
offshore sales agents and domestic exporters.
ELECTRONIC/OEM COMPONENTS
The Company's electronic components are sold primarily to OEMs in the
automotive, information services, office equipment, test equipment,
instrumentation, industrial automation and telecommunications businesses and
commercial offices, with the remainder of the components going to others such
as electronic distributors and contractors. Total Electronic/OEM Components
sales were $250.9, $238.4 and $250.4 million, or 27%, 25% and 23% of the
Company's total sales, for 1992, 1993 and 1994, respectively.
The Company's electronic/OEM components include: (i) printed circuit
connectors; (ii) IDC connectors for mass termination of flat cables; (iii)
custom-engineered connectors for automotive and professional electronics
applications; (iv) flexible interconnects, flat cables and assemblies for
automotive and other applications;
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(v) cable ties; (vi) terminals; (vii) D-subminiature connectors, a broad group
of industry standard connectors; and (viii) modular voice and data connectors,
twinax and coax connectors, baluns, patch panels, jack and wall plates and
related components for use in mainframe-to-terminal systems and personal
computer-based local area networks in commercial properties. These components
are sold under various brand names, including T&B electronic connectors,
ANSLEY IDC flat cable and connectors, FLEXSTRIP jumpers, TY-RAP, TY-FAST and
CATAMOUNT cable ties, HOLMBERG D-subminiature and card edge connectors, and
NEVADA WESTERN, ARMIGER, OMNI and EPITOME premises wiring brand names. The
Amerace acquisition added the following products to the Company's
electronic/OEM components product line: RUSSELLSTOLL, MAX-GARD and EVER-LOK
interconnect components and systems, MIPCO power connectors, FEEDRAIL trolley
busway electrification systems, AGASTAT electro-mechanical and solid-state
devices for timers and relays, and BUCHANAN terminal blocks and connectors.
These Amerace products are sold to electrical interconnect, trolley busway
electrification and industrial markets.
In North America, the Company sells its standard components through
electronic distributors and directly to end users, and provides customer-
specific components directly to major OEMs. The Company sells through
national, regional and local distributors serving a large customer base.
The Company also manufactures and markets its electronic/OEM components
internationally, with design, manufacturing and distribution capabilities in
Europe and the Pacific Region. In Europe and the Pacific Region, as in North
America, electronic/OEM components are sold primarily to automotive, computer,
office equipment, test equipment, instrumentation, industrial automation and
telecommunications markets, and certain of the Company's electronic components
are developed and manufactured for specific customer applications.
There has been a trend on the part of OEM customers to reduce the number of
their preferred suppliers, focusing on companies that can meet quality and
delivery standards and that have a global presence, a broad product package,
strong design capability and competitive prices. The Company has achieved a
preferred supplier designation from many of its most important OEM customers
for electronic components, and continues to seek this preferred status from
other accounts.
OTHER PRODUCTS AND COMPONENTS
The Company sells its other products and components, comprised of heating
products, transmission poles and towers, telecommunication components and
other components, through distributors and directly to end users. Total Other
Products and Components sales were $247.2, $266.1 and $299.2 million, or 26%,
28% and 28% of the Company's total sales, for 1992, 1993 and 1994,
respectively.
Heating Products
The Company designs, manufactures and markets heating products for
commercial and industrial buildings. Products include gas, oil and electric
unit heaters, gas-fired duct furnaces, indirect and direct gas-fired make-up
air heaters, and infrared heaters for the heating, ventilation and air
conditioning ("HVAC") marketplace under the REZNOR and E.K. CAMPBELL brand
names. The Company's products are sold through HVAC, mechanical and
refrigeration distributors in over 1,000 locations throughout North America.
Transmission Poles and Towers
The Company designs, manufactures and markets transmission and distribution
poles and towers for North American power and telecommunications companies and
for export. These products are primarily sold to five types of end users:
investor-owned utilities; cooperatives, which purchase power from utilities
and manage its distribution to end users; municipal utilities; cable
television operating companies; and telephone companies. The Company's
products include tubular steel transmission and distribution poles and lattice
steel transmission towers. The Company manufactures and sells its transmission
towers and its transmission and distribution poles under the LEHIGH, MEYER and
THOMAS & BETTS brand names.
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Telecommunication Components
The Company designs, manufactures and markets T&B aerial, pole, pedestal and
buried splice enclosures, T&B connectors, KOLD-N-KLOSE encapsulation and
sheath repair systems, TY-RAP, TY-FAST and CATAMOUNT cable ties, and DELTEC
specialty devices for cable television companies and telephone operating
companies. These components are sold both directly to end users and through
distributors.
Other Components
The Company designs, manufactures and markets flood, roadway and security
lighting fixtures; and connectors, grounding systems, fastening and metal
framing components for North American power companies and heating, mechanical
and refrigeration ("HMR") product distributors. These products are primarily
sold to four markets: investor-owned utilities, cooperatives, municipal
utilities and HMR distributors. The Company's other component products include
BLACKBURN power connectors and grounding systems, AMERICAN ELECTRIC LIGHTING
roadway, security and area lighting fixtures, SUPERSTRUT metal framing, TY-
RAP, TY-FAST and CATAMOUNT cable ties, ANCHOR meter sockets and, from the
Amerace acquisition, ELASTIMOLD power connectors and HENDRIX cable products.
These Amerace products are sold to investor-owned utilities, cooperatives and
municipal utilities, and to the export market.
THE EXCHANGE OFFER
PURPOSE OF THE EXCHANGE OFFER
In connection with the sale of the Old Notes, the Company entered into the
Registration Rights Agreement with the Initial Purchasers, pursuant to which
the Company agreed to use its best efforts to file with the Commission a
registration statement with respect to the exchange of the Old Notes for debt
securities with terms identical in all material respects to the terms of the
Old Notes, except that (i) the New Notes would be registered under the
Securities Act and therefore would not be subject to certain restrictions on
transfer applicable to the Old Notes and would not be entitled to registration
and other rights under the Registration Rights Agreement and (ii) the New
Notes would not provide for any increase in the interest rate thereon. In that
regard, the Old Notes provide, among other things, that, if the Exchange Offer
is not consummated by July 28, 1996, the interest rate borne by the Old Notes
following July 28, 1996 will increase by 0.50% per annum until the Exchange
Offer is consummated. The New Notes offered hereby in exchange for Old Notes
meet the above requirements. Upon consummation of the Exchange Offer, holders
of Old Notes will not be entitled to any increase in the rate of interest
thereon or any further registration rights under the Registration Rights
Agreement, except that the Initial Purchasers may have certain registration
rights under limited circumstances. See "Summary--Certain Consequences of a
Failure to Exchange Old Notes" and "Description of the Old Notes."
The Exchange Offer is not being made to, nor will the Company accept tenders
for exchange from, holders of Old Notes in any jurisdiction in which the
Exchange Offer or the acceptance thereof would not be in compliance with the
securities or blue sky laws of such jurisdiction.
TERMS OF THE EXCHANGE
The Company hereby offers, upon the terms and subject to the conditions set
forth in this Prospectus and in the accompanying Letter of Transmittal, to
exchange up to $150,000,000 aggregate principal amount of New Notes for a like
aggregate principal amount of Old Notes properly tendered on or prior to the
Expiration Date (as defined below) and not properly withdrawn in accordance
with the procedures described below. The Company will issue, promptly after
the Expiration Date, an aggregate principal amount of up to $150,000,000 of
New Notes in exchange for a like principal amount of outstanding Old Notes
tendered and accepted in connection with the Exchange Offer. Holders may
tender their Old Notes in whole or in part in a principal amount of $1,000 and
integral multiples thereof.
The Exchange Offer is not conditioned upon any minimum number of Old Notes
being tendered. As of the date of this Prospectus $150,000,000 aggregate
principal amount of the Old Notes is outstanding.
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Holders of Old Notes do not have any appraisal or dissenters' rights in
connection with the Exchange Offer. Old Notes which are not tendered for
exchange or are tendered but not accepted in connection with the Exchange
Offer will remain outstanding and be entitled to the benefits of the
Indenture, but will not be entitled to any further registration rights under
the Registration Rights Agreement, except that the Initial Purchasers may have
certain registration rights under limited circumstances.
If any tendered Old Notes are not accepted for exchange because of an
invalid tender, the occurrence of certain other events set forth herein or
otherwise, certificates for any such unaccepted Old Notes will be returned,
without expense, to the tendering holder thereof promptly after the Expiration
Date.
Holders who tender Old Notes in connection with the Exchange Offer will not
be required to pay brokerage commissions or fees or, subject to the
instructions in the Letter of Transmittal, transfer taxes with respect to the
exchange of Old Notes for New Notes in connection with the Exchange Offer. The
Company will pay all charges and expenses, other than certain applicable taxes
described below, in connection with the Exchange Offer. See "--Fees and
Expenses."
NEITHER THE BOARD OF DIRECTORS OF THE COMPANY NOR THE COMPANY MAKES ANY
RECOMMENDATION TO HOLDERS OF OLD NOTES AS TO WHETHER TO TENDER OR REFRAIN FROM
TENDERING ALL OR ANY PORTION OF THEIR OLD NOTES PURSUANT TO THE EXCHANGE
OFFER. IN ADDITION, NO ONE HAS BEEN AUTHORIZED TO MAKE ANY SUCH
RECOMMENDATION. HOLDERS OF OLD NOTES MUST MAKE THEIR OWN DECISION WHETHER TO
TENDER PURSUANT TO THE EXCHANGE OFFER AND, IF THEY CHOOSE TO DO SO, THE
AGGREGATE AMOUNT OF OLD NOTES TO TENDER AFTER READING THIS PROSPECTUS AND THE
LETTER OF TRANSMITTAL AND CONSULTING WITH THEIR ADVISERS, IF ANY, BASED ON
THEIR OWN FINANCIAL POSITION AND REQUIREMENTS.
EXPIRATION DATE; EXTENSIONS; AMENDMENTS
The term "Expiration Date" means 5:00 p.m., New York City time, on April 12,
1996 unless the Exchange Offer is extended by the Company (in which case the
term "Expiration Date" shall mean the latest date and time to which the
Exchange Offer is extended).
The Company expressly reserves the right in its sole and absolute
discretion, subject to applicable law and the terms of the Registration Rights
Agreement, at any time and from time to time, (i) to delay the acceptance of
the Old Notes for exchange, (ii) to terminate the Exchange Offer (whether or
not any Old Notes have theretofore been accepted for exchange) if the Company
determines, in its sole and absolute discretion, that any of the events or
conditions referred to under "--Certain Conditions to the Exchange Offer" have
occurred or exist or have not been satisfied, (iii) to extend the Expiration
Date of the Exchange Offer and retain all Old Notes tendered pursuant to the
Exchange Offer, subject, however, to the right of holders of Old Notes to
withdraw their tendered Old Notes as described under "--Withdrawal Rights,"
and (iv) to waive any condition or otherwise amend the terms of the Exchange
Offer in any respect. If the Exchange Offer is amended in a manner determined
by the Company to constitute a material change, or if the Company waives a
material condition of the Exchange Offer, the Company will promptly disclose
such amendment by means of a prospectus supplement that will be distributed to
the registered holders of the Old Notes, and the Company will extend the
Exchange Offer to the extent required by Rule 14e-1 under the Exchange Act.
Any such delay in acceptance, extension, termination or amendment will be
followed promptly by oral or written notice thereof to the Exchange Agent and
by making a public announcement thereof, and such announcement in the case of
an extension will be made no later than 9:00 a.m., New York City time, on the
next business day after the previously scheduled Expiration Date. Without
limiting the manner in which the Company may choose to make any public
announcement and subject to applicable law, the Company shall have no
obligation to publish, advertise or otherwise communicate any such public
announcement other than by issuing a release to an appropriate news agency.
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ACCEPTANCE FOR EXCHANGE AND ISSUANCE OF NEW NOTES
Upon the terms and subject to the conditions of the Exchange Offer, the
Company will exchange, and will issue to the Exchange Agent, New Notes for Old
Notes validly tendered and not withdrawn (pursuant to the withdrawal rights
described under "--Withdrawal Rights") promptly after the Expiration Date.
In all cases, delivery of New Notes in exchange for Old Notes tendered and
accepted for exchange pursuant to the Exchange Offer will be made only after
timely receipt by the Exchange Agent of (i) Old Notes or a book-entry
confirmation of a book-entry transfer of Old Notes into the Exchange Agent's
account at The Depository Trust Company ("DTC"), (ii) the Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, with
any required signature guarantees, and (iii) any other documents required by
the Letter of Transmittal.
The term "book-entry confirmation" means a timely confirmation of a book-
entry transfer of Old Notes into the Exchange Agent's account at DTC.
Subject to the terms and conditions of the Exchange Offer, the Company will
be deemed to have accepted for exchange, and thereby exchanged, Old Notes
validly tendered and not withdrawn as, if and when the Company gives oral or
written notice to the Exchange Agent of the Company's acceptance of such Old
Notes for exchange pursuant to the Exchange Offer. The Exchange Agent will act
as agent for the Company for the purpose of receiving tenders of Old Notes,
Letters of Transmittal and related documents, and as agent for tendering
holders for the purpose of receiving Old Notes, Letters of Transmittal and
related documents and transmitting New Notes to validly tendering holders.
Such exchange will be made promptly after the Expiration Date. If for any
reason whatsoever, acceptance for exchange or the exchange of any Old Notes
tendered pursuant to the Exchange Offer is delayed (whether before or after
the Company's acceptance for exchange of Old Notes) or the Company extends the
Exchange Offer or is unable to accept for exchange or exchange Old Notes
tendered pursuant to the Exchange Offer, then, without prejudice to the
Company's rights set forth herein, the Exchange Agent may, nevertheless, on
behalf of the Company and subject to Rule 14e-1(c) under the Exchange Act,
retain tendered Old Notes and such Old Notes may not be withdrawn except to
the extent tendering holders are entitled to withdrawal rights as described
under "--Withdrawal Rights."
Pursuant to the Letter of Transmittal, a holder of Old Notes will warrant
and agree in the Letter of Transmittal that such holder has full power and
authority to tender, exchange, sell, assign and transfer Old Notes, that the
Company will acquire good, marketable and unencumbered title to the tendered
Old Notes, free and clear of all liens, restrictions, charges and
encumbrances, and that the Old Notes tendered for exchange are not subject to
any adverse claims or proxies. The holder also will warrant and agree that it
will, upon request, execute and deliver any additional documents deemed by the
Company or the Exchange Agent to be necessary or desirable to complete the
exchange, sale, assignment, and transfer of the Old Notes tendered pursuant to
the Exchange Offer.
PROCEDURES FOR TENDERING OLD NOTES
VALID TENDER. Except as set forth below, in order for Old Notes to be
validly tendered pursuant to the Exchange Offer, a properly completed and duly
executed Letter of Transmittal (or facsimile thereof), with any required
signature guarantees and any other required documents, must be received by the
Exchange Agent at one of its addresses set forth under "--Exchange Agent," and
either (i) tendered Old Notes must be received by the Exchange Agent, or (ii)
such Old Notes must be tendered pursuant to the procedures for book-entry
transfer set forth below and a book-entry confirmation must be received by the
Exchange Agent, in each case on or prior to the Expiration Date, or (iii) the
guaranteed delivery procedures set forth below must be complied with.
A tendering holder, if tendering less than all of such holder's Old Notes,
should fill in the amount of Old Notes being tendered in the appropriate box
on the Letter of Transmittal. The entire amount of Old Notes delivered to the
Exchange Agent will be deemed to have been tendered unless otherwise
indicated.
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THE METHOD OF DELIVERY OF CERTIFICATES, THE LETTER OF TRANSMITTAL AND ALL
OTHER REQUIRED DOCUMENTS, IS AT THE OPTION AND SOLE RISK OF THE TENDERING
HOLDER, AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL, RETURN RECEIPT
REQUESTED, PROPERLY INSURED, OR AN OVERNIGHT DELIVERY SERVICE IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
BOOK-ENTRY TRANSFER. The Exchange Agent will establish an account with
respect to the Old Notes at DTC for purposes of the Exchange Offer within two
business days after the date of this Prospectus. Any financial institution
that is a participant in DTC's book-entry transfer facility system may make a
book-entry delivery of the Old Notes by causing DTC to transfer such Old Notes
into the Exchange Agent's account at DTC in accordance with DTC's procedures
for transfers. However, although delivery of Old Notes may be effected through
book-entry transfer into the Exchange Agent's account at DTC, the Letter of
Transmittal (or facsimile thereof), properly completed and duly executed, with
any required signature guarantees and any other required documents, must in
any case be delivered to and received by the Exchange Agent at one of its
addresses set forth under "--Exchange Agent" on or prior to the Expiration
Date, or the guaranteed delivery procedure set forth below must be complied
with.
DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH DTC'S PROCEDURES DOES NOT
CONSTITUTE DELIVERY TO THE EXCHANGE AGENT.
SIGNATURE GUARANTEES. Certificates for the Old Notes need not be endorsed
and signature guarantees on the Letter of Transmittal are unnecessary unless
(a) a certificate for the Old Notes is registered in a name other than that of
the person surrendering the certificate or (b) such registered holder
completes the box entitled "Special Issuance Instructions" or "Special
Delivery Instructions" in the Letter of Transmittal. In the case of (a) or (b)
above, such certificates for Old Notes must be duly endorsed or accompanied by
a properly executed bond power, with the endorsement or signature on the bond
power and on the Letter of Transmittal guaranteed by a firm or other entity
identified in Rule 17Ad-15 under the Exchange Act as an "eligible guarantor
institution," including (as such terms are defined therein): (i) a bank; (ii)
a broker, dealer, municipal securities broker or dealer or government
securities broker or dealer; (iii) a credit union; (iv) a national securities
exchange, registered securities association or clearing agency; or (v) a
savings association (each, an "Eligible Institution"), unless surrendered on
behalf of such Eligible Institution. See Instruction 1 to the Letter of
Transmittal.
GUARANTEED DELIVERY. If a holder desires to tender Old Notes pursuant to the
Exchange Offer and the certificates for such Old Notes are not immediately
available or time will not permit all required documents to reach the Exchange
Agent on or before the Expiration Date, or the procedures for book-entry
transfer cannot be completed on a timely basis, such Old Notes may
nevertheless be tendered, provided that all of the following guaranteed
delivery procedures are complied with:
(i) such tenders are made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form accompanying the Letter of Transmittal,
is received by the Exchange Agent, as provided below, on or prior to the
Expiration Date; and
(iii) the certificates (or a book-entry confirmation) representing all
tendered Old Notes, in proper form for transfer, together with a properly
completed and duly executed Letter of Transmittal (or facsimile thereof),
with any required signature guarantees and any other documents required by
the Letter of Transmittal, are received by the Exchange Agent within five
New York Stock Exchange trading days after the date of execution of such
Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand, or transmitted
by facsimile or mail to the Exchange Agent and must include a guarantee by an
Eligible Institution in the form set forth in such notice.
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Notwithstanding any other provision hereof, the delivery of New Notes in
exchange for Old Notes tendered and accepted for exchange pursuant to the
Exchange Offer will in all cases be made only after timely receipt by the
Exchange Agent of Old Notes, or of a book-entry confirmation with respect to
such Old Notes, and a properly completed and duly executed Letter of
Transmittal (or facsimile thereof), together with any required signature
guarantees and any other documents required by the Letter of Transmittal.
Accordingly, the delivery of New Notes might not be made to all tendering
holders at the same time, and will depend upon when Old Notes, book-entry
confirmations with respect to Old Notes and other required documents are
received by the Exchange Agent.
The Company's acceptance for exchange of Old Notes tendered pursuant to any
of the procedures described above will constitute a binding agreement between
the tendering holder and the Company upon the terms and subject to the
conditions of the Exchange Offer.
DETERMINATION OF VALIDITY. All questions as to the form of documents,
validity, eligibility (including time of receipt) and acceptance for exchange
of any tendered Old Notes will be determined by the Company, in its sole
discretion, whose determination shall be final and binding on all parties. The
Company reserves the absolute right, in its sole and absolute discretion, to
reject any and all tenders determined by it not to be in proper form or the
acceptance of which, or exchange for, may, in the view of counsel to the
Company, be unlawful. The Company also reserves the absolute right, subject to
applicable law, to waive any of the conditions of the Exchange Offer as set
forth under "--Certain Conditions to the Exchange Offer" or any condition or
irregularity in any tender of Old Notes of any particular holder whether or
not similar conditions or irregularities are waived in the case of other
holders.
The Company's interpretation of the terms and conditions of the Exchange
Offer (including the Letter of Transmittal and the instructions thereto) will
be final and binding. No tender of Old Notes will be deemed to have been
validly made until all irregularities with respect to such tender have been
cured or waived. Neither the Company, any affiliates or assigns of the
Company, the Exchange Agent nor any other person shall be under any duty to
give any notification of any irregularities in tenders or incur any liability
for failure to give any such notification.
If any Letter of Transmittal, endorsement, bond power, power of attorney, or
any other document required by the Letter of Transmittal is signed by a
trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and unless waived by the Company,
proper evidence satisfactory to the Company, in its sole discretion, of such
person's authority to so act must be submitted.
A beneficial owner of Old Notes that are held by or registered in the name
of a broker, dealer, commercial bank, trust company or other nominee or
custodian is urged to contact such entity promptly if such beneficial holder
wishes to participate in the Exchange Offer.
RESALES OF NEW NOTES
The Company is making the Exchange Offer in reliance on the position of the
staff of the Division of Corporation Finance of the Commission as set forth in
No-Action Letters issued to Morgan Stanley & Co. Incorporated (available June
5, 1991) (the "Morgan Stanley Letter"), Exxon Capital Holdings Corp.
(available April 13, 1988), and Shearman & Sterling (available July 2, 1993),
and certain other interpretive letters addressed to third parties in other
transactions. However, the Company has not sought its own interpretive letter
and there can be no assurance that the staff of the Division of Corporation
Finance of the Commission would make a similar determination with respect to
the Exchange Offer as it has in such interpretive letters to third parties.
Based on these interpretations by the staff of the Division of Corporation
Finance, and subject to the two immediately following sentences, the Company
believes that New Notes issued pursuant to this Exchange Offer in exchange for
Old Notes may be offered for resale, resold and otherwise transferred by a
holder thereof (other than a holder who is a broker-dealer) without further
compliance with the registration and prospectus delivery requirements of the
Securities Act, provided that such New Notes are acquired in the ordinary
course of such holder's business and that such holder is not participating,
and has no arrangement or understanding with any
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person to participate, in a distribution (within the meaning of the Securities
Act) of such New Notes. However, any holder of Old Notes that is an
"affiliate" of the Company or that intends to participate in the Exchange
Offer for the purpose of distributing New Notes, or any broker-dealer who
purchased Old Notes from the Company to resell pursuant to Rule 144A or any
other available exemption under the Securities Act, (a) will not be able to
rely on the interpretations of the staff of the Division of Corporation
Finance of the Commission set forth in the Morgan Stanley Letter and the other
above-mentioned interpretive letters, (b) will not be permitted or entitled to
tender such Old Notes in the Exchange Offer and (c) must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any sale or other transfer of such Old Notes unless such sale
is made pursuant to an exemption from such requirements. In addition, as
described below, if any broker-dealer holds Old Notes acquired for its own
account as a result of market-making or other trading activities and exchanges
such Old Notes for New Notes, then such broker-dealer must deliver a
prospectus meeting the requirements of the Securities Act in connection with
any resales of such New Notes.
Each holder of Old Notes who wishes to exchange Old Notes for New Notes in
the Exchange Offer will be required to represent that (i) it is not an
"affiliate" of the Company, (ii) any New Notes to be received by it are being
acquired in the ordinary course of its business, (iii) it has no arrangement
or understanding with any person to participate in a distribution (within the
meaning of the Securities Act) of such New Notes, and (iv) if such holder is
not a broker-dealer, such holder is not engaged in, and does not intend to
engage in, a distribution (within the meaning of the Securities Act) of such
New Notes. Each broker-dealer that receives New Notes for its own account
pursuant to the Exchange Offer (and, therefore, may be deemed to be a
statutory underwriter) must acknowledge that it acquired the Old Notes for its
own account as the result of market-making activities or other trading
activities and must agree that it will deliver a prospectus meeting the
requirements of the Securities Act in connection with any resale of such New
Notes. The Letter of Transmittal states that by so acknowledging and by
delivering a prospectus, a broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act. Based on the
position taken by the staff of the Division of Corporation Finance of the
Commission in the interpretive letters referred to above, the Company believes
that broker-dealers who acquired Old Notes for their own accounts as a result
of market-making activities or other trading activities ("Participating
Broker-Dealers") may fulfill their prospectus delivery requirements with
respect to the New Notes received upon exchange of such Old Notes (other than
Old Notes which represent an unsold allotment from the original sale of the
Old Notes) with a prospectus meeting the requirements of the Securities Act,
which may be the prospectus prepared for an exchange offer so long as it
contains a description of the plan of distribution with respect to the resale
of such New Notes. Accordingly, this Prospectus, as it may be amended or
supplemented from time to time, may be used by a Participating Broker-Dealer
during the period referred to below in connection with resales of New Notes
received in exchange for Old Notes where such Old Notes were acquired by such
Participating Broker-Dealer for its own account as a result of market-making
or other trading activities. Subject to certain provisions set forth in the
Registration Rights Agreement, the Company has agreed that this Prospectus, as
it may be amended or supplemented from time to time, may be used by a
Participating Broker-Dealer in connection with resales of such New Notes for a
period ending 90 days (subject to extension under certain limited
circumstances described below) after the Expiration Date or, if earlier, when
all such New Notes have been disposed of by such Participating Broker-Dealer.
However, a Participating Broker-Dealer who intends to use this Prospectus in
connection with the resale of New Notes received in exchange for Old Notes
pursuant to the Exchange Offer must notify the Company, or cause the Company
to be notified, on or prior to the Expiration Date, that it is a Participating
Broker-Dealer. Such notice may be given in the space provided for that purpose
in the Letter of Transmittal or may be delivered to the Exchange Agent at one
of the addresses set forth herein under "--Exchange Agent." See "Plan of
Distribution." Any Participating Broker-Dealer who is an "affiliate" of the
Company may not rely on such interpretive letters and must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any resale transaction.
In that regard, each Participating Broker-Dealer who surrenders Old Notes
pursuant to the Exchange Offer will be deemed to have agreed, by execution of
the Letter of Transmittal, that, upon receipt of notice from the Company of
the occurrence of any event or the discovery of any fact which makes any
statement contained or incorporated by reference in this Prospectus untrue in
any material respect or which causes this Prospectus to omit to state a
material fact necessary in order to make the statements contained or
incorporated by reference
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herein, in light of the circumstances under which they were made, not
misleading or of the occurrence of certain other events specified in the
Registration Rights Agreement, such Participating Broker-Dealer will suspend
the sale of New Notes pursuant to this Prospectus until the Company has
amended or supplemented this Prospectus to correct such misstatement or
omission and has furnished copies of the amended or supplemented Prospectus to
such Participating Broker-Dealer or the Company has given notice that the sale
of the New Notes may be resumed, as the case may be. If the Company gives such
notice to suspend the sale of the New Notes, it shall extend the 90-day period
referred to above during which Participating Broker-Dealers are entitled to
use this Prospectus in connection with the resale of New Notes by the number
of days during the period from and including the date of the giving of such
notice to and including the date when Participating Broker-Dealers shall have
received copies of the amended or supplemented Prospectus necessary to permit
resales of the New Notes or to and including the date on which the Company has
given notice that the sale of New Notes may be resumed, as the case may be.
WITHDRAWAL RIGHTS
Except as otherwise provided herein, tenders of Old Notes may be withdrawn
at any time on or prior to the Expiration Date.
In order for a withdrawal to be effective a written, telegraphic, telex or
facsimile transmission of such notice of withdrawal must be timely received by
the Exchange Agent at one of its addresses set forth under "--Exchange Agent"
on or prior to the Expiration Date. Any such notice of withdrawal must specify
the name of the person who tendered the Old Notes to be withdrawn, the
aggregate principal amount of Old Notes to be withdrawn, and (if certificates
for such Old Notes have been tendered) the name of the registered holder of
the Old Notes as set forth on the Old Notes, if different from that of the
person who tendered such Old Notes. If Old Notes have been delivered or
otherwise identified to the Exchange Agent, then prior to the physical release
of such Old Notes, the tendering holder must submit the serial numbers shown
on the particular Old Notes to be withdrawn and the signature on the notice of
withdrawal must be guaranteed by an Eligible Institution, except in the case
of Old Notes tendered for the account of an Eligible Institution. If Old Notes
have been tendered pursuant to the procedures for book-entry transfer set
forth in "--Procedures for Tendering Old Notes," the notice of withdrawal must
specify the name and number of the account at DTC to be credited with the
withdrawal of Old Notes, in which case a notice of withdrawal will be
effective if delivered to the Exchange Agent by written, telegraphic, telex or
facsimile transmission. Withdrawals of tenders of Old Notes may not be
rescinded. Old Notes properly withdrawn will not be deemed validly tendered
for purposes of the Exchange Offer, but may be retendered at any subsequent
time on or prior to the Expiration Date by following any of the procedures
described above under "--Procedures for Tendering Old Notes."
All questions as to the validity, form and eligibility (including time of
receipt) of such withdrawal notices will be determined by the Company, in its
sole discretion, whose determination shall be final and binding on all
parties. Neither the Company, any affiliates or assigns of the Company, the
Exchange Agent nor any other person shall be under any duty to give any
notification of any irregularities in any notice of withdrawal or incur any
liability for failure to give any such notification. Any Old Notes which have
been tendered but which are withdrawn will be returned to the holder thereof
promptly after withdrawal.
INTEREST ON THE NEW NOTES
Each New Note will bear interest at the rate of 6 1/2% per annum from the
most recent date to which interest has been paid or duly provided for on the
Old Note surrendered in exchange for such New Note or, if no interest has been
paid or duly provided for on such Old Note, from January 30, 1996. Interest on
the New Notes will be payable semiannually on January 15 and July 15 of each
year, commencing on the first such date following the original issuance date
of the New Notes.
Holders of Old Notes whose Old Notes are accepted for exchange will not
receive accrued interest on such Old Notes for any period from and after the
last Interest Payment Date to which interest has been paid or duly
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provided for on such Old Notes prior to the original issue date of the New
Notes or, if no such interest has been paid or duly provided for, will not
receive any accrued interest on such Old Notes, and will be deemed to have
waived the right to receive any interest on such Old Notes accrued from and
after such Interest Payment Date or, if no such interest has been paid or duly
provided for, from and after January 30, 1996.
CERTAIN CONDITIONS TO THE EXCHANGE OFFER
Notwithstanding any other provisions of the Exchange Offer, or any extension
of the Exchange Offer, the Company will not be required to accept for
exchange, or to exchange, any Old Notes for any New Notes, and, as described
below, may terminate the Exchange Offer (whether or not any Old Notes have
theretofore been accepted for exchange) or may waive any conditions to or
amend the Exchange Offer, if any of the following conditions have occurred or
exists or have not been satisfied:
(a) the Exchange Offer, or the making of any exchange by a holder,
violates any applicable law or any applicable interpretation of the staff
of the Commission;
(b) any action or proceeding shall have been instituted or threatened in
any court or by or before any governmental agency or body with respect to
the Exchange Offer which, in the Company's judgment, would reasonably be
expected to impair the ability of the Company to proceed with the Exchange
Offer;
(c) any law, statute, rule or regulation shall have been adopted or
enacted which, in the Company's judgment, would reasonably be expected to
impair the ability of the Company to proceed with the Exchange Offer;
(d) a banking moratorium shall have been declared by United States
federal or Tennessee or New York state authorities which, in the Company's
judgment, would reasonably be expected to impair the ability of the Company
to proceed with the Exchange Offer;
(e) trading on the New York Stock Exchange or generally in the United
States over-the-counter market shall have been suspended by order of the
Commission or any other governmental authority which, in the Company's
judgment, would reasonably be expected to impair the ability of the Company
to proceed with the Exchange Offer; or
(f) a stop order shall have been issued by the Commission or any state
securities authority suspending the effectiveness of the Registration
Statement or proceedings shall have been initiated or, to the knowledge of
the Company, threatened for that purpose.
If the Company determines in its sole and absolute discretion that any of
the foregoing events or conditions has occurred or exists or has not been
satisfied, the Company may, subject to applicable law, terminate the Exchange
Offer (whether or not any Old Notes have theretofore been accepted for
exchange) or may waive any such condition or otherwise amend the terms of the
Exchange Offer in any respect. If such waiver or amendment constitutes a
material change to the Exchange Offer, the Company will promptly disclose such
waiver by means of a prospectus supplement that will be distributed to the
registered holders of the Old Notes, and the Company will extend the Exchange
Offer to the extent required by Rule 14e-1 under the Exchange Act.
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EXCHANGE AGENT
First Trust of New York, National Association, has been appointed as
Exchange Agent for the Exchange Offer. Delivery of the Letters of Transmittal
and any other required documents, questions, requests for assistance, and
requests for additional copies of this Prospectus or of the Letter of
Transmittal should be directed to the Exchange Agent as follows:
By Mail: By Overnight Delivery or Hand:
First Trust of New York, National First Trust of New York, National
Association Association
c/o First Trust National Association 100 Wall Street
P.O. Box 64485 New York, New York 10005
St. Paul, Minnesota 55164-9549 Attn: Patsy Poole
Attn: Specialized Finance
To Confirm by Telephone or for Information:
(612) 244-1197
Attn: Phyliss Meath
Facsimile Transmissions:
(612) 244-1145
Delivery to other than one of the above addresses or facsimile number will not
constitute a valid delivery.
FEES AND EXPENSES
The Company has agreed to pay the Exchange Agent reasonable and customary
fees for its services and will reimburse it for its reasonable out-of-pocket
expenses in connection therewith. The Company will also pay brokerage houses
and other custodians, nominees and fiduciaries the reasonable out-of-pocket
expenses incurred by them in forwarding copies of this Prospectus and related
documents to the beneficial owners of Old Notes, and in handling or tendering
for their customers.
Holders who tender their Old Notes for exchange will not be obligated to pay
any transfer taxes in connection therewith. If, however, New Notes are to be
delivered to, or are to be issued in the name of, any person other than the
registered holder of the Old Notes tendered, or if a transfer tax is imposed
for any reason other than the exchange of Old Notes in connection with the
Exchange Offer, then the amount of any such transfer taxes (whether imposed on
the registered holder or any other persons) will be payable by the tendering
holder. If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the Letter of Transmittal, the amount of such
transfer taxes will be billed directly to such tendering holder.
The Company will not make any payment to brokers, dealers or others
soliciting acceptances of the Exchange Offer.
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DESCRIPTION OF THE NEW NOTES
GENERAL
The Old Notes were issued and the New Notes are to be issued under the
Indenture, dated as of January 15, 1992 (the "Indenture"), between the Company
and First Trust of New York, National Association, as Trustee (successor
trustee to Morgan Guaranty Trust Company of New York) (the "Trustee"). The
following summaries of certain provisions of the Indenture, the Old Notes and
the New Notes set forth below and under "Description of the Old Notes" do not
purport to be complete and are subject to, and are qualified in their entirety
by reference to, all of the provisions of the Indenture, including the
definitions therein of certain terms, and the forms of the certificates
evidencing the Old Notes and the New Notes. Wherever particular sections or
defined terms of the Indenture and/or Notes are referred to or used herein,
such sections or defined terms are incorporated herein by reference as part of
the statements made. See "Available Information."
The Indenture does not limit the aggregate principal amount of debt
securities or of any particular series of debt securities which may be issued
thereunder. The Indenture provides that debt securities may be issued from
time to time in one or more series. (Section 301). As of the date of this
Prospectus, $125,000,000 of the Company's 8 1/4% Notes due January 15, 2004
and $150,000,000 of the Old Notes were the only debt securities outstanding
under the Indenture. The Indenture, as supplemented, also provides for the
issuance from time to time of Medium-Term Notes with maturities ranging from
nine months to 30 years. As of the date of this Prospectus, no such Medium-
Term Notes have been issued.
The Old Notes and the New Notes will constitute a single series of debt
securities under the Indenture. If the Exchange Offer is consummated, holders
of the Old Notes who do not exchange their Old Notes for New Notes will vote
together with the holders of New Notes for all relevant purposes under the
Indenture. In that regard, the Indenture requires that certain actions by the
holders thereunder (including acceleration following an Event of Default) must
be taken, and certain rights must be exercised, by specified minimum
percentages of the aggregate principal amount of the outstanding debt
securities of the relevant series. In determining whether holders of the
requisite percentage in principal amount have given any notice, consent or
waiver or taken any other action permitted under the Indenture, any Old Notes
which remain outstanding after the Exchange Offer will be aggregated with the
New Notes and the holders of such Old Notes and the New Notes will vote
together as a single series for all such purposes. Accordingly, all references
herein to specified percentages in aggregate principal amount of the
outstanding Notes shall be deemed to mean, at any time after the Exchange
Offer is consummated, such percentage in aggregate principal amount of the Old
Notes and the New Notes then outstanding.
The New Notes and the Old Notes are sometimes referred to, collectively, as
the "Notes" and, individually, as a "Note."
The New Notes will be unsecured obligations of the Company and will rank
equally in right of payment with all other unsecured and unsubordinated
indebtedness of the Company and prior to any of its subordinated indebtedness.
The New Notes will be limited to an aggregate principal amount of
$150,000,000. Each New Note will bear interest at the rate of 6 1/2% per annum
from the most recent date to which interest has been paid or duly provided for
on the Old Note surrendered in exchange for such New Note or, if no interest
has been paid or duly provided for on such Old Note, from January 30, 1996,
payable semiannually on January 15 and July 15 of each year (each, an
"Interest Payment Date"), commencing July 15, 1996, to the persons in whose
names such New Note is registered at the close of business on the December 31
or June 30 next preceding such Interest Payment Date. Interest on the New
Notes will be computed on the basis of a 360-day year of twelve 30-day months.
The New Notes will mature on January 15, 2006. The New Notes will not be
redeemable prior to maturity and will not be entitled to any mandatory
redemption or sinking fund.
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The New Notes will not provide for any increase in the interest rate
thereon. For a discussion of the circumstances in which the interest rate on
the Old Notes may be temporarily increased, see "Description of the Old
Notes."
PAYMENTS, DENOMINATION AND REGISTRATION
Principal of and interest on the Notes will be payable, and the transfer or
exchange of the Notes will be registrable, at the office or agency maintained
by the Company for that purpose in New York, New York, provided that, at the
option of the Company, interest may be paid by check mailed to the address of
the Person entitled thereto as it appears on the Security Register. (Sections
301, 305 and 1002).
The Notes will be issued only in registered form without coupons and in
denominations of $1,000 and integral multiples thereof. (Section 302). No
service charge will be made for any registration of transfer or exchange of
the Notes, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith. (Section
305).
In case any Note shall become mutilated, defaced, destroyed, lost or stolen,
the Company will execute and, upon the Company's request, the Trustee will
authenticate and deliver a new Note, of like tenor and equal principal amount
in exchange and substitution for such Note (upon surrender and cancellation
thereof) or in lieu of and substitution for such Note. In case such Note is
destroyed, lost or stolen, the applicant for a substituted Note shall furnish
to the Company and the Trustee such security or indemnity as may be required
by them to hold each of them harmless, and, in every case of destruction, loss
or theft of such Note, the applicant shall also furnish to the Company or the
Trustee satisfactory evidence of the destruction, loss or theft of such Note
and of the ownership thereof. Upon the issuance of any substituted Note, the
Company may require the payment by the registered holder thereof of a sum
sufficient to cover fees and expenses connected therewith.
CERTAIN COVENANTS OF THE COMPANY
The Indenture contains certain covenants for the benefit of the Notes. These
covenants include, among others, the following:
Limitations upon Liens. The Indenture provides that neither the Company nor
any Subsidiary (as defined below) will create, incur, issue or assume any
notes, bonds, debentures or other similar evidences of indebtedness for money
borrowed ("Debt") secured by any pledge, mortgage, lien, charge, encumbrance
or security interest ("Lien") on any Principal Property (as defined below)
owned by the Company or any Restricted Subsidiary (as defined below), and does
not permit the Company or any Subsidiary to create, incur, issue or assume any
Debt secured by any Lien on any shares of stock or Debt of any Restricted
Subsidiary (such shares of stock or Debt of any Restricted Subsidiary being
called "Restricted Securities"), without in any such case effectively
providing that the Notes, and any other applicable series of Securities issued
pursuant to the Indenture (together with, if the Company so determines, any
other Debt of the Company or such Subsidiary then existing or thereafter
created which is not subordinate to the Notes and such other Securities) will
be secured equally and ratably with (or prior to) such secured Debt, so long
as such secured Debt is so secured. This restriction will not, however, apply
to Debt secured by:
(i) Liens on any Principal Property or Restricted Securities of the
Company or any Subsidiary existing on the date of the original issuance by
the Company of the Notes or such other applicable series of Securities
issued pursuant to the Indenture, or such other date as may be specified
for an applicable series of Securities issued pursuant to the Indenture;
(ii) Liens on any Principal Property or Restricted Securities of any
corporation existing at the time such corporation becomes a Restricted
Subsidiary or is merged with or into or consolidated with the Company or a
Restricted Subsidiary, or at the time of a sale, lease or other disposition
of the properties of a corporation as an entirety or substantially as an
entirety to the Company or a Restricted Subsidiary, or arising thereafter
(a) otherwise than in connection with the borrowing of money arranged
thereafter and (b) pursuant to
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contractual commitments entered into prior to and not in contemplation of
such corporation becoming a Restricted Subsidiary and not in contemplation
of any such merger or consolidation or any such sale, lease or other
disposition;
(iii) Liens on any Principal Property or Restricted Securities of the
Company or any Subsidiary existing at the time of acquisition thereof
(including acquisition through merger or consolidation) or securing the
payment of all or any part of the purchase price or construction cost
thereof or securing any Debt incurred prior to, at the time of or within
180 days after, the acquisition of such Principal Property or Restricted
Securities or the completion of any such construction, whichever is later,
for the purpose of financing all or any part of the purchase price or
construction cost thereof (provided such Liens are limited to such
Principal Property or Restricted Securities, to improvements on such
Principal Property and to any other property or assets not then
constituting a Principal Property or Restricted Securities);
(iv) Liens on any Principal Property to secure all or any part of the
cost of development, operation, construction, alteration, repair or
improvement of all or any part of such Principal Property, or to secure
Debt incurred prior to, at the time of or within 180 days after, the
completion of such development, operation, construction, alteration, repair
or improvement, whichever is later, for the purpose of financing all or any
part of such cost (provided such Liens are limited to such Principal
Property, improvements thereon and any other property or assets not then
constituting a Principal Property);
(v) Liens which secure Debt owing by a Subsidiary to the Company or to a
Restricted Subsidiary;
(vi) Liens on the property of the Company or a Restricted Subsidiary in
favor of the United States of America or any State thereof, or any
department, agency, instrumentality or political subdivision of the United
States of America or any State thereof, to secure partial, progress,
advance or other payments pursuant to any contract or statute; and
(vii) any extension, renewal, substitution or replacement of any of the
Liens referred to in paragraphs (i) through (vi) above or the Debt secured
thereby; provided that (a) such extension, renewal, substitution or
replacement Lien will be limited to all or any part of the same Principal
Property or Restricted Securities that secured the Lien extended, renewed,
substituted or replaced (plus improvements on such property, and plus any
other property or assets not then constituting a Principal Property or
Restricted Securities) and (b) in the case of paragraphs (i) through (iii)
above, the Debt secured by such Lien at such time is not increased.
Notwithstanding the foregoing, the Company and any Subsidiary may create,
incur, issue or assume Debt secured by a Lien which would otherwise be subject
to the foregoing restrictions if the aggregate principal amount of all Debt
secured by Liens on Principal Properties and Restricted Securities then
outstanding (not including any such Debt secured by Liens permitted to be
incurred pursuant to paragraphs (i) through (vii) above) plus Attributable
Debt (as defined below) of the Company and its Restricted Subsidiaries in
respect of sale and leaseback transactions (as defined in "Limitations upon
Sales and Leasebacks" below) that would otherwise be subject to the
restrictions described below under "Limitations upon Sales and Leasebacks"
does not at the time such Debt is incurred exceed an amount equal to 10% of
Consolidated Net Tangible Assets (as defined below). (Section 1006).
For the purposes of the "Limitations upon Liens" covenant described herein,
the giving of a guarantee which is secured by a Lien on a Principal Property
or Restricted Securities, and the creation of a Lien on a Principal Property
or Restricted Securities to secure Debt which existed prior to the creation of
such Lien, will be deemed to involve the creation of Debt in an amount equal
to the principal amount guaranteed or secured by such Lien; but the amount of
Debt secured by Liens on Principal Properties and Restricted Securities will
be computed without cumulating the underlying indebtedness with any guarantee
thereof or Lien securing the same. (Section 1006).
Limitations upon Sales and Leasebacks. The Indenture provides that neither
the Company nor any Restricted Subsidiary will enter into any arrangement
after the date of the original issuance by the Company of the Notes (i.e.,
January 30, 1996) or any other applicable series of Securities issued pursuant
to the Indenture, or such other date as may be specified for an applicable
series of Securities issued pursuant to the Indenture, with any bank,
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insurance company or other lender or investor (other than the Company or
another Restricted Subsidiary) providing for the leasing by the Company or any
such Restricted Subsidiary of any Principal Property for a period of more than
three years, which was or is owned or leased by the Company or a Restricted
Subsidiary and which has been or is to be sold or transferred by the Company
or such Restricted Subsidiary, more than 180 days after the completion of
construction and commencement of all operations thereof by the Company or such
Restricted Subsidiary, to such lender or investor or to any Person to whom
funds have been or are to be advanced by such lender or investor on the
security of such Principal Property (herein referred to as a "sale and
leaseback transaction") unless, either:
(i) the Company and its Restricted Subsidiaries would be entitled,
pursuant to the provisions described in the "Limitations upon Liens"
covenant described above, to incur Debt secured by a Lien on such Principal
Property in a principal amount equal to or exceeding the Attributable Debt
in respect of such sale and leaseback transaction without equally and
ratably securing the applicable series of Securities, or
(ii) the Company, within 180 days after the sale or transfer, applies or
causes a Restricted Subsidiary to apply an amount equal to the net proceeds
of such sale or transfer (as determined by any two of the following: the
Chairman of the Board, the President, any Vice President, the Treasurer and
the Controller of the Company) to the retirement of Securities of any
series or other Funded Debt (as defined below) of the Company (other than
Funded Debt subordinated to the Securities) or Funded Debt of a Restricted
Subsidiary; provided that the amount to be so applied will be reduced by
(a) the principal amount of Securities delivered within 180 days after such
sale or transfer to the Trustee for retirement and cancellation, and (b)
the principal amount of any such Funded Debt of the Company or a Restricted
Subsidiary, other than Securities, voluntarily retired by the Company or a
Restricted Subsidiary within 180 days after such sale or transfer,
excluding in the case of both (a) and (b), retirement pursuant to any
mandatory sinking fund payment or any mandatory prepayment provision or by
payment at maturity.
Notwithstanding the foregoing, where the Company or any Restricted
Subsidiary is the lessee in any sale and leaseback transaction, Attributable
Debt will not include any Debt resulting from the guarantee by the Company or
any other Restricted Subsidiary of the lessee's obligation thereunder.
(Section 1007).
Restrictions on Funded Debt of Restricted Subsidiaries. The Indenture
provides that the Company will not permit any Restricted Subsidiary to create,
incur, issue, assume or guarantee any Funded Debt. This restriction will not
apply if:
(i) the Company or such Restricted Subsidiary could create Debt secured
by Liens in accordance with the "Limitations upon Liens" covenant described
above or enter into a sale and leaseback transaction in accordance with the
"Limitations upon Sales and Leasebacks" covenant described above in an
amount equal to such Funded Debt, without equally and ratably securing the
Notes; or (ii) such Funded Debt existed on the date of the original
issuance by the Company of the Notes (i.e., January 30, 1996); or (iii)
such Funded Debt is owed to the Company or any Subsidiary; or (iv) such
Funded Debt existed at the time the corporation that issued such Funded
Debt became a Restricted Subsidiary, or was merged with or into or
consolidated with such Restricted Subsidiary, or at the time of a sale,
lease or other disposition of the properties of such corporation as an
entirety to such Restricted Subsidiary, or arising thereafter (a) otherwise
than in connection with the borrowing of money arranged thereafter and (b)
pursuant to contractual commitments entered into prior to and not in
contemplation of such corporation becoming a Restricted Subsidiary and not
in contemplation of any such merger or consolidation or any such sale,
lease or other disposition; or (v) such Funded Debt is guaranteed by the
Company; or (vi) such Funded Debt is guaranteed by a governmental agency;
or (vii) such Funded Debt is issued, assumed or guaranteed in connection
with, or with a view to, compliance by such Restricted Subsidiary with the
requirements of any program adopted by any federal, state or local
governmental authority and applicable to such Restricted Subsidiary and
providing financial or tax benefits to such Restricted Subsidiary which are
not available directly to the Company; or (viii) such Funded Debt is
issued, assumed or guaranteed to pay all or any part of the purchase price
or the construction cost of property or equipment acquired by a Restricted
Subsidiary, provided such
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Funded Debt is incurred within 180 days after acquisition, completion of
construction or commencement of full operation of such property, whichever
is later; or (ix) such Funded Debt is nonrecourse; or (x) such Funded Debt
is incurred for the purpose of extending, renewing, substituting, replacing
or refunding Funded Debt permitted by the foregoing.
Notwithstanding the foregoing, any Restricted Subsidiary may create, incur,
issue, assume or guarantee Funded Debt which would otherwise be subject to the
foregoing restrictions in an aggregate principal amount which, together with
the aggregate outstanding principal amount of all other Funded Debt of the
Company's Restricted Subsidiaries which would otherwise be subject to the
foregoing restrictions (not including Funded Debt permitted to be incurred
pursuant to clauses (i) through (x) above), does not at the time such Funded
Debt is incurred exceed an amount equal to 10% of Consolidated Net Tangible
Assets. (Section 1008).
Dividend Restrictions. The Indenture provides that the Company will not (i)
declare or pay any dividend or make any other distribution (other than
dividends or distributions made in capital stock of the Company) on or in
respect of any capital stock of the Company, (ii) purchase, redeem or
otherwise acquire for value any shares of the capital stock of the Company,
except shares acquired upon the conversion or exchange thereof into other
shares of capital stock of the Company or out of the proceeds of a
substantially concurrent sale of other shares of capital stock of the Company,
or (iii) permit any Restricted Subsidiary to purchase, redeem or otherwise
acquire for value any shares of capital stock of the Company, if immediately
thereafter the aggregate amount of all such dividends, distributions,
purchases, redemptions, acquisitions or payments (other than dividends or
distributions payable in shares of capital stock of the Company) during the
period from and after January 1, 1992 would exceed the sum of (a) $130,000,000
plus (or minus to an amount not less than zero in the case of a deficit), (b)
the consolidated net income (or net loss) of the Company and its Subsidiaries
earned subsequent to January 1, 1992, plus (c) the aggregate net proceeds,
including cash and the fair market value of property other than cash (as
determined by any two of the following: the Chairman of the Board, the
President, any Vice President, the Treasurer and the Controller of the
Company), received by the Company in respect of the issue, sale or exchange
after January 1, 1992, of (1) any shares of capital stock of the Company and
any rights, options or warrants entitling the holders to purchase or subscribe
for shares of such capital stock, or (2) any indebtedness of the Company which
is converted into or exchanged for shares of its capital stock after January
1, 1992. (Section 1009).
The foregoing will not prohibit (i) payment of any dividend or distribution
within 65 days after the date of declaration thereof, if at the date of
declaration the payment of such dividend or distribution would have complied
with this "Dividend Restrictions" covenant, (ii) payment of any dividend or
distribution where substantially concurrently with the payment thereof an
amount of net proceeds, including cash and the fair market value of property
other than cash (as determined by any two of the following: the Chairman of
the Board, the President, any Vice President, the Treasurer and the Controller
of the Company), at least equal to such dividend or distribution is received
as a capital contribution or as the proceeds from the issuance or sale of
capital stock of the Company, (iii) the retirement of any shares of the
Company's capital stock in exchange for, or out of the proceeds of the
substantially concurrent sale of, other shares of the Company's capital stock,
(iv) purchases of shares of capital stock of the Company to deliver pursuant
to, or purchases or redemptions of shares of capital stock from employees or
former employees of the Company or its Subsidiaries in connection with, the
Company's stock option and incentive plans, and (v) the payment by the Company
or any Restricted Subsidiary to any member of the same consolidated group for
tax purposes of any amounts with respect to taxes or payments in lieu of
taxes. (Section 1009).
The covenants described above would not necessarily afford the Holders
protection in the event of a highly leveraged transaction involving the
Company, such as a leveraged buyout.
CERTAIN DEFINITIONS
"Attributable Debt" means, as to any particular lease under which any Person
is at the time liable for a term of more than 12 months, at any date as of
which the amount thereof is to be determined, the total net amount of rent
required to be paid by such Person under such lease during the remaining term
thereof (excluding any
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subsequent renewal or other extension options held by the lessee), discounted
from the respective due dates thereof to such date at the interest rate
inherent in such lease (such rate to be determined by any two of the
following: the Chairman of the Board, the President, any Vice President, the
Treasurer and the Controller of the Company), compounded annually. The net
amount of rent required to be paid under any such lease for any such period
will be the aggregate amount of the rent payable by the lessee with respect to
such period after excluding amounts required to be paid on account of
maintenance and repairs, services, insurance, taxes, assessments, water rates
and similar charges and contingent rents (such as those based on sales). In
the case of any lease which is terminable by the lessee upon the payment of a
penalty, such net amount of rent will include the lesser of (i) the total
discounted net amount of rent required to be paid from the later of the first
date upon which such lease may be so terminated or the date of the
determination of such amount of rent, as the case may be, and (ii) the amount
of such penalty (in which event no rent shall be considered as required to be
paid under such lease subsequent to the first date upon which it may be so
terminated).
"Consolidated Net Tangible Assets" means the total amount of assets (less
applicable reserves and other properly deductible items) after deducting
therefrom (i) all current liabilities (excluding any thereof which are by
their terms extendible or renewable at the option of the obligor thereon to a
time more than 12 months after the time as of which the amount thereof is
being computed), (ii) all good will, trade names, trademarks, patents,
unamortized debt discount and expense and other like intangibles and (iii)
appropriate adjustments on account of minority interests of other Persons
holding stock of the Company's Subsidiaries, all as set forth on the most
recent balance sheet of the Company and its consolidated Subsidiaries and
computed in accordance with generally accepted accounting principles.
"Funded Debt" means indebtedness created, assumed or guaranteed by a Person
for money borrowed which matures by its terms, or is renewable by the borrower
to a date, more than one year after the date of original creation, assumption
or guarantee.
"Principal Property" means any manufacturing plant or distribution facility,
together with the land upon which it is erected and fixtures comprising a part
thereof, owned by the Company or any Restricted Subsidiary and located in the
United States, the gross book value (without deduction of any reserve for
depreciation) of which on the date as of which the determination is being made
is an amount which exceeds 1% of Consolidated Net Tangible Assets, other than
any such manufacturing plant or distribution facility or any portion thereof
or any such fixture (together with the land upon which it is erected and
fixtures comprising a part thereof) (i) which is financed by industrial
development bonds, industrial revenue bonds, pollution control bonds or other
similar debt issued or guaranteed by the United States of America or any State
thereof, or any department, agency, instrumentality or political subdivision
of the United States of America or any State thereof or (ii) which, in the
opinion of the Board of Directors of the Company as evidenced by a Board
Resolution, is not of material importance to the total business conducted by
the Company and its Subsidiaries, taken as a whole.
"Restricted Subsidiary" means any Subsidiary of which, at the time of
determination, all of the outstanding capital stock (other than directors'
qualifying shares) is owned by the Company directly and/or indirectly and
which, at the time of determination, is primarily engaged in manufacturing,
except a Subsidiary (i) which neither transacts any substantial portion of its
business nor regularly maintains any substantial portion of its fixed assets
within the United States, or (ii) which is engaged primarily in the finance
business including, without limitation thereto, financing the operations of,
or the purchase of products which are products of or incorporate products of,
the Company and/or its Subsidiaries, or (iii) which is primarily engaged in
ownership and development of real estate, construction of buildings, or
related activities, or a combination of the foregoing. In the event that there
shall at any time be a question as to whether a Subsidiary is primarily
engaged in manufacturing or is described in the foregoing clause (i), (ii) or
(iii), such matter will be determined for all purposes of the Indenture by a
Board Resolution.
"Subsidiary" means any corporation of which at the time of determination the
Company, directly and/or indirectly through one or more Subsidiaries, owns
more than 50% of the shares of Voting Stock.
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"Voting Stock" means stock of the class or classes having general voting
power under ordinary circumstances to elect at least a majority of the board
of directors, managers or trustees of a corporation (irrespective of whether
or not at the time stock of any other class or classes has or might have
voting power by reason of the happening of any contingency).
EVENTS OF DEFAULT
An Event of Default with respect to the Notes is defined in the Indenture
as: (a) default in payment of principal of (or premium, if any, on) any Note
at Maturity; (b) default in payment of any interest upon any Note when due,
continued for 30 days; (c) failure by the Company for 90 days after due notice
in performance of any other of the covenants or warranties in the Indenture
(other than a covenant or warranty included in the Indenture solely for the
benefit of a series of Securities issued pursuant to the Indenture other than
the Notes); (d) a default under any indebtedness for money borrowed by the
Company resulting in such indebtedness in an aggregate principal amount
exceeding $25,000,000 becoming due prior to maturity, without such
acceleration having been rescinded within 60 days after due notice of such
default as provided in the Indenture; and (e) certain events of bankruptcy,
insolvency or reorganization of the Company (Section 501).
The Indenture provides that, if any Event of Default with respect to the
Notes at the time Outstanding occurs and is continuing, either the Trustee or
the Holders of not less than 25% in principal amount of the Outstanding Notes
may, by notice as provided in the Indenture, declare the principal amount of
all the Notes to be due and payable immediately, but upon certain conditions
such declaration may be rescinded and annulled and past defaults (except,
unless theretofore cured, a default in payment of principal of (or premium, if
any) or interest, if any, on the Notes and certain other specified defaults)
may be waived by the Holders of a majority in principal amount of the
Outstanding Notes on behalf of the Holders of all the Notes. (Sections 502 and
513).
The Indenture provides that no holder of any Note will have any right to
institute any proceeding with respect to the Indenture or for any remedy
thereunder unless such Holder shall have previously given to the Trustee
written notice of a continuing Event of Default and unless the Holders of at
least 25% in principal amount of the Outstanding Notes have made written
request and offered reasonable indemnity to the Trustee to institute such
proceeding as trustee and the Trustee has not received from the Holders of a
majority in principal amount of the Outstanding Notes a direction inconsistent
with such request and the Trustee has failed to institute such proceeding
within 60 days. (Section 507). However, the Holder of any Note will have an
absolute right to receive payment of the principal of (and premium, if any,
on) and interest on such Note on or after the Stated Maturity therein (or, in
the case of redemption, on the Redemption Date) and to institute suit for the
enforcement of any such payment. (Section 508).
The Indenture provides that the Trustee will, within 90 days after the
occurrence of a default with respect to the Notes at the time Outstanding,
give to the Holders of the Outstanding Notes notice of such default known to
it if uncured or not waived, provided, that, except in the case of default in
the payment of principal of (or premium, if any) or interest, if any, on any
Note, the Trustee will be protected in withholding such notice if the Trustee
in good faith determines that the withholding of such notice is in the
interest of the Holders of the Outstanding Notes; and, provided further, that
such notice will not be given until 90 days after the occurrence of a default
with respect to Outstanding Notes in the performance of a covenant in the
Indenture other than for the payment of the principal of (or premium, if any)
or interest, if any, on any Note. The term default with respect to the Notes
for the purpose only of this provision means the happening of any of the
Events of Default specified in the Indenture excluding any grace periods and
irrespective of any notice requirements. (Section 602).
The Indenture contains a provision entitling the Trustee, subject to the
duty of the Trustee during default to act with the required standard of care,
to be indemnified by the Holders of Outstanding Notes before proceeding to
exercise any right or power under the Indenture at the request of the Holders
of the Notes (Section 601). The Indenture provides that the Holders of a
majority in principal amount of Outstanding Notes may direct the time, method
and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust or other power conferred on the Trustee,
provided that the Trustee may decline to act if such direction is contrary to
law or the Indenture. (Section 512).
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<PAGE>
The Indenture includes a covenant that the Company will file annually with
the Trustee a certificate of no default, or specifying any default that
exists. (Section 1005).
DEFEASANCE
The Indenture provides that the Company, at its option, (a) will be
discharged from any and all obligations with respect to the Notes (except for
certain obligations which include registering the transfer or exchange of the
Notes, replacing stolen, lost or mutilated Notes, maintaining paying agencies
and holding monies for payment in trust) or (b) need not comply with certain
restrictive covenants of the Indenture, upon the deposit with the Trustee (and
in the case of a discharge, 91 days after such deposit), in trust, of money,
or U.S. Government Obligations, or a combination thereof, which through the
payment of interest thereon and principal thereof in accordance with their
terms will provide money, in an amount sufficient to pay all the principal of
and interest on the Notes on the date such payments are due in accordance with
the terms of the Notes to their stated maturities or to and including a
redemption date which has been irrevocably designated by the Company for
redemption of the Notes. To exercise any such option, the Company is required
to meet certain conditions, including delivering to the Trustee an opinion of
counsel to the effect that (i) the deposit and related defeasance would not
cause the holders of the Notes to recognize income, gain or loss for federal
income tax purposes and (ii) the holders of the Notes will be subject to
Federal income tax on the same amounts and in the same manner and at the same
times as would have been the case had the deposit and related defeasance not
occurred. (Sections 403 and 1010).
MODIFICATION OF THE INDENTURE
The Indenture contains provisions permitting the Company and the Trustee,
with the consent of the Holders of not less than a majority in principal
amount of the Outstanding Notes (voting as a class), to execute supplemental
indentures adding any provisions to or changing or eliminating any of the
provisions of the Indenture or modifying the rights of the Holders of
Outstanding Notes, except that no such supplemental indenture may without the
consent of the Holder of each Outstanding Note affected thereby (i) change the
Stated Maturity of any Note, (ii) reduce the principal amount of, or the rate
of interest or any premium on, any Note, (iii) change the place or currency of
payment on any Note, (iv) impair the right to institute suit for the
enforcement of any payment on or after the Stated Maturity thereof, (v) reduce
the above-stated percentage of Outstanding Notes necessary to modify or amend
the Indenture, or (vi) reduce the percentage of aggregate principal amount of
Outstanding Notes necessary for waiver of compliance with certain provisions
of the Indenture or for the waiver of certain covenants and defaults. (Section
902).
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Indenture contains a provision permitting the Company, without the
consent of the Holders of any of the Outstanding Notes under the Indenture, to
consolidate with or merge into any other corporation or transfer or lease its
assets substantially as an entirety to any Person or to acquire or lease the
assets of any Person substantially as an entirety or to permit any corporation
to merge into the Company, provided that: (i) the successor is a corporation
organized and existing under the laws of any domestic jurisdiction; (ii) the
successor corporation, if other than the Company, assumes the Company's
obligations on the Notes and under the Indenture; and (iii) after giving
effect to the transaction, no Event of Default, and no event which, after
notice or lapse of time, would become an Event of Default, shall have occurred
and be continuing. (Section 801).
OUTSTANDING NOTES
The Indenture provides that, in determining whether the Holders of the
requisite principal amount of Outstanding Notes have given any request,
demand, authorization, direction, notice, consent or waiver under the
Indenture, Notes owned by the Company or any of its Affiliates shall not be
deemed to be Outstanding. (Section 101).
GOVERNING LAW
The Indenture and the Notes will be governed by, and construed in accordance
with, the laws of the State of New York.
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<PAGE>
DESCRIPTION OF THE OLD NOTES
The terms of the Old Notes are identical in all material respects to the New
Notes, except that (i) the Old Notes have not been registered under the
Securities Act, are subject to certain restrictions on transfer and are
entitled to certain registration rights under the Registration Rights
Agreement (which rights will terminate upon consummation of the Exchange
Offer, except to the extent that the Initial Purchasers may have certain
registration rights under limited circumstances) and (ii) the New Notes will
not provide for any increase in the interest rate thereon. In that regard, the
Old Notes provide that, in the event that the Exchange Offer is not
consummated or a shelf registration statement (the "Shelf Registration
Statement") with respect to the resale of the Old Notes is not declared
effective on or prior to July 28, 1996, the interest rate on the Old Notes
will increase by 0.50% per annum following July 28, 1996; provided, however,
that if the Company requests holders of Old Notes to provide certain
information called for by the Registration Rights Agreement for inclusion in
any such Shelf Registration Statement, then Old Notes owned by holders who do
not deliver such information to the Company or who do not provide comments on
the Shelf Registration Statement when required pursuant to the Registration
Rights Agreement will not be entitled to any such increase in the interest
rate. Upon the consummation of the Exchange Offer or the effectiveness of a
Shelf Registration Statement, as the case may be, after July 28, 1996, the
interest rate on any Old Notes which remain outstanding will be reduced, from
the date of such consummation or effectiveness, as the case may be, to 6 1/2%
per annum and the Old Notes will not thereafter be entitled to any increase in
the interest rate thereon. The New Notes are not entitled to any such increase
in the interest rate thereon. In addition, the Old Notes and the New Notes
will constitute a single series of debt securities under the Indenture. See
"Description of the New Notes--General." Accordingly, holders of Old Notes
should review the information set forth under "Summary--Certain Consequences
of a Failure to Exchange Old Notes" and "Description of the New Notes."
CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following summary describes certain United States federal income tax
considerations to holders of the New Notes who are subject to U.S. net income
tax with respect to the New Notes ("U.S. persons") and who will hold the New
Notes as capital assets. There can be no assurance that the U.S. Internal
Revenue Service (the "IRS") will take a similar view of the purchase,
ownership or disposition of the New Notes. This discussion is based upon the
provisions of the Internal Revenue Code of 1986, as amended, and regulations,
rulings and judicial decisions now in effect, all of which are subject to
change. It does not include any description of the tax laws of any state,
local or foreign governments or any estate or gift tax considerations that may
be applicable to the New Notes or holders thereof. It does not discuss all
aspects of U.S. federal income taxation that may be relevant to a particular
investor in light of his particular investment circumstances or to certain
types of investors subject to special treatment under the U.S. federal income
tax laws (for example, dealers in securities or currencies, S corporations,
life insurance companies, tax-exempt organizations, taxpayers subject to the
alternative minimum tax and non-U.S. persons) and also does not discuss New
Notes held as a hedge against currency risks or as part of a straddle with
other investments or as part of a "synthetic security" or other integrated
investment (including a "conversion transaction") comprised of a New Note and
one or more other investments, or situations in which the functional currency
of the holders is not the U.S. dollar.
Holders of Old Notes contemplating acceptance of the Exchange Offer should
consult their own tax advisors with respect to their particular circumstances
and with respect to the effects of state, local or foreign tax laws to which
they may be subject.
EXCHANGE OF NOTES
The exchange of Old Notes for New Notes should not be a taxable event to
holders for federal income tax purposes. The exchange of Old Notes for the New
Notes pursuant to the Exchange Offer should not be treated as an "exchange"
for federal income tax purposes, because the New Notes should not be
considered to differ materially in kind or extent from the Old Notes. If,
however, the exchange of the Old Notes for the New Notes
37
<PAGE>
were treated as an exchange for federal income tax purposes, such exchange
should constitute a recapitalization for federal income tax purposes.
Accordingly, the New Notes should have the same issue price as the Old Notes,
and a holder should have the same adjusted basis and holding period in the New
Notes as it had in the Old Notes immediately before the exchange.
INTEREST ON THE NEW NOTES
A holder of a New Note will be required to report as ordinary interest
income for U.S. federal income tax purposes interest earned on the New Note in
accordance with the holder's method of tax accounting.
DISPOSITION OF NEW NOTES
A holder's tax basis for a New Note generally will be the holder's purchase
price for the Old Note. Upon the sale, exchange, redemption, retirement or
other disposition of a New Note, a holder will recognize gain or loss equal to
the difference (if any) between the amount realized and the holder's tax basis
in the New Note. Such gain or loss will be long-term capital gain or loss if
the New Note has been held for more than one year and otherwise will be short-
term capital gain or loss (with certain exceptions to the characterization as
capital gain if the New Note was acquired at a market discount).
BACKUP WITHHOLDING
A holder of a New Note may be subject to backup withholding at the rate of
31% with respect to interest paid on the New Note and proceeds from the sale,
exchange, redemption or retirement of the New Note, unless such holder (a) is
a corporation or comes within certain other exempt categories and, when
required, demonstrates that fact or (b) provides a correct taxpayer
identification number, certifies as to no loss of exemption from backup
withholding and otherwise complies with applicable requirements of the backup
withholding rules. A holder of a New Note who does not provide the Company
with his correct taxpayer identification number may be subject to penalties
imposed by the IRS.
A holder of a New Note who is not a U.S. person will generally be exempt
from backup withholding and information reporting requirements, but may be
required to comply with certification and identification procedures in order
to obtain an exemption from backup withholding and information reporting.
Any amount paid as backup withholding will be creditable against the
holder's U.S. federal income tax liability.
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Notes for its own account in connection
with the Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such New Notes. This Prospectus, as it may be
amended or supplemented from time to time, may be used by Participating
Broker-Dealers during the period referred to below in connection with resales
of New Notes received in exchange for Old Notes if such Old Notes were
acquired by such Participating Broker-Dealers for their own accounts as a
result of market-making activities or other trading activities. The Company
has agreed that this Prospectus, as it may be amended or supplemented from
time to time, may be used by a Participating Broker-Dealer in connection with
resales of such New Notes for a period ending 90 days (subject to extension
under certain limited circumstances described herein) after the Expiration
Date or, if earlier, when all such New Notes have been disposed of by such
Participating Broker-Dealer. However, a Participating Broker-Dealer who
intends to use this Prospectus in connection with the resale of New Notes
received in exchange for Old Notes pursuant to the Exchange Offer must notify
the Company, or cause the Company to be notified, on or prior to the
Expiration Date, that it is a Participating Broker-Dealer. Such notice may be
given in the space provided for that purpose in the Letter of Transmittal or
may be delivered to the Exchange Agent at one of the addresses set forth
herein under "The Exchange Offer--Exchange Agent." See "The Exchange Offer--
Resales of New Notes."
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<PAGE>
The Company will not receive any cash proceeds from the issuance of the New
Notes offered hereby. New Notes received by broker-dealers for their own
accounts in connection with the Exchange Offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the New Notes or a combination
of such methods of resale, at market prices prevailing at the time of resale,
at prices related to such prevailing market prices or at negotiated prices.
Any such resale may be made directly to purchasers or to or through brokers or
dealers who may receive compensation in the form of commissions or concessions
from any such broker-dealer and/or the purchasers of any such New Notes. Any
broker-dealer that resells New Notes that were received by it for its own
account in connection with the Exchange Offer and any broker or dealer that
participates in a distribution of such New Notes may be deemed to be an
"underwriter" within the meaning of the Securities Act, and any profit on any
such resale of New Notes and any commissions or concessions received by any
such persons may be deemed to be underwriting compensation under the
Securities Act. The Letter of Transmittal states that by acknowledging that it
will deliver and by delivering a prospectus, a broker-dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the
Securities Act.
LEGAL MATTERS
Certain legal matters in connection with the New Notes will be passed upon
for the Company by Andrews & Kurth L.L.P., New York, New York and, with
respect to matters governed by the laws of the State of New Jersey, by Riker,
Danzig, Scherer, Hyland and Perretti, Morristown, New Jersey.
EXPERTS
The consolidated financial statements and schedules of Thomas & Betts
Corporation as of January 1, 1995 and January 2, 1994 and for each of the
years in the three-year period ended January 1, 1995, have been incorporated
by reference herein in reliance upon the reports of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein,
and upon the authority of said firm as experts in accounting and auditing.
The consolidated financial statements of Amerace Corporation as of December
31, 1994 and 1993 and for each of the years in the three-year period ended
December 31, 1994, have been incorporated by reference herein in reliance upon
the reports of Arthur Andersen LLP, independent certified public accountants,
incorporated by reference herein, and upon the authority of said firm as
experts in accounting and auditing.
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Trademarks of the Company include: THOMAS & BETTS, T & B, CATAMOUNT, TY-RAP,
TY-FAST, STA-KON, STEEL CITY, IBERVILLE, PERFECT-LINE, BLACKBURN, COLOR-KEYED,
KINDORF, SUPERSTRUT, AMERICAN ELECTRIC LIGHTING, HAZLUX, UNION, BOWERS,
ZINSCO, CANSTRUT, ELECTROTRAY, E-Z-CODE, ANCHOR, ANSLEY, FLEXSTRIP, HOLMBERG,
NEVADA WESTERN, ARMIGER, EPITOME, RUSSELLSTOLL, MAX-GARD, EVER-LOK, MIPCO,
FEEDRAIL, AGASTAT, BUCHANAN, REZNOR, E.K. CAMPBELL, LEHIGH, MEYER, KOLD-N-
KLOSE, DELTEC, ELASTIMOLD AND HENDRIX.
39
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NO PERSON IS AUTHORIZED IN CONNECTION WITH THE OFFERING MADE HEREBY TO GIVE
ANY INFORMATION OR MAKE ANY REPRESENTATION OTHER THAN AS CONTAINED AND INCORPO-
RATED BY REFERENCE IN THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION
OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COM-
PANY OR ANY OF ITS AFFILIATES. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO
SELL, OR A SOLICITATION OF AN OFFER TO BUY, ANY OF THE SECURITIES OFFERED
HEREBY BY ANY PERSON IN ANY JURISDICTION IN WHICH OR TO ANY PERSON TO WHOM IT
IS UNLAWFUL FOR SUCH PERSON TO MAKE SUCH AN OFFERING OR SOLICITATION. NEITHER
THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL UNDER ANY
CIRCUMSTANCES IMPLY THAT THE INFORMATION CONTAINED IN THIS PROSPECTUS OR ANY
DOCUMENT INCORPORATED BY REFERENCE HEREIN IS CORRECT AS OF ANY DATE SUBSEQUENT
TO THE DATE HEREOF OR THEREOF, AS THE CASE MAY BE.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Available Information...................................................... 4
Incorporation of Certain Documents by Reference............................ 4
Summary.................................................................... 6
Certain Consequences of a Failure to Exchange Old Notes.................... 12
Recent Acquisitions........................................................ 13
Use of Proceeds............................................................ 13
Capitalization............................................................. 14
Selected Consolidated Historical and Pro Forma Financial Information....... 15
Business of the Company.................................................... 17
The Exchange Offer......................................................... 20
Description of the New Notes............................................... 29
Description of the Old Notes............................................... 37
Certain United States Federal Income Tax Considerations.................... 37
Plan of Distribution....................................................... 38
Legal Matters.............................................................. 39
Experts.................................................................... 39
</TABLE>
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[LOGO] THOMAS&BETTS
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OFFER TO EXCHANGE ITS
6 1/2% NOTES DUE 2006
WHICH HAVE BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933
FOR ANY AND ALL OF ITS OUTSTANDING
6 1/2% NOTES DUE 2006
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PROSPECTUS
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MARCH 4, 1996
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