e424b3
The
information in this preliminary prospectus supplement is not
complete and may be changed. This preliminary prospectus
supplement is neither an offer to sell these securities nor a
solicitation of an offer to buy these securities in any
jurisdiction in which the offer or sale thereof is not
permitted.
|
Registration No. 333-150613
Filed pursuant to Rule 424(b)(3)
SUBJECT TO COMPLETION DATED JULY
23, 2008
PROSPECTUS
SUPPLEMENT
(To
prospectus dated May 2, 2008)
$
E. I. du Pont de Nemours
and Company
% Notes
due ,
% Notes
due ,
We will pay interest on the notes referenced above
(collectively, the Notes)
on
and
of each year,
beginning ,
2009. We may redeem the Notes prior to maturity, in whole or in
part, as described in this prospectus supplement. If we
experience a Change of Control Triggering Event (as defined
herein), we may be required to offer to purchase the Notes from
holders. See Description of Notes Change of
Control.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Public
|
|
Underwriting
|
|
Proceeds before
|
|
|
Offering Price(1)
|
|
Discount
|
|
Expenses
|
|
Per % Note
|
|
|
|
%
|
|
|
|
%
|
|
|
|
%
|
Total for % Notes
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
Per % Note
|
|
|
|
%
|
|
|
|
%
|
|
|
|
%
|
Total for % Notes
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
Combined Total for % Notes
and % Notes
|
|
$
|
|
|
|
$
|
|
|
|
$
|
|
|
|
|
|
(1) |
|
Plus accrued interest, if any, from July , 2008. |
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined if this prospectus supplement or either
accompanying prospectus is truthful or complete. Any
representation to the contrary is a criminal offense.
The Notes will be ready for delivery in book-entry form only
through The Depository Trust Company, Clearstream or the
Euroclear System, as the case may be, on or about
July , 2008.
Joint Bookrunners
|
|
|
Credit
Suisse |
Goldman, Sachs & Co. |
Morgan Stanley |
The date of this prospectus supplement is
July , 2008.
TABLE OF
CONTENTS
|
|
|
|
|
|
|
Page
|
|
Prospectus Supplement
|
|
|
|
|
|
|
|
S-3
|
|
|
|
|
S-3
|
|
|
|
|
S-8
|
|
|
|
|
S-9
|
|
|
|
|
S-17
|
|
|
|
|
S-18
|
|
|
|
|
S-21
|
|
|
|
|
S-23
|
|
|
|
|
|
1
|
|
|
|
|
1
|
|
|
|
|
2
|
|
|
|
|
3
|
|
|
|
|
3
|
|
|
|
|
3
|
|
|
|
|
3
|
|
|
|
|
4
|
|
|
|
|
11
|
|
|
|
|
13
|
|
|
|
|
15
|
|
|
|
|
15
|
|
You should rely only on the information contained in this
prospectus supplement and the accompanying prospectus. We have
not authorized anyone to provide you with information different
from that contained in this prospectus supplement and the
accompanying prospectus. We are offering to sell Notes and
making offers to buy Notes only in jurisdictions in which offers
and sales are permitted. The information contained in this
prospectus supplement and the accompanying prospectus is
accurate only as of the date of this prospectus supplement,
regardless of the time of delivery of this prospectus supplement
and the accompanying prospectus or any sale of the Notes. In
this prospectus supplement and the accompanying prospectus, the
Company, we, us and
our refer to E. I. du Pont de Nemours and Company.
If we use a capitalized term in this prospectus supplement and
do not define the term, it is defined in the accompanying
prospectus.
The Notes are offered globally for sale only in those
jurisdictions in the United States, Canada, Europe, Asia and
elsewhere in which it is lawful to make such offers. See
Underwriting.
The distribution of this prospectus supplement and the
accompanying prospectus and the offering of the Notes in certain
jurisdictions may be restricted by law. Persons into whose
possession this prospectus supplement and the accompanying
prospectus come should inform themselves about and observe any
such restrictions. This prospectus supplement and the
accompanying prospectus do not constitute, and may not be used
in connection with, an offer or solicitation by anyone in any
jurisdiction in which such offer or solicitation is not
authorized or in which the person making such offer or
solicitation is not qualified to do so or to any person to whom
it is unlawful to make such offer or solicitation. See
Underwriting.
References herein to $ and dollars are
to the currency of the United States.
S-2
ABOUT
DUPONT
We were founded in 1802 and incorporated in Delaware in 1915. We
have been in continuous operation for over 200 years. Our
principal offices are at 1007 Market Street in Wilmington,
Delaware.
We are a world leader in science and technology in a range of
disciplines including biotechnology, electronics, materials
science, safety and security, and synthetic fibers. We operate
globally, manufacturing a wide range of products for
distribution and sale to many different markets, including the
transportation, safety and protection, construction, motor
vehicle, agriculture, home furnishings, medical, electronics,
communications, protective apparel, and the nutrition and health
markets.
We are strategically aligned into five market- and
technology-focused growth platforms consisting of
Agriculture & Nutrition, Coatings & Color
Technologies, Electronic & Communication Technologies,
Performance Materials, and Safety & Protection. In
addition to the five growth platforms, our reportable segments
include Pharmaceuticals, which represents our retained interest
in
Cozaar®/
Hyzaar®
drugs. We include embryonic businesses not included in the
growth platforms, such as applied biosciences and nonaligned
businesses, in Other.
RECENT
DEVELOPMENTS
On July 22, 2008, we announced our preliminary unaudited
results for the second fiscal quarter ended
June 30, 2008. Our consolidated net sales were
$8.8 billion in the second quarter of 2008, up 12% from the
second quarter of 2007. Our net income for the second quarter of
2008 was $1,078 million or $1.18 per share, which includes
a $.07 per share benefit from a litigation settlement and a
favorable tax settlement. Second quarter 2007 net income
was $972 million, or $1.04 per share. Earnings per share
for the second quarter 2008 increased 13% over earnings per
share for the second quarter 2007, which principally reflects
higher local prices, favorable currency impact, and volume
growth outside the United States. These gains were partially
offset by higher ingredient costs and increased spending for
growth initiatives and capacity expansions. Sales outside the
United States grew 18% in the second quarter of 2008 versus the
second quarter of 2007 and accounted for 60% of our worldwide
sales.
The following are business segment highlights comparing second
quarter 2008 results to second quarter 2007:
|
|
|
|
|
Sales in our Agriculture & Nutrition segment increased
by 23% due to record seed revenue and strong global pricing
actions across the platform. Pre-tax Operating Income in this
segment increased by 18% due to higher volumes and
U.S. dollar prices across all businesses in this segment.
This increase was partially offset by growth investments, higher
commodity prices and a $52 million loss on open soybean
contracts.
|
|
|
|
Sales in our Coatings & Color Technologies segment
increased by 10% due to a higher U.S. dollar selling price
in all businesses in this segment and volume growth in emerging
markets, which more than offset lower volumes in North America.
Pre-tax Operating Income in this segment increased by 9% due to
sales growth and favorable currency, which offset the impact of
weak auto and housing markets and higher raw material and
transportation costs.
|
|
|
|
Sales in our Electronic & Communication Technologies
segment increased by 10% due to price gains and favorable
currency. Strong demand for photovoltaics, printed packaging,
and refrigerants was partially offset by weakness in
U.S. automotive electronics. Pre-tax Operating Income in
this segment decreased by $6 million, or 3%, to
$170 million compared to $176 million in the
prior-year quarter, which included a $25 million pre-tax
inventory valuation benefit. Excluding this pre-tax inventory
valuation benefit, Pre-tax Operating Income increased 13% as a
result of strong sales growth and cost productivity gains.
|
|
|
|
Sales in our Performance Materials segment increased by 8% due
to price gains, currency, and strong growth in Asia Pacific.
Volumes outside Asia declined due to weakness in automative
markets and the impact of scheduled production outages. Pre-tax
Operating Income in this segment decreased by 2% as
significantly higher ingredient costs and lower volumes offset
the benefit of price increases.
|
|
|
|
Sales in our Safety & Protection segment increased by
8% due to pricing gains, particularly in chemicals, favorable
currency and broad-based volume growth in emerging markets. This
increase was partially offset by lower volumes in the
U.S. housing market. Pre-tax Operating Income in this
segment decreased by 5% as
|
S-3
|
|
|
|
|
significant earnings growth in our chemical businesses was
offset by less favorable product mix, lower volumes in
U.S. housing, higher raw material costs, and higher fixed
costs associated with growth investments.
|
We increased the lower end of our full year 2008 earnings
outlook, narrowing the range to $3.45 to $3.55
per share. Our previous earnings outlook was a range of
$3.40 to $3.55. First half 2008 earnings per share increased
significantly versus the prior year, principally reflecting
strong growth in agriculture earnings, which are concentrated in
the first half of the year. We expect second half 2008 earnings
per share to be modestly lower than last year due to the impact
of higher energy and ingredient costs, lower demand in certain
developed markets, lower income from asset sales, and a higher
base tax rate. We expect second half 2008 earnings per share to
be approximately equally split between the third and fourth
quarters.
Consolidated
Income Statement for the Three Months Ended June 30,
2008
|
|
|
|
|
|
|
(Dollars in millions,
|
|
|
|
except per share
|
|
|
|
information)
|
|
Net Sales
|
|
$
|
8,837
|
|
Other income, net
|
|
|
442
|
|
|
|
|
|
|
Total
|
|
|
9,279
|
|
Cost of goods sold and other operating charges
|
|
|
6,426
|
|
Selling, general and administrative expenses
|
|
|
987
|
|
Amortization of intangible assets
|
|
|
|
|
Research and development expense
|
|
|
360
|
|
Interest expense
|
|
|
94
|
|
|
|
|
|
|
Total
|
|
|
7,867
|
|
Income before income taxes and minority interests
|
|
|
1,412
|
|
Provision for income taxes
|
|
|
335
|
|
Minority interests in earnings of consolidated subsidiaries
|
|
|
(1
|
)
|
|
|
|
|
|
Net income
|
|
$
|
1,078
|
|
|
|
|
|
|
Basic earnings per share of common stock
|
|
$
|
1.19
|
|
Diluted earnings per share of common stock
|
|
$
|
1.18
|
|
Dividends per share of common stock
|
|
$
|
0.41
|
|
Average number of shares outstanding used in earnings per share
calculation:
|
|
|
|
|
Basic
|
|
|
902,617,000
|
|
Diluted
|
|
|
910,080,000
|
|
S-4
Consolidated
Balance Sheet at June 30, 2008
|
|
|
|
|
|
|
(Dollars in millions,
|
|
|
|
except per share
|
|
|
|
information)
|
|
Assets
|
|
|
|
|
Current assets
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
1,303
|
|
Marketable securities
|
|
|
210
|
|
Accounts and notes receivable, net
|
|
|
8,477
|
|
Inventories
|
|
|
5,021
|
|
Prepaid expenses
|
|
|
160
|
|
Income taxes
|
|
|
565
|
|
|
|
|
|
|
Total current assets
|
|
|
15,736
|
|
Property, plant and equipment, net of accumulated
depreciation
(June 30, 2008 $16,425; December 31,
2007 $15,733)
|
|
|
10,922
|
|
Goodwill
|
|
|
2,085
|
|
Other intangible assets
|
|
|
2,796
|
|
Investment in affiliates
|
|
|
892
|
|
Other assets
|
|
|
5,163
|
|
|
|
|
|
|
Total
|
|
$
|
37,594
|
|
|
|
|
|
|
Liabilities and Stockholders Equity
|
|
|
|
|
Current liabilities
|
|
|
|
|
Accounts payable
|
|
$
|
2,846
|
|
Short-term borrowings and capital lease obligations
|
|
|
4,432
|
|
Income taxes
|
|
|
170
|
|
Other accrued liabilities
|
|
|
3,188
|
|
|
|
|
|
|
Total current liabilities
|
|
|
10,636
|
|
Long-term borrowings and capital lease obligations
|
|
|
5,361
|
|
Other liabilities
|
|
|
7,287
|
|
Deferred income taxes
|
|
|
966
|
|
|
|
|
|
|
Total liabilities
|
|
|
24,250
|
|
|
|
|
|
|
Minority interests
|
|
|
441
|
|
|
|
|
|
|
Commitments and contingent liabilities
|
|
|
|
|
Stockholders equity
|
|
|
|
|
Preferred stock
|
|
|
237
|
|
Common stock, $0.30 par value; 1,800,000,000 shares
authorized; issued at June 30,
2008 989,194,000; December 31,
2007 986,330,000
|
|
|
297
|
|
Additional paid-in capital
|
|
|
8,336
|
|
Reinvested earnings
|
|
|
11,466
|
|
Accumulated other comprehensive loss
|
|
|
(706
|
)
|
Common stock held in treasury, at cost (87,041,000 shares
at June 30, 2008 and December 31, 2007)
|
|
|
(6,727
|
)
|
|
|
|
|
|
Total stockholders equity
|
|
|
12,903
|
|
|
|
|
|
|
Total
|
|
$
|
37,594
|
|
|
|
|
|
|
S-5
Condensed
Consolidated Statement of Cash Flows for the Six Months Ended
June 30, 2008
|
|
|
|
|
|
|
(Dollars in millions)
|
|
Cash used for operating activities
|
|
$
|
(433
|
)
|
|
|
|
|
|
Investing activities
|
|
|
|
|
Purchases of property, plant and equipment
|
|
|
(892
|
)
|
Investments in affiliates
|
|
|
(19
|
)
|
Payment for Businesses (Net of Cash Acquired)
|
|
|
(67
|
)
|
Other investing activities net
|
|
|
(356
|
)
|
|
|
|
|
|
Cash used for investing activities
|
|
|
(1,334
|
)
|
Financing activities
|
|
|
|
|
Dividends paid to stockholders
|
|
|
(749
|
)
|
Net increase in borrowings
|
|
|
2,443
|
|
Other financing activities net
|
|
|
46
|
|
|
|
|
|
|
Cash provided by financing activities
|
|
|
1,740
|
|
Effect of exchange rate changes on cash
|
|
|
25
|
|
|
|
|
|
|
Decrease in cash and cash equivalents
|
|
|
(2
|
)
|
Cash and cash equivalents at beginning of period
|
|
|
1,305
|
|
|
|
|
|
|
Cash and cash equivalents at end of period
|
|
$
|
1,303
|
|
|
|
|
|
|
Global
Consolidated Sales for the Three Months Ended June 30,
2008
|
|
|
|
|
|
|
(Dollars in billions)
|
|
U.S.
|
|
$
|
3.5
|
|
Europe
|
|
|
2.7
|
|
Asia Pacific
|
|
|
1.5
|
|
Canada & Latin America
|
|
|
1.1
|
|
|
|
|
|
|
Total Consolidated Sales
|
|
$
|
8.8
|
|
|
|
|
|
|
Business
Segment Performance for the Three Months Ended June 30,
2008
|
|
|
|
|
|
|
(Dollars in millions)
|
|
Segment Sales
|
|
|
|
|
Agriculture & Nutrition
|
|
$
|
2,541
|
|
Coatings & Color Technologies
|
|
|
1,867
|
|
Electronic & Communication Technologies
|
|
|
1,074
|
|
Performance Materials
|
|
|
1,810
|
|
Safety & Protection
|
|
|
1,583
|
|
|
|
|
|
|
Pre-tax operating income/loss (PTOI)
|
|
|
|
|
Agriculture & Nutrition
|
|
$
|
504
|
|
Coatings & Color Technologies
|
|
|
247
|
|
Electronic & Communication Technologies
|
|
|
170
|
|
Performance Materials
|
|
|
223
|
|
Safety & Protection
|
|
|
302
|
|
Pharmaceuticals
|
|
|
265
|
|
Other
|
|
|
1
|
|
|
|
|
|
|
Total Segment PTOI
|
|
$
|
1,712
|
|
|
|
|
|
|
S-6
We intend to file our interim financial statements for the
second fiscal quarter of 2008 with the SEC on
Form 10-Q
on or about July 28, 2008. Our actual results of operations
for the second fiscal quarter of 2008 and our financial position
at June 30, 2008 included in such interim financial
statements may vary from the preliminary results discussed
herein, and such variations could be material.
The foregoing information and estimates contain certain
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995 and have not been
compiled or examined by our independent auditors. While we
believe that such information and estimates are based on
reasonable assumptions, our actual results may vary, and such
variations may be material. Please refer to the sections
entitled Forward-Looking Statements and Risk
Factors included in the accompanying prospectus and the
documents incorporated by reference for more information on
events that could materially impact our ability to meet the
guidance set forth above.
S-7
USE OF
PROCEEDS
We will use the net proceeds from the sale of the Notes, which
are expected to be approximately
$ after payment of expenses related
to the offering, for general corporate purposes. These purposes
may include repayment and refinancing of debt, acquisitions,
working capital, capital expenditures and repurchases and
redemptions of securities. Pending any specific application, we
may initially invest funds in cash equivalents and short-term
marketable securities or apply them to the reduction of
short-term indebtedness.
S-8
DESCRIPTION
OF NOTES
The following description of the particular terms of
the % Notes
due ,
(the % Notes) and
the % Notes
due , (
the % Notes) offered hereby (referred to in the
prospectus as the Debt Securities) supplements the
description of the general terms and provisions of the Debt
Securities included in the accompanying prospectus.
The % Notes and
the % Notes are collectively
referred to in this prospectus supplement as the
Notes. Each series constitutes a separate series of
debt securities for purposes of the Indenture. The following
summary of the Notes is qualified in its entirety by reference
in the accompanying prospectus to the description of the
Indenture dated as of June 1, 1992 (the
Indenture), between the Company and Deutsche Bank
Trust Company Americas, formerly known as Bankers
Trust Company, as trustee (the Trustee).
General
The % Notes will mature at par
on ,
. The % Notes will mature at
par
on ,
. The Notes will constitute part of the senior debt of the
Company and will rank pari passu with all other unsecured
and unsubordinated indebtedness of the Company. The Notes will
be issued in fully registered form only, in denominations of
$2,000 and additional multiples of $1,000. Principal of and
interest on the Notes will be payable, and the transfer of Notes
will be registerable, through the Depositary, as described below.
Each % Note will bear interest
from ,
2008 at the annual rate of %.
Each % Note will bear interest
from ,
2008 at the annual rate of %.
Interest on the % Notes and
the % Notes will be payable
semiannually
on
and ,
commencing ,
2009, to the person in whose name such Note is registered at the
close of business on the
14th calendar
day immediately preceding such date (whether or not a Business
Day).
Interest payable at the maturity of the Notes will be payable to
registered holders of the Notes to whom principal is payable.
Interest will be computed on the basis of a
360-day year
of twelve
30-day
months.
If any interest payment date falls on a day that is not a
Business Day, the interest payment will be postponed to the next
day that is a Business Day, and no interest on such payment will
accrue for the period from and after such interest payment date.
If the maturity date of the Notes falls on a day that is not a
Business Day, the payment of interest and principal may be made
on the next succeeding Business Day, and no interest on such
payment will accrue for the period from and after the maturity
date.
Interest payments for the Notes will include accrued interest
from and including the date of issue or from and including the
last date in respect of which interest has been paid, as the
case may be, to but excluding the interest payment date or the
date of maturity, as the case may be.
The Company may, without the consent of the holders of the
Notes, issue additional notes having the same ranking and the
same interest rate, maturity and other terms as the Notes. Any
additional notes having such similar terms, together with the
Notes, will constitute a single series of notes under the
Indenture. No additional Notes may be issued if an Event of
Default has occurred with respect to the Notes.
As used in this prospectus supplement, Business Day
means any day, other than a Saturday or Sunday, that is not a
day on which banking institutions are authorized or required by
law or regulation to close in The City of New York.
Book-Entry,
Delivery and Form
The Notes will be issued in the form of one or more fully
registered global notes (the Global Notes)
registered in the name of The Depository Trust Company, New
York, New York (the Depositary or DTC)
or Cede & Co., the Depositarys nominee.
Beneficial interests in the Global Notes will be represented
through book-entry accounts of financial institutions acting on
behalf of beneficial owners as direct and indirect participants
in the Depositary.
Investors may elect to hold interests in the Global Notes
through the Depositary, Clearstream Banking Luxembourg S.A.
(Clearstream) or Euroclear Bank S.A./N.V., as
operator of the Euroclear System (Euroclear) if they
are participants of such systems, or indirectly through
organizations which are participants in such systems.
S-9
Clearstream and Euroclear will hold interests on behalf of their
participants through customers securities accounts in
Clearstreams and Euroclears names on the books of
their respective depositaries, which in turn will hold such
interests in customers securities accounts in the
depositaries names on the books of the Depositary.
Citibank, N.A. will act as depositary for Clearstream and
JPMorgan Chase Bank, N.A. will act as depositary for Euroclear
(in such capacities, the U.S. Depositaries).
Beneficial interest in the Global Notes will be held in
denominations of $2,000 and additional multiples of $1,000.
Except as described below, the Global Notes may be transferred,
in whole and not in part, only to another nominee of the
Depositary or to a successor of the Depositary or its nominee.
The Depositary has advised the Company as follows: the
Depositary is a limited-purpose trust company organized under
the New York Banking Law, a banking organization
within the meaning of the New York Banking Law, a member of the
Federal Reserve System, a clearing corporation
within the meaning of the New York Uniform Commercial Code,
and a clearing agency registered pursuant to the
provisions of Section 17A of the Securities Exchange Act of
1934, as amended (the Exchange Act). The Depositary
holds securities deposited with it by its participants and
records the settlement of transactions among its participants in
such securities through electronic computerized book-entry
changes in accounts of the participants, thereby eliminating the
need for physical movement of securities certificates. The
Depositarys participants include securities brokers and
dealers (including the Underwriters), banks, trust companies,
clearing corporations and certain other organizations, some of
whom (and/or their representatives) own the Depositary. Access
to the Depositary book-entry system is also available to others,
such as banks, brokers, dealers and trust companies that clear
through or maintain a custodial relationship with a participant,
either directly or indirectly.
Clearstream advises that it is incorporated under the laws of
Luxembourg as a bank. Clearstream holds securities for its
customers (Clearstream Customers) and facilitates
the clearance and settlement of securities transactions between
Clearstream Customers through electronic book-entry transfers
between their accounts. Clearstream provides to Clearstream
Customers, among other things, services for safekeeping,
administration, clearance and settlement of internationally
traded securities and securities lending and borrowing.
Clearstream interfaces with domestic securities markets in over
30 countries through established depository and custodial
relationships. As a bank, Clearstream is subject to regulation
by the Luxembourg Commission for the Supervision of the
Financial Sector (Commission de Surveillance du Secteur
Financier). Clearstream Customers are recognized financial
institutions around the world, including underwriters,
securities brokers and dealers, banks, trust companies, clearing
corporations and certain other organizations. Clearstreams
U.S. customers are limited to securities brokers and
dealers and banks. Indirect access to Clearstream is also
available to other institutions such as banks, brokers, dealers
and trust companies, that clear through or maintain a custodial
relationship with a Clearstream Customer.
Distributions with respect to the Notes held through Clearstream
will be credited to cash accounts of Clearstream Customers in
accordance with its rules and procedures, to the extent received
by the U.S. Depositary for Clearstream.
Euroclear advises that it was created in 1968 to hold securities
for its participants (Euroclear Participants) and to
clear and settle transactions between Euroclear Participants
through simultaneous electronic book-entry delivery against
payment, thereby eliminating the need for physical movement of
certificates and any risk from lack of simultaneous transfers of
securities and cash. Euroclear provides various other services,
including securities lending and borrowing, and interfaces with
domestic markets in several countries. Euroclear is operated by
Euroclear Bank S.A./N.V. (the Euroclear Operator),
under contract with Euroclear Clearance Systems, S.C., a Belgian
cooperative corporation (the Cooperative).
All operations are conducted by the Euroclear Operator, and all
Euroclear securities clearance accounts and Euroclear cash
accounts are accounts with the Euroclear Operator, not the
Cooperative. The Cooperative establishes policy for Euroclear on
behalf of Euroclear Participants. Euroclear Participants include
banks (including central banks), securities brokers and dealers
and other professional financial intermediaries and may include
the Underwriters. Indirect access to Euroclear is also available
to other firms that clear through or maintain a custodial
relationship with a Euroclear Participant, either directly or
indirectly.
Securities clearance accounts and cash accounts with the
Euroclear Operator are governed by the Terms and Conditions
Governing Use of Euroclear and the related Operating Procedures
of the Euroclear System, and
S-10
applicable Belgian law (collectively, the Terms and
Conditions). The Terms and Conditions govern transfers of
securities and cash within Euroclear, withdrawals of securities
and cash from Euroclear, and receipts of payments with respect
to securities in Euroclear. All securities in Euroclear are held
on a fungible basis without attribution of specific certificates
to specific securities clearance accounts. The Euroclear
Operator acts under the Terms and Conditions only on behalf of
Euroclear Participants and has no record of or relationship with
persons holding through Euroclear Participants.
Distributions with respect to the Notes held beneficially
through Euroclear will be credited to the cash accounts of
Euroclear Participants in accordance with the Terms and
Conditions, to the extent received by the U.S. Depositary
for Euroclear.
Euroclear further advises that investors that acquire, hold and
transfer interests in the Notes by book-entry through accounts
with the Euroclear Operator or any other securities intermediary
are subject to the laws and contractual provisions governing
their relationship with their intermediary, as well as the laws
and contractual provisions governing the relationship between
such an intermediary and each other intermediary, if any,
standing between themselves and the Global Notes.
The Euroclear Operator advises as follows: Under Belgian law,
investors that are credited with securities on the records of
the Euroclear Operator have a co-property right in the fungible
pool of interests in securities on deposit with the Euroclear
Operator in an amount equal to the amount of interests in
securities credited to their accounts. In the event of the
insolvency of the Euroclear Operator, Euroclear Participants
would have a right under Belgian law to the return of the amount
and type of interests in securities credited to their accounts
with the Euroclear Operator. If the Euroclear Operator did not
have a sufficient amount of interests in securities on deposit
of a particular type to cover the claims of all Participants
credited with such interests in securities on the Euroclear
Operators records, all Participants having an amount of
interests in securities of such type credited to their accounts
with the Euroclear Operator would have the right under Belgian
law to the return of their pro rata share of the amount
of interests in securities actually on deposit.
Under Belgian law, the Euroclear Operator is required to pass on
the benefits of ownership in any interests in securities on
deposit with it (such as dividends, voting rights and other
entitlements) to any person credited with such interests in
securities on its records.
Individual certificates in respect of the Notes will not be
issued in exchange for the Global Notes, except in very limited
circumstances. If DTC notifies the Company that it is unwilling
or unable to continue as a clearing system in connection with
the Global Notes, or ceases to be a clearing agency registered
under the Exchange Act, and a successor clearing system is not
appointed by the Company within 90 days after receiving
such notice from DTC or upon becoming aware that DTC is no
longer so registered, the Company will issue or cause to be
issued individual certificates in registered form on
registration of transfer of, or in exchange for, book-entry
interests in the Notes represented by such Global Notes upon
delivery of such Global Notes for cancellation.
Title to book-entry interests in the Notes will pass by
book-entry registration of the transfer within the records of
Clearstream, Euroclear or DTC, as the case may be, in accordance
with their respective procedures. Book-entry interests in the
Notes may be transferred within Clearstream and within Euroclear
and between Clearstream and Euroclear in accordance with
procedures established for these purposes by Clearstream and
Euroclear. Book-entry interests in the Notes may be transferred
within DTC in accordance with procedures established for this
purpose by DTC. Transfers of book-entry interests in the Notes
among Clearstream and Euroclear and DTC may be effected in
accordance with procedures established for this purpose by
Clearstream, Euroclear and DTC.
A further description of the Depositarys procedures with
respect to the Global Notes is set forth in the accompanying
prospectus under Description of Debt
Securities Global Securities. The Depositary
has confirmed to the Company, the Underwriters and the Trustee
that it intends to follow such procedures.
Global
Clearance and Settlement Procedures
Initial settlement for the Notes will be made in immediately
available funds. We will make all payments of principal,
premium, if any, and interest in respect of the Notes in
immediately available funds while the Notes are held in
book-entry only form. Secondary market trading between DTC
participants will occur in the ordinary way in
S-11
accordance with the Depositarys rules and will be settled
in immediately available funds using the Depositarys
Same-Day
Funds Settlement System. Secondary market trading between
Clearstream Customers
and/or
Euroclear Participants will occur in the ordinary way in
accordance with the applicable rules and operating procedures of
Clearstream and Euroclear and will be settled using the
procedures applicable to conventional Eurobonds in immediately
available funds.
Cross-market transfers between persons holding directly or
indirectly through the Depositary on the one hand, and directly
or indirectly through Clearstream Customers or Euroclear
Participants, on the other, will be effected in the Depositary
in accordance with the Depositarys rules on behalf of the
relevant European international clearing system by its
U.S. Depositary; however, such cross-market transactions
will require delivery of instructions to the relevant European
international clearing system by the counterparty in such system
in accordance with its rules and procedures and within its
established deadlines (European time). The relevant European
international clearing system will, if the transaction meets its
settlement requirements, deliver instructions to its
U.S. Depositary to take action to effect final settlement
on its behalf by delivering interests in the Notes to or
receiving interests in the Notes from the Depositary, and making
or receiving payment in accordance with normal procedures for
same-day
funds settlement applicable to the Depositary. Clearstream
Customers and Euroclear Participants may not deliver
instructions directly to their respective U.S. Depositaries.
Because of time-zone differences, credits of interests in the
Notes received in Clearstream or Euroclear as a result of a
transaction with a DTC participant will be made during
subsequent securities settlement processing and dated the
business day following the Depositary settlement date. Such
credits or any transactions involving interests in such Notes
settled during such processing will be reported to the relevant
Clearstream Customers or Euroclear Participants on such business
day. Cash received in Clearstream or Euroclear as a result of
sales of interests in the Notes by or through a Clearstream
Customer or a Euroclear Participant to a DTC participant will be
received with value on the Depositary settlement date but will
be available in the relevant Clearstream or Euroclear cash
account only as of the business day following settlement in the
Depositary.
Although the Depositary, Clearstream and Euroclear have agreed
to the foregoing procedures in order to facilitate transfers of
interests in the Notes among participants of the Depositary,
Clearstream and Euroclear, they are under no obligation to
perform or continue to perform such procedures and such
procedures may be changed or discontinued at any time.
Optional
Redemption
The % Notes will be redeemable
as a whole at any time or in part from time to time, at the
option of the Company, at a redemption price equal to the
greater of (i) 100% of the principal amount of
the % Notes or (ii) the
sum of the present values of the remaining scheduled payments of
principal and interest thereon from the redemption date to the
maturity date (exclusive of any accrued interest) discounted to
the redemption date on a semiannual basis (assuming a
360-day year
consisting of twelve
30-day
months) at the Treasury Rate
plus basis
points, plus, in each case, any interest accrued but not paid to
the date of redemption.
The % Notes will be redeemable
as a whole at any time or in part from time to time, at the
option of the Company, at a redemption price equal to the
greater of (i) 100% of the principal amount of
the % Notes or (ii) the
sum of the present values of the remaining scheduled payments of
principal and interest thereon from the redemption date to the
maturity date (exclusive of any accrued interest) discounted to
the redemption date on a semiannual basis (assuming a
360-day year
consisting of twelve
30-day
months) at the Treasury Rate
plus basis
points, plus, in each case, any interest accrued but not paid to
the date of redemption.
Treasury Rate means, with respect to any
redemption date for the Notes (i) the yield, under the
heading which represents the average for the immediately
preceding week, appearing in the most recently published
statistical release designated H.15(519) or any
successor publication which is published weekly by the Board of
Governors of the Federal Reserve System and which establishes
yields on actively traded United States Treasury securities
adjusted to constant maturity under the caption Treasury
Constant Maturities, for the maturity corresponding to the
Comparable Treasury Issue (if no maturity is within three months
before or after the maturity date for the Notes, yields for the
two published maturities most closely corresponding to the
Comparable Treasury Issue shall be determined and the Treasury
Rate shall be interpolated or extrapolated from such yields on a
straight
S-12
line basis, rounding to the nearest month) or (ii) if that
release (or any successor release) is not published during the
week preceding the calculation date or does not contain such
yields, the rate per annum equal to the semiannual equivalent
yield to maturity of the Comparable Treasury Issue, calculated
using a price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable
Treasury Price for that redemption date. The Treasury Rate shall
be calculated on the third business day preceding the redemption
date.
Comparable Treasury Issue means the United
States Treasury security selected by an Independent Investment
Banker as having a maturity comparable to the remaining term of
the Notes to be redeemed that would be utilized, at the time of
selection and in accordance with customary financial practice,
in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such securities.
Independent Investment Banker means one of the
Reference Treasury Dealers appointed by the Trustee after
consultation with the Company.
Comparable Treasury Price means with respect
to any redemption date for the Notes (i) the average of
four Reference Treasury Dealer Quotations for that redemption
date, after excluding the highest and lowest such Reference
Treasury Dealer Quotations, or (ii) if the Trustee obtains
fewer than four such Reference Treasury Dealer Quotations, the
average of all such quotations.
Reference Treasury Dealer means each of
Credit Suisse Securities (USA) LLC, Goldman, Sachs &
Co., Morgan Stanley & Co. Incorporated and one other
primary U.S. Government securities dealers in New York City
(each, a Primary Treasury Dealer) appointed by the
Trustee in consultation with the Company; provided, however,
that if any of the foregoing shall cease to be a Primary
Treasury Dealer, the Company shall substitute therefor another
Primary Treasury Dealer.
Reference Treasury Dealer Quotations means,
with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Trustee, of
the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount)
quoted in writing to the Trustee by that Reference Treasury
Dealer at 5:00 p.m. (New York City time) on the third
business day preceding that redemption date.
Unless the Company defaults in payment of the redemption price,
on and after the redemption date interest will cease to accrue
on the Notes or portions thereof called for redemption.
Change of
Control
If a Change of Control Triggering Event occurs, unless we have
exercised our right to redeem the Notes as described above under
Optional Redemption or upon the
occurrence of specified events involving United States
taxation as described below under Tax
Redemption, holders of Notes will have the right to
require us to repurchase all or any part (equal to $2,000 and
additional multiples of $1,000) of their Notes pursuant to the
offer described below (the Change of Control Offer)
on the terms set forth in the Notes. In the Change of Control
Offer, we will be required to offer payment in cash equal to
101% of the aggregate principal amount of Notes repurchased plus
accrued and unpaid interest, if any, on the Notes repurchased,
to the date of purchase (the Change of Control
Payment). Within 30 days following any Change of
Control Triggering Event, we will be required to mail a notice
to holders of Notes describing the transaction or transactions
that constitute the Change of Control Triggering Event and
offering to repurchase the Notes on the date specified in the
notice, which date will be no earlier than 30 days and no
later than 60 days from the date such notice is mailed (the
Change of Control Payment Date), pursuant to the
procedures required by the Notes and described in such notice.
We must comply with the requirements of
Rule 14e-1
under the Exchange Act and any other securities laws and
regulations thereunder to the extent those laws and regulations
are applicable in connection with the repurchase of the Notes as
a result of a Change of Control Triggering Event. To the extent
that the provisions of any securities laws or regulations
conflict with the Change of Control provisions of the Notes, we
will be required to comply with the applicable securities laws
and regulations and will not be deemed to have breached our
obligations under the Change of Control provisions of the Notes
by virtue of such conflicts.
On the Change of Control Payment Date, we will be required, to
the extent lawful, to:
|
|
|
|
|
accept for payment all Notes or portions of Notes properly
tendered pursuant to the Change of Control Offer;
|
S-13
|
|
|
|
|
deposit with the Paying Agent an amount equal to the Change of
Control Payment in respect of all Notes or portions of Notes
properly tendered; and
|
|
|
|
deliver or cause to be delivered to the Trustee the Notes
properly accepted together with an officers certificate
stating the aggregate principal amount of Notes or portions of
Notes being purchased.
|
The Paying Agent will promptly mail to each holder of Notes
properly tendered the purchase price for the Notes, and the
Trustee will promptly authenticate and mail (or cause to be
transferred by book-entry) to each holder a new Note equal in
principal amount to any unpurchased portion of any Notes
surrendered; provided that each new Note will be in a
principal amount of $2,000 and additional multiples of $1,000.
We will not be required to make an offer to repurchase the Notes
upon a Change of Control Triggering Event if a third party makes
such an offer in the manner, at the times and otherwise in
compliance with the requirements for an offer made by us, and
such third party purchases all Notes properly tendered and not
withdrawn under its offer.
For purposes of the foregoing discussion of a repurchase of
Notes at the option of holders, the following definitions are
applicable:
Below Investment Grade Rating Event means the
Notes are rated below an Investment Grade Rating by each of the
Rating Agencies (as defined below) on any date from the date of
the public notice of an arrangement that could result in a
Change of Control until the end of the
60-day
period following public notice of the occurrence of the Change
of Control (which
60-day
period shall be extended so long as the rating of the Notes is
under publicly announced consideration for possible downgrade by
any of the Rating Agencies); provided that a Below
Investment Grade Rating Event otherwise arising by virtue of a
particular reduction in rating shall not be deemed to have
occurred with respect to a particular Change of Control (and
thus shall not be deemed a Below Investment Grade Rating Event
for purposes of the definition of Change of Control Triggering
Event hereunder) if the Rating Agency or Agencies making the
reduction in rating to which this definition would otherwise
apply do not announce or publicly confirm or inform the Trustee
in writing at its request that the reduction was the result, in
whole or in part, of any event or circumstance comprised of or
arising as a result of, or in respect of, the applicable Change
of Control (whether or not the applicable Change of Control
shall have occurred at the time of the Below Investment Grade
Rating Event).
Change of Control means the occurrence of any
of the following: (1) the direct or indirect sale,
transfer, conveyance or other disposition (other than by way of
merger or consolidation), in one or a series of related
transactions, of all or substantially all of the properties or
assets of the Company and its subsidiaries taken as a whole to
any Person or group of related persons for purposes of
Section 13(d) of the Exchange Act (a Group)
other than the Company or one of its subsidiaries; (2) the
approval by the holders of the Companys voting stock of
any plan or proposal for the liquidation or dissolution of the
Company (whether or not otherwise in compliance with the
provisions of the Indenture); (3) the consummation of any
transaction (including, without limitation, any merger or
consolidation) the result of which is that any Person or Group
becomes the beneficial owner, directly or indirectly, of more
than 50% of the then outstanding voting interests in our capital
stock; or (4) the first day on which a majority of the
members of our Board of Directors are not Continuing Directors.
The definition of Change of Control includes a phrase relating
to the direct or indirect sale, lease, transfer, conveyance or
other disposition of all or substantially all of our
and our subsidiaries properties or assets taken as a
whole. Although there is a limited body of case law interpreting
the phrase substantially all, there is no precise
established definition of the phrase under applicable law.
Accordingly, the ability of a holder of Notes to require us to
repurchase such holders Notes as a result of a sale,
lease, transfer, conveyance or other disposition of less than
all of our and our subsidiaries assets taken as a whole to
another Person or Group may be uncertain.
Change of Control Triggering Event means the
occurrence of both a Change of Control and a Below Investment
Grade Rating Event.
Continuing Directors means, as of any date of
determination, any member of our Board of Directors who
(1) was a member of such Board of Directors on the date of
the issuance of the Notes; or (2) was nominated for
election or elected to such Board of Directors with the approval
of a majority of the Continuing Directors who were members of
such Board of Directors at the time of such nomination or
election (either by a
S-14
specific vote or by approval of our proxy statement in which
such member was named as a nominee for election as a director,
without objection to such nomination).
Fitch means Fitch Ratings.
Investment Grade Rating means a rating equal
to or higher than BBB- (or the equivalent) by Fitch, Baa3 (or
the equivalent) by Moodys, BBB- (or the equivalent) by
S&P and an equivalent rating of any replacement agency,
respectively.
Moodys means Moodys Investors
Service, Inc.
Paying Agent shall mean the Trustee or any
other Person authorized by the Company to pay the principal of
or interest on the Notes on behalf of the Company.
Person has the meaning set forth in the
Indenture and includes a person as used in
Section 13(d)(3) of the Exchange Act.
Rating Agencies means (1) each of Fitch,
Moodys and S&P; and (2) if any of Fitch,
Moodys or S&P ceases to rate the Notes or fails to
make a rating of the Notes publicly available for reasons
outside of our control, a nationally recognized
statistical rating organization within the meaning of
Rule 15c3-1(c)(2)(vi)(F)
under the Exchange Act, selected by us (as certified by a
resolution of our Board of Directors) as a replacement agency
for Fitch, Moodys or S&P, or all of them, as the case
may be.
S&P means Standard &
Poors Ratings Services, a division of The McGraw-Hill
Companies, Inc.
Applicable
Law
The Notes and the Indenture will be governed by and construed in
accordance with the laws of the State of New York.
Tax
Redemption
The Notes may be redeemed as a whole, at the option of the
Company at any time prior to maturity, upon the giving of a
notice of redemption as described below, if the Company
determines that, as a result of any change in or amendment to
the laws (or any regulations or rulings promulgated thereunder)
of the United States or of any political subdivision or taxing
authority thereof or therein, or any change in official position
regarding the application or interpretation of such laws,
regulations or rulings, which change or amendment becomes
effective on or after the date of this prospectus supplement,
the Company has or will become obligated to pay Additional
Amounts (as defined below) with respect to such Notes for
reasons outside its control and after taking reasonable measures
to avoid such obligation. The Notes will be redeemed at a
redemption price equal to 100% of the principal amount thereof,
together with accrued interest to the date fixed for redemption.
Prior to the giving of any notice of redemption pursuant to this
paragraph, the Company will deliver to the Trustee (i) a
certificate stating that the Company is entitled to effect such
redemption and setting forth a statement of facts showing that
the conditions precedent to the right of the Company to so
redeem have occurred and (ii) an opinion of independent
counsel satisfactory to such Trustee to the effect that the
Company has or will become obligated to pay Additional Amounts
for the reasons described above; provided that no such
notice of redemption shall be given earlier than 60 days
prior to the earliest date on which the Company would be
obligated to pay such Additional Amounts if a payment in respect
of the Notes were then due. Notice of redemption will be given
not less than 30 nor more than 60 days prior to the date
fixed for redemption, which date and the redemption price will
be specified in the notice.
Payment
of Additional Amounts
The Company will, subject to certain exceptions and limitations
set forth below, pay such additional amounts (Additional
Amounts) to the beneficial owner of any Note who is a
United States Alien as may be necessary in order that every net
payment of principal of and interest on such Note and any other
amounts payable on such Note, after withholding for or on
account of any present or future tax, assessment or governmental
charge imposed upon or as a result of such payment by the United
States (or any political subdivision or taxing authority thereof
or therein),
S-15
will not be less than the amount provided for in such Note to be
then due and payable. The Company will not, however, be required
to make any payment of Additional Amounts to any beneficial
owner for or on account of:
(a) any such tax, assessment or other governmental charge
that would not have been so imposed but for the existence of any
present or former connection between such beneficial owner (or
between a fiduciary, settlor, beneficiary, member or shareholder
of such beneficial owner, if such beneficial owner is an estate,
a trust, a partnership or a corporation) and the United States
and its possessions, including, without limitation, such
beneficial owner (or such fiduciary, settlor, beneficiary,
member or shareholder) being or having been a citizen or
resident thereof or being or having been engaged in a trade or
business or present therein or having, or having had, a
permanent establishment therein;
(b) any tax that would not have been so imposed, assessed,
levied or collected but for the fact that, where presentation is
required in order to receive payment, the Note was presented
more than 30 days after the date on which such payment
became due and payable or was provided for, whichever is later;
(c) any estate, inheritance, gift, sales, transfer or
personal property tax or any similar tax, assessment or
governmental charge;
(d) any tax, assessment or other governmental charge
imposed by reason of such beneficial owners past or
present status as a personal holding company or controlled
foreign corporation or passive foreign investment company with
respect to the United States or as a corporation that
accumulates earnings to avoid United States federal income tax;
(e) any tax, assessment or other governmental charge that
is payable otherwise than by withholding from payments on or in
respect of any Note;
(f) any tax, assessment or other governmental charge that
would not have been imposed but for the failure to comply with
certification, information or other reporting requirements
concerning the nationality, residence or identity of the
beneficial owner of such Note, if such compliance is required by
statute or by regulation of the United States or of any
political subdivision or taxing authority thereof or therein as
a precondition to relief or exemption from such tax, assessment
or other governmental charge;
(g) any tax, assessment or other governmental charge
imposed by reason of such beneficial owners status
(including past status) as the actual or constructive owner of
10% or more of the total combined voting power of all classes of
stock entitled to vote of the Company or as a controlled foreign
corporation that is related directly or indirectly to the
Company through stock ownership; or
(h) any combination of items (a), (b), (c), (d), (e),
(f) or (g);
nor shall Additional Amounts be paid with respect to any payment
on a Note to a United States Alien who is a fiduciary or
partnership or other than the sole beneficial owner of such
payment to the extent such payment would be required by the laws
of the United States (or any political subdivision thereof) to
be included in the income, for tax purposes, of a beneficiary or
settlor with respect to such fiduciary or a member of such
partnership or a beneficial owner who would not have been
entitled to the Additional Amounts had such beneficiary,
settlor, member or beneficial owner held its interest in the
Note directly.
The term United States Alien means any person that
is, for United States federal income tax purposes, a foreign
corporation, a nonresident alien individual, a nonresident alien
fiduciary of a foreign estate or trust, or a foreign partnership
to the extent that one or more of its members is a foreign
corporation, a nonresident alien individual or a nonresident
alien fiduciary of a foreign estate or trust.
S-16
UNITED
STATES FEDERAL TAXATION
The information provided in the accompanying prospectus under
the caption United States Federal Taxation is
supplemented with the following information. Please also refer
to information provided in this prospectus supplement under the
captions Description of Notes Tax
Redemption and Payment of Additional
Amounts.
Each
non-U.S. owner
of a Note should be aware that if it does not properly provide
the required IRS form, or if the IRS form (or, if permissible, a
copy of such form) is not properly transmitted to and received
by the United States person otherwise required to withhold
United States federal income tax, interest on the Note may be
subject to United States withholding tax at a 30% rate or a
lower applicable treaty rate, and the owner will not be entitled
to any Additional Amounts from the Company described under the
heading Description of Notes Payment of
Additional Amounts with respect to such tax. Such tax,
however, may in certain circumstances be allowed as a refund or
as a credit against such owners United States federal
income tax. The foregoing does not deal with all aspects of
federal income tax withholding that may be relevant to
non-U.S. owners
of the Notes. Investors are advised to consult their own tax
advisors for specific advice concerning the ownership and
disposition of Notes.
S-17
UNDERWRITING
Under the terms and subject to the conditions set forth in the
Underwriting Agreement, dated July , 2008 (the
Underwriting Agreement), the underwriters named
below (the Underwriters) have severally agreed to
purchase, and the Company has agreed to sell to them, severally,
the respective principal amount of the Notes set forth opposite
their respective names below:
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
Principal
|
|
|
|
Amount of
|
|
|
Amount of
|
|
Name
|
|
% Notes
|
|
|
% Notes
|
|
|
Credit Suisse Securities (USA) LLC
|
|
$
|
|
|
|
$
|
|
|
Goldman, Sachs & Co.
|
|
|
|
|
|
|
|
|
Morgan Stanley & Co. Incorporated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
$
|
|
|
|
$
|
|
|
|
|
|
|
|
|
|
|
|
The Underwriting Agreement provides that the obligations of the
several Underwriters to pay for and accept delivery of the Notes
are subject to, among other things, the approval of certain
legal matters by their counsel and certain other conditions. The
Underwriters are obligated to take and pay for all the Notes if
any are taken.
The Underwriters propose initially to offer part of the Notes to
the public at the public offering price set forth on the cover
page hereof and in part to certain dealers at prices that
represent a concession not in excess
of % of the principal amount of
the % Notes
and % of the principal amount of
the % Notes. Any Underwriter
may allow, and such dealers may reallow, a concession not in
excess of % of the principal amount
of the% Notes and % of the
principal amount of
the % Notes to certain other
dealers. After the initial offering of the Notes, the offering
price and other selling terms may from time to time be varied by
the Underwriters.
In order to facilitate the offering of the Notes, the
Underwriters may engage in transactions that stabilize, maintain
or otherwise affect the price of the Notes. Specifically, the
Underwriters may over-allot in connection with this offering,
creating short positions in the Notes for their own account. In
addition, to cover over-allotments or to stabilize the price of
the Notes, the Underwriters may bid for, and purchase, Notes in
the open market. Finally, the Underwriters may reclaim selling
concessions allowed to an underwriter or dealer for distributing
Notes in this offering, if the Underwriters repurchase
previously distributed Notes in transactions that cover
syndicate short positions, in stabilization transactions or
otherwise. Any of these activities may stabilize or maintain the
market price of the Notes above independent market levels. The
Underwriters are not required to engage in these activities, and
may end any of these activities at any time.
Certain of the Underwriters and their affiliates engage in
transactions with, and perform services for, the Company in the
ordinary course of business and have engaged, and may in the
future engage, in commercial banking and investment banking
transactions with the Company.
The Notes are offered for sale in those jurisdictions in the
United States, Canada, Europe, Asia and elsewhere where it is
lawful to make such offers.
Each of the Underwriters has represented and agreed that it has
not and will not offer, sell or deliver any of the Notes
directly or indirectly, or distribute this prospectus supplement
or the prospectus or any other offering material relating to the
Notes, in or from any jurisdiction except under circumstances
that will result in compliance with the applicable laws and
regulations thereof and that will not impose any obligations on
the Company except as set forth in the Underwriting Agreement.
In particular, each Underwriter has represented and agreed that:
In relation to each Member State of the European Economic Area
which has implemented the Prospectus Directive (each, a
Relevant Member State), with effect from and
including the date on which the Prospectus Directive is
implemented in that Relevant Member State (the Relevant
Implementation Date), it has not made and will not make an
offer of Notes to the public in that Relevant Member State prior
to the publication of a prospectus in relation to the Notes
which has been approved by the competent authority in that
Relevant Member State or, where appropriate, approved in another
Relevant Member State and notified to the
S-18
competent authority in that Relevant Member State, all in
accordance with the Prospectus Directive, except that it may,
with effect from and including the Relevant Implementation Date,
make an offer of Notes to the public in that Relevant Member
State at any time:
(a) to legal entities which are authorised or regulated to
operate in the financial markets or, if not so authorised or
regulated, whose corporate purpose is solely to invest in
securities;
(b) to any legal entity which has two or more of
(1) an average of at least 250 employees during the
last financial year; (2) a total balance sheet of more than
43,000,000 and (3) an annual net turnover of more
than 50,000,000, as shown in its last annual or
consolidated accounts;
(c) to fewer than 100 natural or legal persons (other than
qualified investors as defined in the Prospectus Directive)
subject to obtaining prior consent of the representatives of any
such offer; or
(d) in any other circumstances which do not require the
publication by the issuer of a prospectus pursuant to
Article 3 of the Prospectus Directive.
For the purposes of this provision, the expression an
offer of Notes to the public in relation to any
Notes in any Relevant Member State means the communication in
any form and by any means of sufficient information on the terms
of the offer and the Notes to be offered so as to enable an
investor to decide to purchase or subscribe for the Notes, as
the same may be varied in that Relevant Member State by any
measure implementing the Prospectus Directive in that Relevant
Member State and the expression Prospectus Directive
means Directive 2003/71/ EC and includes any relevant
implementing measure in each Relevant Member State.
With respect to sales to residents of the United Kingdom:
(a) it has only communicated or caused to be communicated
and will only communicate or cause to be communicated an
invitation or inducement to engage in investment activity
(within the meaning of Section 21 of the FSMA) received by
it in connection with the issue or sale of the Notes in
circumstances in which Section 21(1) of the FSMA does not
apply to the Issuer; and
(b) it has complied and will comply with all applicable
provisions of the FSMA with respect to anything done by it in
relation to the Notes in, from or otherwise involving the United
Kingdom.
The Notes may not be offered or sold by means of any document
other than to persons whose ordinary business is to buy or sell
shares or debentures, whether as principal or agent, or in
circumstances which do not constitute an offer to the public
within the meaning of the Companies Ordinance (Cap. 32) of
Hong Kong, and no advertisement, invitation or document relating
to the Notes may be issued, whether in Hong Kong or elsewhere,
which is directed at, or the contents of which are likely to be
accessed or read by, the public in Hong Kong (except if
permitted to do so under the securities laws of Hong Kong) other
than with respect to Notes which are or are intended to be
disposed of only to persons outside Hong Kong or only to
professional investors within the meaning of the
Securities and Futures Ordinance (Cap. 571) of Hong Kong
and any rules made thereunder.
The Notes have not been and will not be registered under the
Financial Instruments and Exchange Law of Japan (the
Financial Instruments and Exchange Law) and each
underwriter will not offer or sell any securities, directly or
indirectly, in Japan or to, or for the benefit of, any resident
of Japan (which term as used herein means any person resident in
Japan, including any corporation or other entity organized under
the laws of Japan), or to others for re-offering or resale,
directly or indirectly, in Japan or to a resident of Japan,
except pursuant to an exemption from the registration
requirements of, and otherwise in compliance with, the Financial
Instruments and Exchange Law and any other applicable laws,
regulations and ministerial guidelines of Japan.
This prospectus supplement has not been registered as a
prospectus with the Monetary Authority of Singapore.
Accordingly, this prospectus supplement and any other document
or material in connection with the offer or sale, or invitation
for subscription or purchase, of the Notes may not be circulated
or distributed, nor may the Notes be offered or sold, or be made
the subject of an invitation for subscription or purchase,
whether directly or indirectly, to persons in Singapore other
than (i) to an institutional investor under
Section 274 of the Securities and Futures Act,
Chapter 289 of Singapore (the SFA),
(ii) to a relevant person, or any person pursuant to
Section 275(1A), and in
S-19
accordance with the conditions, specified in Section 275 of
the SFA or (iii) otherwise pursuant to, and in accordance
with the conditions of, any other applicable provision of the
SFA.
Where the Notes are subscribed or purchased under
Section 275 by a relevant person which is: (a) a
corporation (which is not an accredited investor) the sole
business of which is to hold investments and the entire share
capital of which is owned by one or more individuals, each of
whom is an accredited investor; or (b) a trust (where the
trustee is not an accredited investor) whose sole purpose is to
hold investments and each beneficiary is an accredited investor,
shares, debentures and units of shares and debentures of that
corporation or the beneficiaries rights and interest in
that trust shall not be transferable for six months after that
corporation or that trust has acquired the notes under
Section 275 except: (1) to an institutional investor
under Section 274 of the SFA or to a relevant person, or
any person pursuant to Section 275(1A), and in accordance
with the conditions, specified in Section 275 of the SFA;
(2) where no consideration is given for the transfer; or
(3) by operation of law.
The Notes are a new issue of securities with no established
trading market. The Underwriters have advised the Company the
Underwriters intend to make a market in the Notes. The
Underwriters are not obligated, however, to do so and may
discontinue their market making at any time without notice. No
assurance can be given as to the liquidity of the trading market
for the Notes.
Expenses associated with this offering, to be paid by the
Company, are estimated to be $650,000.
The Company has agreed to indemnify the Underwriters against
certain liabilities, including liabilities under the Securities
Act of 1933.
S-20
NOTICE TO
CANADIAN RESIDENTS
Resale
Restrictions
The distribution of the Notes in Canada is being made only on a
private placement basis exempt from the requirement that we
prepare and file a prospectus with the securities regulatory
authorities in each province where trades of Notes are made. Any
resale of the Notes in Canada must be made under applicable
securities laws which will vary depending on the relevant
jurisdiction, and which may require resales to be made under
available statutory exemptions or under a discretionary
exemption granted by the applicable Canadian securities
regulatory authority. Purchasers are advised to seek legal
advice prior to any resale of the Notes.
Representations
of Purchasers
By purchasing Notes in Canada and accepting a purchase
confirmation a purchaser is representing to us and the dealer
from whom the purchase confirmation is received that:
|
|
|
|
|
the purchaser is entitled under applicable provincial securities
laws to purchase the Notes without the benefit of a prospectus
qualified under those securities laws,
|
|
|
|
where required by law, that the purchaser is purchasing as
principal and not as agent,
|
|
|
|
the purchaser has reviewed the text above under Resale
Restrictions, and
|
|
|
|
the purchaser acknowledges and consents to the provision of
specified information concerning its purchase of the Notes to
the regulatory authority that by law is entitled to collect the
information.
|
Further details concerning the legal authority for this
information is available on request.
Rights of
Action Ontario Purchasers Only
Under Ontario securities legislation, certain purchasers who
purchase a security offered by this prospectus supplement during
the period of distribution will have a statutory right of action
for damages, or while still the owner of the Notes, for
rescission against us in the event that this prospectus
supplement contains a misrepresentation without regard to
whether the purchaser relied on the misrepresentation. The right
of action for damages is exercisable not later than the earlier
of 180 days from the date the purchaser first had knowledge
of the facts giving rise to the cause of action and three years
from the date on which payment is made for the Notes. The right
of action for rescission is exercisable not later than
180 days from the date on which payment is made for the
Notes. If a purchaser elects to exercise the right of action for
rescission, the purchaser will have no right of action for
damages against us. In no case will the amount recoverable in
any action exceed the price at which the Notes were offered to
the purchaser and if the purchaser is shown to have purchased
the securities with knowledge of the misrepresentation, we will
have no liability. In the case of an action for damages, we will
not be liable for all or any portion of the damages that are
proven to not represent the depreciation in value of the Notes
as a result of the misrepresentation relied upon. These rights
are in addition to, and without derogation from, any other
rights or remedies available at law to an Ontario purchaser. The
foregoing is a summary of the rights available to an Ontario
purchaser. Ontario purchasers should refer to the complete text
of the relevant statutory provisions.
Enforcement
of Legal Rights
All of our directors and officers as well as the experts named
herein may be located outside of Canada and, as a result, it may
not be possible for Canadian purchasers to effect service of
process within Canada upon us or those persons. All or a
substantial portion of our assets and the assets of those
persons may be located outside of Canada and, as a result, it
may not be possible to satisfy a judgment against us or those
persons in Canada or to enforce a judgment obtained in Canadian
courts against us or those persons outside of Canada.
S-21
Taxation
and Eligibility for Investment
Canadian purchasers of Notes should consult their own legal and
tax advisors with respect to the tax consequences of an
investment in the Notes in their particular circumstances and
about the eligibility of the Notes for investment by the
purchaser under relevant Canadian legislation.
S-22
LEGAL
OPINIONS
The validity of the Notes offered hereby will be passed on for
the Company by Thomas L. Sager, Esq., Senior Vice President
and General Counsel of the Company, and for the Underwriters by
Cravath, Swaine & Moore LLP. Certain matters may be
passed upon for the Company by Skadden, Arps, Slate,
Meagher & Flom LLP. Mr. Sager beneficially owned
as of June 30, 2008, 5,772 shares of the common stock
of the Company, plus 141,913 shares of which he has the
right to acquire beneficial ownership within 60 days
through the exercise of stock options awarded under the
Companys Stock Option Plan. Cravath, Swaine &
Moore LLP performs legal services for the Company from time to
time.
S-23
E. I. du Pont de Nemours and
Company
Debt
Securities
E. I. du Pont de Nemours and Company may offer, issue and sell
from time to time debt securities, which may be senior debt
securities or subordinated debt securities.
We will provide the specific terms of these securities in
supplements to this prospectus. We may describe the terms of
these securities in a term sheet that will precede the
prospectus supplement. You should read this prospectus and any
prospectus supplement carefully before you make your investment
decision.
This prospectus may not be used to sell securities unless
accompanied by a prospectus supplement.
We may offer and sell these securities to or through one or more
underwriters, dealers and agents or directly to purchasers on a
continuous or delayed basis. The prospectus supplement for each
offering of securities will describe in detail the plan of
distribution for that offering. For general information about
the distribution of securities offered, please see Plan of
Distribution in this prospectus.
Investing in our securities involves risks. Before buying our
securities, you should refer to the risk factors included in our
most recent Annual Report on
Form 10-K,
our other periodic reports and in other information that we file
with the Securities and Exchange Commission. See Risk
Factors on page 3.
Neither the Securities and Exchange Commission nor any state
securities commission has approved or disapproved of these
securities or determined whether this prospectus is truthful or
complete. Any representation to the contrary is a criminal
offense.
The date of this prospectus is May 2, 2008.
ABOUT
THIS PROSPECTUS
This prospectus is part of a registration statement that we have
filed with the Securities and Exchange Commission, or SEC, using
a shelf registration process. Using this process, we
may, from time to time, offer to sell any combination of the
securities described in this prospectus in one or more offerings
at an unspecified aggregate initial offering price. This
prospectus provides you with a general description of the
securities we may offer. Each time we offer to sell securities,
we will provide a supplement to this prospectus. The prospectus
supplement will describe the specific terms of that offering,
including the specific amounts, prices and terms of the
securities offered. The prospectus supplement may also add,
update or change the information contained in this prospectus.
Please carefully read this prospectus and the prospectus
supplement, in addition to the information contained in the
documents we refer you to under the headings Where You Can
Find More Information and Incorporation of Certain
Documents by Reference appearing immediately below. If
there is any inconsistency between the information in this
prospectus and any prospectus supplement, you should rely on the
information in the prospectus supplement.
In this prospectus and any prospectus supplement hereto, unless
the context suggests otherwise, references to our
company, the Company, DuPont,
we, us and our mean E. I. du
Pont de Nemours and Company.
WHERE YOU
CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements
and other information with the SEC. You can read and copy any
materials we file with the SEC at the SECs Public
Reference Room at 100 F Street,
N.E., Washington, D.C. 20549. You can obtain
information about the operation of the SECs Public
Reference Room by calling the SEC at
1-800-SEC-0330.
The SEC also maintains a web site that contains information we
file electronically with the SEC, which you can access over the
internet at
http://www.sec.gov.
Our SEC filings are also available at our website at
http://www.dupont.com.
You can also obtain information about us at the offices of the
New York Stock Exchange, 20 Broad Street, New York, New
York 10005.
This prospectus is part of a registration statement we have
filed with the SEC on
Form S-3.
As permitted by SEC rules, this prospectus does not contain all
of the information we have included in the registration
statement. You should also read the documents incorporated by
reference to the registration statement of which this prospectus
forms a part, as described immediately below under
Incorporation of Certain Documents by Reference.
INCORPORATION
OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate by reference into
this prospectus documents that we file with the SEC, which means
that we can disclose important information to you by referring
you to those documents. The information incorporated by
reference is considered part of this prospectus. Any statement
in this prospectus or incorporated by reference into this
prospectus shall be automatically modified or superseded for
purposes of this prospectus to the extent that a statement
contained herein or in a subsequently filed document that is
incorporated by reference in this prospectus modifies or
supersedes such prior statement. Any statement so modified or
superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this prospectus.
We incorporate by reference into this prospectus the documents
listed below and all documents we subsequently file with the SEC
(other than any portion of such filings that are furnished under
applicable SEC rules rather than filed) pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934 (the Exchange Act), prior to
the completion of the offering of all securities covered by the
relevant prospectus supplement:
|
|
|
|
|
our annual report on
Form 10-K
for the year ended December 31, 2007, filed with the SEC on
February 19, 2008, and Amendment No. 1 thereto, filed
with the SEC on April 23, 2008;
|
|
|
|
our quarterly report on
Form 10-Q
for the quarter ended March 31, 2008, filed with the SEC on
April 29, 2008; and
|
|
|
|
our current reports on
Form 8-K,
filed with the SEC on January 9, 2008, February 5,
2008, March 11, 2008 and May 2, 2008.
|
You may request a copy of these filings (other than an exhibit
to these filings unless we have specifically incorporated that
exhibit by reference into the filing), at no cost, by writing or
telephoning us at the following address:
DuPont
Company
1007 Market Street
Wilmington, DE 19898
Attention: Treasury
Telephone:
(302) 774-1000
You should rely only on the information contained in, or
incorporated by reference into, this prospectus, any prospectus
supplement or any incorporated document. We have not authorized
anyone to provide you with different or additional information.
We are not offering to sell or soliciting any offer to buy any
securities in any jurisdiction where the offer or sale thereof
is not permitted. You should not assume that the information in
this prospectus, any prospectus supplement or in any document
incorporated by reference herein is accurate as of any date
other than the date on the front cover of the applicable
document.
FORWARD-LOOKING
INFORMATION
This prospectus and the information incorporated herein by
reference contains forward-looking statements within the meaning
of Section 21E of the Exchange Act and Section 27A of
the Securities Act of 1933 (the Securities Act),
which may be identified by their use of words like
plans, expects, will,
anticipates, intends,
projects, estimates or other words of
similar meaning. All statements that address expectations or
projections about the future, including statements about our
strategy for growth, product development, market position,
expenditures, and financial results, are forward-looking
statements.
Forward-looking statements are based on certain assumptions and
expectations of future events. We cannot guarantee that these
assumptions and expectations are accurate or will be realized.
In addition, the following are some of the important factors
that could cause our actual results to differ materially from
those projected in any forward-looking statements:
|
|
|
|
|
Price increases for energy and raw materials could have a
significant impact on our ability to sustain and grow earnings.
|
|
|
|
Failure to develop and market new products could impact our
competitive position and have an adverse effect on our financial
results.
|
|
|
|
Our results of operations could be adversely affected by
litigation and other commitments and contingencies.
|
|
|
|
As a result of our current and past operations, including
operations related to divested businesses, we could incur
significant environmental liabilities.
|
|
|
|
Our ability to generate sales from genetically enhanced
products, particularly seeds and other agricultural products,
could be adversely affected by market acceptance, government
policies, rules or regulations and competition.
|
|
|
|
Changes in government policies and laws could adversely affect
our financial results.
|
|
|
|
Economic factors, including inflation and fluctuations in
currency exchange rates, interest rates and commodity prices
could affect our financial results.
|
|
|
|
Business disruptions could seriously impact our future revenue
and financial condition and increase costs and expenses.
|
|
|
|
Inability to protect and enforce our intellectual property
rights could adversely affect our financial results.
|
The foregoing list of important factors is not inclusive, or
necessarily in order of importance. Additional risks and
uncertainties not presently known to us or that we currently
believe to be immaterial also could affect our businesses.
2
ABOUT
DUPONT
We were founded in 1802 and incorporated in Delaware in 1915. We
have been in continuous operation for over 200 years. Our
principal offices are at 1007 Market Street in Wilmington,
Delaware.
We are a world leader in science and technology in a range of
disciplines including biotechnology, electronics, materials
science, safety and security, and synthetic fibers. We operate
globally, manufacturing a wide range of products for
distribution and sale to many different markets, including the
transportation, safety and protection, construction, motor
vehicle, agriculture, home furnishings, medical, electronics,
communications, protective apparel, and the nutrition and health
markets.
We are strategically aligned into five market- and
technology-focused growth platforms consisting of
Agriculture & Nutrition, Coatings & Color
Technologies, Electronic & Communication Technologies,
Performance Materials, and Safety & Protection. In
addition to the five growth platforms, our reportable segments
include Pharmaceuticals, which represents our retained interest
in
Cozaar®/
Hyzaar®
drugs. We include embryonic businesses not included in the
growth platforms, such as applied biosciences and nonaligned
businesses in Other.
RISK
FACTORS
Before you invest in any of our securities, in addition to the
other information included or incorporated by reference in this
prospectus and any applicable prospectus supplement, you should
carefully consider the risk factors under the heading
Risk Factors contained in Part I, Item 1A
in our Annual Report on
Form 10-K
for the year ended December 31, 2007, which are
incorporated herein by reference. These risk factors may be
amended, supplemented or superseded from time to time by risk
factors contained in other Exchange Act reports that we file
with the SEC, which will be subsequently incorporated by
reference herein; by any prospectus supplement accompanying this
prospectus; or by a post-effective amendment to the registration
statement of which this prospectus forms a part. In addition,
new risks may emerge at any time and we cannot predict such
risks or estimate the extent to which they may affect our
financial performance. See Incorporation Of Certain
Documents By Reference and Cautionary Statement
Regarding Forward-Looking Statements.
USE OF
PROCEEDS
Unless we inform you otherwise in a prospectus supplement, we
will use the net proceeds from the sale of the offered
securities for general corporate purposes. These purposes may
include repayment and refinancing of debt, acquisitions, working
capital, capital expenditures and repurchases and redemptions of
securities. Pending any specific application, we may initially
invest funds in short-term marketable securities or apply them
to the reduction of short-term indebtedness.
RATIO OF
EARNINGS TO FIXED CHARGES
The following table sets forth our ratio of earnings to fixed
charges for each of the periods indicated:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
|
|
|
|
|
|
|
|
|
|
|
|
|
Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
|
|
Years Ended December 31,
|
|
|
2008
|
|
2007
|
|
2006
|
|
2005
|
|
2004
|
|
2003
|
|
Ratio of earnings to fixed charges
|
|
|
13.2
|
|
|
|
7.8
|
|
|
|
6.6
|
|
|
|
6.7
|
|
|
|
5.0
|
|
|
|
2.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For purposes of calculating the ratio of earnings to fixed
charges, (i) earnings represent the sum of
income before cumulative effect of changes in accounting
principles, provision for (benefit from) income taxes, minority
interests in earnings (losses) of consolidated subsidiaries,
adjustment for companies accounted for by the equity method,
capitalized interest and amortization of capitalized interest
plus fixed charges, and (ii) fixed charges
represent the sum of interest and debt expense, capitalized
interest and rental expense representative of interest factor.
The ratio is based solely on historical financial information.
3
DESCRIPTION
OF DEBT SECURITIES
We will issue the debt securities under one of two indentures:
|
|
|
|
|
an indenture dated as of June 1, 1992 between us and
Deutsche Bank Trust Company Americas (formerly Bankers
Trust Company), as trustee; or
|
|
|
|
an indenture dated as of June 1, 1992 between us and The
Bank of New York Trust Company, N.A., successor to The
Chase Manhattan Bank and Chemical Bank, as trustee.
|
Each indenture is incorporated into or filed as an exhibit to
the registration statement, of which this prospectus is a part.
The trustee will be designated in the prospectus supplement for
each offering of debt securities. All references to the
trustee mean the trustee identified in the
prospectus supplement. The following summaries of certain
provisions of the indentures are not complete. We encourage you
to read the indentures.
General
The indentures do not limit the amount of debt securities that
we may issue. Each provides that debt securities may be issued
up to the aggregate principal amount that we authorize from time
to time. The debt securities will be unsecured and will rank on
a parity with all of our other unsecured and unsubordinated
indebtedness.
The prospectus supplement relating to a series of debt
securities will describe the terms of that series, including,
where applicable:
|
|
|
|
|
the designation, aggregate principal amount, currency or
currencies and denominations of the debt securities;
|
|
|
|
whether the debt securities may be convertible into or
exchangeable for other securities;
|
|
|
|
the price or prices, expressed as a percentage of aggregate
principal amount, at which the debt securities will be issued;
|
|
|
|
the date or dates on which the debt securities will mature;
|
|
|
|
the currency or currencies in which the debt securities are
being sold and in which the principal of and any interest on the
debt securities will be payable and whether the holder of the
debt securities may elect the currency in which payments are to
be made, and, if so, the manner of such election;
|
|
|
|
the rate or rates, which may be fixed or variable, at which the
debt securities will bear interest, if any;
|
|
|
|
the date from which interest on the debt securities will accrue,
the dates on which interest will be payable and the date on
which payment of interest will commence;
|
|
|
|
the dates on which and the price or prices at which the debt
securities will, under any mandatory sinking fund provision, or
may, under any optional redemption or required repayment
provisions, be redeemed or repaid and the other terms and
provisions of any mandatory sinking fund, optional redemption or
required repayment;
|
|
|
|
whether the debt securities are to be issuable as registered
securities, bearer securities or both and the terms upon which
any bearer securities of a series may be exchanged for
registered securities of that series;
|
|
|
|
whether the debt securities are to be issued in whole or in part
in the form of one or more global securities and, if so, the
identity of the depositary or depositaries for the global
security or securities;
|
|
|
|
any special provisions for the payment of additional amounts on
the debt securities;
|
|
|
|
if a temporary global security is to be issued for a series, the
requirements for certification of ownership by
non-United
States persons that will apply before (a) the issuance of a
definitive bearer security or (b) the payment of interest
on an interest payment date that occurs before the issuance of a
definitive bearer security;
|
|
|
|
if a temporary global security is to be issued with respect to
the series, the terms upon which interests in the temporary
global security may be exchanged for interests in a definitive
global security or for definitive debt
|
4
|
|
|
|
|
securities of the series and the terms upon which interests in a
definitive global security, if any, may be exchanged for
definitive debt securities of the series;
|
|
|
|
|
|
any additions, modifications or deletions to the restrictive
covenants included for the benefit of holders of the debt
securities;
|
|
|
|
any additions, modifications or deletions to the events of
default provided with respect to the debt securities;
|
|
|
|
if the debt securities of the series are subject to defeasance
at our option, the provisions, federal income tax consequences
and other considerations applicable thereto;
|
|
|
|
the designated trustee for the debt securities; and
|
|
|
|
any other terms of the debt securities not inconsistent with the
provisions of the applicable indenture. (Section 301)
|
Debt securities of a series may be issuable in whole or in part
in the form of one or more global securities, as described below
under Global Securities. Registered securities
denominated in U.S. dollars will ordinarily be issued only
in denominations of $1,000 or any integral multiple of $1,000.
(Section 302) One or more global securities will be
issued in a denomination or aggregate denominations equal to the
aggregate principal amount of outstanding debt securities of the
series. (Section 303) The prospectus supplement
relating to a series of debt securities denominated in a foreign
or composite currency will specify the allowable denominations
and any special U.S. federal income tax and other
considerations. No service charge will be made for any tender or
exchange of debt securities but we may require payment of a sum
sufficient to cover any tax or other governmental charge.
(Section 305)
Debt securities may be presented for exchange, and registered
securities that are not in global form may be presented for
transfer, with the form of transfer endorsed thereon duly
executed, at the office of any transfer agent or at the office
of the security registrar, without service charge and upon
payment of any taxes and other governmental charges as described
in the indenture. Transfers or exchanges will be effected once
the transfer agent or the security registrar, as the case may
be, is satisfied with the documents of title and identity of the
person making the request. (Section 305)
Debt securities may be issued under the indenture as original
issue discount securities to be offered and sold at a
substantial discount below their stated principal amount.
Original issue discount securities means any debt
securities that provide for an amount less than their principal
amount to be due and payable upon a declaration of acceleration
of maturity upon the occurrence and continuation of an event of
default and any debt securities issued with original issue
discount for U.S. federal income tax purposes.
(Section 101) A prospectus supplement will describe
U.S. federal income tax consequences and other special
considerations applicable to any original issue discount
securities.
Global
Securities
The debt securities of a series may be issued in whole or in
part in the form of one or more global securities that will be
deposited with, or on behalf of, a depositary identified in the
prospectus supplement relating to that series. Global securities
may be issued in either registered or bearer form and in either
temporary or definitive form. Unless and until it is exchanged
in whole or in part for debt securities in definitive form, a
global security may not be transferred except as a whole by the
depositary to a nominee of the depositary or by a nominee of the
depositary to the depositary or another nominee of the
depositary or by the depositary or any nominee to a successor of
the depositary or a nominee of that successor.
(Sections 303 and 305)
The specific terms of the depositary arrangement with respect to
any debt securities of a series will be described in the
prospectus supplement relating to that series. We anticipate
that the following provisions will apply to all depositary
arrangements.
Upon the issuance of a global security, the depositary will
credit, on its book-entry registration and transfer system, the
respective principal amounts of the debt securities represented
by the global security to the accounts of
participants that have accounts with the depositary.
The accounts to be credited shall be designated by the
5
underwriters of debt securities, by certain of our agents or by
us if we sell debt securities directly. Ownership of beneficial
interests in a global security will be limited to participants
or persons that may hold interests through participants.
Ownership of beneficial interests in a global security will be
shown on, and the transfer of that ownership will be effected
only through, records maintained by the depositary or by
participants or persons that hold through participants. The laws
of some states require that certain purchasers of securities
take physical delivery of securities in definitive form. These
limits and laws may impair the ability to transfer beneficial
interests in a global security.
So long as the depositary or its nominee is the owner of a
global security, the depositary or its nominee, as the case may
be, will be considered the sole owner or holder of the debt
securities represented by that global security for all purposes
under the indenture. Except as set forth below, owners of
beneficial interests in a global security will not be entitled
to have debt securities of the series represented by that global
security registered in their names, will not receive or be
entitled to receive physical delivery of debt securities in
definitive form and will not be considered the owners or holders
of the debt securities under the indenture governing the debt
securities. Accordingly, each person owning a beneficial
interest in a global security must rely on the procedures of the
depositary and, if such person is not a participant, on the
procedures of the participant and, if applicable, the indirect
participant, through which such person owns its interest, to
exercise any right of a holder under the indenture.
Principal, premium, if any, and interest payments on debt
securities registered in the name of or held by a depositary or
its nominee will be made to the depositary or its nominee, as
the case may be, as the registered owner or the holder of the
global security representing those debt securities. Neither we,
the trustee, any paying agent nor the security registrar will
have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial
ownership interests in a global security or for maintaining,
supervising or reviewing any records relating to beneficial
ownership interests. (Section 308)
We expect that the depositary for debt securities of a series,
upon receipt of any payment of principal, premium or interest in
respect of a definitive global security, will credit immediately
participants accounts with payments in amounts
proportionate to their respective beneficial interests in the
principal amount of the global security as shown on the records
of the depositary. We also expect that payments by participants
to owners of beneficial interests in a global security held
through those participants will be governed by standing
instructions and customary practices, as is now the case with
securities held for the accounts of customers in bearer form or
registered in street name, and will be the
responsibility of those participants.
If a depositary for debt securities of a series is at any time
unwilling or unable to continue as depositary and we do not
appoint a successor depositary within 90 days, we will
issue debt securities of that series in definitive form in
exchange for the global security or securities representing the
debt securities of that series. In addition, we may at any time
and in our sole discretion determine not to have any debt
securities of a series represented by one or more global
securities. In that event, we will issue debt securities of that
series in definitive form in exchange for the global security or
securities representing those debt securities. An owner of a
beneficial interest in a global security representing debt
securities of a series may, on terms acceptable to us and the
depositary for such global security, receive debt securities of
that series in definitive form. In any of these instances, an
owner of a beneficial interest in a global security will be
entitled to physical delivery in definitive form of debt
securities of the series represented by that global security
equal in principal amount to that beneficial interest and to
have debt securities registered in its name if the debt
securities of that series are issuable as registered securities.
Debt securities of that series issued in definitive form will be
issued only in authorized denominations. (Section 305)
Payment
and Paying Agents
Payment of principal of and any premium on registered securities
will be made in the designated currency against surrender of any
registered securities at the corporate trust office of the
trustee in New York City. Payment of any installment of interest
on registered securities will ordinarily be made to the person
in whose name the debt security is registered at the close of
business on the regular record date for that interest payment.
Payments of interest will be made, at our option, by a check in
the designated currency mailed to each holder at the
holders registered address or by wire transfer to an
account designated by the holder pursuant to an arrangement that
is satisfactory to the trustee and us. (Sections 307 and
1001)
6
The paying agents outside the United States that we initially
appoint for a series of debt securities will be named in the
prospectus supplement. We may terminate the appointment of any
of the paying agents from time to time, except that we will
maintain at least one paying agent in New York City for payments
on registered securities. So long as any series of debt
securities is listed on The International Stock Exchange of the
United Kingdom and the Republic of Ireland Limited or the
Luxembourg Stock Exchange or any other stock exchange located
outside the United States and it is a requirement of that stock
exchange, we will maintain a paying agent in London or
Luxembourg or any other required city located outside the United
States, as the case may be, for that series of debt securities.
(Section 1002)
All moneys that we pay to a paying agent for the payment of
principal of or any premium, or interest on any debt security
that remains unclaimed at the end of two years after it became
due and payable will be repaid to us and the holder of that debt
security will thereafter look only to us for payment.
(Section 1003)
Certain
Covenants
Liens. We covenant that, so long as any of the
debt securities remain outstanding, we will not, nor will we
permit any Restricted Subsidiary (as defined below, in
Definition of Certain Terms) to issue, assume, or
guarantee any debt for money borrowed if that debt is secured by
a mortgage on any Principal Property (as defined), or on any
shares of stock or indebtedness of any Restricted Subsidiary
(whether the Principal Property, shares of stock, or
indebtedness are now owned or hereafter acquired) without in any
such case effectively providing that the debt securities shall
be secured equally and ratably with such debt. This restriction,
however, shall not apply to:
|
|
|
|
|
mortgages on property, shares of stock, or indebtedness of any
corporation existing at the time such corporation becomes a
Restricted Subsidiary;
|
|
|
|
mortgages on property existing at the time that it is acquired,
or to secure debt incurred for the purpose of financing the
purchase price of such property or improvements or construction
on the property, which debt is incurred prior to, at the time of
or within one year after such acquisition, completion of such
construction, or the commencement of commercial operation of
such property thereon;
|
|
|
|
mortgages securing debt owing by any Restricted Subsidiary to us
or another Restricted Subsidiary;
|
|
|
|
mortgages on property of a corporation existing at the time that
corporation is merged into or consolidated with us 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 us or a Restricted Subsidiary;
|
|
|
|
mortgages on property of us or a Restricted Subsidiary in favor
of the United States of America or any State thereof, or any
department, agency or instrumentality or political subdivision
of the United States of America or any State thereof, or in
favor of any other country, or any political subdivision
thereof, to secure certain payments pursuant to any contract or
statute or to secure any indebtedness incurred for the purpose
of financing all or any part of the purchase price or the cost
of construction of the property subject to such mortgages,
including without limitation mortgages incurred in connection
with pollution control, industrial revenue or similar financings;
|
|
|
|
mortgages existing at the date of the indenture;
|
|
|
|
mortgages on particular property, or any proceeds of the sale of
that property, to secure all or any part of the cost of
exploration, drilling, mining or development of that property,
including construction of facilities for field processing of
minerals, intended to obtain or materially increase the
production and sale or other disposition of oil, gas, coal,
uranium, copper or other minerals of that property, or any
indebtedness created, issued, assumed or guaranteed to provide
funds for any or all such purposes; or
|
|
|
|
any extension, renewal or replacement or successive extensions,
renewals or replacements, in whole or in part, of any mortgage
referred to in the clauses immediately above.
|
Notwithstanding the above, we and one or more of our Restricted
Subsidiaries may, without securing the debt securities issued
under this prospectus, issue, assume, or guarantee debt secured
by mortgages which would otherwise be subject to the above
restrictions, provided that the aggregate amount of that debt
that would then be
7
outstanding, with certain exceptions, does not at any one time
exceed 10% of the Consolidated Net Tangible Assets (as defined)
of us and our consolidated subsidiaries. (Section 1004)
For the purposes of this covenant, the following types of
transactions shall not be deemed to create debt secured by a
mortgage: the sale or other transfer of
|
|
|
|
|
oil, gas, coal, uranium, copper or other minerals in place for a
period of time until, or in an amount such that, the purchaser
will realize therefrom a specified amount of money (however
determined) or a specified amount of such minerals; or
|
|
|
|
any other interest in property of the character commonly
referred to as a production payment.
(Section 1004)
|
Sale and Leaseback Transactions. Sale and
leaseback transactions by us or any Restricted Subsidiary of any
Principal Property are prohibited unless (a) we or such
Restricted Subsidiary would be entitled to issue, assume, or
guarantee debt secured by a mortgage upon the property involved
at least equal in amount to the Attributable Debt (as defined)
for that transaction without equally and ratably securing the
debt securities or (b) an amount in cash equal to the
Attributable Debt for that transaction is applied to the
retirement of our nonsubordinated debt or debt of a Restricted
Subsidiary, which by its terms matures at or is extendible or
renewable at the option of the obligor to a date more than
twelve months after its creation. (Section 1005)
Consolidation or Merger. We will not
consolidate or merge with or dispose of all or substantially all
of our property to any corporation unless the surviving
corporation, if other than us, shall assume our obligations
under the indenture and under the debt securities.
(Section 801) If on any consolidation or merger of us
or any Restricted Subsidiary with or into any other corporation,
or on any sale, conveyance, or lease of substantially all our or
a Restricted Subsidiarys properties, any Principal
Property or any shares of stock or indebtedness of any
Restricted Subsidiary would then become subject to any mortgage,
pledge, lien or encumbrance, we, prior to such event, will
secure the debt securities by a direct lien on that Principal
Property, shares of stock or indebtedness, prior to all liens
other than any previously existing. (Section 802)
Except for the limitations on secured debt and sale and
leaseback transactions described above, the indenture and debt
securities do not contain any covenants or other provisions
designed to afford holders of the debt securities protection in
the event of a highly leveraged transaction involving us.
Definition
of Certain Terms
Subsidiary is defined to mean any corporation
which is consolidated in our accounts and any corporation of
which at least a majority of the outstanding stock having voting
power under ordinary circumstances to elect a majority of the
board of directors of that corporation shall at the time be
owned or controlled by us, or by us and one or more
Subsidiaries, or by one or more Subsidiaries. (Section 101)
Restricted Subsidiary is defined to mean any
wholly-owned subsidiary
|
|
|
|
|
substantially all the property of which is located within the
continental United States of America,
|
|
|
|
which owns a Principal Property, and
|
|
|
|
in which our investment exceeds 1% of our consolidated assets as
of the end of the preceding year.
|
The term Restricted Subsidiary does not include any
wholly-owned subsidiary which is principally engaged in leasing
or in financing installment receivables or which is principally
engaged in financing our operations outside the continental
United States. (Section 101)
Principal Property is defined as any
manufacturing plant or facility or any mineral producing
property or any research facility located within the continental
United States owned by us or any Restricted Subsidiary, unless,
in the opinion of our Board of Directors, such plant, facility,
property or research facility is not of material importance to
the total business conducted by us and our Restricted
Subsidiaries. (Section 101)
Attributable Debt is defined as the present
value, discounted as provided in the indenture, of the
obligation of a lessee for rental payments during the remaining
term of any lease. (Section 1005)
8
Consolidated Net Tangible Assets means the
total amount of assets less applicable reserves and other
properly deductible items after deducting (a) 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, and (b) all goodwill,
trade names, trademarks, patents, purchased technology,
unamortized debt discount and other like intangible assets, all
as set forth on our most recent quarterly balance sheet and
computed in accordance with generally accepted accounting
principles. (Section 101)
Modification
of the Indenture
The indenture permits us and the trustee, with the consent of
the holders of not less than a majority in principal amount of
the debt securities at the time outstanding and affected, to
execute a supplemental indenture modifying the indenture or the
rights of the holders of debt securities and any related
coupons. No modification shall, without the consent of the
holder of each debt security affected thereby,
|
|
|
|
|
change the maturity of any debt security or coupon, or reduce
its principal amount, or reduce the rate or change the time of
payment of interest, or change any place of payment or change
the coin or currency in which a debt security or coupon is
payable or impair the right of any holder to institute suit for
the enforcement of payment in accordance with the
foregoing, or
|
|
|
|
reduce the percentage of debt securities, the consent of the
holders of which is required for any modification.
(Section 902)
|
The indenture contains provisions for convening meetings of the
holders of debt securities of a series.
(Section 1401) A meeting may be called at any time by
the trustee or upon our request or the request of holders of at
least 10% in principal amount of the outstanding debt securities
of the series, upon notice given in accordance with the
indenture. (Section 1402) Except as limited in the
preceding paragraph, any resolution presented at a meeting or
adjourned meeting at which a quorum is present may be adopted by
the affirmative vote of the holders of not less than a majority
in principal amount of the outstanding debt securities of that
series. Except as limited in the preceding paragraph, any
resolution with respect to any demand, consent, waiver or other
action that may be made, given or taken by the holders of a
specified percentage, which is less than a majority in principal
amount of outstanding debt securities of a series, may be
adopted at a meeting or adjourned meeting at which a quorum is
present by the affirmative vote of the holders of such specified
percentage in principal amount of the outstanding debt
securities of that series. (Section 1404)
Any resolution passed or decision taken at any meeting of
holders of debt securities of any series duly held in accordance
with the indenture will be binding on all holders of debt
securities of that series and the related coupons. The quorum at
any meeting called to adopt a resolution, and at any reconvened
meeting, will be persons holding or representing not less than a
majority in principal amount of the outstanding debt securities
of a series. (Section 1404)
Events of
Default
The indenture defines an event of default with respect to any
series of debt securities as any one of the following events and
any other event that is established for the debt securities of a
particular series:
|
|
|
|
|
default for 30 days in any payment of interest on the
series;
|
|
|
|
default in any payment of principal and premium, if any, on the
series;
|
|
|
|
default in the payment of any sinking fund installment;
|
|
|
|
default for 60 days after appropriate notice in performance
of any other covenant in the indenture; or
|
|
|
|
certain events involving bankruptcy, insolvency or
reorganization.
|
No event of default with respect to a particular series of debt
securities issued under the indenture necessarily constitutes an
event of default with respect to any other series of debt
securities. (Section 501).
9
We are required to file with the trustee annually an
officers certificate indicating whether we are in default
under the indenture. (Section 1008)
The indenture provides that if an event of default shall occur
and be continuing with respect to any series of debt securities,
either the trustee or the holders of 25% in principal amount of
the debt securities of the series (in the case of defaults under
the final two clauses listed above, the holders of 25% in
principal amount of all the debt securities) then outstanding
may declare the principal, or in the case of original issue
discount securities, that portion of the principal amount as may
be specified, of the debt securities of the series or of all the
debt securities, as the case may be, to be due and payable
immediately. (Section 502) In certain cases, the
holders of a majority in principal amount of the outstanding
debt securities of any series, or in the case of defaults under
the final two clauses listed above, the holders of a majority in
principal amount of all the debt securities may on behalf of the
holders of all the debt securities of any such series or of all
the debt securities, as the case may be, waive any past default
or event of default except a default not previously cured in
payment of the principal of or premium, if any, or interest on
any of the debt securities of such series or of all the debt
securities. (Section 513)
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 the debt securities of any series before exercising any right
or power under the indenture at the request of the holders.
(Section 603) The indenture provides that no holder of
any debt securities of any series may institute any proceeding,
judicial or otherwise, to enforce the indenture except, among
other things, where the trustee has, for 60 days after it
is given notice of default, failed to act, and where there has
been both a request to enforce the indenture by the holders of
not less than 25% in aggregate principal amount of the then
outstanding debt securities of that series and an offer of
reasonable indemnity to the trustee.
(Section 507) This provision will not prevent any
holder of debt securities from enforcing payment of the
principal thereof and premium, if any, and interest thereon at
their due dates. (Section 508) The holders of a
majority in aggregate principal amount of the debt securities of
any series then outstanding may direct the time, method and
place of conducting any proceedings for any remedy available to
the trustee or exercising any trust or power conferred on it for
the debt securities of that series. However, the trustee may
refuse to follow any direction that conflicts with law or the
indenture or which would be unjustly prejudicial to the other
holders. (Section 512)
The indenture provides that the trustee will, within
90 days after the occurrence of a default on any series of
debt securities known to it, give to the holders of that series
notice of the default if not cured or waived. Except in the case
of a default in the payment of principal of, any premium, or
interest on, any debt securities, the trustee shall be protected
in withholding such notice if it determines in good faith that
doing so is in the holders interests. (Section 602)
Discharge
and Defeasance
The indenture provides that we may specify that, for debt
securities of a certain series, we will be discharged from any
and all obligations regarding those debt securities if we
irrevocably deposit with the trustee, in trust, money
and/or
U.S. government obligations which through the payment of
interest and principal will provide enough money to pay any
installment of principal, any premium, and, any interest, and
any mandatory sinking fund payments of such debt securities on
their stated maturity in accordance with the terms of the
indenture and the debt securities. A trust may only be
established if it would not cause the debt securities of a
series listed on any nationally recognized securities exchange
to be de-listed. Establishment of a trust may be conditioned on
our delivery to the trustee of an opinion of counsel, who may be
our counsel, to the effect that, based upon applicable
U.S. federal income tax law or a ruling published by the
United States Internal Revenue Service, a defeasance and
discharge will not be deemed, or result in, a taxable event to
holders of the debt securities.
(Section 1301) Defeasance, however, will not end our
obligations to register the transfer or exchange of debt
securities, to replace stolen, lost or mutilated debt
securities, to maintain paying agencies and hold monies for
payment in trust and, if so specified for debt securities of a
certain series, to pay the principal of and premium, if any, and
interest, if any, on those debt securities.
Trustees
Relationship with Issuer
The Bank of New York Trust Company, N.A. acts as trustee
for our Medium-Term Notes Series G and 4.125% Notes
Due 2013.
10
Deutsche Bank Trust Company Americas acts as depositary for
our funds and performs other services for us in the normal
course of business. It also acts as trustee for our
6.875% Notes Due 2009, 4.125% Notes Due 2010,
4.75% Notes Due 2012, 5.0% Notes Due 2013,
4.875% Notes Due 2014, 5.25% Notes Due 2016,
6.50% Debentures Due 2028 and 5.60% Notes Due 2036.
UNITED
STATES FEDERAL TAXATION
The following summary describes the material United States
federal income and certain estate tax consequences of ownership
and disposition of the debt securities. This summary provides
general information only and is directed solely to original
beneficial owners purchasing debt securities at the issue
price, that is, the first price at which a substantial
amount of debt securities is sold to the public (excluding sales
to bond houses, brokers or similar persons or organizations
acting in the capacity of underwriters, placement agents or
wholesalers). This summary is based on the Internal Revenue Code
of 1986, as amended to the date hereof (the Code),
existing administrative pronouncements and judicial decisions,
existing and proposed Treasury Regulations currently in effect,
and interpretations of the foregoing, changes to any of which
subsequent to the date of this prospectus may affect the tax
consequences described herein, possibly with retroactive effect.
This summary deals only with debt securities held as capital
assets within the meaning of Section 1221 of the Code. This
summary does not discuss all of the tax consequences that may be
relevant to a beneficial owner in light of his particular
circumstances or to beneficial owners subject to special rules,
such as certain financial institutions, insurance companies,
dealers in securities, persons holding debt securities in
connection with a hedging transaction, straddle,
conversion transaction or other integrated transaction or
persons who have ceased to be United States citizens or to be
taxed as resident aliens. Persons considering the purchase of
debt securities should consult their own tax advisors with
regard to the application of the United States federal income
and estate tax laws to their particular situations, as well as
any tax consequences arising under the laws of any state, local
or foreign taxing jurisdiction.
Tax
Consequences to United States Persons
For purposes of the following discussion, United States
person means a beneficial owner of the debt securities
that is, for United States federal income tax purposes,
(i) a citizen or resident of the United States, (ii) a
corporation or other entity treated as a corporation for United
States federal income tax purposes created or organized in or
under the laws of the United States, any State or the District
of Columbia, (iii) an estate the income of which is subject
to United States federal income taxation regardless of its
source, or (iv) a trust (A) if a court within the
United States is able to exercise primary supervision over the
administration of the trust and one or more United States
persons have the authority to control all substantial decisions
of the trust or (B) that has made a valid election to be
treated as a U.S. person for U.S. federal income tax
purposes. Partnerships are subject to special tax rules and
should contact their own tax advisors.
Payments
of Interest
Interest on the debt securities will generally be taxable to a
United States person as ordinary interest income at the time it
is accrued or is received in accordance with the United States
persons method of accounting for tax purposes.
Sale,
Exchange or Retirement of the Debt Securities
Upon the sale, exchange or retirement of the debt securities, a
United States person will recognize taxable gain or loss equal
to the difference between the amount realized on the sale,
exchange or retirement and the United States persons
adjusted tax basis in the debt securities. For these purposes,
the amount realized does not include any amount attributable to
accrued but unpaid interest on the debt securities. Amounts
attributable to accrued but unpaid interest are treated as
interest as described under Payments of Interest
above. A United States persons adjusted tax basis in the
debt securities generally will equal the cost of the debt
securities to the United States person.
In general, gain or loss realized on the sale, exchange or
redemption of the debt securities will be capital gain or loss.
Prospective investors should consult their own tax advisors
regarding the treatment of capital gains (which may
11
be taxed at lower rates than ordinary income for taxpayers who
are individuals, trusts or estates) and losses (the
deductibility of which is subject to limitations).
Backup
Withholding and Information Reporting
Backup withholding and information reporting requirements may
apply to certain payments of principal, premium and interest on
the debt securities, and to payments of proceeds of the sale or
redemption of the debt securities, to certain non-corporate
United States persons. We, our agent, a broker, or any paying
agent, as the case may be, will be required to withhold from any
payment a tax at a rate currently equal to 28 percent of
such payment if the United States person fails to furnish or
certify its correct taxpayer identification number to the payor
in the manner required, fails to certify that such United States
person is not subject to backup withholding, or otherwise fails
to comply with the applicable requirements of the backup
withholding rules. Any amounts withheld under the backup
withholding rules from a payment to a United States person may
be credited against such United States persons United
States federal income tax and may entitle such United States
person to a refund, provided that the required information is
furnished to the Internal Revenue Service.
Tax
Consequences to
Non-United
States Persons
As used herein, the term
non-United
States person means a beneficial owner of the debt
securities that is not a United States person.
Income
and Withholding Tax
Subject to the discussion of backup withholding below:
(a) Payments of principal and interest on the debt
securities that is beneficially owned by a
non-United
States person will not be subject to United States federal
withholding tax; provided, that in the case of interest, (1)(i)
the beneficial owner does not actually or constructively own 10%
or more of the total combined voting power of all classes of our
stock entitled to vote, (ii) the beneficial owner is not a
controlled foreign corporation that is related, directly or
indirectly, to us through stock ownership, (iii) the
beneficial owner of the debt securities is not a bank whose
receipt of interest is described in Section 881(c)(3)(A) of
the Code; and (iv) either (A) the beneficial owner of
the debt securities provides an IRS
Form W-8
BEN (or successor form) certifying to the person otherwise
required to withhold United States federal income tax from such
interest, under penalties of perjury, that it is not a
United States person and provides its name and address or
(B) a securities clearing organization, bank or other
financial institution that holds customers securities in
the ordinary course of its trade or business (a financial
institution) and holds an interest in the debt securities
certifies to the person otherwise required to withhold
United States federal income tax from such interest, under
penalties of perjury, that such statement has been received from
the beneficial owner by it or by a financial institution between
it and the beneficial owner and furnishes the payor with a copy
thereof; (2) the beneficial owner is entitled to the
benefits of an income tax treaty under which the interest is
exempt from United States federal withholding tax and the
beneficial owner of the debt securities or such owners
agent provides an IRS
Form W-8
BEN (or successor form) claiming the exemption; or (3) the
beneficial owner conducts a trade or business in the United
States to which the interest is effectively connected and the
beneficial owner of the debt securities or such owners
agent provides an IRS
Form W-8
ECI (or successor form) provided that in each such case, the
relevant certification or IRS Form is delivered pursuant to
applicable procedures and is properly transmitted to the person
otherwise required to withhold United States federal income tax,
and none of the persons receiving the relevant certification or
IRS Form has actual knowledge that the certification or any
statement on the IRS Form is false. The
Forms W-8
ECI and W-8
BEN must be periodically updated.
(b) A
non-United
States person will not be subject to United States federal
withholding tax on any gain realized on the sale, exchange or
other disposition of the debt securities unless the gain is
effectively connected with the beneficial owners trade or
business in the United States or, in the case of an individual,
the beneficial owner is present in the United States for
183 days or more in the taxable year in which the sale,
exchange or other disposition occurs and certain other
conditions are met, or the
non-United
States person is subject to U.S. tax under provisions
applicable to certain U.S. expatriates.
12
(c) The debt securities owned by an individual who at the
time of death is not, for United States estate tax purposes, a
citizen or resident of the United States generally will not be
subject to United States federal estate tax as a result of such
individuals death if the individual does not actually or
constructively own 10% or more of the total combined voting
power of all classes of our stock entitled to vote and, at the
time of such individuals death the income on the debt
securities would not have been effectively connected with a
United States trade or business of the individual.
If a
non-United
States person owning the debt securities is engaged in a trade
or business in the United States, and if interest on the debt
securities (or gain realized on its sale, exchange or other
disposition) is effectively connected with the conduct of such
trade or business, such owner, although exempt from the
withholding tax discussed in the preceding paragraphs, will
generally be subject to regular United States income tax on such
effectively connected income in the same manner as if it were a
United States person. In addition, if such owner is a foreign
corporation, it may be subject to a 30% branch profits tax
(unless reduced or eliminated by an applicable treaty) of its
effectively connected earnings and profits for the taxable year,
subject to certain adjustments. For purposes of the branch
profits tax, interest on, and any gain recognized on the sale,
exchange or other disposition of, the debt securities will be
included in the effectively connected earnings and profits of
such owner if such interest or gain, as the case may be, is
effectively connected with the conduct by such owner of a trade
or business in the United States.
Each owner of the debt securities should be aware that if it
does not properly provide the required IRS form, or if the IRS
form (or, if permissible, a copy of such form) is not properly
transmitted to and received by the United States person
otherwise required to withhold United States federal income tax,
interest on the debt securities may be subject to United States
withholding tax at a 30% rate or a lower applicable treaty rate.
Such tax, however, may in certain circumstances be allowed as a
refund or as a credit against such owners United States
federal income tax. The foregoing does not deal with all aspects
of federal income tax withholding that may be relevant to
foreign owners of the debt securities. Investors are advised to
consult their own tax advisors for specific advice concerning
the ownership and disposition of debt securities.
Backup
Withholding and Information Reporting
Under current Treasury Regulations, backup withholding (imposed
at a rate currently equal to 28 percent) will not apply to
payments made by us or a paying agent to an owner in respect of
the debt securities if the certifications described above are
received, provided in each case that we or the paying agent, as
the case may be, does not have actual knowledge that the payee
is a United States person.
Backup withholding is not a separate tax, but is allowed as a
refund or credit against the owners United States federal
income tax, provided the necessary information is furnished to
the Internal Revenue Service.
Interest on the debt securities that is beneficially owned by a
non-United
States person will be reported annually on IRS Form 1042S,
which must be filed with the Internal Revenue Service and
furnished to such beneficial owner.
The United States federal income tax discussion set forth above
is included for general information only and may not be
applicable depending upon an owners particular situation.
Owners should consult their own tax advisors with respect to the
tax consequences to them of the ownership and disposition of the
debt securities, including the tax consequences under state,
local, foreign and other tax laws and the possible effects of
changes in federal or other tax laws.
PLAN OF
DISTRIBUTION
We may sell the debt securities in and outside the United States
(a) through underwriters or dealers, (b) directly to
purchasers or (c) through agents. The prospectus supplement
will include the following information:
|
|
|
|
|
the terms of the offering
|
|
|
|
the names of any underwriters or agents
|
|
|
|
the purchase price from us of the securities
|
13
|
|
|
|
|
the net proceeds to us from the sale of the securities
|
|
|
|
any delayed delivery arrangements
|
|
|
|
any underwriting discounts and other items constituting
underwriters compensation
|
|
|
|
any initial public offering price
|
|
|
|
any discounts or concessions allowed or reallowed or paid to
dealers
|
If we use underwriters in the sale, the underwriters will
acquire the debt securities for their own account. The
underwriters may resell the securities from time to time in one
or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at
the time of sale. Underwriters may offer securities to the
public either through underwriting syndicates represented by one
or more managing underwriters or directly by one or more firms
acting as underwriters. Unless we inform you otherwise in the
prospectus supplement, the obligations of the underwriters to
purchase the securities will be subject to certain conditions,
and the underwriters will be obligated to purchase all the
offered securities if they purchase any of them. The
underwriters may change from time to time any initial public
offering price and any discounts or concessions allowed or
re-allowed or paid to dealers.
During and after an offering through underwriters, the
underwriters may purchase and sell the securities in the open
market. These transactions may include over-allotment and
stabilizing transactions and purchases to cover syndicate short
positions created in connection with the offering. The
underwriters may also impose a penalty bid, whereby selling
concessions allowed to syndicate members or other broker-dealers
for the offered securities sold for their account may be
reclaimed by the syndicate if those offered securities are
repurchased by the syndicate in stabilizing or covering
transactions. These activities may stabilize, maintain or
otherwise affect the market price of the offered securities,
which may be higher than the price that might otherwise prevail
in the open market. If commenced, these activities may be
discontinued at any time.
If we use dealers in the sale of securities, we will sell the
securities to them as principals. They may then resell those
securities to the public at varying prices determined by the
dealers at the time of resale. We will include in the prospectus
supplement the names of the dealers and the terms of the
transaction.
We may sell the securities directly. In that case, no
underwriters or agents would be involved. We may also sell the
securities through agents we designate from time to time. In the
prospectus supplement, we will name any agent involved in the
offer or sale of the offered securities, and we will describe
any commissions payable by us to the agent. Unless we inform you
otherwise in the prospectus supplement, any agent will agree to
use its reasonable best efforts to solicit purchases for the
period of its appointment.
We may sell the securities directly to institutional investors
or others who may be deemed to be underwriters within the
meaning of the Securities Act with respect to any sale of those
securities. We will describe the terms of any such sales in the
prospectus supplement.
If we so indicate in the prospectus supplement, we may authorize
agents, underwriters or dealers to solicit offers from certain
types of institutions to purchase securities from us at the
public offering price under delayed delivery contracts. These
contracts would provide for payment and delivery on a specified
date in the future. The contracts would be subject only to those
conditions described in the prospectus supplement. The
prospectus supplement will describe the commission payable for
solicitation of those contracts.
14
We may have agreements with the agents, dealers and underwriters
to indemnify them against certain civil liabilities, including
liabilities under the Securities Act, or to contribute to
payments that the agents, dealers or underwriters may be
required to make. Agents, dealers and underwriters may be
customers of, engage in transactions with or perform services
for us in the ordinary course of their businesses.
LEGAL
OPINION
Stacey J. Mobley, our General Counsel, or another of our
lawyers, will issue an opinion about the legality of the offered
securities for us. Any underwriters will be advised about other
issues relating to any offering by their own legal counsel.
EXPERTS
The consolidated financial statements incorporated in this
prospectus by reference to the Annual Report on
Form 10-K
for the year ended December 31, 2007 have been so
incorporated in reliance on the report of PricewaterhouseCoopers
LLP, an independent registered public accounting firm, given on
the authority of said firm as experts in auditing and accounting.
15