As filed with the Securities and Exchange Commission on March 29, 2002.
Registration No. 333-82988
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SECURITIES AND EXCHANGE COMMISSION
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Washington, D.C. 20549
PREEFFECTIVE AMENDMENT NO. 1 TO THE
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
BAXTER INTERNATIONAL INC.
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(Exact name of registrant as specified in its charter)
Delaware 36-0781620
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
One Baxter Parkway
Deerfield, Illinois 60015
(847) 948-2000
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(Address, including zip code of registrant's principal executive offices)
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J. Patrick Fitzsimmons
Corporate Counsel
Baxter International Inc.
One Baxter Parkway
Deerfield, Illinois 60015
(847) 948-2000
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(Name, address, and telephone number,
including area code, of agent for service)
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC:
From time to time after the effective date of this Registration
Statement as determined in light of market conditions and other factors.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
The prospectus included in this Registration Statement is a combined
prospectus relating also to all the Debt Securities registered pursuant to the
Registration Statement (No. 333-19025) filed January 30, 1997 as to which,
pursuant to Rule 429 under the Securities Act of 1933, a separate post-effective
amendment will not be filed. A filing fee has previously been paid as to these
debt securities.
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [_]
CALCULATION OF REGISTRATION FEE
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TITLE OF EACH PROPOSED PROPOSED MAXIMUM PROPOSED AMOUNT OF
CLASS OF AMOUNT TO BE MAXIMUM OFFERING AGGREGATE REGIST-
SECURITIES TO BE REGISTERED PRICE(1) OFFERING RATION
REGISTERED PRICE(1) FEE
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Debt Securities $1,000,000,000 100% $1,000,000,000 $92,000
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(1) Estimated solely for purposes of calculating the registration fee. The debt
securities are assumed issues at 100% of the principal amount, which represents
an aggregate issue price of $1,000,000,000.
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THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING
PURSUANT TO SAID SECTION 8(a), MAY DETERMINE.
The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any jurisdiction where the offer or sale is not permitted.
Prospectus
[Baxter logo]
UP TO $1,000,000,000 OF
DEBT SECURITIES
Baxter International Inc. ("we", "us", "our" or the "Company") intends
to offer from time to time up to $1,000,000,000 aggregate principal amount (or
the equivalent in foreign denominated currency or currency units) of our senior,
unsecured debt securities on terms to be determined when an agreement to sell is
made. The specific designation, aggregate principal amount, rate or method of
calculation of any interest, the time of payment of any interest, maturity,
authorized denominations, any initial public offering price, any redemption
terms or prepayment rights, repurchase rights, other specific terms, currency of
payment, and any listing on a securities exchange for each issue of debt
securities in respect of which this prospectus is being delivered, will be set
forth in the applicable prospectus supplement, together with the terms of the
offering of the debt securities, the net proceeds to us from their sale, and the
ratio of earnings to fixed charges for appropriate periods, if applicable.
The debt securities may be sold directly, through agents, or through
underwriters or dealers. If any of our agents or any underwriters are involved
in the sale of the debt securities in respect of which this prospectus is being
delivered, the names of the agents or underwriters and any applicable
commissions and discounts will be set forth in the applicable prospectus
supplement.
Neither the Securities and Exchange Commission ("SEC") nor any state
securities commission has approved or disapproved of these securities or
determined if this prospectus is truthful or complete. Any representation to the
contrary is a criminal offense.
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The date of this Prospectus is April 2, 2002
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NOTICE TO INVESTORS
YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED, OR INCORPORATED BY REFERENCE,
IN THIS PROSPECTUS. WE HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT
OR ADDITIONAL INFORMATION. YOU SHOULD NOT ASSUME THAT THE INFORMATION CONTAINED
IN THIS PROSPECTUS IS ACCURATE AS OF ANY DATE OTHER THAN THE DATE ON THE FRONT
OF THIS PROSPECTUS.
This prospectus is part of a registration statement that we filed with
the SEC utilizing a "shelf" registration process or continuous offering process.
Under this shelf registration process, we may issue and sell, from time to time,
the debt securities described in this prospectus in one or more offerings.
This prospectus provides you with a general description of the debt
securities which may be offered by us. Each time we sell debt securities, we are
required to provide you with a prospectus and a prospectus supplement containing
specific information about us and the terms of the offering. That prospectus
supplement may include additional risk factors or other special considerations
applicable to those debt securities. Any prospectus supplement may also add,
update or change information in this prospectus. If there is any inconsistency
between the information in this prospectus and the applicable prospectus
supplement, you should rely on the information in that prospectus supplement.
You should read both this prospectus and the applicable prospectus supplement
together with additional information described under "Where You Can Find More
Information."
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WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and other
information with the SEC. You may read and copy any document we file with the
SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington,
D.C. 20549. You may obtain further information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330. Our SEC filings are also
available to the public over the Internet at the SEC's Web site at
http://www.sec.gov. Our SEC filings are also available at the offices of the New
York Stock Exchange, 20 Broad Street, New York, New York 10005.
We incorporate by reference in this prospectus the following document
filed by us with the SEC:
. our Annual Report on Form 10-K for the fiscal year ended December 31,
2001.
Any statement made in a document incorporated by reference or deemed
incorporated herein by reference is deemed to be modified or superseded for
purposes of this prospectus if a statement contained in this prospectus or in
any other subsequently filed document which also is incorporated or deemed
incorporated by reference herein modifies or supersedes that statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this prospectus. We also incorporate by
reference all documents filed pursuant to Section 13(a), 13(c), 14 or 15(d) of
the Securities Exchange Act after the date of this prospectus until we or the
underwriters sell all of the debt securities.
Statements made in this prospectus or in any document incorporated by
reference in this prospectus as to the contents of any contract or other
document referred to herein or therein are not necessarily complete, and in each
instance reference is made to the copy of such contract or other document filed
as an exhibit to the documents incorporated by reference, each such statement
being qualified in all material respects by such reference.
You may request a copy of these filings at no cost, by writing or
calling us at the following address: Corporate Secretary, Baxter International
Inc., One Baxter Parkway, Deerfield, Illinois 60015 (847) 948-2000.
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NOTE REGARDING FORWARD-LOOKING STATEMENTS
Statements throughout this prospectus that are not historical facts,
(including material incorporated herein by reference) are forward-looking
statements. These statements are based on our current expectations and involve
numerous risks and uncertainties. Some of these risks and uncertainties are
factors that affect all international businesses, while some are specific to us
and the health care areas in which we operate.
The factors below in some cases have affected and could affect our
actual results, causing results to differ, and possibly differ materially, from
those expressed in any such forward looking statements. These factors include
technological advances in the medical field, economic conditions, demand and
market acceptance risks for new and existing products, technologies and health
care services, the impact of competitive products and pricing, manufacturing
capacity, new plant start-ups, global regulatory, trade and tax policies,
ongoing product testing, regulatory, legal or other developments relating to our
series A, AF and AX dialyzers, continued price competition, product development
risks, including technological difficulties, ability to enforce patents and
unforeseen commercialization and regulatory factors. Additionally, as discussed
in Item 3.--"Legal Proceedings," in our Form 10-K for the year ended
December 31, 2001 which is incorporated herein by reference, upon the resolution
of certain legal matters, we may incur charges in excess of presently
established reserves. Any such charge could have a material adverse effect on
our results of operations or cash flows in the period in which it is recorded.
International operations are subject to certain additional risks
inherent in conducting business outside the United States, such as changes in
currency exchange rates, price and currency exchange controls, import
restrictions, nationalization, expropriation and other governmental action.
Currency fluctuations are also a significant variable for global
companies, especially fluctuations in local currencies where hedging
opportunities are unreasonably expensive or unavailable. If the United States
dollar strengthens significantly against most foreign currencies, our ability to
realize projected growth rates in our sales and net earnings outside the United
States could be negatively impacted.
We believe that our expectations with respect to forward-looking
statements are based upon reasonable assumptions within the bounds of our
knowledge of our business and operations, but there can be no assurance that our
actual results or performance will conform to any future results or performance
expressed or implied by such forward-looking statements.
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ABOUT THE COMPANY
Baxter International Inc. and our Subsidiaries
We were incorporated under Delaware law in 1931. We engage in the
worldwide development, manufacture and distribution of a diversified line of
products, systems and services used primarily in the health care field.
Throughout the rest of this Business Description, "we" (or "us", or "our")
refers to Baxter International Inc., our parent company, together with its
subsidiary companies, taken as a consolidated enterprise. We manufacture
products in 27 countries and sell them in over 100 countries. Health care is
concerned with the preservation of health and with the diagnosis, cure,
mitigation and treatment of disease and body defects and deficiencies. Our
products are used by hospitals, clinical and medical research laboratories,
blood and blood dialysis centers, rehabilitation centers, nursing homes,
doctors' offices and by patients, at home, under physician supervision.
We operate as a global leader in critical therapies for
life-threatening conditions. We develop, manufacture and market products and
technologies related to the blood circulatory system. Our businesses are
comprised of three segments: Medication Delivery, which develops technologies
and systems to improve intravenous medication delivery and distributes medical
products; BioScience, which develops biopharmaceutical and blood collection and
separation products and technologies; and Renal, which develops products and
provides services to treat end-stage kidney disease. Our three businesses enjoy
leading positions in the medical products and services fields.
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USE OF PROCEEDS
Except as otherwise set forth in any Prospectus Supplement relating to
the Offered Securities, we will use the net proceeds from the sale of the
Securities for working capital, to repay our existing debt, for our capital
expenditures and for general corporate purposes.
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DESCRIPTION OF DEBT SECURITIES
The debt securities will be our unsecured and unsubordinated
obligations issued in one or more series and will rank equally with each other
and with all of our other unsecured and unsubordinated indebtedness. The debt
securities will be issued under an indenture to be entered into between us and
Bank One Trust Company, N.A., as trustee. The terms of any series of debt
securities will be those specified in the indenture, as amended or supplemented
from time to time, and in the certificates evidencing that series of debt
securities.
The following summary of selected provisions of the indenture and the
debt securities is not complete, and the summary of selected terms of a
particular series of debt securities included in the applicable prospectus
supplement also will not be complete. You should review the indenture and the
form of certificate evidencing the applicable debt securities, each of which
have been or will be filed as exhibits to the registration statement of which
this prospectus is a part or as exhibits to documents which have been or will be
incorporated by reference in this prospectus. To obtain a copy of the indenture
or the form of certificate for the debt securities, see "Where You Can Find More
Information" in this prospectus. The following summary and the summary in the
applicable prospectus supplement are qualified in their entirety by reference to
all of the provisions of the indenture and the certificates evidencing the debt
securities. The provisions of the indenture and the debt certificates, including
defined terms, are incorporated by reference in this prospectus. Terms used in
this section have the meanings assigned to those terms in the indenture. When we
refer to "we", "us" or "our" in this section or when we otherwise refer to
ourselves in this section, we mean Baxter
International Inc., excluding, unless otherwise expressly stated or the context
otherwise requires, our subsidiaries.
The following description of debt securities describes general terms
and provisions of the series of debt securities to which any prospectus
supplement may relate. When we offer to sell a series of debt securities, we
will describe the specific terms of the series in the applicable prospectus
supplement. If any particular terms of the debt securities described in a
prospectus supplement differ from any of the terms described in this prospectus,
the terms described in the applicable prospectus supplement will supersede the
terms described in this prospectus.
General
The debt securities may be issued from time to time in one or more
series. We can issue an unlimited amount of debt securities under the indenture.
The indenture provides that we may issue debt securities of any series in an
amount up to the aggregate principal amount which is authorized from time to
time by us. Please read the applicable prospectus supplement relating to the
series of debt securities being offered for specific terms including, where
applicable:
o the title of the series of debt securities;
o any limit on the aggregate principal amount of debt
securities of the series;
o the price or prices at which we will issue debt securities of
the series;
o the date or dates on which we will pay the principal of and
premium, if any, on debt securities of the series, or the method
or methods, if any, that will used to determine those dates;
o the rate or rates, which may be fixed or variable, at which
debt securities of the series will bear interest, if any, or the
method or methods, if any, that will be used to determine those
rates;
o the basis used to calculate interest, if any, on the debt
securities of the series if other than a 360-day year of twelve
30-day months;
o the date or dates, if any, from which interest on the debt
securities of the series will accrue, or the method or methods, if
any, that will be used to determine those dates;
o the dates on which the interest, if any, on the debt
securities of the series will commence accruing and will be
payable and the record dates for the payment of interest;
o the place or places where amounts due on the debt securities
of the series will be payable and where the debt securities of the
series may be surrendered for registration of transfer and
exchange;
o the terms and conditions, if any, upon which we may, at our
option, redeem debt securities of the series;
o the terms and conditions, if any, upon which we will
repurchase debt securities of the series at the option of the
holders of debt securities of the series;
o the terms of any sinking fund or analogous provision;
o if other than United States dollars, the currency to be used
to purchase the debt securities of the series and the currency to
be used for payments on debt securities of the series, and the
ability or the ability of the holders of debt securities of the
series, if any, to have payments made in any other currency;
o any addition to, or modification or deletion of, any covenant
or event of default with respect to debt securities of the series;
o whether the debt securities of the series are to be issuable
in registered or bearer form or both and, if in bearer form,
whether we will issue any debt securities of the series in
temporary or permanent global form and, if so, the identity of the
depositary for the global debt security;
o whether and under what circumstances we will pay any
additional amounts in respect of certain taxes, assessments or
other governmental charges imposed on holders of the series of
debt securities who are United States Aliens ("additional
amounts") and, if so, whether we will have the option to redeem
the series of debt securities rather than pay any additional
amounts;
o the person to whom any interest on any registered securities
of the series of debt securities will be payable, if different
than the person in whose name a registered security is registered
at the close of business on the regular record date for that
payment;
o the manner in which, or the person to whom, any interest on
any bearer security of the series of debt securities will be
payable, if different than upon presentation and surrender of the
coupons relating to the bearer security;
o the extent to which, or the manner in which, any interest
payable on a temporary global debt security will be paid, if other
than in the manner provided in the indenture;
o the portion of the principal amount of the series of debt
securities which will be payable upon acceleration if other than
the full principal amount;
o the authorized denominations in which the series of debt
securities will be issued, if other than denominations of $1,000
and any integral multiple of $1,000, in the case of registered
securities, or $5,000, in the case of bearer securities;
o if the amount of payments on the series of debt securities
may be determined with reference to an index, formula or other
method or methods ("indexed securities") and the manner used to
determine those amounts; and
o any other terms of debt securities of the series.
As used in this prospectus and any prospectus supplement relating to
the offering of debt securities, references to the principal of and premium, if
any, and interest, if any, on the series of debt securities include the payment
of additional amounts, if any, required by the series of debt securities in that
context.
Debt securities may be issued as original issue discount securities to
be sold at a substantial discount below their principal amount. In the event of
an acceleration of the maturity of any original issue discount security, the
amount payable to the holder upon acceleration will be determined in the manner
described in the applicable prospectus supplement. Material federal income tax
and other considerations applicable to original issue discount securities will
be described in the applicable prospectus supplement.
If the purchase price of any debt securities is payable in a foreign
currency or currency unit or if the principal of, or premium, if any, or
interest, if any, on any of the debt securities is payable in a foreign currency
or currency unit, the specific terms of those debt securities and the applicable
foreign currency or currency unit will be specified in the prospectus supplement
relating to those debt securities.
The terms of the debt securities of any series may differ from the
terms of the debt securities of any other series, and the terms of particular
debt securities within any series may differ from each other. If expressly
provided in the applicable prospectus supplement, we may, without the consent of
the holders of the debt securities of any series, reopen an existing series of
debt securities and issue additional debt securities of that series or establish
additional or different terms of that series.
Registration, transfer, payment and paying agent
Unless otherwise indicated in the applicable prospectus supplement,
each series of debt securities will be issued in registered form only, without
coupons. The indenture, however, provides that we may also issue debt securities
in bearer form only, or in both registered and bearer form. Bearer securities
may not be offered, sold, resold or delivered in connection with their original
issuance in the United States or to any United States person, as defined below,
other than offices located outside the United States of specified United States
financial institutions. "United States person" means any citizen or resident of
the United States, any corporation, partnership or other entity created or
organized in or under the laws of the United States, any estate the income of
which is subject to United States federal income taxation regardless of its
source, or any trust whose administration is subject to the primary supervision
of a United States court and which has one or more United States fiduciaries who
have the authority to control all substantial decisions of the trust. "United
States" means the United States of America, including the states thereof and the
District of Columbia, its territories, its possessions and other areas subject
to its jurisdiction. Purchasers of bearer securities will be subject to
certification procedures and may be affected by limitations under United States
tax laws. The applicable procedures and limitations will be described in the
prospectus supplement relating to the offering of the bearer securities.
Unless otherwise indicated in the applicable prospectus supplement, the
debt securities will be payable and may be surrendered for registration of
transfer or exchange and, if applicable, for conversion into or exchange for
other types of securities, at an office or agency maintained by the trustee in
the Borough of Manhattan, The City of New York. However, we, at our option, may
make payments of interest on any registered security by check mailed to the
address of the person entitled to receive that payment or by wire transfer to an
account maintained by the payee with a bank located in the United States. No
service charge will be made for any registration of transfer or exchange,
redemption or repayment of debt securities, or for any conversion or exchange of
debt securities for other types of securities, but we may require payment of a
sum sufficient to cover any tax or other governmental charge that may be imposed
in connection with that transaction.
Unless otherwise indicated in the applicable prospectus supplement,
payment of principal, premium, if any, and interest, if any, on bearer
securities will be made, subject to any applicable laws and regulations, at an
office or agency outside the United States. Unless otherwise indicated in the
applicable prospectus supplement, payment of interest due on bearer securities
on any interest payment date will be made only against surrender of the coupon
relating to that interest payment date. Unless otherwise indicated in the
applicable prospectus supplement, no payment of principal, premium, if any, or
interest, if any, with respect to any bearer security will be made at any office
or agency in the United States or by check mailed to any address in the United
States or by wire transfer to an account maintained with a bank located in the
United States. However, if any bearer securities are payable in United States
dollars, payments on those bearer securities may be made at the corporate trust
office of the trustee or at any office or agency designated by us in the Borough
of Manhattan, The City of New York, if, but only if, payment of the full amount
due on the bearer securities for principal, premium, if any, or interest, if
any, at all offices outside of the United States maintained for that purpose by
us is illegal or effectively precluded by exchange controls or similar
restrictions.
Unless otherwise indicated in the applicable prospectus supplement, we
will not be required to:
o issue, register the transfer of or exchange debt securities
of any series during a period beginning at the opening of business
15 days before any selection of debt securities of that series
having the same terms to be redeemed and ending at the close of
business on the day of that selection;
o register the transfer of or exchange any registered security,
or portion of any registered security, selected for redemption,
except the unredeemed portion of any registered security being
redeemed in part;
o exchange any bearer security selected for redemption, except
to exchange a bearer security for a registered security of that
series having the same terms that is simultaneously surrendered
for redemption; or
o issue, register the transfer of or exchange a debt security
which has been surrendered for repayment at the option of the
holder, except the portion, if any, of the debt security not to be
repaid.
Book-entry debt securities
The debt securities of a series may be issued in whole or in part in
the form of one or more global debt securities. Global debt securities will be
deposited with, or on behalf of, a depositary identified in the applicable
prospectus supplement relating to the series. Global debt securities may be
issued in either registered or bearer form and in either temporary or permanent
form. Unless and until it is exchanged in whole or in part for individual
certificates evidencing debt securities, a global debt security may not be
transferred except as a whole by the depositary to its nominee or by the nominee
to the depositary, or by the depositary or its nominee to a successor depositary
or to a nominee of the successor depositary.
We anticipate that global debt securities will be deposited with, or on
behalf of, The Depository Trust Company ("DTC"), New York, New York, and that
global debt securities will be registered in the name of DTC's nominee, Cede &
Co. We also anticipate that the following provisions will apply to the
depository arrangements with respect to global debt securities. Additional or
differing terms of the depository arrangements will be described in the
applicable prospectus supplement.
DTC has advised us that it is:
o a limited-purpose trust company organized under the New York
Banking Law;
o a "banking organization" within the meaning of the New York
Banking Law;
o a member of the Federal Reserve System;
o a "clearing corporation" within the meaning of the New York
Uniform Commercial Code; and
o a "clearing agency" registered pursuant to the provisions of
Section 17A of the Securities Exchange Act.
DTC holds securities that its participants deposit with DTC. DTC also
facilitates the settlement among its participants of securities transactions,
including transfers and pledges, in deposited securities through electronic
computerized book-entry changes in participants' accounts, which eliminates the
need for physical movement of securities certificates. Direct participants
include securities brokers and dealers, banks, trust companies, clearing
corporations and other organizations. DTC is owned by a number of its
direct participants and by the New York Stock Exchange, Inc., the American Stock
Exchange, LLC. and the National Association of Securities Dealers, Inc. Access
to the DTC system is also available to others, sometimes referred to in this
prospectus as indirect participants, that clear transactions through or maintain
a custodial relationship with a direct participant either directly or
indirectly. Indirect participants include securities brokers and dealers, banks
and trust companies. The rules applicable to DTC and its participants are on
file with the SEC.
Purchases of debt securities within the DTC system must be made by or
through direct participants, which will receive a credit for the debt securities
on DTC's records. The ownership interest of the actual purchaser or beneficial
owner of a debt security is, in turn, recorded on the direct and indirect
participants' records. Beneficial owners will not receive written confirmation
from DTC of their purchases, but beneficial owners are expected to receive
written confirmations providing details of the transactions, as well as periodic
statements of their holdings, from the direct or indirect participants through
which they purchased the debt securities. Transfers of ownership interests in
debt securities are to be accomplished by entries made on the books of
participants acting on behalf of beneficial owners. Beneficial owners will not
receive certificates representing their ownership interests in the debt
securities, except under the limited circumstances described below.
To facilitate subsequent transfers, all debt securities deposited by
direct participants with DTC will be registered in the name of DTC's nominee,
Cede & Co. The deposit of debt securities with DTC and their registration in the
name of Cede & Co. will not change the beneficial ownership of the debt
securities. DTC has no knowledge of the actual beneficial owners of the debt
securities. DTC's records reflect only the identity of the direct participants
to whose accounts the debt securities are credited. Those participants may or
may not be the beneficial owners. The direct and indirect participants are
responsible for keeping account of their holdings on behalf of their customers.
Conveyance of notices and other communications by DTC to direct
participants, by direct participants to indirect participants and by direct and
indirect participants to beneficial owners will be governed by arrangements
among them, subject to any legal requirements in effect from time to time.
Redemption notices will be sent to DTC or its nominee. If less than all
of the debt securities of a series are being redeemed, DTC's practice is to
determine by lot the amount of the interest of each direct participant in the
debt securities to be redeemed.
In any case where a vote may be required with respect to the debt
securities of any series, neither DTC nor Cede & Co. will give consents for or
vote the global debt securities. Under its usual procedures, DTC will mail an
omnibus proxy to us as soon as possible after the record date. The omnibus proxy
assigns the consenting or voting rights of Cede & Co. to those direct
participants to whose accounts the debt securities are credited on the record
date identified in a listing attached to the omnibus proxy.
Principal and premium, if any, and interest, if any, on the global debt
securities will be paid to Cede & Co., as nominee of DTC. DTC's practice is to
credit direct participants' accounts on the relevant payment date unless DTC has
reason to believe that it will not receive payments on the payment date.
Payments by direct and indirect participants to beneficial owners will be
governed by standing instructions and customary practices, as is the case with
securities held for the account of customers in bearer form or registered in
"street name." Those payments will be the responsibility of participants and not
of DTC or us, subject to any legal requirements in effect from time to time.
Payment of principal, premium, if any, and interest, if any, to Cede & Co. is
our responsibility, disbursement of payments to direct participants is the
responsibility of DTC, and disbursement of payments to the beneficial owners is
the responsibility of direct and indirect participants.
Except under the limited circumstances described in this prospectus,
beneficial owners of interests in a global debt security will not be entitled to
have debt securities registered in their names and will not
receive physical delivery of debt securities. Accordingly, each beneficial owner
must rely on the procedures of DTC to exercise any rights under the debt
securities and the indenture.
The laws of some jurisdictions may require that some purchasers of
securities take physical delivery of securities in definitive form. These laws
may impair the ability to transfer or pledge beneficial interests in global debt
securities.
DTC is under no obligation to provide its services as depositary for
the debt securities of any series and may discontinue providing its services at
any time by giving reasonable notice to use or the trustee. Neither we nor the
trustee will have any responsibility for the performance by DTC or its
participants or indirect participants under the rules and procedures governing
DTC. As noted above, beneficial owners of debt securities generally will not
receive certificates representing their ownership interests in the debt
securities. However, if
o DTC notifies us that it is unwilling or unable to continue as
a depositary for the global debt securities of any series or if
DTC ceases to be a clearing agency registered under the Securities
Exchange Act and a successor depositary for the debt securities of
the series is not appointed within 90 days of the notification or
of our becoming aware of DTC's ceasing to be so registered, as the
case may be,
o we determine, in our sole discretion, not to have the debt
securities of any series represented by one or more global debt
securities, or
o an event of default under the indenture has occurred and is
continuing with respect to the debt securities of any series,
we will prepare and deliver to the trustee certificates for the debt securities
of that series, which will deliver the certificates in exchange for beneficial
interests in the global debt securities. Any beneficial interest in a global
debt security that is exchangeable under the circumstances described in the
preceding sentence will be exchangeable for debt securities in definitive
certificated form registered in the names that DTC will direct. It is expected
that these directions will be based upon directions received by DTC from its
participants with respect to ownership of beneficial interests in the global
debt securities.
We obtained the information in this section and elsewhere in this
prospectus concerning DTC and DTC's book-entry system from sources that we
believe to be reliable, but we take no responsibility for the accuracy of this
information.
Outstanding debt securities
In determining whether the holders of the requisite principal amount of
outstanding debt securities have given any request, demand, authorization,
direction, notice, consent or waiver under the indenture:
o the principal amount of an original issue discount security
that will be deemed to be outstanding for these purposes will be
that portion of the principal amount of the original issue
discount security that could be declared to be due and payable
upon a declaration of acceleration of the original issue discount
security as of the date of the determination;
o the principal amount of any indexed security that will be
deemed to be outstanding for these purposes will be the principal
face amount of the indexed security determined on the date of its
original issuance;
o the principal amount of a debt security denominated in a
foreign currency that will be deemed to be outstanding for these
purposes will be the United States dollar equivalent,
determined on the date of original issue of the debt security, of
the principal amount of the debt security; and
o a debt security owned by us or any obligor on the debt
security or any affiliate of ours or the other obligor will not be
deemed to be outstanding.
Redemption and repurchase
The debt securities of any series may be redeemable at our option or
may be subject to mandatory redemption by us as required by a sinking fund or
otherwise. In addition, the debt securities of any series may be subject to
repurchase by us at the option of the holders. The applicable prospectus
supplement will describe the terms, the times and the prices regarding any
optional or mandatory redemption or option to repurchase any series of debt
securities.
Restrictive Covenants
Restrictions on the creation of secured debt. The indenture provides
that we will not, and will not cause or permit a restricted subsidiary to,
create, incur, assume or guarantee any indebtedness borrowed by us or our
restricted subsidiaries that is secured by a security interest in any of our
principal facilities or shares of stock owned directly or indirectly by us or a
restricted subsidiary or by indebtedness borrowed by one of our restricted
subsidiaries from us or another of our restricted subsidiaries ("secured debt")
unless the debt securities will be secured equally and ratably with or prior to
the secured debt, with exceptions as listed in the indenture. These restrictions
do not apply to indebtedness secured by:
o security interests on any property, which is a parcel of real
property at a manufacturing plant, a warehouse or an office
building and which is acquired, constructed, developed or improved
by us or a restricted subsidiary, which secures or provides for
the payment of all or any part of the acquisition cost of the
property or the cost of the construction, development or
improvement of the property and which is created prior to, at the
same time or within 120 days after the completion of the
acquisition of the property or the later to occur of the
completion, development or improvement or the commencement or
operation, use or commercial production of the property;
o security interests on property at the time of its acquisition
by us or a restricted subsidiary which secure obligations assumed
by us or a restricted subsidiary;
o security interests arising from conditional sales agreements
or title retention agreements with respect to property acquired by
us or any of our restricted subsidiaries;
o security interests existing on the property or on the
outstanding shares or indebtedness of a corporation or firm at the
time the corporation or firm becomes a restricted subsidiary or is
merged or consolidated with us or a restricted subsidiary or
or sells, leases or otherwise disposes of substantially all of its
property to us or one of our restricted subsidiaries;
o security interests securing indebtedness of a restricted
subsidiary owed to us or to another restricted subsidiary;
o mechanics' and other statutory liens in respect of
obligations not due or being contested;
o security interests for taxes, assessments or governmental
changes or levies not yet delinquent or security interests for
taxes, assessments or governmental changes or levies already
delinquent but which are being contested;
o security interests arising in connection with legal
proceedings, including judgment liens, so long as the proceedings
are being contested and, in the case of judgment liens, the
execution has been stayed;
o landlords' liens on fixtures;
o security interests arising in connection with contracts and
subcontracts with or made at the request of the United States,
any state, or any department, agency or instrumentality of the
Unites States or any state;
o security interests that secure an obligation issued by the
United States of America or any state, territory or possession of
the United States or any of their political subdivisions or the
District of Columbia, in connection with the financing of the
cost of construction or acquisition of a principal facility or a
part of a principal facility;
o security interests by reason of deposits to qualify us or a
restricted subsidiary to conduct business, to maintain
self-insurance, or to comply with law;
o the extension of any security interest existing on the date
of the indenture on a principal facility to additions, extensions
or improvements to the principal facility and not as a result of
borrowing money or the securing of indebtedness incurred after
the date of the indenture; and
o any extension, renewal or refunding, or successive
extensions, renewals or refundings, in whole or in part of by
secured debt secured by any security interest listed to above,
provided that the principal amount of the secured debt does not
exceed the principal amount outstanding immediately prior to the
extension, renewal or refunding and that the security interest
securing the secured debt is limited to the property which,
immediately prior to the extension, renewal or reducing, secured
the secured debt and additions to the property.
For purposes of the indenture, our "principal facilities" are our manufacturing
plants, warehouses, office buildings or parcels of real property owned by us or
any of our restricted subsidiaries, provided each plant, warehouse, office
building or parcel of real property has a gross book value, without deduction
for any depreciation reserves, in excess of 2% of consolidated net tangible
assets other than any facility which is determined by our board of directors to
not be of material importance. For purposes of the indenture, our consolidated
net tangible assets are the total amount of assets which would be included on
our consolidated balance sheet under generally accepted accounting principles
after deducting all short-term liabilities and liability items, except for
indebtedness payable more than one year from the date of incurrence and all
goodwill, trade names, trademarks, patents, unamortized debt discount,
unamortized expense incurred in the issuance of debt and other like intangibles
except for prepaid royalties.
In addition to the foregoing, we and our restricted subsidiaries may
create, incur, assume or guarantee secured debt, without equally and ratably
securing the debt securities, if and only to the extent that, the sum of
o the amount of secured debt entered into after the date of the
indenture, other than secured debt permitted as listed in the
preceding paragraph, plus
o the aggregate value of sale and leaseback transactions
entered into after the date of the indenture, other than sale and
leaseback transactions permitted under the second bullet point
under "Restrictions on sale and leaseback transactions,"
does not exceed 5% of our consolidated net tangible assets.
For purposes of the indenture, our "restricted subsidiaries" are those
corporations in which we own voting securities entitling us to elect a majority
of the directors and which are either designated as restricted subsidiaries in
accordance with the indenture or:
o existed as such on the date of the indenture or is the
successor to, or owns, any equity interest in, a corporation
which so existed;
o has its principal business and assets in the United States;
o the business is other than the obtaining of financing in
capital markets outside the United States or the financing of the
acquisition or disposition of real or personal property or
dealing in real property for residential or office building
purposes; and
o does not have assets substantially all of which consist of
securities of one or more corporations which are not restricted
subsidiaries.
Restrictions on sale and leaseback transactions. The indenture
provides that we will not, and will not permit any restricted subsidiary to,
enter into any sale or transfer of any principal facility which has been in
operation, use or commercial production for more than 120 days prior to the sale
or transfer, or which, in the case of a principal facility which is a parcel of
real property other than a manufacturing plant, warehouse or office building,
has been owned by us or one of our restricted subsidiaries for more than 120
days prior to the sale or transfer, if the sale or transfer is made with the
intention of leasing, or as part of an arrangement involving the lease, of the
principal facility to us or one of our restricted subsidiaries, except a lease
for a period not exceeding 36 months or that secures or relates to obligations
issued by the United States, or any state, in connection with the financing of
the cost of construction or acquisition of the principal facility ("sale and
leaseback transaction"), unless:
o we or our restricted subsidiary would be entitled to incur
secured debt permitted by the indenture only by reason of the
provision described in the second paragraph under the sub-heading
"Restrictions on the creation of secured debt" equal in amount to
the value of the sale and leaseback transaction without equally
and ratably securing the debt securities; or
o we or our restricted subsidiary apply within one year, or
commit to apply within one year, an amount equal to the net
proceeds of the property sold pursuant to the sale and leaseback
transaction to:
- the acquisition, construction or improvement of
properties which are or will be a principal facility, or
- the optional redemption of debt securities or to the
repayment of other superior indebtedness of us or of any
restricted subsidiary.
For purposes of the indenture, "superior indebtedness" means any of our
obligations, or the obligations of any of our restricted subsidiaries, which:
o when created, are payable at least one year later;
o should be shown on our consolidated balance sheet in
accordance with generally accepted accounting principles; and
o are not subordinate and junior in right of payment to the
prior payment of our debt securities.
Instead of applying all or any part of the proceeds of a sale and
leaseback transaction to the redemption of debt securities, we may deliver to
the trustee, within one year of the transfer, debt securities for cancellation
and thereby reduce the amount to be applied to the redemption of debt securities
by an amount equivalent to the aggregate principal amount of the debt securities
delivered. Debt securities so redeemed or delivered will not be used as credits
against any mandatory sinking fund payments.
Restrictions on transfers of principal facilities. The indenture
provides that we will not, nor will we permit any restricted subsidiary to,
transfer any principal facility to any of our subsidiaries which is not a
restricted subsidiary unless we or it apply within one year, or commit to apply
within one year, an amount equal to the fair value of the principal facility at
the time of the transfer:
o to the acquisition, construction, development or improvement
of a principal facility or part of a principal facility; or
o to the optional redemption of debt securities or to the
repayment of our superior indebtedness or the superior
indebtedness of any of our restricted subsidiaries.
In lieu of applying all or any part of the amount to the redemption of
securities, we may deliver to the trustee securities for cancellation and
thereby reduce the amount to be applied to the redemption of securities by the
principal amount of the securities so delivered. Securities so redeemed or
delivered will not be used as credits against any mandatory sinking fund
payments.
Restrictions on mergers, consolidations and transfers of assets. The
indenture provides that we will not consolidate or merge into or transfer or
lease all or substantially all of our assets to another person unless;
o in the case of a merger, we are the surviving corporation in
the merger; or
o the person into which we are merged or which acquires all or
substantially all of our assets is a corporation organized under
the laws of the United States, any state or the District of
Columbia, and assumes all of our obligations relating to the
securities and the indenture, and immediately after the
transaction no default exists.
Upon any the consolidation, merger or transfer, the successor
corporation will be substituted for us under the indenture. The successor
corporation may then exercise all of our powers and rights under the indenture,
and we will be released from all of our liabilities and obligations in respect
of the securities and the indenture. In the event we lease all or substantially
all of our assets, the lessee corporation will be our successor and may exercise
all of our powers and rights under the indenture but we will not be released
from our obligations to pay the principal of and interest on the securities.
Events of default
Unless otherwise specified in the applicable prospectus supplement, an
"event of default" with respect to the debt securities of any series is defined
in the indenture as being:
o default in payment of any interest on, or any additional
amounts payable with respect to any interest on, any of the debt
securities of that series or any coupon relating to the debt
securities when due, and continuance of the default for a period
of 30 days;
o default in payment of any principal of or premium, if any,
on, or any additional amounts payable with respect to any
principal of or premium, if any, on, any of the debt securities of
that series when due, whether at maturity, upon redemption, upon
repayment or repurchase at the option of the holder or otherwise;
o default in the deposit of any sinking fund payment or payment
under any analogous provision when due with respect to any of the
debt securities of that series;
o default by us in the performance, or breach, of any other
covenant or warranty in the indenture or in any debt security of
that series, other than a covenant or warranty included in the
indenture solely for the benefit of a series of debt securities
other than that series, and continuance of that default or breach,
without that default or breach having been cured or waived, for a
period of 60 days after the trustee or the holders of not less
than 25% in aggregate principal amount of the debt securities of
that series then outstanding give notice to us, or in the case of
notice by the holders, to us and the trustee, specifying the
default or breach;
o our failure to make any payment when due, including any
applicable grace period, relating to our indebtedness which is in
an amount in excess of $50,000,000, or our default with respect to
any of our indebtedness that results in acceleration of
indebtedness which is in an amount in excess of $50,000,000;
o specified events of bankruptcy, insolvency or reorganization
with respect to us or any of our restricted subsidiaries; or
o any other event of default established for the debt
securities of that series.
No event of default with respect to any particular series of debt
securities necessarily constitutes an event of default with respect to any other
series of debt securities. The indenture provides that, within 90 days after the
occurrence of any default with respect to the debt securities of any series, the
trustee will mail to all holders of the debt securities of that series notice of
that default, unless that default has been cured or waived. However, the
indenture provides that the trustee may withhold notice of a default with
respect to the debt securities of that series, except a default in payment of
principal, premium, if any, interest, if any, additional amounts, if any, or
sinking fund payments, if any, if the trustee considers it in the best interest
of the holders to do so. In the case of a default in the performance or the
breach of any covenant or warranty in the indenture with respect to debt
securities or that series, no notice will be given until at least 30 days after
the occurrence of the default or breach. As used in this paragraph, the term
"default" means any event which is, or after notice or lapse of time or both
would become, an event of default with respect to the debt securities of any
series.
The indenture provides that if an event of default, other than an event
of default relating to events of bankruptcy, insolvency or reorganization with
respect to any series of debt securities occurs and is continuing, either the
trustee or the holders of at least 25% in principal amount of the debt
securities of that series then outstanding may declare the principal of, or if
debt securities of that series are original issue discount securities, the
lesser amount as may be specified in the terms of that series of debt
securities, and accrued and unpaid interest, if any, on all the debt securities
of that series to be due and payable immediately. The indenture also provides
that if an event of default relating to events of bankruptcy, insolvency or
reorganization with respect to any series of debt securities occurs, the
principal of, or if debt securities of that series are original issue discount
securities, the lesser amount as may be specified in the terms of that series of
debt securities, and accrued and unpaid interest, if any, on all the debt
securities of that series will automatically become and be immediately due and
payable without any declaration or other action on the part of the trustee or
any holder of the debt securities of that series. However, upon specified
conditions, the holders of a majority in principal amount of the debt securities
of a series then outstanding may rescind and annul an acceleration of the debt
securities of that series and its consequences.
Subject to the provisions of the Trust Indenture Act requiring the
trustee, during the continuance of an event of default under the indenture, to
act with the requisite standard of care, the trustee is under no obligation to
exercise any of its rights or powers under the indenture at the request or
direction of any of the holders of debt securities of any series unless those
holders have offered the trustee reasonable indemnity.
Subject to this requirement, holders of a majority in principal amount of the
outstanding debt securities of any series issued under the indenture have the
right to direct the time, method and place of conducting any proceeding for any
remedy available to the trustee under the indenture with respect to that series.
The indenture requires the annual filing by us with the trustee of a certificate
which states whether we are in default under the terms of the indenture.
Notwithstanding any other provision of the indenture, the holder of a
debt security will have the right, which is absolute and unconditional, to
receive payment of the principal of and premium, if any, and interest, if any,
on that debt security on the respective due dates for those payments and to
institute suit for the enforcement of those payments, and this right will not be
impaired without the consent of the holder.
Modification and waivers
The indenture permits us and the trustee, with the consent of the
holders of a majority in principal amount of the outstanding debt securities of
each series issued under the indenture and affected by a modification or
amendment, to modify or amend any of the provisions of the indenture or of the
debt securities of the applicable series or the rights of the holders of the
debt securities of that series under the indenture. However, no modification or
amendment may, without the consent of the holder of each outstanding debt
security issued under the indenture affected by the modification or amendment,
among other things:
o change the stated maturity of the principal of, or premium,
if any, or any installment of interest, if any, on or any
additional amounts, if any, with respect to any debt securities
issued under the indenture;
o reduce the principal of or any premium on any debt securities
or reduce the rate of interest on or the redemption or repurchase
price of any debt security, or any additional amounts with respect
to any debt securities, or change our obligation to pay additional
amounts;
o reduce the amount of principal of any original issue discount
securities that would be due and payable upon an acceleration of
the maturity of the debt security;
o adversely affect any right of repayment or repurchase at the
option of any holder;
o change any place where or the currency in which the principal
of, any premium or interest on, or any additional amounts with
respect to, any debt securities are payable;
o impair the holder's right to institute suit to enforce the
payment of any debt securities on or after their stated maturity
or, in the case of redemption, on or after the redemption date; or
o reduce the percentage of debt securities of any series issued
under the indenture whose holders must consent to any modification
or amendment or any waiver of compliance with specific provisions
of the indenture or specified defaults under the indenture and
their consequences.
The indenture also contains provisions permitting us and the trustee,
without the consent of the holders of any debt securities issued under the
indenture, to modify or amend the indenture, among other things:
o to evidence the succession of another person to us under the
indenture and the assumption of our obligations contained in the
indenture and the debt securities;
o to add to our covenants for the benefit of the holders of all
or any series of debt securities issued under the indenture or to
surrender any right or power conferred upon us in the indenture
with respect to all or any series of debt securities issued under
the indenture;
o to add to or change any provisions of the indenture to
facilitate the issuance of bearer securities;
o to establish the form or terms of debt securities of any
series and any related coupons, including, deletions from or
additions or changes to the indenture in connection with the
modification or amendment, so long as those deletions, additions
and changes are not applicable to any other series of debt
securities then outstanding;
o to cure any ambiguity or correct or supplement any provision
in the indenture which may be defective or inconsistent with other
provisions in the indenture, or to make any other provisions with
respect to matters or questions arising under the indenture which
will not adversely affect the interests of the holders of the debt
securities of any series then outstanding;
o to add any additional events of default with respect to all
or any series of debt securities; or
o to amend or supplement any provision contained in the
indenture, provided that the amendment or supplement does not
apply to any outstanding debt securities issued before the date of
the amendment or supplement that is entitled to the benefits of
that provision.
The holders of a majority in aggregate principal amount of the
outstanding debt securities of any series may waive our compliance with some of
the restrictive provisions of the indenture, which may include covenants, if
any, which are specified in the applicable prospectus supplement. The holders of
a majority in aggregate principal amount of the outstanding debt securities of
any series may, on behalf of all holders of debt securities of that series,
waive any past default under the indenture with respect to debt securities of
that series and its consequences, except a default in the payment of the
principal of, or premium, if any, or interest, if any, on debt securities of
that series or a default in respect of a covenant or provision which cannot be
modified or amended without the consent of the holder of each outstanding debt
security of the affected series.
Discharge, defeasance and covenant defeasance
Unless otherwise provided in the applicable prospectus supplement, upon
our direction, the indenture will cease to be of further effect with respect to
any series of debt securities issued under the indenture specified by us,
subject to the survival of specified provisions of the indenture, when:
o either
- all outstanding debt securities of that series and, in
the case of bearer securities, all related coupons, have been
delivered to the trustee for cancellation, subject to
exceptions, or
- all debt securities of that series and, if applicable,
any related coupons have become due and payable or will
become due and payable at their stated maturity within one
year or are to be called for redemption within one year and
we have deposited with the trustee, in trust, funds in United
States dollars, in the foreign currency in which the debt
securities of that series are payable, or direct or indirect
obligations of the United States or the government which
issued the applicable foreign currency ("government
obligations") in an amount sufficient to pay the entire
indebtedness on the debt securities
of that series in respect of principal, premium, if any, and
interest, if any, and, to the extent that the debt securities
of that series provide for the payment of additional amounts
and the amount of any additional amounts which are or will be
payable is at the time of deposit reasonably determinable by
us, in the exercise of our sole discretion, those additional
amounts, to the date of the deposit, if the debt securities
of that series have become due and payable, or to the
maturity or redemption date of the debt securities of that
series, as the case may be;
o we have paid all other sums payable under the indenture with
respect to the debt securities of that series; and
o the trustee has received an officers' certificate and an
opinion of counsel called for by the indenture.
If the debt securities of any series provide for the payment of
additional amounts, we will remain obligated, following the deposit described
above, to pay additional amounts on those debt securities to the extent that
they exceed the amount deposited in respect of those additional amounts as
described above.
Unless otherwise provided in the applicable prospectus supplement, we
may elect with respect to any series of debt securities either
o to defease and be discharged from all of our obligations with
respect to that series of debt securities ("defeasance"), except
for, among other things,
- the obligation to pay additional amounts with respect to
payments on that series of debt securities to the extent that
those additional amounts exceed the amount deposited in
respect of those amounts as provided below,
- the obligation to register the transfer or exchange of
those debt securities,
- the obligation to replace temporary or mutilated,
destroyed, lost or stolen debt securities,
- the obligation to maintain an office or agency in
respect of that series of debt securities,
- the obligation to hold moneys for payment in trust, and
- the obligation, if applicable, to repurchase or repay
debt securities of that series at the option of the holders
in accordance with their terms, or
o to be released from our obligations with respect to the debt
securities of the series under specified covenants in the
indenture including those described under the heading "Restrict
Covenants" and, if applicable, other covenants as may be specified
in the applicable prospectus supplement, and any omission to
comply with those obligations will not constitute a default or an
event of default with respect to that series of debt securities
("covenant defeasance"),
in either case upon the irrevocable deposit with the trustee, or other
qualifying trustee, in trust for that purpose, of an amount in United States
dollars or in the foreign currency in which those debt securities are payable at
stated maturity or, if applicable, upon redemption, and/or government
obligations which, through the payment of principal and interest in accordance
with their terms, will provide money in an amount sufficient to pay the
principal of and any premium and any interest on, and, to the extent that the
debt securities of that series provide for the payment of additional amounts and
the amount of the additional
amounts which are or will be payable is at the time of deposit reasonably
determinable by us, in the exercise of our sole discretion, the additional
amounts with respect to, that series of debt securities, and any mandatory
sinking fund or analogous payments on that series of debt securities, on the due
dates for those payments.
The defeasance or covenant defeasance described above will only be effective if,
among other things:
o it will not result in a breach or violation of, or constitute
a default under, the indenture or any other material agreement or
instrument to which we are a party or are bound;
o in the case of defeasance, we will have delivered to the
trustee an opinion of independent counsel confirming that
- we have received from or there has been published by the
Internal Revenue Service a ruling, or
- since the date of the indenture there has been a change
in applicable federal income tax law,
in either case to the effect that, and based on this ruling or
change the opinion of counsel will confirm that, the holders of
the debt securities of the applicable series will not recognize
income, gain or loss for federal income tax purposes as a result
of the defeasance and will be subject to federal income tax on the
same amounts, in the same manner and at the same times as would
have been the case if the defeasance had not occurred;
o in the case of covenant defeasance, we will have delivered to
the trustee an opinion of independent counsel to the effect that
the holders of the debt securities of that series will not
recognize income, gain or loss for federal income tax purposes as
a result of the covenant defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if the covenant
defeasance had not occurred;
o if the cash and/or government obligations deposited are
sufficient to pay the principal of, and premium, if any, and
interest and additional amounts, if any, with respect to the debt
securities of that series provided those debt securities are
redeemed on a particular redemption date, we will have given the
trustee irrevocable instructions to redeem those debt securities
on that date; and
o no event of default or event which with notice or lapse of
time or both would become an event of default with respect to debt
securities of that series will have occurred and be continuing on
the date of the deposit into trust; and, solely in the case of
defeasance, no event of default arising from specified events of
bankruptcy, insolvency or reorganization with respect to us or any
restricted subsidiary or event which with notice or lapse of time
or both would become an event of default will have occurred and be
continuing during the period through and including the 91st day
after the date of the deposit into trust.
Unless otherwise provided in the applicable prospectus supplement, if
after we have deposited funds and/or government obligations to effect defeasance
or covenant defeasance with respect to debt securities of any series,
o the holder of a debt security of that series is entitled to,
and does, elect under the indenture or the terms of that debt
security to receive payment in a currency other than the currency
in which the deposit has been made, or
o a conversion event, as defined below, occurs in respect of
the foreign currency in which the deposit has been made,
the indebtedness represented by that debt security will be deemed to have been,
and will be, fully discharged and satisfied through the payment of the principal
of and premium, if any, and interest, if any, on that debt security as it
becomes due out of the proceeds yielded by converting the amount deposited in
respect of that debt security into the currency in which that debt security
becomes payable as a result of the election or conversion event based on, in the
case of payments made under the first bullet above, the applicable market
exchange rate for the foreign currency in effect on the second business day
before the payment date, or, with respect to a conversion event, the applicable
market exchange rate for the foreign currency in effect, as nearly as feasible,
at the time of the conversion event.
For purposes of the indenture, a "conversion event" is the cessation of
the use of a foreign currency both by the government of the country or the
confederation which issued the foreign currency and for the settlement of
transactions by a central bank or other public institutions of or within the
international banking community, or any currency unit or composite currency for
the purposes for which it was established.
In the event we effect covenant defeasance with respect to debt
securities of any series and those debt securities are declared due and payable
because of the occurrence of any event of default other than an event of default
with respect to the covenants as to which covenant defeasance has been effected,
which would no longer be applicable to the debt securities of that series after
covenant defeasance, the amount of monies and/or government obligations
deposited with the trustee to effect covenant defeasance may not be sufficient
to pay amounts due on the debt securities of that series at the time of any
acceleration resulting from that event of default. However, we would remain
liable to make payment of those amounts due at the time of acceleration.
The applicable prospectus supplement may further describe the
provisions, if any, permitting or restricting defeasance or covenant defeasance
with respect to the debt securities of a particular series.
Regarding the trustee
We and our subsidiaries may maintain deposit accounts and conduct other
banking transactions with the trustee or its affiliates in the ordinary course
of business, and the trustee and its affiliates may from time to time in the
future provide us with banking and financial services in the ordinary course of
their business.
PLAN OF DISTRIBUTION
The company may sell securities through underwriters or agents or
directly to other purchasers, including broker-dealers as principals. The
prospectus supplement with respect to the securities sets forth the terms of the
offering of the securities, including the name or names of any underwriters and
the respective amount of the securities underwritten, the names of any agents
involved in the offer or sale of the securities, the purchase price of the
securities and the proceeds to the company from such sale, any underwriting
discounts and other items constituting underwriters' compensation, any
commissions payable to agents, any initial public offering price, and any
discounts or concessions allowed or reallowed or paid to dealers. Any initial
public offering price and any discounts or concessions allowed or reallowed or
paid to dealers may be changed from time to time.
If the securities are sold through underwriters, they will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at a
fixed public offering price or at varying prices determined at the time of sale.
The securities may be offered to the public either (i) through underwriting
syndicates or (ii) directly by one or more firms acting as underwriters. The
underwriter or underwriters with respect to a particular underwritten offering
of securities are named in the prospectus supplement relating to such offering,
and if an underwriting syndicate is used, the managing underwriter or
underwriters are set forth on the cover of such prospectus supplement. Unless
otherwise set forth in the prospectus supplement, the obligations of the
underwriters to purchase the securities will be subject to certain conditions
precedent and the underwriters will be obligated to purchase all the securities
if any are purchased.
If broker-dealers are used in the sale, the company will sell the
securities to the dealers as principals. The dealers may then resell the
securities to the public at varying prices to be determined by such dealers at
the time of resale.
The securities may be sold directly by the company or through agents
designated by the company from time to time. Unless otherwise indicated in the
prospectus supplement, any such agent is acting on a best efforts basis for the
period of its appointment. As one of the means of direct issuance of the
securities, the company may, through an agent, conduct an electronic "dutch
auction" of the securities among potential purchasers who are eligible to
participate in such auction, as more fully described in the prospectus
supplement.
In the event that the securities are not listed on a national
securities exchange, certain broker-dealers may make a market in the securities,
but will not be obligated to do so and may discontinue any market making at any
time without notice. No assurance can be given that any broker- dealer will make
a market in the securities or as to the liquidity of the trading market for the
securities, whether or not the securities are listed on a national securities
exchange. The prospectus supplement with respect to the securities will state,
if known, whether or not any broker-dealer intends to make a market in such
securities. If no such determination has been made, the prospectus supplement
will so state.
If so indicated in the prospectus supplement, the company will
authorize agents, underwriters or broker-dealers to solicit offers from certain
types of institutions to purchase securities from the company at the public
offering price set forth in the prospectus supplement pursuant to delayed
delivery contracts providing for payment and delivery on a specified date in the
future.
Agents, underwriters and broker-dealers may be entitled under
agreements entered into with the company to indemnification by the company
against certain civil liabilities, including liabilities under the Securities
Act of 1933, as amended, or to contribution with respect to payments which the
agents, underwriters or broker-dealers may be required to make in respect
thereof. Agents, underwriters and broker-dealers may be customers of, engage in
transactions with, or perform services for the company in the ordinary course of
business.
--------------------------------------------------------------------------------
LEGAL MATTERS
The validity of the debt securities issued hereunder will be passed
upon for us by our Senior Vice President and General Counsel, Thomas J.
Sabatino, Jr. Mr. Sabatino owns shares of, and options on, our common stock,
both directly and as a participant in various stock and employee benefit plans.
See our proxy statement for details.
--------------------------------------------------------------------------------
INDEPENDENT ACCOUNTANTS
The financial statements of Baxter International Inc. incorporated in
this prospectus by reference to Baxter's Annual Report on Form 10-K for the year
ended December 31, 2001, have been audited by PricewaterhouseCoopers LLP,
independent accountants, as stated in their report appearing therein.
--------------------------------------------------------------------------------
PROSPECTUS
$1,000,000,000
[LOGO]
Baxter International Inc.
Debt Securities
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distributions.*
Securities and Exchange Commission registration fee.. $ 92,000
Accounting fees...................................... 5,000
Legal fees and expenses.............................. 5,000
Miscellaneous........................................ 3,000
--------
Total........................................ $105,000
========
* All amounts are estimated except for the Securities and Exchange Commission
registration fee.
Item 15. Indemnification of Directors and Officers.
The registrant, a Delaware corporation, is empowered by section 145 of
the Delaware General Corporation Law, subject to the procedures and limitations
stated therein, to indemnify any person against expenses (including attorney's
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person in the defense of any threatened, pending or completed
action, suit or proceeding in which such person is made a party by reason of his
or her being or having been a director or officer of the registrant. The statute
provides that indemnification pursuant to its provisions is not exclusive of
other rights of indemnification to which a person may be entitled under any
bylaw, agreement, vote of stockholders or disinterested directors, or otherwise.
The Restated Certificate of Incorporation of the registrant provides that the
registrant shall indemnify its directors and officers substantially to the
fullest extent permitted by the Delaware General Corporation Law.
The registrant is also empowered by section 102(b) of the Delaware
General Corporation Law to include a provision in its certificate of
incorporation to limit a director's liability to the registrant or its
stockholders for monetary damages for breaches of fiduciary duty as a director.
Article Eighth of the Restated Certificate of Incorporation states that
directors of the registrant shall not be liable for monetary damages for breach
of fiduciary duty "to the fullest extent permitted by the General Corporation
Law of Delaware as the same exists or may hereafter be amended." Under currently
applicable Delaware law then, directors will remain liable for damages for (i) a
breach of their duty of loyalty to the registrant and its stockholders; (ii)
their failure to act in good faith; (iii) their intentional misconduct or
knowing violation of law; (iv) improper dividend payments, stock repurchases or
redemptions; and (v) any transaction from which the director derived an improper
personal benefit.
Policies of insurance are maintained by the registrant under which the
directors and officers of the registrant are insured, within the limits and
subject to the limitations of the polices, against certain expenses in
connection with the defense of actions, suits or proceedings, and certain
liabilities which might be imposed as a result of such actions, suits or
proceedings, to which they are parties by reason of being or having been such
directors or officers which could include liabilities under the Securities Act
of 1933 or the Securities Exchange Act of 1934.
The registrant has entered into indemnification agreements with its
officers and directors, which its stockholders have approved or ratified. These
agreements provide for full indemnification, including indemnification for
judgments or settlements against an officer or director in favor of the
registrant, with certain exceptions. This indemnity could apply to liabilities
under the Securities Act of 1933 in certain circumstances.
The proposed form of Underwriting Agreement, to be filed as Exhibit 1.1
to this registration statement provides for indemnification of directors and
officers of the registrant by the underwriters against certain liabilities.
Similar indemnification provisions were contained in the underwriting agreements
executed in connection with prior offerings and sales of securities by the
registrant.
Item 16. Exhibits.
Exhibits marked with an asterisk (*) are incorporated by reference to
documents previously filed by the Registrant with the Securities and Exchange
Commission, as indicated. All other documents are filed with this Registration
Statement.
Number Description
------ -----------
4.1 Indenture dated as of February 14, 2002 by and among the Company
and Bank One Trust Company, N.A. as trustee.
4.2* Form of Debenture with optional sinking fund and redemption
provisions, filed as Exhibit 4.2 to the Company's registration
statement on Form S-3 (No. 33-1665) (the "Prior S-3").
4.3* Form of Note with optional redemption provisions, filed as
Exhibit 4.3 to the Prior S-3.
4.4* Form of Deep Discount Note or Debenture, filed as Exhibit 4.4 to
the Prior S-3.
4.5* Form of Zero Coupon Note of Debenture, filed as Exhibit 4.5 to
the Prior S-3.
4.6* Form of Extendible Note, filed as Exhibit 4.6 to the Prior S-3.
4.7* Form of Floating Rate Note, filed as Exhibit 4.7 to the Prior
S-3.
4.8* Form of Medium-Term Note, filed as Exhibit 4.9 to the Prior S-3.
5 Opinion of Thomas J. Sabatino, Jr., Senior Vice President and
General Counsel of Registrant.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Thomas J. Sabatino, Jr. (included in Exh. 5).
24 Powers of Attorney (contained in the signature page to this
Registration Statement).
25 Form T-1 Statement of Eligibility under the Trust Indenture Act
of 1939, as amended, of Bank One Trust Company, N.A. as trustee
under the Indenture.
Item 17. Undertakings.
The Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933:
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) under
the Act if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee"
table in the effective Registration Statement; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply
if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934, as amended, that are incorporated
by reference in this registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant
to Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934, as amended, that is incorporated by reference in the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
provisions referred to in Item 15 of the registration statement,
or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the
question of whether such indemnification is against public policy
as expressed in the Act and will be governed by the final
adjudication of such issue.
(6) For purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon
Rule 430A and contained in a form of prospectus filed by the
registrant pursuant to Rule 424 or 497 under the Securities Act
shall be deemed to be part of this registration statement as of
the time it was declared effective.
II-3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing this Registration Statement or amendment
thereto on Form S-3 and has duly caused this Registration Statement to be signed
on its behalf by the undersigned, thereunto duly authorized, in the City of
Deerfield, State of Illinois, as of March 29, 2002.
BAXTER INTERNATIONAL INC.
By: /s/ Harry M. Jansen Kraemer, Jr.
---------------------------------
Name: Harry M. Jansen Kraemer, Jr.
Title Chief Executive Officer
KNOW ALL BY THESE PRESENTS, that each person whose signature appears
below constitutes and appoints Harry M. Jansen Kraemer, Jr. and Thomas J.
Sabatino, Jr., and each of them, his or her true and lawful attorneys-in-fact
and agents, with full power of substitution and resubstitution, in any and all
capacities, to sign any or all amendments (including post-effective amendments)
to this Registration Statement, including any filings under Rule 462 promulgated
under the Securities Act of 1933, as amended, and to file the same with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto said attorneys-in-fact and
agents full power and authority to do and perform each and every act and thing
requisite and necessary to be done in and about the premises, as fully to all
intents and purposes as he or she might or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or their substitutes,
may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement amendment has been signed below by the following
persons in the capacities indicated as of March 29, 2002.
Signature Title
--------- -----
/s/ Harry M. Jansen Kraemer, Jr. Chairman of the Board of Directors and Chief
-------------------------------- Executive Officer
Harry M. Jansen Kraemer, Jr. (principal executive officer)
/s/ Brian P. Anderson Senior Vice President and Chief Financial
--------------------- Officer (principal financial officer and
Brian P. Anderson principal accounting officer)
/s/ Walter E. Boomer Director
--------------------
Walter E. Boomer
/s/ Pei-yuan Chia Director
-----------------
Pei-yuan Chia
/s/ John W. Colloton Director
--------------------
John W. Colloton
/s/ Susan Crown Director
---------------
Susan Crown
/s/ Brian D. Finn Director
-----------------
Brian D. Finn
/s/ Gail D. Fosler Director
------------------
Gail D. Fosler
/s/ Martha R. Ingram Director
--------------------
Martha R. Ingram
/s/ Thomas T. Stallkamp Director
-----------------------
Thomas T. Stallkamp
/s/ Monroe E. Trout Director
-------------------
Monroe E. Trout, M.D.
/s/ Fred L. Turner Director
------------------
Fred L. Turner
EXHIBIT INDEX
TO REGISTRATION STATEMENT
ON FORM S-3
BAXTER INTERNATIONAL INC.
Exhibits marked with an asterisk (*) are incorporated by reference to documents
previously filed by the Registrant with the Securities and Exchange Commission,
as indicated. All other documents are filed by this amendment to the
Registration Statement.
Number Description
------ -----------
4.1 Indenture dated as of February 14, 2002 by and among the Company and
Bank One Trust Company, N.A. as trustee.
4.2* Form of Debenture with optional sinking fund and redemption provisions,
filed as Exhibit 4.2 to the Company's registration statement on Form S-3
(No. 33-1665) (the "Prior S-3").
4.3* Form of Note with optional redemption provisions, filed as Exhibit 4.3
to the Prior S-3.
4.4* Form of Deep Discount Note or Debenture, filed as Exhibit 4.4 to the
Prior S-3.
4.5* Form of Zero Coupon Note of Debenture, filed as Exhibit 4.5 to the Prior
S-3.
4.6* Form of Extendible Note, filed as Exhibit 4.6 to the Prior S-3.
4.7* Form of Floating Rate Note, filed as Exhibit 4.7 to the Prior S-3.
4.8* Form of Medium-Term Note, filed as Exhibit 4.9 to the Prior S-3.
5 Opinion of Thomas J. Sabatino, Jr., Senior Vice President and General
Counsel of Registrant.
23.1 Consent of PricewaterhouseCoopers LLP.
23.2 Consent of Thomas J. Sabatino, Jr. (included in Exhibit 5).
24* Powers of Attorney (contained in the signature page to this Registration
Statement).
25 Form T-1 Statement of Eligibility under the Trust Indenture Act of 1939,
as amended, of Bank One Trust Company, N.A. as trustee under the
Indenture.