-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TOYdeH7reqcKRtzbg0SgkZ41f+DjpUnVlR97DfnwuD364xOqx1bJlmRImvA2bhj3 8CHt+RTtH959P5J4QWs8nA== 0000950152-95-002276.txt : 19951010 0000950152-95-002276.hdr.sgml : 19951010 ACCESSION NUMBER: 0000950152-95-002276 CONFORMED SUBMISSION TYPE: S-4/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19951006 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: RPM INC/OH/ CENTRAL INDEX KEY: 0000110621 STANDARD INDUSTRIAL CLASSIFICATION: PAINTS, VARNISHES, LACQUERS, ENAMELS & ALLIED PRODUCTS [2851] IRS NUMBER: 346550857 STATE OF INCORPORATION: OH FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: S-4/A SEC ACT: 1933 Act SEC FILE NUMBER: 033-61541 FILM NUMBER: 95579117 BUSINESS ADDRESS: STREET 1: 2628 PEARL RD STREET 2: P O BOX 777 CITY: MEDINA STATE: OH ZIP: 44258 BUSINESS PHONE: 2162735090 MAIL ADDRESS: STREET 1: 2628 PEARL RD STREET 2: P O BOX 777 CITY: MEDINA STATE: OH ZIP: 44258 FORMER COMPANY: FORMER CONFORMED NAME: REPUBLIC POWDERED METALS INC DATE OF NAME CHANGE: 19711027 S-4/A 1 RPM, INC. S-4/A 1 As filed with the Securities and Exchange Commission on October 6, 1995 REGISTRATION NO. 33-61541 - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 ___________ AMENDMENT NO. 2 TO FORM S-4 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ___________ RPM, INC. (Exact name of registrant as specified in its charter) Ohio 2851 34-6550857 (State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer incorporation or organization) Classification Code Number) Identification No.) ___________ 2628 Pearl Road Thomas C. Sullivan P.O. Box 777 Chairman and Chief Executive Officer Medina, Ohio 44258 RPM, Inc. (216) 273-5090 2628 Pearl Road (Address, including zip code, and telephone number, P.O. Box 777 including area code, of registrant's principal executive offices) Medina, Ohio 44258 (216) 273-5090 (Name, address, including zip code, and telephone number, including area code, of agent for service)
___________ Copies of communications to: William A. Papenbrock, Esq. Calfee, Halter & Griswold 1400 McDonald Investment Center 800 Superior Avenue Cleveland, Ohio 44114 (216) 622-8200 ___________ Approximate date of commencement of proposed sale to the public: As soon as practicable after this Registration Statement becomes effective. If the securities being registered on this Form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box: [ ] _______________ The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to Section 8(a), may determine. - -------------------------------------------------------------------------------- - -------------------------------------------------------------------------------- 2 RPM, INC. CROSS REFERENCE SHEET Furnished Pursuant to Item 501(b) of Regulation S-K
Form S-4 Item Number and Caption Location in Prospectus -------------------------------- ---------------------- 1. Forepart of Registration Statement and Outside Front Page of Prospectus . . . . . . . . Forepart of the Registration Statement and Outside Front Cover Page of Prospectus 2. Inside Front and Outside Back Cover Pages of Prospectus . . . . . . . . . . . . . . . Inside Front Cover Page and Outside Back Cover Pages of Prospectus 3. Risk Factors and Ratio of Earnings to Fixed Charges, and Other Information . . . . . Prospectus Summary; The Company; Risk Factors 4. Terms of the Transaction . . . . . . . . . . Prospectus Summary; The Exchange Offer; Certain Federal Income Tax Consequences; Description of Notes 5. Pro Forma Financial Information . . . . . . Prospectus Summary; Selected Financial Data 6. Material Contracts with the Company Being Acquired . . . . . . . . . . . . . . . . * 7. Additional Information Required for Reoffering by Persons and Parties Deemed to be Underwriters . . . . . . . . . . . . . . * 8. Interests of Named Expert and Counsel . . . Legal Matters; Independent Public Accountants 9. Disclosure of Commission Position on Indemnification for Securities Act Liabilities . . . . . . . . . . . . . . * 10. Information with Respect to S-3 Registrants * 11. Incorporation of Certain Information by Reference . . . . . . . . . . . . . . . Incorporation of Certain Documents by Reference 12. Information with Respect to S-2 or S-3 Registrants . . . . . . . . . . . . . . * 13. Incorporation of Certain Information by Reference . . . . . . . . . . . . . . . * 14. Information with Respect to Registrants Other than S-3 or S-2 Registrants . . . . . . * 15. Information with Respect to S-3 Companies . * 16. Information with Respect to S-2 or S-3 Companies . . . . . . . . . . . . . . . * 17. Information with Respect to Companies Other than S-2 or S-3 Companies . . . . . . . * 18. Information if Proxies, Consents or Authorizations are to be Solicited . . . * 19. Information if Proxies, Consents or Authorizations are not to be Solicited or in an Exchange Offer . . . . . . . . . . Incorporated by reference to the Registrant's Annual Report on Form 10-K for the fiscal year ended May 31, 1995 _________________ *Not applicable or answer thereto is negative.
3 *************************************************************************** * * * Information contained herein is subject to completion or amendment. * * A registration statement relating to these securities has been filed * * with the Securities and Exchange Commission. These securities may * * not be sold nor may offers to buy be accepted prior to the time the * * registration statement becomes effective. This Prospectus shall not * * constitute an offer to sell or the solicitation of an offer to buy * * nor shall there be any sale of these securities in any State in which * * such offer, solicitation or sale would be unlawful prior to * * registration or qualification under the securities laws of any such * * State. * * * *************************************************************************** 4 Subject to Completion, Dated October 6, 1995 OFFER TO EXCHANGE -- PROSPECTUS RPM, INC. LOGO Offer to Exchange its 7.0% Senior Notes Due 2005 ($150,000,000 principal amount outstanding) for 7.0% Senior Exchange Notes Due 2005 ($150,000,000 principal amount) ____________ The Exchange Offer and withdrawal rights will expire at 5:00 P.M., New York City time, on November 10, 1995, unless extended. ____________ RPM, Inc., an Ohio corporation (the "Company" or "RPM"), hereby offers, upon the terms and subject to the conditions set forth in this Offer to Exchange -- Prospectus (the "Prospectus") and the accompanying Letter of Transmittal (which together constitute the "Exchange Offer"), to exchange its 7.0% Senior Exchange Notes Due 2005 (the "New Notes") for an equal principal amount of its outstanding 7.0% Senior Notes Due 2005 (the "Old Notes"), of which $150,000,000 principal amount is outstanding as of the date hereof. The Old Notes and New Notes are collectively referred to herein as the "Notes." The form and terms of the New Notes are the same as the form and terms of the Old Notes except that (i) the Company's offer and exchange of the New Notes will have been registered under the Securities Act of 1933, as amended (the "Securities Act"), and, therefore, the New Notes will not bear legends restricting their transfer and (ii) holders of New Notes will not be entitled to certain rights under the Registration Rights Agreement (as hereinafter defined), which rights will terminate when the Exchange Offer is consummated. The New Notes will evidence the same debt as the Old Notes (which they replace) and will be issued under and be entitled to the benefits of the indenture governing the Old Notes, dated as of June 1, 1995 (the "Indenture"). See "The Exchange Offer" and "Description of Notes." The Company will accept for exchange any and all validly tendered Old Notes on or prior to 5:00 p.m. New York City time, on November 10, 1995 (if and as extended, the "Expiration Date"). Tenders of Old Notes may be withdrawn at any time prior to 5:00 p.m., New York City time, on the Expiration Date. The Exchange Offer is not conditioned upon any minimum principal amount of Old Notes being tendered for exchange. Old Notes may be tendered only in integral multiples of $1,000. ____________ SEE "RISK FACTORS" ON PAGE 18 FOR A DISCUSSION OF CERTAIN FACTORS WHICH INVESTORS SHOULD CONSIDER IN CONNECTION WITH THE EXCHANGE OFFER AND AN INVESTMENT IN THE NEW NOTES. (continued on following page) 5 ____________ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. ____________ The date of this Offer to Exchange -- Prospectus is ______________, 1995. 2 6 The Old Notes were sold by the Company on June 20, 1995 to Chase Securities, Inc. and Bear, Stearns & Co. Inc. (the "Initial Purchasers") in a transaction exempt from registration under the Securities Act. The Initial Purchasers subsequently placed the Old Notes with qualified institutional buyers in reliance upon Rule 144A under the Securities Act or with institutional accredited buyers within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the Securities Act. Accordingly, the Old Notes may not be reoffered, resold or otherwise transferred in the United States unless so registered or unless an applicable exemption from the registration requirements of the Securities Act is available. The New Notes are being offered hereunder in order to satisfy the obligations of the Company under the Registration Rights Agreement. See "The Exchange Offer--Purpose and Effect of the Exchange Offer." Based on certain interpretive letters issued by the Staff of the Division of Corporation Finance of the Securities and Exchange Commission (the "Commission") to third parties, the Company believes that the New Notes issued pursuant to the Exchange Offer may be offered for resale, resold and otherwise transferred by any holder thereof (other than (i) a broker-dealer who acquired Old Notes directly from the Company for resale pursuant to Rule 144A or any other available exemption under the Securities Act or (ii) a person who is an "affiliate" of the Company within the meaning of Rule 405 under the Securities Act) without further compliance with the registration and prospectus delivery provisions of the Securities Act, provided that such New Notes are acquired in the ordinary course of such holder's business and such holder has no arrangement or understanding with any person to participate in the distribution of such New Notes. Holders of Old Notes wishing to accept the Exchange Offer must represent to the Company that such conditions have been met. Each broker-dealer that receives New Notes for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such New Notes. The Letter of Transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. This Prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of New Notes received in exchange for Old Notes where such Old Notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. The Company has agreed that it will make this Prospectus available to any broker-dealer for use in connection with any such resale. See "Plan of Distribution." As of the Record Date (as hereinafter defined), there were two registered holders of the Old Notes and Cede & Co., as nominee for The Depository Trust Company, New York, New York ("DTC"). DTC held Old Notes for certain of its participants. The Company believes that no such holder is an affiliate (as such term is defined in Rule 405 under the Securities Act) of the Company. There previously has been only a limited secondary market and no public market for the Old Notes. The Old Notes are eligible for trading in the Private Offering, Resales and Trading through Automatic Linkages ("PORTAL") market. The Company does not intend to list the New Notes on any securities exchange or to seek approval for quotation through any automated quotation system. Therefore, there can be no assurance that an active market for the 3 7 New Notes will develop. If such a trading market develops for the New Notes, future trading prices will depend on many factors, including, among other things, prevailing interest rates, the Company's results of operations and the market for similar securities. Depending on such factors, the New Notes may trade at a discount from their face value. See "Risk Factors--Lack of Public Market for New Notes." The Company will not receive any proceeds from this offering, but, pursuant to the Registration Rights Agreement, the Company will bear certain offering expenses. No underwriter is being utilized in connection with the Exchange Offer. THE EXCHANGE OFFER IS NOT BEING MADE TO, NOR WILL THE COMPANY ACCEPT SURRENDERS FOR EXCHANGE FROM, HOLDERS OF OLD NOTES IN ANY JURISDICTION IN WHICH THE EXCHANGE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE WITH THE SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTION. Holders of Old Notes whose Old Notes are not tendered and accepted in the Exchange Offer will continue to hold such Old Notes and will be entitled to all the rights and preferences and will be subject to the limitations applicable thereto under the Indenture, and with respect to transfer, under the Securities Act. To the extent that Old Notes are tendered and accepted in the Exchange Offer, the trading market for untendered and tendered but unaccepted Old Notes could be adversely affected. The New Notes will be available initially only in book-entry form. The Company expects that the New Notes issued pursuant to this Exchange Offer will be issued in the form of one or more fully registered global notes, which will be deposited with, or on behalf of, DTC and registered in the its name or in the name of Cede & Co., its nominee. Beneficial interests in the global notes representing the New Notes will be shown on, and transfers thereof will be effected only through, records maintained by DTC and its participants. After the initial issuance of each global note, New Notes in certificated form will be issued in exchange for the global note only as set forth in the Indenture. See "Description of Notes--Book-Entry, Delivery and Form." AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information with the Commission. Such reports, proxy statements and other information can be inspected and copied at the public reference facilities maintained by the Commission at Judiciary Plaza, 450 Fifth Street N.W., Washington D.C. 20549; Seven World Trade Center, 13th Floor, New York, New York 10007; and 500 West Madison Street, Chicago, Illinois 60661. Copies of such material can be obtained at prescribed rates from the Public Reference Section of the Commission, 450 Fifth Street N.W., Washington, D.C. 20549. 4 8 The Company has filed with the Commission a Registration Statement on Form S-4 (herein, together with all amendments thereto, referred to as the "Registration Statement") under the Securities Act. This Prospectus does not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission. For further information, reference is hereby made to the Registration Statement. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The following documents have been filed by the Company with the Commission and are incorporated herein by reference: (i) the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1995; and (ii) the Company's Current Report on Form 8-K dated July 24, 1995. All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this Prospectus and prior to the termination of the Exchange Offer shall be deemed to be incorporated in this Prospectus by reference and to be a part hereof from the date of filing of such documents. Any statement contained herein or in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person to whom a copy of this Prospectus has been delivered, on the written or oral request of such person, a copy of any or all of the documents which have been or may be incorporated in this Prospectus by reference (other than exhibits to such documents unless such exhibits are specifically incorporated by reference in any such documents) and a copy of any or all other contracts or documents which are referred to herein. Requests for such copies should be directed to RPM, Inc., P.O. Box 777, 2628 Pearl Road, Medina, Ohio 44258, Attn: Paul A. Granzier, Vice President, General Counsel and Secretary, telephone (216) 273-5090. 5 9 PROSPECTUS SUMMARY The following summary is qualified in its entirety by the more detailed information and financial statements, including the notes thereto, appearing elsewhere in this Prospectus. Unless the context otherwise requires, the terms "Company" and "RPM" as used in this Prospectus refer to RPM, Inc. and its subsidiaries. Investors should carefully consider the information set forth under the heading "Risk Factors." THE COMPANY General. RPM operates principally in one business segment, the manufacture and marketing of protective coatings. These protective coatings products are used for both industrial and consumer applications. For industrial applications, RPM manufactures and markets coatings for waterproofing and general maintenance, corrosion control and other specialty chemical applications. For consumer applications, RPM manufactures do-it-yourself products for the home maintenance, automotive repair, and consumer hobby and leisure markets. RPM's consumer brands, such as Testors, Rust-Oleum, Bondo, Wolman, Bondex and Zinsser are long-established household names. RPM, through its operating companies, serves niche markets within these broader categories, thus providing a foundation for its strategy of growth through product line extensions. RPM markets its products in approximately 110 countries and operates manufacturing facilities in 45 locations in the United States, Belgium, Canada, Luxembourg and The Netherlands. The Company's executive offices are located at 2628 Pearl Road, P.O. Box 777, Medina, Ohio 44258 and its telephone number is (216) 273-5090. Acquisition of Narragansett/DSI Acquisition Co., Inc. On September 21, 1995, the Company acquired Narragansett/DSI Acquisition Co., Inc., a Delaware corporation ("NDSI"), through the merger (the "Merger") of the Company's wholly owned subsidiary, RPM of Delaware, Inc., a Delaware corporation, with and into NDSI, whereby NDSI became a wholly owned subsidiary of the Company. For further information regarding the Company's acquisition of NDSI, see the Company's Current Report on Form 8-K dated July 24, 1995, which is incorporated herein by reference. NDSI is a non-operating holding company with one direct wholly owned operating subsidiary, Dryvit Systems, Inc., a Rhode Island corporation ("Dryvit"). Dryvit manufactures, distributes and markets insulated, exterior wall materials which are used in both new and retrofit construction. 6 10
TERMS OF THE EXCHANGE OFFER 7.0% Senior Notes Due 2005 . . . . . . . . . . . . The Old Notes were sold by the Company on June 20, 1995 (the "Issue Date" or "Closing Date"), pursuant to a Purchase Agreement, dated as of June 15, 1995 (the "Purchase Agreement"), by and among the Company, and Chase Securities, Inc. and Bear, Stearns & Co. Inc., the initial purchasers of the Old Notes (the "Initial Purchasers"). Registration Rights . . . . . . . . . . . . . . . . Pursuant to the Purchase Agreement, the Company and the Initial Purchasers entered into a Registration Rights Agreement, dated as of June 20, 1995 (the "Registration Rights Agreement"), which grants the holders of the Old Notes certain exchange and registration rights. This Exchange Offer is intended to satisfy such exchange rights which terminate upon consummation of the Exchange Offer. The Exchange Offer . . . . . . . . . . . . . . . . The Company is offering to exchange $1,000 principal amount of its New Notes for each $1,000 principal amount of its outstanding Old Notes that are properly tendered and accepted. As of the date of this Prospectus $150,000,000 in aggregate principal amount of the Old Notes are outstanding. As of the Record Date, there were two registered holders of Old Notes. Based on the position of the Staff of the Division of Corporation Finance of the Commission set forth in certain interpretive letters addressed to third parties, the Company believes that New Notes issued pursuant to the Exchange Offer in exchange for Old Notes may be offered for resale, resold and otherwise transferred by any holder thereof (other than (i) a broker-dealer who acquired Old Notes directly from the Company for resale pursuant to Rule 144A or any other available exemption under the Securities Act or (ii) any person who is an
7 11 "affiliate" of the Company within the meaning of Rule 405 under the Securities Act) without further compliance with the registration and prospectus delivery provisions of the Securities Act, provided that such New Notes are acquired in the ordinary course of such holder's business and that such holder does not intend to participate and has no arrangement or understanding with any person to participate in the distribution of such New Notes. Each broker-dealer that receives New Notes for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such New Notes. The Letter of Transmittal that accompanies this Prospectus (the "Letter of Transmittal") states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. This Prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of New Notes received in exchange for Old Notes where such Old Notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. The Company has agreed that it will make this Prospectus available to any broker-dealer for use in connection with any such resale. See "Plan of Distribution." Any holder of Old Notes who tenders in the Exchange Offer with the intention to participate, or for the purpose of participating, in a distribution of the New Notes could not rely on the position of the Staff of the Division of Corporation Finance of the Commission enunciated in interpretive letters addressed to third parties and in the absence of an exemption therefrom, must comply with the registration and prospectus
8 12 delivery requirements of the Securities Act in connection with any resale transaction. Failure to comply with such requirements in such instance may result in such holder incurring liability under the Securities Act for which the holder is not indemnified by the Company. Expiration Date . . . . . . . . . . . . . . . . . . 5:00 p.m., New York City time, on November 10, 1995. See "The Exchange Offer--Terms of the Exchange Offer, Expiration Date; Termination." Accrued Interest on the New Notes and Old Notes . . . . . . . . . . . . . . The New Notes will bear interest from their respective issuance dates at the same rate and upon the same terms as the Old Notes. Holders whose Old Notes are accepted for exchange will receive accrued and unpaid interest thereon to, but not including, the issuance date of the New Notes and will be deemed to have waived the right to receive any payment in respect of interest on the Old Notes accrued from and after the date of issuance of the New Notes. Accrued but unpaid interest on the Old Notes will be payable with the first interest payment on the New Notes. Procedures for Tendering Old Notes . . . . . . . . . . . . . . . . . . . . . Each holder of Old Notes desiring to accept the Exchange Offer must complete and sign the Letter of Transmittal or a facsimile thereof, in accordance with the instructions contained herein and therein, and mail or deliver the Letter of Transmittal, together with the Old Note and any other required documents to the Exchange Agent (as hereinafter defined) at the address set forth herein and in the Letter of Transmittal on or prior to the Expiration Date. By executing the Letter of Transmittal, each holder will represent to the Company that, among other things, the New Notes acquired pursuant to the Exchange Offer are being obtained in the
9 13 ordinary course of business of the person receiving such New Notes, whether or not such person is the holder, that neither the holder nor any such other person has any arrangement or understanding with any person to participate in the distribution of such New Notes and that neither the holder nor any such other person is an "affiliate," as defined under Rule 405 of the Securities Act. Untendered Old Notes . . . . . . . . . . . . . . . Following the consummation of the Exchange Offer, holders of Old Notes eligible to participate but who do not tender their Old Notes will not have any further registration rights and such Old Notes will continue to be subject to certain restrictions on transfer. Accordingly, the liquidity of the market for such Old Notes could be adversely affected. Shelf Registration Statement . . . . . . . . . . . (i) If, because of any change in law or applicable interpretations thereof by the Division of Corporation Finance of the Staff of the Commission, the Company is not permitted to effect the Exchange Offer, (ii) if the Exchange Offer Registration Statement (as hereinafter defined) is not declared effective by October 19, 1995, or (iii) upon the request of either Initial Purchaser following the consummation of the Exchange Offer (with respect to any Old Notes which were acquired directly from the Company), to the extent such Initial Purchaser is not eligible under applicable securities laws to participate in the Exchange Offer and in each such case such holder has satisfied certain conditions relating to the provision of information to the Company for use therein, the Company has agreed to register resales of the Old Notes on a shelf registration statement (the "Shelf Registration Statement") and use its best efforts to cause it to be declared effective by the Commission as promptly as practicable. The Company
10 14 has agreed to maintain the effectiveness of the Shelf Registration Statement for a period of three (3) years to cover resales of the Old Notes held by any such holders. Special Procedures for Beneficial Owners . . . . . . . . . . . . . . . . . Any beneficial owner whose Old Notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and who wishes to tender should contact such registered holder promptly and instruct such registered holder to tender on such beneficial owner's behalf. If such beneficial owner wishes to tender on such owner's own behalf, such owner must, prior to completing and executing the Letter of Transmittal and delivering its Old Notes, either make appropriate arrangements to register ownership of the Old Notes in such owner's name or obtain a properly completed bond power from the registered holder. The transfer of registered ownership may take considerable time. Guaranteed Delivery Procedures . . . . . . . . . . Holders of Old Notes who wish to tender their Old Notes and (i) whose Old Notes are not immediately available or (ii) who cannot deliver their Old Notes, the Letter of Transmittal and any other documents required by the Letter of Transmittal to the Exchange Agent (or comply with the procedures for book-entry transfers) prior to the Expiration Date, must tender their Old Notes according to the guaranteed delivery procedures set forth in "The Exchange Offer--Guaranteed Delivery Procedures." Withdrawal of Tenders . . . . . . . . . . . . . . . Tenders of Old Notes may be withdrawn at any time prior to 5:00 p.m., New York City time, on the Expiration Date. Acceptance of Old Notes and Delivery of New Notes . . . . . . . . . . . . . . . Subject to the satisfaction or waiver of all conditions of the Exchange Offer, the Company will accept for exchange any and
11 15 all Old Notes that are properly tendered in the Exchange Offer prior to 5:00 p.m., New York City time, on the Expiration Date. The New Notes issued pursuant to the Exchange Offer will be delivered in exchange for the applicable Old Notes accepted in the Exchange Offer promptly following the Expiration Date. See "The Exchange Offer--Acceptance of Old Notes for Exchange; Delivery of New Notes." Certain Federal Income Tax Consequences . . . . . . . . . . . . . . . . . . . For a discussion of certain federal income tax consequences of the exchange of the Old Notes, see "Certain Federal Income Tax Consequences." Exchange Agent . . . . . . . . . . . . . . . . . . The First National Bank of Chicago is the exchange agent (the "Exchange Agent"). The address and telephone number of the Exchange Agent are set forth in "The Exchange Offer--Exchange Agent." DESCRIPTION OF THE NEW NOTES The Exchange Offer applies to $150,000,000 aggregate principal amount of the Old Notes. The form and terms of the New Notes are the same as the form and terms of the Old Notes except that (i) the offer and exchange of the New Notes will have been registered under the Securities Act and, therefore, the New Notes will not bear legends restricting the transfer thereof and (ii) holders of the New Notes will not be entitled to certain rights of holders of Old Notes under the Registration Rights Agreement which will terminate upon consummation of the Exchange Offer. New Notes will evidence the same indebtedness as the Old Notes (which they replace) and will be issued under, and be entitled to the benefits of, the Indenture governing the Old Notes. See "Description of Notes." Securities Offered . . . . . . . . . . . . . . . . $150,000,000 aggregate principal amount of 7.0% Senior Exchange Notes due 2005. Maturity . . . . . . . . . . . . . . . . . . . . . June 15, 2005 Payment of Interest . . . . . . . . . . . . . . . . June 15 and December 15, commencing December 15, 1995.
12 16 Denominations . . . . . . . . . . . . . . . . . . . The New Notes will be issued in minimum denominations of $1,000 and integral multiples of $1,000 in excess thereof. Redemption . . . . . . . . . . . . . . . . . . . . The Notes are not redeemable prior to maturity. Ranking . . . . . . . . . . . . . . . . . . . . . . The Notes will be general unsecured obligations of the Company. The Notes will rank on a parity in right of payment with all existing and future unsubordinated unsecured indebtedness of the Company for borrowed money (approximately $414 million at June 20, 1995). Covenants . . . . . . . . . . . . . . . . . . . . . The Indenture contains certain covenants that, among other things, limit the ability of the Company and its subsidiaries to create certain liens upon its Principal Properties (as hereinafter defined) or upon any Equity Interests (as hereinafter defined) of any subsidiary or engage in certain sale and leaseback transactions. See "Description of Notes." Events of Default . . . . . . . . . . . . . . . . . The Indenture provides that the occurrence of one of a number of certain events will constitute an "Event of Default" under the Indenture and may cause the principal and accrued interest on the New Notes to be due and payable immediately. See "Description of Notes."
NO PROTECTION IN EVENT OF CREDIT DECLINE The provisions of the Indenture do not afford the holders of Notes protection (whether in the form of a repurchase right or otherwise) in the event of the decline in the Company's credit quality resulting from a highly leveraged transaction, reorganization, restructuring, merger or other similar transaction that may adversely affect the holders of the Notes. RISK FACTORS Investors in the Notes should carefully consider the specific factors set forth under "Risk Factors" as well as the other information and data included elsewhere in this Prospectus. 13 17 SUMMARY FINANCIAL DATA (1) (4) The summary historical consolidated financial data for the five years in the period ended May 31, 1995 set forth below are principally derived from and should be read in conjunction with, the related audited consolidated financial statements and accompanying notes included in the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1995.
FISCAL YEAR ENDED MAY 31, ---------------------------------------------------------------------------- 1995 1995 1991 1992 1993 1994 (ACTUAL) PRO FORMA(2) ------ ------ ------ ---- -------- ------------ (IN THOUSANDS EXCEPT PER SHARE AND RATIO DATA) Income Statement Data: Net sales . . . . . $619,613 $680,091 $768,372 $815,598 $1,016,954 $1,034,043 Net income . . . . 37,435 38,481 39,498 52,640 61,099 62,349 Primary earnings per share . . . . . . 0.72 0.73 0.74 0.93 1.07 1.09 Fully diluted earnings per share . . . . 0.71 0.72 0.72 0.89 1.01 1.03 Other Data: Cash dividends per share . . . . . . 0.399 0.442 0.473 0.510 0.550 0.550 Ratio of earnings to fixed charges (3) 4.54 4.12 4.08 6.21 4.83 4.80 Balance Sheet Data: Working capital . . $142,581 $205,419 $191,872 $226,994 $270,226 $270,226 Total assets . . . 457,779 623,346 648,524 660,838 959,140 959,140 Short-term debt . . 21,441 7,763 21,262 1,196 643 643 Long-term debt . . 130,800 273,871 258,712 233,039 406,375 406,375 Shareholders' equity 215,471 233,360 243,899 314,476 347,591 347,591 ___________________ (1) All information presented includes the fiscal 1994 acquisitions of Dynatron/Bondo Corporation and Stonhard, Inc. accounted for on a pooling-of-interests basis. (2) On June 28, 1994, the Company acquired Rust-Oleum Corporation ("Rust-Oleum"). The pro forma data reflect the combined results of operations of the Company and Rust Oleum for the fiscal year ended May 31, 1995. The pro forma Income Statement Data and Other Data are shown as if the acquisition had occurred on June 1, 1994. The pro forma amounts give effect to appropriate adjustments resulting from the combination, but are not necessarily indicative of future results of operations or of what results would have been for the combined companies. (3) For purposes of the ratio of earnings to fixed charges, earnings consist of income from operations before income taxes and fixed charges. Fixed charges include interest and debt expense and one-third of rents which is deemed representative of an interest factor. (4) As described under the caption "Acquisition of Narragansett/DSI Acquisition Co., Inc. and its Wholly Owned Subsidiary Dryvit Systems, Inc.," on July 24, 1995 the Company entered into the Merger Agreement with NDSI and its securityholders pursuant to which the Company will acquire NDSI. The pro forma data set forth in this footnote reflect the combined results of operations of the Company and NDSI for the fiscal year ended May 31, 1995. The pro forma amounts give effect to appropriate adjustments resulting from the combination, but are not necessarily indicative of future results of operations or of what results would have been for the combined companies.
Fiscal Year Ended May 31, 1995 ----------------- (In thousands, except per share data) Net sales $1,085,043 Net income 62,266 Primary earnings per share 1.03 Fully diluted earnings per share 0.98
14 18 ACQUISITION OF NARRAGANSETT/DSI ACQUISITION CO., INC. AND ITS WHOLLY OWNED SUBSIDIARY DRYVIT SYSTEMS, INC. On September 21, 1995 the Company acquired all of the issued and outstanding securities of NDSI and its wholly owned operating subsidiary, Dryvit, for $47 million in cash, of which approximately $14.5 million will be used to repay indebtedness of NDSI, and the issuance of 3,200,000 Common Shares. NDSI is a non-operating holding company with one wholly owned subsidiary, Dryvit. Dryvit manufactures, distributes and markets insulated, exterior wall materials which are used in both new and retrofit construction. For further information regarding NDSI and Dryvit, see the Company's Current Report on Form 8-K dated July 24, 1995, which is incorporated herein by reference. THE COMPANY RPM was organized in 1947 as an Ohio corporation under the name Republic Powdered Metals, Inc. On November 9, 1971, the Company's name was changed to RPM, Inc. As used herein, the terms "RPM" and the "Company" refer to RPM, Inc. and its subsidiaries, unless the context indicates otherwise. The Company has its principal executive offices at 2628 Pearl Road, P.O. Box 777, Medina, Ohio 44258, and its telephone number is (216) 273-5090. BUSINESS RPM operates principally in one business segment, the manufacture and marketing of protective coatings. These protective coatings products are used for both industrial and consumer applications. For industrial applications, RPM manufactures and markets coatings for waterproofing and general maintenance, corrosion control and other specialty chemical applications. For consumer applications, RPM manufactures do-it-yourself products for the home maintenance, automotive repair, and consumer hobby and leisure markets. RPM's consumer brands, such as Testors, Rust-Oleum, Bondo, Wolman, Bondex and Zinsser are long-established household names. RPM, through its operating companies, serves niche markets within these broader categories, thus providing a foundation for its strategy of growth through product line extensions. RPM markets its products in approximately 110 countries and operates manufacturing facilities in 45 locations in the United States, Belgium, Canada, Luxembourg and The Netherlands. 15 19 INDUSTRIAL MARKETS AND PRODUCTS WATERPROOFING AND GENERAL MAINTENANCE. Waterproofing and general maintenance constitute RPM's original marketplace, having been served by Republic Powdered Metals, Inc. since the Company's founding. Operating companies and products include: REPUBLIC POWDERED METALS - heavy-duty protective coatings and single-ply roofing systems; RUST-OLEUM NETHERLANDS B.V. - - coatings for industrial routine maintenance; MAMECO INTERNATIONAL - sealants, deck coatings and membranes; MARTIN MATHYS - water-based coatings for commercial and industrial maintenance; and STONHARD - high-performance polymer floors, linings and wall systems. CORROSION CONTROL. RPM's CARBOLINE manufactures high-performance corrosion-resistant protective coatings, fireproofing, tank linings and floor coatings, and markets these products to industrial, architectural and applicator companies throughout the world. WISCONSIN PROTECTIVE COATINGS manufactures a complete line of liquid-applied, corrosion-resistant coatings used for extremely harsh environments, such as rail cars, tank linings and smoke stacks. SPECIALTY CHEMICALS. RPM's specialty chemicals businesses address selected niche markets within this broad industry category. Specialty chemical companies and products include: DAY-GLO COLOR - fluorescent colorants and pigments; MOHAWK FINISHING PRODUCTS - furniture repair, cleaning and polishing products; ALOX - chemical additives used as rust preventatives, corrosion inhibitors, special lubricants and metal working compounds; CHEMICAL SPECIALTIES - chemicals used for cleaning carpet, upholstery and fabric wall covering, and chemicals used in smoke and fire restoration clean-up; and AMERICAN EMULSIONS - dye additives for textile dyeing and finishing, and water treatment products for the paper industry. CONSUMER MARKETS AND PRODUCTS CONSUMER HOBBY AND LEISURE. The hobby and leisure marketplace is served by TESTOR, America's largest producer and marketer of model paints and accessory items to the hobby and model market, CRAFT HOUSE, producer of paint-by-numbers sets, basic preschool activity sets, crafts and hobby products, and FLOQUIL/POLY S COLOR, manufacturer of hobby, art and craft coatings. RPM's consumer hobby and leisure products are marketed through thousands of mass merchandise, toy and hobby stores throughout North America. CONSUMER DO-IT-YOURSELF. RPM's six primary consumer do-it-yourself businesses are RUST-OLEUM, WM. ZINSSER, KOP-COAT, BONDEX INTERNATIONAL, DYNATRON/BONDO and TALSOL. RUST-OLEUM manufactures high-quality corrosion-resistant coatings for the household maintenance and light industrial markets. WM. ZINSSER is the nation's leading producer of shellac items used as pharmaceutical glazes, confectioner's glazes, citrus fruit coatings and wood coatings, including a broad line of specialty primers and 16 20 sealers. KOP-COAT manufactures pleasure marine coatings and compounds and manufactures wood treatment products. BONDEX INTERNATIONAL produces a nationwide line of household patch and repair products, in addition to basement waterproofing products. DYNATRON/BONDO manufactures auto and marine body filler and related products. TALSOL manufactures automotive paints and coatings. Other consumer do-it-yourself products include fabrics, window treatments and wall coverings sold by DESIGN/CRAFT FABRIC and RICHARD E. THIBAUT. RPM's consumer do-it-yourself products are marketed through thousands of mass merchandise, home center and hardware stores throughout North America. PATENTS, TRADEMARKS AND LICENSES No single patent, trademark (other than the registered trademarks Day-Glo(R), Rust-Oleum(R) and Carboline(R), which are material), name or license, or group of these rights, is material to the Company's business. Day-Glo Color Corp., a subsidiary of the Company, is the owner of over 50 trademark registrations of the mark and name "DAY-GLO" in numerous countries and the United States for a variety of fluorescent products. There are also many other foreign and domestic registrations for other trademarks of the Day-Glo Color Corp., for a total of over 100 registrations. These registrations are valid for a variety of terms ranging from one year to twenty years, which terms are renewable as long as the marks continue to be used. Many of these registrations are renewed on a regular basis. Rust-Oleum Corporation, a subsidiary of the Company, is the owner of over 50 United States trademark registrations for the mark and name "RUST-OLEUM" and other trademarks covering a variety of rust-preventative coatings sold by Rust-Oleum Corporation. There are also many foreign registrations for "RUST-OLEUM" and the other trademarks of Rust-Oleum Corporation, for a total of nearly 400 registrations. These registrations are valid for a variety of terms ranging from one year to twenty years, which terms are renewable for as long as the marks continue to be used. Many of these registrations are renewed on a regular basis. ACQUISITION STRATEGY Since RPM's offering of Common Shares to the public in September 1969, the Company has made a number of significant acquisitions that have been described in previous reports on file with the Commission. For a description of RPM's currently pending acquisition of NDSI see "Acquisition of Narragansett/DSI Acquisition Co., Inc. and its Wholly Owned Subsidiary Dryvit Systems, Inc." RPM's acquisition strategy focuses on companies with high performance and quality products which are leaders in their respective markets. RPM expects to continue its acquisition program, although there is no assurance that any additional acquisitions will be made. 17 21 RISK FACTORS Investors in the Notes should carefully consider the following risk factors in addition to the other information contained in this Prospectus. CONSEQUENCES OF FAILURE TO EXCHANGE The untendered Old Notes of holders who do not exchange such Old Notes pursuant to the Exchange Offer will remain restricted securities. Such Old Notes will continue to be subject to the restrictions on transfer, as set forth in the Confidential Offering Memorandum, dated June 15, 1995, pursuant to which the Old Notes were originally purchased; if in the future a holder of Old Notes decides to resell, pledge or otherwise transfer the Old Notes, such Old Notes may be resold, pledged or transferred only (i) to the Company (upon redemption or otherwise), (ii) so long as such security is eligible for resale pursuant to Rule 144A, to a person whom the seller reasonably believes is a qualified institutional buyer that purchases for its own account or for the account of a qualified institutional buyer to whom notice is given that the resale, pledge or transfer is being made in reliance on Rule 144A, (iii) in an offshore transaction in accordance with Regulation S, but only in the case of a transfer that is effected by the delivery of the transferee of securities registered in its name (or its nominee's name) in the books maintained by the registrar for the Notes, (iv) pursuant to an exemption from registration under the Securities Act provided by Rule 144 (if available) or Rule 145 under the Securities Act, (v) in reliance on another exemption from the registration requirements of the Securities Act but only in the case of a transfer that is effected by the delivery to the transferee of securities registered in its name (or its nominee's name) in the books maintained by the registrar for the Old Notes and subject to the receipt by the registrar or co-registrar of a certification of the transferor and an opinion satisfactory to counsel to the Company to the effect that such transfer is in compliance with the Securities Act or (vi) pursuant to an effective registration statement under the Securities Act, in each case in accordance with any applicable securities laws of any state of the United States. The Old Notes provide that, if the Exchange Offer is not consummated by November 17, 1995, the interest rate borne by the Old Notes will increase by .50% per annum following November 17, 1995 until the Exchange Offer is consummated. See "Description of Old Notes." Following consummation of the Exchange Offer, the Old Notes will not be entitled to any increase in the interest rate thereon. The New Notes will not be entitled to any such increase in the interest rate thereon. ABSENCE OF PUBLIC MARKET The Old Notes are currently owned by a relatively small number of beneficial owners. The Company believes that none of such holders is an affiliate (as defined in Rule 405 under the Securities Act) of the Company. Prior to the Exchange Offer, there has not been any public market for the Notes, although the Old Notes are eligible for trading in the PORTAL Market. Certain holders of Old Notes who are not eligible to participate in the Exchange Offer are entitled to certain registration rights and the Company is required to file the Shelf Registration 18 22 Statement with respect to resales of any such Notes. The Old Notes have not been registered under the Securities Act and will be subject to restrictions on transferability to the extent that they are not exchanged for New Notes by holders who are entitled to participate in this Exchange Offer. See "-- Consequences of Failure to Exchange." The Company does not intend to list the New Notes on any national securities exchange or to seek the admission thereof to trading in the National Association of Securities Dealers Automated Quotation System. Accordingly, no assurance can be given that an active public or other market will develop for the Notes or as to liquidity of or the trading market for the Notes. If a trading market does not develop or is not maintained, holders of the Notes may experience difficulty in reselling the Notes or may be unable to sell them at all. If a market for the Notes develops, any such market may be discontinued at any time. If a public trading market develops for the Notes, future trading prices of the Notes will depend on many factors, including, among other things, prevailing interest rates, the Company's results of operations and the market for similar securities. Depending on prevailing interest rates, the market for similar securities and other factors, including the financial condition of the Company, the Notes may trade at a discount from their principal amount. EXCHANGE OFFER PROCEDURES Issuance of the New Notes in exchange for the Old Notes pursuant to the Exchange Offer will be made only after a timely receipt by the Company of such Old Notes, a properly completed and duly executed Letter of Transmittal and all other required documents. Therefore, holders of the Old Notes desiring to tender such Old Notes in exchange for New Notes should allow sufficient time to ensure timely delivery. The Company is under no duty to give notification of defects or irregularities with respect to the tenders of Old Notes for exchange. Old Notes that are not tendered or are tendered but not accepted will, following the consummation of the Exchange Offer, continue to be subject to the existing restrictions upon transfer thereof and, upon consummation of the Exchange Offer certain registration rights under the Registration Rights Agreement will terminate. In addition, any holder of Old Notes who tenders in the Exchange Offer for the purpose of participating in a distribution of the New Notes may be deemed to have received restricted securities and, if so, will be required to comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction. Each broker-dealer that receives New Notes for its own account in exchange for Old Notes, where such Old Notes were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such New Notes. See "Plan of Distribution." To the extent that Old Notes are tendered and accepted in the Exchange Offer, the trading market for untendered and tendered but unaccepted Old Notes could be adversely affected. See "The Exchange Offer." POSSIBLE RUST LIABILITIES OF NDSI NDSI periodically receives warranty claims relating to rust spotting and staining that appears on a customer's exterior finished wall. These rust claims arise from the presence of impurities in the sand component of product manufactured by NDSI's operating subsidiary, 19 23 Dryvit, prior to April 1991. The impurities consisted of ferrous and pyrite particles which developed into rust spots when exposed to seasonal weathering conditions. The rust spots affect only the aesthetic appearance of the building and have no impact on its structural integrity. NDSI has implemented comprehensive quality control procedures specifically aimed at ensuring the elimination of impurities from the manufacturing process. The quality control procedures include independent inspection and analysis of sand sources prior to selecting suppliers, analysis of sand shipments before shipping and again upon arrival at the production facilities, and the inclusion of high powered magnets in the sand handling process at all facilities. These quality control steps were completed and in place by April 1991. NDSI has not received any rust warranty claims relating to product produced after April 1991. Rust warranty expense amounted to $2,416,983 in 1994 and $1,904,302 in 1993. However, based on their experience with reported claims, management believes that an estimate of future claims cannot be reasonably determined, since not all product produced prior to April 1991 contained impurities and not all projects having rust spots will result in a claim. Significant increases in future rust warranty claims could have an adverse impact on the Company's results of operations. THE EXCHANGE OFFER PURPOSE AND EFFECT OF THE EXCHANGE OFFER The Old Notes were sold by the Company on June 20, 1995 to the Initial Purchasers pursuant to the Purchase Agreement. The Initial Purchasers subsequently placed the Old Notes with "qualified institutional buyers" in reliance on Rule 144A under the Securities Act or to institutional "accredited" buyers within the meaning of subparagraph (a)(1), (2), (3) or (7) of Rule 501 under the Securities Act. Pursuant to the Registration Rights Agreement executed in connection with the Company's sale of the Old Notes to the Initial Purchasers, the Company agreed (i) to file with the Commission a registration statement under the Securities Act with respect to the Exchange Offer within 45 days of the Closing Date, (ii) use its best efforts to cause such Exchange Offer Registration Statement (the "Exchange Offer Registration Statement") to become effective under the Securities Act on or prior to 120 days after the Closing Date (the "Exchange Offer Effectiveness Target Date"), and (iii) unless the Exchange Offer would not be permitted by law or a policy of the Commission, to commence the Exchange Offer promptly following the effectiveness of the Exchange Offer Registration Statement and use its best efforts to issue within 150 days of the Closing Date New Notes in exchange for all Old Notes tendered prior thereto in the Exchange Offer. This Prospectus is intended to satisfy such Company obligations under the Registration Rights Agreement. A copy of the Registration Rights Agreement has been filed as an exhibit to the Registration Statement of which this Prospectus is a part. The term "Holder" with respect to the Exchange Offer means any person in whose name Old Notes are registered on the books of the Company or any other person who has obtained a properly completed bond power from the registered holder. 20 24 Based on the position of the Staff of the Division of Corporation Finance of the Commission set forth in certain interpretive letters addressed to third parties, the Company believes that New Notes issued pursuant to the Exchange Offer in exchange for Old Notes may be offered for resale, resold and otherwise transferred by any holder of such New Notes (other than (i) a broker-dealer who acquired Old Notes directly from the Company for resale pursuant to Rule 144A or any other available exemption under the Securities Act or (ii) any person who is an "affiliate" of the Company within the meaning of Rule 405 under the Securities Act) without further compliance with the registration and prospectus delivery provisions of the Securities Act, provided that such New Notes are acquired in the ordinary course of such holder's business and such holder does not intend to participate and has no arrangement or understanding with any person to participate in the distribution of such New Notes. Any Holder who tenders in the Exchange Offer with the intention to participate, or for the purpose of participating, in a distribution of the New Notes could not rely on the position of the Staff of the Division of Corporation Finance of the Commission enumerated in interpretive letters addressed to third parties and, in the absence of an exemption therefrom, must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction. In addition, any such resale transaction should be covered by an effective registration statement containing the selling securityholders information required by Item 507 of Regulation S-K. See "Description of Notes--Registration Rights." Each broker-dealer that receives New Notes for its own account in exchange for Old Notes, where such Old Notes were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such New Notes. See "Plan of Distribution." By tendering in the Exchange Offer, each Holder will represent to the Company that, among other things, (i) the New Notes acquired pursuant to the Exchange Offer are being obtained in the ordinary course of business of the person receiving such New Notes, whether or not such person is the Holder, (ii) neither the Holder nor any such other person has an arrangement or understanding with any person to participate in the distribution of such New Notes, (iii) neither the Holder nor any such other person is an "affiliate," as defined under Rule 405 of the Securities Act, of the Company, and (iv) the Holder and such other person acknowledge that (a) any person participating in the Exchange Offer for the purpose of distributing the New Notes must, in the absence of an exemption therefrom, comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale of the New Notes and cannot rely on the interpretive letters referenced above and (b) failure to comply with such requirements in such instance could result in such Holder incurring liability under the Securities Act for which such Holder is not indemnified by the Company. As a result of the filing and the effectiveness of the Exchange Offer Registration Statement of which this Prospectus is a part, certain prospective increases in the interest rate on the Old Notes provided for in the Registration Rights Agreement will not occur. Following the consummation of the Exchange Offer, Holders of Old Notes not tendered will generally not have any further registration rights and the Old Notes will continue to be subject to certain restrictions on transfer. Accordingly, the liquidity of the market for the Old Notes could be adversely affected. See "Description of the Notes--Registration Rights." 21 25 TERMS OF THE EXCHANGE OFFER The Company hereby offers, upon the terms and subject to the conditions set forth herein and in the accompanying Letter of Transmittal, to exchange $1,000 in principal amount of New Notes for each $1,000 in principal amount of its outstanding Old Notes. New Notes will be issued only in integral multiples of $1,000 to each tendering Holder whose Old Notes are accepted in the Exchange Offer. The Company will accept any Old Notes validly tendered and not withdrawn prior to 5:00 p.m., New York City time, on November 10, 1995, the Expiration Date of the Exchange Offer. Old Notes that are not accepted for exchange will be returned as promptly as practicable after the Expiration Date. Holders may tender all or a portion of their Old Notes pursuant to the Exchange Offer. The form and terms of the New Notes under the Indenture will be identical in all material respects to the form and terms of the Old Notes, except that (i) the offering of the New Notes will have been registered under the Securities Act and hence the New Notes will not bear legends restricting the transfer thereof and (ii) holders of New Notes will not be entitled to certain rights intended for holders of unregistered securities under the Registration Rights Agreement which will terminate upon the consummation of the Exchange Offer. The New Notes evidence the same debt as the Old Notes (which they replace) and will be issued under, and be entitled to the benefits of, the Indenture governing the Old Notes. The New Notes will bear interest from their date of issuance at the same rate and upon the same terms as the Old Notes. See "Description of Notes." Accrued and unpaid interest on the Old Notes accepted for exchange for the period to but not including the date of issuance of the New Notes (the "Exchange Date") will be paid to the holders of New Notes on the first Interest Payment Date (as defined in "Description of Notes"). Holders whose Old Notes are accepted for exchange will be deemed to have waived the right to receive any payment in respect of interest on the Old Notes accrued on and after the Exchange Date. As of the date of this Prospectus, $150,000,000 aggregate principal amount of the Old Notes was outstanding and of such amount, $148,000,000 aggregate principal amount was registered in the name of Cede & Co., as nominee for DTC. Solely for reasons of administration (and for no other purpose) the Company has fixed the close of business on October 10, 1995, as the record date (the "Record Date") for the Exchange Offer for purposes of determining the persons to whom this Prospectus and the Letter of Transmittal will be mailed initially. Only a registered holder of the Old Notes (or such holder's legal representative or attorney-in-fact) as reflected on the records of the Trustee under the Indenture may participate in the Exchange Offer. Holders of Old Notes do not have any appraisal or dissenters' rights in connection with the Exchange Offer. The Company shall be deemed to have accepted validly tendered Old Notes when, as and if the Company has given oral or written notice thereof to the Exchange Agent. The Exchange 22 26 Agent will act as agent for tendering Holders of Old Notes for the purposes of receiving the New Notes from the Company. If any tendered Old Notes are not accepted for exchange because of an invalid tender, the occurrence of certain other events set forth herein or otherwise, certificates for any such unaccepted Old Notes will be returned, without expense, to the tendering Holder thereof as promptly as practicable after the Expiration Date. Tendering Holders will not be required to pay brokerage commissions or fees or, subject to the instructions of the Letter of Transmittal, transfer taxes with respect to the exchange of Old Notes for New Notes pursuant to the Exchange Offer. The Company will pay all charges and expenses, other than certain taxes which may be levied in the event of any transfer of ownership, in connection with the Exchange Offer. See "The Exchange Offer--Fees and Expenses." Neither the Board of Directors of the Company nor the Company makes any recommendation to holders of Old Notes as to whether to tender or refrain from tendering all or any portion of their Old Notes pursuant to the Exchange Offer. In addition, no one has been authorized to make any such recommendation. Holders of Old Notes must make their own decision whether to tender pursuant to the Exchange Offer and, if so, the aggregate amount of Old Notes to tender after reading this Prospectus and the Letter of Transmittal and consulting with their advisers, if any, based on their own financial position and requirements. EXPIRATION DATE; EXTENSIONS; AMENDMENTS The term "Expiration Date" shall mean 5:00 p.m. New York City time, on November 10, 1995, unless the Company, in its sole discretion, extends the Exchange Offer, in which case the term "Expiration Date" shall mean the latest date and time to which the Exchange Offer is extended. In order to extend the Exchange Offer, the Company will notify the Exchange Agent of any extension by oral or written notice and will make a public announcement thereof, each prior to 9:00 a.m., New York City time on the next business day after the previously scheduled Expiration Date. The Company reserves the right, in its sole discretion, (i) to delay accepting any Old Notes, (ii) to extend the Exchange Offer, or (iii) to amend the terms of the Exchange Offer in any manner. Any such delay in acceptance, extension, or amendment will be followed as promptly as practicable by a public announcement thereof. If the Exchange Offer is amended in a manner determined by the Company to constitute a material change, the Company will promptly disclose such amendments by means of a prospectus supplement that will be distributed to the registered holders of Old Notes, and the Company will extend the Exchange Offer for a period of five to 10 business days, depending upon the significance of the amendment and the manner of disclosure to the registered holders, if the Exchange Offer would otherwise expire during such five to 10 business day period. 23 27 Without limiting the manner in which the Company may choose to make public announcement of any delay, extension, or amendment of the Exchange Offer, the Company shall not have an obligation to publish, advertise or otherwise communicate any such public announcement, other than by making a timely release to the Dow Jones News Service. INTEREST ON THE NEW NOTES The New Notes will bear interest from their date of issuance. Holders of Old Notes that are accepted for exchange will receive, in cash, accrued interest thereon to, but not including, the date of issuance of the New Notes. Such interest will be paid with the first interest payment of the New Notes. Interest of the Old Notes accepted for exchange will cease to accrue on the day prior to the issuance of the New Notes. The New Notes bear interest (as do the Old Notes) at a rate equal to 7.0% per annum. Interest on the New Notes is payable on each June 15 and December 15 beginning on December 15, 1995. PROCEDURES FOR TENDERING OLD NOTES The tender by a Holder as set forth below and the acceptance thereof by the Company will constitute a binding agreement between the tendering Holder and the Company upon the terms and subject to the conditions set forth in this Prospectus and in the accompanying Letter of Transmittal. Except as set forth below, a Holder who wishes to tender Old Notes for exchange pursuant to the Exchange Offer must transmit such Old Notes, together with a properly completed and duly executed Letter of Transmittal, including all other documents required by such Letter of Transmittal, to the Exchange Agent at the address set forth below under "--Exchange Agent" on or prior to 5:00 p.m. New York City time, on the Expiration Date. By executing the Letter of Transmittal, each Holder will make to the Company the representations set forth above in the third paragraph under the heading "--Purpose and Effect of the Exchange Offer." THE METHOD OF DELIVERY OF OLD NOTES, LETTERS OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS IS AT THE ELECTION AND RISK OF THE ELIGIBLE HOLDER. IF SUCH DELIVERY IS BY MAIL, IT IS RECOMMENDED THAT REGISTERED MAIL, PROPERLY INSURED, WITH RETURN RECEIPT REQUESTED BE USED. INSTEAD OF DELIVERY BY MAIL, IT IS RECOMMENDED THAT THE ELIGIBLE HOLDER USE AN OVERNIGHT OR HAND DELIVERY SERVICE. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ASSURE TIMELY DELIVERY. Each signature on a Letter of Transmittal or a notice of withdrawal, as the case may be, must be guaranteed unless the Old Notes surrendered for exchange pursuant thereto are tendered (i) by a registered holder of the Old Notes who has not completed either the box entitled 24 28 "Special Exchange Instructions" or the box entitled "Special Delivery Instructions" on the Letter of Transmittal or (ii) by an Eligible Institution (as defined below). In the event that a signature on a Letter of Transmittal or a notice of withdrawal, as the case may be, is required to be guaranteed, such guarantee must be by a firm which is a member of a registered national securities exchange or a member of the National Association of Securities Dealers, Inc., a commercial bank or trust company having an office or correspondent in the United States or is otherwise an "eligible institution" within the meaning of Rule 17AD-15 under the Exchange Act (collectively, "Eligible Institutions"). If Old Notes are registered in the name of a person other than a signer of the Letter of Transmittal, the Old Notes surrendered for exchange must either (i) be endorsed by the registered holder, with the signature thereon guaranteed by an Eligible Institution or (ii) be accompanied by a bond power, in satisfactory form as determined by the Company in its sole discretion, duly executed by the registered holder, with the signature thereon guaranteed by an Eligible Institution along with the other documents required upon transfer by the Purchase Agreement. The term "registered holders" as used herein with respect to the Old Notes means any person in whose name the Old Notes are registered on the books of the Registrar for the Old Notes. Tenders may be made only in principal amounts of $1,000 and integral multiples thereof. Subject to the foregoing, Holders may tender less than the aggregate principal amounts represented by the Old Notes deposited with the Exchange Agent provided they appropriately indicate this fact in the Letter of Transmittal accompanying the tendered Old Notes. The Company understands that the Exchange Agent will make a request promptly after the date of this Prospectus to establish accounts with respect to the Old Notes at the book-entry transfer facility. DTC (the "Book-Entry Transfer Facility"), for the purpose of facilitating the Exchange Offer, and subject to the establishment thereof, any financial institution that is a participant in the Book-Entry Transfer Facility's system may make book entry delivery of Old Notes by causing such book entry transfer facility to transfer such Old Notes into the Exchange Agent's account with respect to the Old Notes in accordance with the Book-Entry Transfer Facility's procedures for such transfer. Although delivery of the Old Notes may be effected through book-entry transfer into the Exchange Agent's account at the Book-Entry Transfer Facility, an appropriate Letter of Transmittal properly completed and duly executed with any required signature guarantee and all other required documents must in each case be transmitted to and received or confirmed by the Exchange Agent at its address set forth below on or prior to the Expiration Date, or, if the guaranteed delivery procedures described below are complied with, within the time period provided under such procedures. Delivery of documents to the Book-Entry Transfer Facility does not constitute delivery to the Exchange Agent. All questions as to validity, form, eligibility (including time of receipt), acceptance and withdrawal of Old Notes tendered for exchange will be determined by the Company in its sole, reasonable discretion, which determination shall be final and binding. The Company reserves the absolute right to reject any or all tenders of any particular Old Notes not properly tendered or to reject any particular Old Notes which acceptance might, in the judgment of the Company 25 29 or its counsel, be unlawful. The Company also reserves the absolute right to waive any defects or irregularities or conditions of the Exchange Offer as to any particular Old Notes either before or after the Expiration Date (including the right to waive the ineligibility of any Holder who seeks to tender Old Notes in the Exchange Offer). The interpretation of the terms and conditions of the Exchange Offer (including the Letter of Transmittal and the instructions thereto) by the Company shall be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of Old Notes for exchange must be cured within such reasonable period of time as the Company shall determine. The Company will use reasonable efforts to give notification of defects or irregularities with respect to tenders of Old Notes for exchange but shall not incur any liability for failure to give such notification. Tenders of the Old Notes will not be deemed to have been made until such irregularities have been cured or waived. If any Letter of Transmittal, endorsement, bond power, power of attorney or any other document required by the Letter of Transmittal is signed by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, such person should so indicate when signing, and, unless waived by the Company, proper evidence satisfactory to the Company of such person's authority to so act must be submitted. Any beneficial owner whose Old Notes are registered in the name of a broker, dealer, commercial bank, trust company or other nominee and who wishes to tender Old Notes in the Exchange Offer should contact such registered holder promptly and instruct such registered holder to tender on such beneficial owner's behalf. If such beneficial owner wishes to tender directly, such beneficial owner must, prior to completing and executing the Letter of Transmittal and tendering Old Notes, make appropriate arrangements to register ownership of the Old Notes in such beneficial owner's name. Beneficial owners should be aware that the transfer of registered ownership may take considerable time. GUARANTEED DELIVERY PROCEDURES Holders who wish to tender their Old Notes and (i) whose Old Notes are not immediately available, (ii) who cannot deliver their Old Notes and Letter of Transmittal or any other documents required by the Letter of Transmittal to the Exchange Agent prior to the Expiration Date, or (iii) who cannot complete the procedures for book-entry transfer on a timely basis must tender their Old Notes according to the guaranteed delivered procedures set forth in the Letter of Transmittal. Pursuant to such procedures: a. such tender must be made by or through an Eligible Institution and a Notice of Guaranteed Delivery (as defined in the Letter of Transmittal) must be signed by such Holder; b. prior to the Expiration Date, the Exchange Agent must have received from the Holder and the Eligible Institution a properly completed and duly executed Letter of Transmittal and a Notice of Guaranteed Delivery (by facsimile transmission, mail or hand delivery) setting 26 30 forth the name and address of the Holder, the certificate number or numbers of the tendered Old Notes, and the principal amount of tendered Old Notes, stating that the tender is being made thereby and guaranteeing that, within five business days after the date of delivery of the Notice of Guaranteed Delivery, the tendered Old Notes and any other required documents will be deposited by the Eligible Institution with the Exchange Agent; and c. such properly completed and executed documents required by the Letter of Transmittal and the tendered Old Notes in proper form for transfer must be received by the Exchange Agent within three business days after the Expiration Date. Any Holder who wishes to tender Old Notes pursuant to the guaranteed delivery procedures described above must ensure that the Exchange Agent received the Notice of guaranteed Delivery and Letter of Transmittal relating to such Old Notes prior to 5:00 p.m. New York City time, on the Expiration Date. Failure to complete the guaranteed delivery procedures outlined above will not, of itself, affect the validity or effect a revocation of any Letter of Transmittal form properly completed and executed by a Holder who attempted to use the guaranteed delivery process. ACCEPTANCE OF OLD NOTES FOR EXCHANGE; DELIVERY OF NEW NOTES The Company will accept, promptly after the Expiration Date, all Old Notes properly tendered and will issue the New Notes promptly after the acceptance of the Old Notes. For purposes of the Exchange Offer, the Company shall be deemed to have accepted properly tendered Old Notes for exchange when, as, and if the company has given oral or written notice thereof to all Holders of properly tendered Old Notes. In all cases, issuances of New Notes for Old Notes that are accepted for exchange pursuant to the Exchange Offer will be made only after timely receipt by the Exchange Agent of such Old Notes, a properly completed and duly executed Letter of Transmittal, and all other required documents; provided, however, that the Company reserves the absolute right to waive any defects or irregularities in the tender or conditions of the Exchange Offer. If any tendered Old Notes are not accepted for any reason set forth in the terms and conditions of the Exchange Offer or if Old Notes are submitted for a greater principal amount than the Holder desires to exchange, such unaccepted or non- exchanged Old Notes or substitute Old Notes evidencing the unaccepted portion, as appropriate, will be returned without expense to the tendering Holder thereof as promptly as practicable after the expiration or termination of the Exchange Offer. WITHDRAWAL RIGHTS Tenders of the Old Notes may be withdrawn at any time prior to 5:00 p.m. New York City time on the Expiration Date. For a withdrawal to be effective, a written notice of withdrawal must be received by the Exchange Agent at its address set forth on the back cover page of this Prospectus. Any such notice of withdrawal must (i) specify the name of the person 27 31 having deposited the Old Notes to be withdrawn (the "Depositor"), (ii) identify the Old Notes to be withdrawn (including the certificate number or numbers and principal amount of such Old Notes), (iii) be signed by the Holder in the same manner as the original signature on the Letter of Transmittal by which such Old Notes were tendered (including any required signature guarantees) or be accompanied by a bond power in the name of the person withdrawing the tender, in satisfactory form as determined by the Company in its sole discretion, duly executed by the registered holder, with the signature thereon guaranteed by an Eligible Institution along with the other documents required upon transfer by the Registration Rights Agreement or Purchase Agreement, and (iv) specify the name in which such Old Notes are to be re-registered, if different from the Depositor, pursuant to such documents of transfer. All questions as to the validity, form and eligibility (including time of receipt) of such notices will be determined by the Company, whose determination shall be final and binding on all parties. The Old Notes so withdrawn, if any, will be deemed not to have been validly tendered for exchange for purposes of the Exchange Offer. Any Old Notes which have been tendered for exchange but which are withdrawn will be returned to the Holder thereof without cost to such Holder as soon as practicable after withdrawal. Properly withdrawn Old Notes may be retendered by following one of the procedures described under "Procedures for Tendering Old Notes" above at any time on or prior to the Expiration Date. TERMINATION OF CERTAIN RIGHTS Holders of the Old Notes to whom this Exchange Offer is made have special rights under the Registration Rights Agreement that will terminate upon the consummation of the Exchange Offer. The Registration Rights Agreement provides that certain rights under such agreement (including the right to receive a prospective increase in the interest rate on the Old Notes) shall terminate upon the occurrence of (i) the filing with the Commission of the Exchange Offer Registration Statement, (ii) the effectiveness under the Securities Act of the Exchange Offer Registration Statement, (iii) the consummation of the Exchange Offer, and (iv) the maintenance of the Exchange Offer Registration Statement continuously effective for a period of not less than the minimum period required under applicable federal and state securities laws (provided that in no event shall such Exchange Offer remain open and the registration statement relating hereto remain continuously effective, in each case, for less than 20 business days), and (v) the delivery by the Company to the registrar under the Indenture of New Notes in the same aggregate principal amount of Old Notes tendered by Holders thereof pursuant to the Exchange Offer. EXCHANGE AGENT The First National Bank of Chicago has been appointed as Exchange Agent for the Exchange Offer. Questions and requests for assistance and requests for additional copies of the Prospectus, the Letter of Transmittal, and other related documents should be addressed to the Exchange Agent as follows: 28 32 By Registered or Certified -------------------------- Mail, Overnight Courier or Hand: ------------------------------- The First National Bank of Chicago, c/o First Chicago Trust Company of New York 14 Wall Street 8th Floor, Window 2 New York, New York 10005 Attention: Corporate Trust Administration FEES AND EXPENSES The expenses of soliciting tenders will be borne by the Company. The principal solicitation is being made by mail; however, additional solicitation may be made by telegraph, telephone or in person by officers and regular employees of the Company and its affiliates. The Company has not retained any dealer-manager in connection with the Exchange Offer and will not make any payments to brokers, dealers or others soliciting acceptance of the Exchange Offer. The Company, however, will pay the Exchange Agent reasonable and customary fees for its services and will reimburse it for its reasonable out-of-pocket expenses in connection therewith. The cash expenses to be incurred in connection with the Exchange Offer will be paid by the Company and are estimated in the aggregate to be approximately $80,000. Such expenses include fees and expenses of the Exchange Agent and Trustee, accounting and legal fees, filing fees and printing costs, among others. The Company will pay all transfer taxes, if any, applicable to the exchange of Old Notes pursuant to the Exchange Offer. If, however, a transfer tax is imposed for any reason other than the exchange of Old Notes pursuant to the Exchange Offer, then the amount of any transfer taxes (whether imposed on the registered holder or any other persons) will be payable by the tendering Holder. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted with the Letter of Transmittal, the amount of such transfer taxes will be billed directly to such tendering Holder. CONSEQUENCES OF FAILURE TO EXCHANGE The Old Notes which are not exchanged for New Notes pursuant to the Exchange Offer will remain restricted securities. Accordingly, such Old Notes may be resold only (i) to the Company (upon redemption thereof or otherwise), (ii) so long as the Old Notes are eligible for resale pursuant to Rule 144A, to a person whom the seller reasonably believes is a qualified institutional buyer within the meaning of Rule 144A under the Securities Act, purchasing for its own account or for the account of a qualified institutional buyer to whom notice is given that 29 33 the resale, pledge or other transfer is being made in reliance on Rule 144A, (iii) in an offshore transaction in accordance with Regulation S under the Securities Act, but only in the case of a transfer that is effected by the delivery to the transferee of Old Notes registered in its name (or its nominee's name) on the books maintained by the registrar of the Old Notes, (iv) pursuant to an exemption from registration in accordance with Rule 144 (if available) or Rule 145 under the Securities Act, (v) in reliance on another exemption from the registration requirements of the Securities Act, but only in the case of a transfer that is effected by the delivery to the transferee of Old Notes registered in its name (or its nominee's name) on the books maintained by the registrar of the Old Notes, and subject to the receipt by the registrar or co-registrar of a certification of the transferor and an opinion of counsel (satisfactory to the Company) to the effect that such transfer is in compliance with the Securities Act, or (vi) pursuant to an effective registration statement under the Securities Act, in each case in accordance with any applicable securities laws of any state of the United States. Following the consummation of the Exchange Offer, holders of Old Notes will have limited rights under the Registration Rights Agreement. See "--The Shelf Registration Statement." ACCOUNTING TREATMENT The New Notes will be recorded at the same carrying value as the Old Notes, as reflected in the Company's accounting records on the date of the exchange. Accordingly, no gain or loss for accounting purposes will be recognized. The expenses of the Exchange Offer will be amortized over the term of the New Notes. RESALES OF THE NEW NOTES With respect to resales of New Notes, based on the position of the Staff of the Division of Corporation Finance of the Commission set forth in certain interpretive letters addressed to third parties, the Company believes that a Holder (other than (i) a broker-dealer who purchases such New Notes directly from the Company to resell pursuant to Rule 144A or any other available exemption under the Securities Act or (ii) a person that is an affiliate of the Company within the meaning of Rule 405 under the Securities Act) who exchanges Old Notes for New Notes in the ordinary course of business and who is not participating, does not intend to participate, and has no arrangement or understanding with any person to participate, in the distribution of the New Notes, will be allowed to resell the New Notes to the public without further registration under the Securities Act and without delivering to the purchasers of the New Notes a prospectus that satisfies the requirements of Section 10 thereof. However, if any Holder acquires New Notes in the Exchange Offer for the purpose of distributing or participating in a distribution of the New Notes, such Holder cannot rely on the position of the Staff of the Division of Corporation Finance of the Commission enunciated in interpretive letters addressed to third parties and must comply with the registration and prospectus delivery requirements of the Securities Act in connection with a secondary resale transaction, unless an exemption from registration is otherwise available. Further, each broker-dealer that receives New Notes for its own account in exchange for Old Notes, where such Old Notes were acquired by such broker- 30 34 dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such New Notes. As contemplated by the position of the Staff of the Division of Corporation Finance of the Commission in the interpretive letters noted above and the Registration Rights Agreement, each Holder accepting the Exchange Offer is required to represent to the Company in the Letter of Transmittal that (i) the New Notes are to be acquired by the Holder or the person receiving such New Notes, whether or not such person is the Holder, in the ordinary course of business, (ii) the Holder or any such other person (other than a broker-dealer referred to in the next sentence) is not engaging and does not intend to engage in the distribution of the New Notes, (iii) the Holder or any such other person has no arrangement or understanding with any person to participate in the distribution of the New Notes, (iv) neither the Holder nor any such other person is an "affiliate" of the Company within the meaning of Rule 405 under the Securities Act, and (v) the Holder or any such other person acknowledges that if such Holder or other person participates in the Exchange Offer for the purpose of distributing the New Notes it must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale of the New Notes and cannot rely on such interpretive letters. As indicated above, each broker-dealer that receives New Notes for its own account in exchange for Old Notes must also acknowledge that it will deliver a prospectus in connection with any resale of such New Notes. For a description of the procedures for such resales by broker-dealers, see "Plan of Distribution." THE SHELF REGISTRATION STATEMENT The Registration Rights Agreement provides that if, (i) because of any change in law or applicable interpretations thereof by the staff of the Commission, the Company is not permitted to effect the Exchange Offer, (ii) the Exchange Offer Registration Statement is not declared effective by October 19, 1995, or (iii) upon the request of either Initial Purchaser (with respect to any Old Notes which were acquired directly from the Company), to the extent such Initial Purchaser is not eligible under applicable securities laws, to participate in the Exchange Offer, the Company will file with the Commission a Shelf Registration Statement to cover resales of the Notes by the holders thereof who satisfy certain conditions relating to the provision of information in connection with the Shelf Registration Statement. The Company will use its best efforts to cause the applicable registration statement to be declared effective as promptly as possible by the Commission. The Registration Rights Agreement further provides that, if obligated to file the Shelf Registration Statement, the Company will file such with the Commission, as promptly as practicable, after such obligation arises and use its best efforts to cause such Shelf Registration Statement to be declared effective by the Commission, in the case of an obligation to file a Shelf Registration Statement as a result of a change in applicable law or Commission interpretation, or in all other cases, on or prior to 180 days after the Closing Date, and to use its best efforts to cause such Shelf Registration Statement to remain effective and usable for a period of three years following the initial effectiveness thereof. If the Company is obligated to file the Shelf 31 35 Registration Statement and such Shelf Registration Statement is not declared effective in the time periods described above the interest rate on the effected Notes shall be increased one-half of one percentage point (.5%) per annum of the principal amount of effected Notes held by such holder. Following the effectiveness of the Shelf Registration Statement, the interest rate shall revert back to 7.0% with respect to the effected Notes. Holders of Notes will be required to deliver information to be used in connection with the Shelf Registration Statement and to provide comments on the Shelf Registration Statement within the time periods set forth in the Registration Rights Agreement in order to have their Notes included in the Shelf Registration Statement and benefit from the provisions regarding increased interest rates set forth above. In addition, for so long as any effected Notes are outstanding during any period when the Company is not subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company will continue to provide to Holders of Notes and to prospective purchasers of such Notes the information required by Rule 144A(d)(4). USE OF PROCEEDS The Company will not receive any cash proceeds from the issuance of the New Notes offered hereby. In consideration for issuing the New Notes as contemplated in this Prospectus, the Company will receive in exchange Old Notes in like principal amount, the terms of which are identical in all material respects to the New Notes. The Old Notes surrendered in exchange for the New Notes will be retired and cancelled and cannot be reissued. Accordingly, issuance of the New Notes will not result in any increase in the indebtedness of the Company. CAPITALIZATION The following table sets forth the short-term debt and the capitalization of the Company as of May 31, 1995 and as adjusted to give effect to the issuance of the Notes on June 20, 1995 and the repayment of long-term debt with the net proceeds of the offering.
May 31, 1995 ------------ Actual As Adjusted ------ ----------- Short-term debt: Current portion of long-term debt . . . . . . . . . . . . $ 643 $ 643 -------- ------- Total short-term debt . . . . . . . . . . . . . . $ 643 $ 643 ======== ======= Long-term debt, less current maturities: Senior indebtedness . . . . . . . . . . . . . . . . . . . $243,452 $ 93,452 Ten year notes . . . . . . . . . . . . . . . . . . . . . . -0- $150,000 Liquid Yield Option notes . . . . . . . . . . . . . . . . 162,923 162,923 ------- ------- Total long-term debt . . . . . . . . . . . . . . . $406,375 $406,375 ======== ========
32 36 Shareholders' equity: Common shares - $.023 per share; authorized 100,000,000 shares, issued and outstanding 56,957,000 shares . . . . $ 1,296 $ 1,296 Paid-in capital . . . . . . . . . . . . . . . . . . . . . 146,509 146,509 Retained earnings . . . . . . . . . . . . . . . . . . . . $199,206 199,206 Cumulative translation adjustment . . . . . . . . . . . . (580) (580) ------ ------ Total shareholders' equity . . . . . . . . . . . . $347,591 $347,591 -------- -------- Total Capitalization . . . . . . . . . . . . . . . . . . . $753,966 $753,966 ======== ========
33 37 SELECTED FINANCIAL INFORMATION(1) The selected historical consolidated financial data for the five years in the period ended May 31, 1995 set forth below are principally derived from, and should be read in conjunction with, the related audited consolidated financial statements and accompanying notes included in the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1995.
FISCAL YEAR ENDED MAY 31, ----------------------------------------------------------------------- 1995 1995 1991 1992 1993 1994 ACTUAL PRO FORMA(2) ------ ------ ------ ---- ------ ------------ (IN THOUSANDS EXCEPT PER SHARE AND RATIO DATA) Income Statement Data: Net sales . . . . $619,613 $680,091 $768,372 $815,598 $1,016,954 $1,034,043 Cost of sales . . (356,480) (393,677) (448,079) (476,146) (581,246) (590,220) -------- -------- -------- -------- -------- ------- Gross profit . . 263,133 286,414 320,293 339,452 435,708 443,823 Selling, general and administrative expenses . . . (195,546) (208,822) (236,955) (237,931) (305,429) (310,404) Interest expense, net (12,972) (16,491) (17,202) (13,427) (33,422) (24,234) ------- ------ ------- ------- ------- Income before income taxes . . . . . 54,615 61,101 66,136 88,094 106,857 109,185 Provision for income taxes . . . . . (17,180) (22,620) (26,638) (35,454) (45,758) (46,836) ------- ------- ------- ------- ------- ------- Net income . . . $ 37,435 $ 38,481 $ 39,498 $ 52,640 $ 61,099 $ 62,349 ======== ======== ======== ======== ======== ======== Primary earnings per share . . . . . $0.72 $ 0.73 $ 0.74 $ 0.93 $ 1.07 $ 1.09 Fully diluted earnings per share . . . 0.71 0.72 0.72 0.89 1.01 1.03 Other Data: Cash dividends per share . . . . . 0.399 0.442 0.473 0.510 0.550 0.550 Average common shares outstanding . . 52,219 52,790 53,267 56,717 57,243 57,243 Ratio of earnings to fixed charges (3) 4.54 4.12 4.08 6.21 4.83 4.80 Balance Sheet Data: Working capital . $142,581 $205,419 $191,872 $230,512 $270,226 $270,226 Total assets . . 457,779 623,346 648,524 660,838 959,140 959,140 Short-term debt . 21,441 7,763 21,262 1,196 643 643 Long-term debt . 130,800 273,871 258,712 233,039 406,375 406,375 Shareholders' equity 215,471 233,360 243,899 314,476 347,591 347,591 - ------------------- (1) All information presented includes the fiscal 1994 acquisitions of Dynatron/Bondo Corporation and Stonhard, Inc. accounted for on a pooling-of-interests basis. (2) On June 28, 1994, the Company acquired Rust-Oleum. The pro forma data reflect the combined results of operations of the Company and Rust-Oleum for the fiscal year ended May 31, 1995. The pro forma Income Statement Data and Other Data are shown as if the acquisition of Rust-Oleum had occurred on June 1, 1993. The pro forma amounts give effect to appropriate adjustments resulting from the combination, but are not necessarily indicative of future results of operations or of what results would have been for the combined companies. (3) For purposes of the ratio of earnings to fixed charges, earnings consist of income from operations before income taxes and fixed charges. Fixed charges include interest and debt expense and one-third of rents which is deemed representative of an interest factor.
34 38 DESCRIPTION OF NOTES The New Notes are to be issued as a separate series of notes under the same Indenture under which the Old Notes have been issued, dated as of June 1, 1995, between the Company and The First National Bank of Chicago, as trustee (the "Trustee"). No New Notes are currently outstanding. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (the "Trust Indenture Act"). The Notes are subject to all such terms, and holders of Notes are referred to the Indenture and the Trust Indenture Act for a statement thereof. The definitions of certain terms used in the following summary are set forth below under " -- Certain Definitions." The Indenture does not limit the aggregate principal amount of debt securities which may be issued thereunder and provides that debt securities may be issued thereunder from time to time in one or more series (such other debt securities issued under the Indenture, together with the Notes, are hereinafter collectively referred to as the "Debt Securities"). The following summary of the material provisions of the Indenture does not purport to be complete, and where reference is made to particular provisions of the Indenture, such provisions, including the definitions of certain terms, some of which are not otherwise defined herein, are qualified in their entirety by reference to all of the provisions of the Indenture and those terms made a part of the Indenture by the Trust Indenture Act. There is no requirement that future issues of debt securities of the Company be issued under the Indenture, and the Company is free to employ other indentures or documentation containing provisions different from those included in the Indenture in connection with future issues of such other debt securities. GENERAL The Notes mature on June 15, 2005, are limited to $150,000,000 aggregate principal amount at any one time outstanding and are unsecured senior obligations of the Company. Each Note bears interest at 7.0% from June 20, 1995 or from the most recent interest payment date to which interest has been paid, payable semi-annually on June 15 and December 15 in each year, commencing December 15, 1995, to the person in whose name the Note (or any predecessor Note) is registered at the close of business on the June 1 or the December 1 next preceding such interest payment date. The Old Notes and the New Notes will constitute a single series of debt securities under the Indenture. If the Exchange Offer is consummated, holders of the Old Notes who do not exchange their Old Notes for New Notes will vote together with the holders of New Notes for all relevant purposes under the Indenture. In that regard, the Indenture requires that certain actions by the holders thereunder (including acceleration following an Event of Default) must be taken, an certain rights must be exercised, by specified minimum percentages of the aggregate principal amount of the outstanding debt securities of the relevant series. In determining whether holders of the requisite percentage in principal amount have given any notice, consent or waiver or taken any other action permitted under the Indenture, any Old Notes which remain outstanding after the Exchange Offer will be aggregated with the New Notes and the holders of such Old Notes and New Notes will vote together as a single series for all such purposes. 35 39 Accordingly, all references herein to specified percentages in aggregate principal amount of the outstanding Notes shall be deemed to mean, at any time after the Exchange Offer is consummated, such percentage in aggregate principal amount of the Old Notes and New Notes then outstanding. Principal of and interest on the Notes are exchangeable and transferable, at the office or agency of the Company in the City of New York maintained for such purposes (which initially will be the office of the Trustee maintained at The First National Bank of Chicago, c/o First Chicago Trust Company of New York, 14 Wall Street -- 8th Floor, Window 2, New York, New York 10005, Attention: Corporate Trust Administration); provided, however, that payment of principal or interest may be made at the option of the Company by check mailed to the person entitled thereto as shown on the security register. The Old Notes are issued only in fully registered form without coupons, in denominations of $250,000 and any integral multiple of $1,000 in excess thereof. The New Notes will be issued only in fully registered form without coupons in denominations of $1,000 and any integral multiple of $1,000 in excess thereof. No service charge will be made for any registration of transfer, exchange or redemption of Notes, except in certain circumstances for any tax or other governmental charge that may be imposed in connection therewith. The provisions of the Indenture do not afford the holders of the Notes protection (whether in the form of a repurchase right or otherwise) in the event of the decline in the Company's credit quality resulting from a highly leveraged transaction, reorganization, restructuring, merger or other similar transaction that may adversely affect the holders of the Notes. OPTIONAL REDEMPTION The Notes are not subject to redemption prior to maturity. SINKING FUND The Notes are not entitled to the benefit of any sinking fund or other mandatory redemption obligation prior to maturity. RANKING; HOLDING COMPANY STRUCTURE The Notes are unsecured unsubordinated obligations of the Company and rank on a parity in right of payment with all other unsecured and unsubordinated indebtedness of the Company for borrowed money. The Notes are obligations exclusively of the Company. The Company is a holding company substantially all of whose consolidated assets are held by its subsidiaries. Accordingly, the cash flow of the Company and the consequent ability to service its debt, including the Notes, are largely dependent upon the earnings of such subsidiaries. 36 40 Because the Company is a holding company, the Notes will be effectively subordinated to all existing and future indebtedness, trade payables, guarantees, lease obligations and letter of credit obligations of the Company's subsidiaries. Therefore, the Company's rights and the rights of its creditors, including the holders of the Notes, to participate in the assets of any subsidiary upon the latter's liquidation or reorganization will be subject to the prior claims of such subsidiary's creditors, except to the extent that the Company may itself be a creditor with recognized claims against the subsidiary, in which case the claims of the Company would still be effectively subordinate to any security interest in, or mortgages or other liens on, the assets of such subsidiary and would be subordinate to any indebtedness of such subsidiary senior to that held by the Company. LIMITATION ON LIENS The Indenture generally provides that the Company may not, and may not permit any Subsidiary of the Company to, incur or suffer to exist any Lien upon any Principal Property, or upon any Equity Interests of any Subsidiary of the Company (whether such Principal Property or Equity Interest were owned as of the date of the Indenture or thereafter acquired), to secure any Indebtedness without making, or causing such Subsidiary to make, effective provision for securing the Debt Securities issued under the Indenture equally and ratably with (or prior to) such Indebtedness, unless after giving effect thereto, the sum of (A) the principal amount of Indebtedness secured by all Liens incurred after the date of the Indenture and otherwise prohibited by the Indenture and (B) the Attributable Value of all Sale and Leaseback Transactions entered into after the date of the Indenture and otherwise prohibited by the Indenture does not exceed the greater of $50,000,000 or 10% of the Consolidated Shareholders' Equity of the Company. The foregoing restrictions will not apply to Liens or to, among other things, (i) Liens securing only the Securities issued under the Indenture; (ii) Liens on property of a Person existing at the time such Person is merged into or consolidated with the Company or any Subsidiary of the Company (but only to the extent such Liens cover such property); (iii) Liens on property existing immediately prior to the time of acquisition thereof (and not in anticipation of the financing of such acquisition); (iv) any Lien upon any Principal Property (including any property that becomes a Principal Property after acquisition thereof) to secure Indebtedness incurred for the purpose of financing all or any part of the purchase price or the cost of construction or improvement thereof, provided that such Principal Property first becomes a Principal Property after, or construction or development of such Principal Property is underway on and completed after, June 1, 1995, and provided, further, that the principal amount of any Indebtedness secured by such Lien (A) does not exceed 100% of such purchase price or cost and (B) in incurred within 24 months after the later of the purchase thereof and the completion of construction or improvements thereof; (v) any Lien securing certain Indebtedness owing to the Company or to a wholly owned subsidiary of the Company; (vi) certain Liens, as described in the Indenture, arising in the ordinary course of business other that in connection with Indebtedness for borrowed money; and (vii) Liens to secure Indebtedness incurred to extend, render, refinance or refund Indebtedness secured by any Lien referred to in the foregoing clauses (i) to (vi). 37 41 "Attributable Value" means, as to any particular lease under which any Person is at the time liable other than a Capital Lease Obligation, and at any date as of which the amount thereof is to be determined, the total net amount of rent required to be paid by such Person under such lease during the remaining term thereof as determined in accordance with generally accepted accounting principles, discounted from the respective due dated thereof to the date of determination at a rate per annum equal to the discount rate that would be applicable to a Capital Lease Obligation with like term in accordance with generally accepted accounting principles. The net amount of rent required to be paid under any such lease for any such period shall be the aggregate amount of rent payable by the lessee with respect to such period after excluding, in accordance with generally accepted accounting principles, amounts required to be paid on account of insurance, taxes, assessments, utility, operating and labor cost and similar charges and rents charged as a percentage of sales in excess of a base amount. In the case of any lease which is terminable by the lessee upon the payment of a penalty, such net amount shall also include the amount of such penalty, but no rent shall be considered as required to be paid under such lease subsequent to the first date upon which it may be so terminated. "Attributable Value" means, as to Capital Lease Obligation under which any Person is at the time liable and at any date as of which the amount thereof is to be determined, the capitalizes amount thereof that would appear on the face of a balance sheet of such Person in accordance with generally accepted accounting principles. "Capital Lease Obligation" of any Person means the obligation to pay rent or other payment amounts under a lease of (or other indebtedness arrangements conveying the right to use) real or personal property of such Person which is required to be classified and accounted for as a capital lease or a liability on the face of a balance sheet of such Person in accordance with generally accepted accounting principles. The stated maturity of such obligation, as of any date (the "measurement date"), shall be the date of the last payment of rent or any other amount due under such lease after the measurement date upon or after which such lease may be terminated by the lessee, at its sole option, without payment of a penalty. "Consolidated Shareholders' Equity" of any Person means the consolidated shareholders' equity of such Person, determined on a consolidated basis in accordance with generally accepted accounting principles. "Equity Interest" in any Person is defined to mean any and all shares, interests, participations or other equivalents (however designated) of corporate stock of or other ownership interests in such Person, and any options or other rights to acquire, and any securities or other interests convertible into or exchangeable for, any of the foregoing. "Indebtedness," with respect to any Person, means indebtedness for borrowed money or for the unpaid purchase price of real or personal property of, or guaranteed by, such Person (other than trade accounts payable arising in the ordinary course of business) and computed in accordance with generally accepted accounting principles. "Lien" means, with respect to any property or assets, any mortgage or deed of trust, pledge, hypothecation, assignment, security interest, lien, encumbrance, or other security 38 42 arrangement of any kind of nature whatsoever on or with respect to such property or assets (including any conditional sale or other title retention agreement having substantially the same economic effect as any of the foregoing). "Principal Property" means any manufacturing, assembly or storage facility owned or used by the Company or any Subsidiary which is located within the United States (including its territories and possessions) or Canada, other than any such facility the gross book value of which (including related land and improvements thereon and all machinery and equipment included therein without deduction of any depreciation reserves) does not exceed 4% of Consolidated Shareholders' Equity of the Company. "Sale and Leaseback Transaction" of any Person means an arrangement with any lender or investor or to which such lender or investor is a party providing for the leasing by such Person of any Principal Property that, within 12 months of the start of such lease and after the Reference Date, has been or is being sold, conveyed, transferred to or otherwise disposed of by such Person to such lender or investor or to any Person to whom funds have been or are to be advanced by such lender or investor of the security of such property. The term of such arrangement, as of any date (the "measurement date"), shall end on the date of the last payment of rent or any other amount due under such arrangement after the measurement date on or after which such arrangement may be terminated by the lessee, at its sole option, without payment of a penalty. "Sale Transaction" means any such sale, conveyance, transfer or other disposition. The "Reference Date" means, for any property that becomes a Principal Property after, or the construction or development of which is underway on and completed after June 1, 1995 the last day of the 24th month after the date of the acquisition, completion of construction and commencement of operation of such property and, for any other property, June 1, 1995. "Subsidiary" means any Corporation of which at the time of determination the Company or one or more Subsidiaries owns or controls directly or indirectly more than 50% of the shares of Voting Stock. LIMITATION ON SALE AND LEASEBACK TRANSACTIONS The Indenture generally provides that the Company may not, and may not permit any Subsidiary of the Company to, enter into any Sale and Leaseback Transaction (except for a period not exceeding 36 months), unless, (i) after giving effect thereto, the sum of (A) the principal amount of Indebtedness secured by all Liens incurred after the date of the Indenture and otherwise prohibited by the Indenture and (B) the Attributable Value of all Sale and Leaseback Transactions entered into after the date of the Indenture and otherwise prohibited by the Indenture does not exceed the greater of $50,000,000 or 10% of Consolidated Shareholders' Equity of the Company or (ii) the Company or such Subsidiary applies or commits to apply, within 180 days before or after the Sale Transaction pursuant to such Sale and Leaseback Transaction, an amount equal to the Net Available Proceeds therefrom to the repayment of Indebtedness of the Company (including any Debt Securities) which is pari passu with or prior to the Debt Securities issued under the Indenture (or, if none, other Indebtedness of the Company or, if non, Indebtedness of any Subsidiary of the Company), 39 43 "Net Available Proceeds" from any Sale Transaction by any Person means cash or readily marketable cash equivalents received (including by way of sale or discounting of a note, installment receivable or other receivable, but excluding any other consideration received in the form of assumption by the acquiree of indebtedness or obligations relating to the properties or assets that are the subject of such Sale Transaction or received in any other noncash form) therefrom by such Person, net of (i) al legal, title and recording taxes, expenses, commissions and other fees and expenses incurred an all federal, state, provincial, foreign and local taxes required to be accrued as a liability as a consequence of such Sale Transaction, (ii) all payments made by such Person or its Subsidiaries on any Indebtedness which is secured in whole or in part by any such properties and assets in accordance with the terms of any Lien upon or with respect to any such properties and assets of which must, by the terms of such Lien, or in order to obtain a necessary consent to such Sale Transaction or by applicable law, be repaid out of the proceeds from such Sale Transaction, and (iii) all distributions and other payments made to minority interest holder in subsidiaries of such persons or joint ventures as a result of such Sale Transaction. CONSOLIDATION, MERGER, SALE OF ASSETS The Company may consolidate or merge with or into, or transfer it assets substantially as an entirety to, any corporation organized under the laws of any domestic jurisdiction, provided that the successor corporation assumes the Company's obligations on the Debt Securities and under the Indenture, that after giving effect to the transaction no Event of Default, and no event which, after notice or lapse of time or both, would become an Event of Default, shall have occurred and be continuing, and that certain other conditions are met. EVENTS OF DEFAULT The following will be "Events of Default" under the Indenture: (i) failure to pay any interest on any Debt Security when it becomes due and payable, and such failure shall continue for a period of 30 days; (ii) failure to pay the principal of (or premium, if any, on) any Debt Security at its maturity (upon acceleration, optional or mandatory redemption, required repurchase or otherwise); (iii) failure to perform, or breach of, any covenant or agreement of the Company under the Indenture (other than a default in the performance of, or breach of, a covenant or agreement which is specifically dealt with in clause (i) or (ii) and such default or breach shall continue for a period of 60 days after written notice of such failure has been given, by certified mail, (x) to the Company by the Trustee or (y) to the Company and the Trustee by the holders of at least 25% in aggregate principal amount of the outstanding Notes, specifying such default or breach and requiring it to be remedied and stating that such notice is a "Notice of Default" under the Indenture; 40 44 (iv) one or more defaults shall have occurred under any agreements, indentures or instruments under which the Company (or any subsidiary) then has outstanding Indebtedness in excess of a principal amount equal to in the aggregate the greater of $50 million or 10% of Consolidated Shareholders' Equity of the Company and, if not already matured at its final maturity in accordance with its terms, such Indebtedness shall have been accelerated; (v) one or more judgments, orders or decrees for the payment of money in excess of $50 million, either individually or in the aggregate (net of amounts covered by insurance, bond, surety or similar instrument), shall be entered against the Company or any Subsidiary, or any of their respective properties, and shall not be discharged and either (a) any creditor shall have commenced an enforcement proceeding upon such judgment, order or decree or (b) there shall have been a period of 60 consecutive days during which a stay of enforcement of such judgment or order, by reason of an appeal or otherwise, shall not be in effect; (vi) there shall have been the entry by a court of competent jurisdiction of (a) a decree or order for relief in respect of the Company or any Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law of (b) a decree or order adjudging the Company or any Material Subsidiary under any applicable federal or state law, or appointing a custodian, receive, liquidator, assignee, trustee, sequestrator (or other similar official) of the Company or any Material Subsidiary or of any substantial part of their respective properties, or ordering the signing up or liquidation of their affairs, and any such decree or order for relief shall continue to be in effect, or any such other decree or order shall be unstayed and in effect, for a period of 60 consecutive days; or (vii) (a) the Company or any Material Subsidiary commences a voluntary case or proceeding under any applicable Bankruptcy Law or any other case or proceeding to be adjudicated bankrupt or insolvent, (b) the Company or any Material Subsidiary consents to the entry or a decree or order for relief in respect of the Company of any Material Subsidiary in an involuntary case or proceeding under any applicable Bankruptcy Law or to the commencement of any bankruptcy or insolvency case or proceeding against it, (c) the Company or any Material Subsidiary files a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, (d) the Company or any Material Subsidiary (x) consents to the filing of such petition or the appointment of, or taking possession by, a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of the Company of any Material Subsidiary or of any substantial part of their respective properties or (y) makes an assignment for the benefit of creditors or (e) the Company or any Material Subsidiary takes any corporate action in furtherance of any such actions in this paragraph (vii). If an Event of Default (other than as specified in clauses (vi) and (vii) of the prior paragraph) shall occur and be continuing, the Trustee or the holders of not less than 25% in aggregate principal amount of the Debt Securities then outstanding may, and the 41 45 Trustee at the request of such Holders shall, declare all unpaid principal of (and premium, if any, on) and accrued interest on all the Debt Securities to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by the Holders of the Debt Securities) provided that so long as the Revolving Credit Facility is in effect, such declaration shall not become effective until the earlier of (a) five business days after receipt of such notice of acceleration from the Holders or the Trustee by the agent under the Revolving Credit Facility or (b) acceleration of the Indebtedness under the Revolving Credit Facility. Thereupon such principal shall become immediately due and payable, and the Trustee may, at its discretion, proceed to protect and enforce the rights of the holders of Debt Securities by appropriate judicial proceeding. If an Event of Default specified in clause (vi) and (vii) of the prior paragraph occurs, then all the Debt Securities shallipso facto become and be immediately due and payable, in an amount equal to the principal amount of the Debt Securities, together with accrued and unpaid interest, if any, to the date the Debt Securities become due and payable, without any declaration or other act on the part of the Trustee or any Holder. After a declaration of acceleration, but before a judgment or decree for payment of the money due has been obtained by the Trustee, the holders of a majority in aggregate principal mounts of Debt Securities outstanding, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if (a) the Company has paid or deposited with the Trustee a sum sufficient to pay (i) all sums paid or advanced by the Trustee under the Indenture and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, (ii) all overdue interest on all Debt Securities, and (iii) to the extent that payment of such interest is lawful, interest upon overdue interest at the rate borne by the Debt Securities; and (b) all Events of Default, other than the non-payment of principal of the Debt Securities which has become due solely by such declaration of acceleration, have been cured or waived; and (c) the rescission will not conflict with any judgment or decree. "Bankruptcy Law" means Title 11, United States Bankruptcy Code of 1978, as amended, or any similar United States federal or state law relating to bankruptcy, insolvency, receivership, winding-up, liquidation, reorganization or relief of debtors or any amendment to, succession to or change in any such law. "Material Subsidiary" means any Corporation of which at the time of determination the Company or one or more Subsidiaries owns or controls directly or indirectly more than 50% of the shares of Voting Stock and whose net sales exceed 4% of the Company's consolidated net sales as determined in accordance with generally accepted accounting principles consistently applied. The holders of not less than a majority in aggregate principal amount of the Debt Securities outstanding may on behalf of the holders of all the Debt Securities waive any past defaults under the Indenture and its consequences, except a default in the payment of the principal of (and premium, if any, on) or interest on any Debt Security, or in respect of a 42 46 covenant or provision which under the Indenture cannot be modified or amended without the consent of the holder of each Debt Security outstanding. The Company is also required to notify the Trustee within five business days of the occurrence of any default. DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE The Company may discharge certain obligations to holders of any series of Debt Securities that have not already been delivered to the Trustee for cancellation and that either have become due and payable or will become due and payable within one year (or scheduled for redemption within one year) by depositing with the Trustee, in trust, funds in U.S. Dollars or in such Foreign Currency in which such Debt Securities are payable in an amount sufficient to pay the entire indebtedness on such Debt Securities in respect of principal (and premium, if any) and interest to the date of such deposit (if such Debt Securities have become due and payable) or to the maturity thereof, as the case may be. The Indenture provides that, if the provisions of Section 402 thereof are made applicable to the Debt Securities of or within any series pursuant to Section 301 thereof, the Company may elect either (a) to defease and be discharged from any and all obligations with respect to such Debt Securities (except for, among other things, the obligation to pay Additional Amounts, if any, upon the occurrence of certain events of taxation, assessment or governmental charge with respect to payments on such Debt Securities and the obligations to register the transfer or exchange of such Debt Securities, to replace temporary or mutilated, destroyed, lost or stolen Debt Securities, to maintain an office or agency in respect of such Debt Securities and to hold moneys for payment in trust) ("defeasance") or (b) to be release from its obligations with respect to such Debt Securities under the covenants described in "--- Limitation on Liens" and "---Limitation on Sale and Leaseback Transactions" above or, if provided pursuant to Section 301 of the Indenture, its obligations with respect to any other covenant, and any omission to comply with such obligations shall not constitute a default or an Event of Default with respect to such Debt Securities ("covenant defeasance"), in either case upon the irrevocable deposit by the Company with the Trustee, in trust, of an amount, in U.S. Dollars or in such Foreign Currency in which such Debt Securities are payable at stated maturity, or Government Obligations (as defined below), or both, applicable to such Debt Securities which through the scheduled payment of principal and interest in accordance with their terms will provide money in an amount sufficient to pay the principal of (and premium, if any) and interest on such Debt Securities, and any mandatory sinking fund or analogous payments thereon, on the scheduled due dates therefor. Such a trust may only be established if, among other things, (i) the applicable defeasance or covenant defeasance does not result in a breach or violation of, or constitute a default under, the Indenture or any other material agreement or instrument to which the Company is a party or by which is bound, (ii) no default or Event of Default with respect to the Debt Securities to be defeased shall have occurred and be continuing on the date of the establishment of such a trust and (iii) the Company has delivered to the Trustee an Opinion of Counsel (as specified in the Indenture) to the effect that the holders of such Debt Securities will not recognize income, 43 47 gain or loss for U.S. federal income tax purposes as a result of such defeasance or covenant defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such defeasance or covenant defeasance had not occurred, and such Opinion of Counsel, in the case of defeasance, must refer to and be based upon a letter ruling of the Internal Revenue Service received by the Company, a Revenue ruling published by the Internal Revenue Service or a change in applicable U.S. federal income tax law occurring after the date of the Indenture. "Foreign Currency" means any currency, currency unit or composite currency, including, without limitation, the ECU, issued by the government of one or more countries other than the United States of America or by any recognized confederation or association of such governments. "Government Obligations" means securities which are (i) direct obligations of the United States of America or the government or the governments in the confederation which issued the Foreign Currency in which the Debt Securities of a particular series are payable, for the payment of which its full faith and credit is pledged or (ii) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America or such government or governments which issued the Foreign Currency in which the Debt Securities of such series are payable, the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America or such other government or governments, which, in the case of clauses (i) and (ii), are not callable or redeemable at the option of the issuer or issuers thereof, and shall also include a depository receipt issued by a bank or trust company as custodian with respect to any such Government Obligation or a specific payment of interest on or principal of or any other amount with respect to any such Government Obligation held by such custodian for the account of the holder of a depository receipt, provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Obligation or the specific payment of interest on or principal of or any other amount with respect to the Government Obligation evidenced by such depository receipt. If after the Company has deposited funds and/or Government Obligations to effect defeasance or covenant defeasance with respect to Debt Securities of any series, (a) the holder of a Debt Security of such series is entitled to, and does, elect pursuant to Section 301 of the Indenture or the terms of such Debt Security to receive payment in a currency other than that in which such deposit has been made in respect of such Debt Security, or (b) a Conversion Event (as defined below) occurs in respect of the Foreign Currency in which such deposit has been made, the indebtedness represented by such Debt Security shall 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 such Debt Security as such Debt Security becomes due out of the proceeds yielded by converting the amount so deposited in respect of such Debt Security into the currency in which such Debt Security becomes payable as a result of such election or such Conversion Event based on (x) in the case of payments made pursuant to clause (a) above, the applicable market exchange rate for such currency in effect on the second business day prior to 44 48 such payment date, or (y) with respect to a Conversion Event, the applicable market exchange rate for such Foreign Currency in effect (as nearly as feasible) at the time of the Conversion Event. "Conversion Event" means the cessation of use of (i) a Foreign Currency both by the government of the country or the confederation which issued such Foreign Currency and for the settlement of transactions by a central bank or other public institutions of or within the international banking community, (ii) the ECU both within the European Monetary System and for the settlement of transactions by public institutions of or within the European Union or (iii) any currency unit or composite currency other than the ECU for the purposes for which it was established. All payments of principal of (and premium, if any) and interest on any Debt Security that is payable in a Foreign Currency that ceases to be used by its government or confederation of issuance shall be made in U.S. dollars. In the event the Company effects covenant defeasance with respect to any Debt Securities and such 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 Sections 1005 and 1006 of the Indenture (which Sections would no longer be applicable to such Debt Securities after such covenant defeasance) or with respect to any other covenant as to which there has been covenant defeasance, the amount in such Foreign Currency in which such Debt Securities are payable, and Government Obligations on deposit with the Trustee, will be sufficient to pay amounts due on such Debt Securities at the time of their stated maturity but may not be sufficient to pay amounts due on such Debt Securities at the time of the acceleration resulting from such Event of Default. However, the Company would remain liable to make payment of such amounts due at the time of acceleration. Under the Indenture, the Company is required to furnish to the Trustee annually a statement as to performance by the Company of certain of its obligations under the Indenture and as to any default in such performance. The Company is also required to delivery to the Trustee, within five days after the occurrence thereof, written notice of any event which after notice or lapse of time or both would constitute an Event of Default. SATISFACTION AND DISCHARGE The Indenture will be discharged and will cease to be of further effect (except as to surviving rights of registration of transfer or exchange of Debt Securities, as expressly provided for in the Indenture) as to all outstanding Debt Securities when (a) either (i) all the Debt Securities theretofore authenticated and delivered (other than lost, stolen or destroyed Debt Securities which have been replaced or paid) have been delivered to the Trustee for cancellation or (ii) all Debt Securities not theretofore delivered to the Trustee for cancellation (x) have become due and payable, (y) will become due and payable at their stated maturity within one year or (z) are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company has irrevocably deposited or caused to be deposited 45 49 with the Trustee funds in an amount sufficient to pay and discharge the entire Indebtedness on the Debt Securities not theretofore delivered to the Trustee for cancellation, including principal of (and premium, if any, on) and accrued interest at such stated maturity or redemption date; (b) the Company has paid or caused to be paid all other sums payable under the Indenture by the Company; and (c) the Company has delivered to the Trustee an Officers' Certificate and an opinion of counsel each stating that (i) all conditions precedent under the Indenture relating to the satisfaction and discharge of the Indenture has been complied with and (ii) such satisfaction and discharge 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 the Company is a party or by which the Company is bound. MODIFICATIONS AND AMENDMENTS Without the consent of any holders, the Company and Trustee, at any time and form time to time, may enter into one or more indentures supplemental to the Indenture for any of the following purposes: (1) to evidence the succession of another Person to the Company; (2) to add to the covenants of the Company for the benefit of the holders, or to surrender any right or power therein conferred upon the Company; (3) to add or change any provisions of the Indenture to facilitate the issuance of bearer Debt Securities; (4) to establish the form or terms of Debt Securities of any series and related coupons; (5) to evidence and provide for the acceptance of the appointment under the Indenture by a successor Trustee; (6) to cure any ambiguity, to correct or supplement any provision in the Indenture which may be defective or inconsistent with any other provision in the Indenture, provided that such actions pursuant to this clause do not adversely affect the interests of the holders of Debt Securities of any series or any related coupons in any material respect; (7) to add to, or delete from or revise the conditions, limitations and restrictions on the authorized amount, terms or purposes of issue, authentication and delivery of Debt Securities; (8) to add any additional Events of Default; (9) to supplement any of the provisions of the Indenture to such extent as shall be necessary to permit or facilitate the defeasance and discharge of any series of Debt Securities, provided that such action pursuant to this clause does not adversely affect the interests of holders of Debt Securities of such series or any related coupons in any material respect; (10) to secure the Debt Securities; (11) to make provision with respect to conversion rights of holders of Debt Securities of any series; and (12) to amend or supplement any provision contained in the Indenture or in any supplemental indenture, provided that such amendment or supplement does not materially adversely affect the interests of the holders of any Debt Securities then outstanding; provided that certain legal opinions and Officers' Certificates are delivered. Modifications and amendments of the Indenture may be made by the Company and the Trustee with the consent of the holders of not less than 66-2/3% in aggregate outstanding principal amount of the Debt Securities; provided, however, that no such modification or amendment may, without the consent of the holder of each outstanding Debt Security affected thereby: (i) change the stated maturity of the principal of, or any installment of interest on, andy Debt Security or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or change the coin or currency in which the 46 50 principal of any Debt Security or any premium or the interest thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the stated maturity thereof; (ii) reduce the percentage in principal amount of outstanding Debt Securities, the consent of whose holders is required for any such modifications and amendments or the consent of whose holders is required for any waiver; (iii) modify any of the provisions relating to supplemental indentures requiring the consent of holders or relating to the waiver of past defaults or relating to the waiver of certain covenants, except to increase the percentage of outstanding Debt Securities required for such actions or to provide that certain other provisions of the Indenture cannot be modified or waived without the consent of the holder of each Debt Security affected thereby; or (iv) make any change that adversely affects the right to convert or exchange any Debt Security. GOVERNING LAW The Indenture and the Notes will be governed by, and construed in accordance with the laws of the State of New York, without giving effect to the conflicts of law principles thereof. BOOK-ENTRY; DELIVERY AND FORM The certificates representing the Notes will be issued in full registered form, without coupons. Except as described under Certificated Notes below, the New Notes will be deposited with, or on behalf of, The Depository Trust Company ("DTC"), New York, New York, as depository (the "Depository"), and registered in the name of Cede & Co., as DTC's nominee, in the form of a global Note certificate (the "Global Certificate"). GLOBAL CERTIFICATES. Ownership of beneficial interests in a Global Certificate will be limited to persons who have accounts with DTC ("participants") or persons who hold interests through participants. Ownership of beneficial interests in the Global Certificates will be shown on, and the transfer of these ownership interests will be effected only through, records maintained by DTC or its nominee (with respect to interests of participants) and the records of participants (with respect to interests of persons other than participants). So long as DTC, or its nominee, is the registered owner or holder of a Global Certificate, DTC or such nominee, as the case may be, will be considered the sole owner or holder of the Notes represented by such Global Certificate for all purposes under the Indenture and the New Notes. In addition, no beneficial owner of an interest in a Global Certificate will be able to transfer that interest except in accordance with DTC's applicable procedures (in additional to those under the Indenture referred to herein). Payments on Global Certificates will be made to DTC, or its nominee, as the registered owner thereof. Neither the Company, the Trustee nor any paying agent will have any responsibility or liability for any aspect of the records relating to or payment made on account 47 51 of beneficial ownership interests in the Global Certificates or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. The Company expects that DTC, or its nominee, upon receipt of any payment in respect of a Global Certificate representing any New Notes held by it or its nominee, will immediately credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of such Global Certificate for such New Notes as shown on the records of DTC or its nominee. The Company also expects that payments by participants to owners of beneficial interests in such Global Certificate held through such participants will be governed by standing instructions and customary practices, as is now the case with securities held for the accounts of customers registered in the names of nominees for such customers. Such payments will be the responsibility of such participants. Transfers between participants in DTC will be effected in the ordinary way in accordance with DTC rules. The laws of some states require that certain persons take physical delivery of securities in definitive form. Consequently, the ability to transfer beneficial interests in a Global Certificate to such persons may be limited. Because DTC can only act on behalf of participants, who in turn act on behalf of indirect participants (defined below) and certain banks, the ability of a person having a beneficial interest in a Global Certificate to pledge such interest to persons or entities that do not participate in the DTC system, or otherwise take actions in respect of such interest, may be affected by the lack of a physical certificate of such interest. The Company believes that it is the policy of DTC that it will take any action permitted to be taken by a holder of Notes (including the presentation of Notes for exchange as described below under "Exchange Offer; Registration Rights") only at the direction of one or more participants to whose account interests in the Global Certificates are credited and only in respect of such portion of the aggregate principal amount at maturity of the Notes as to which such participant or participants has or have given such direction. The Indenture provides that if (i) the Depository notifies the Company that it is unwilling or unable to continue as Depository or if the Depository ceases to be eligible under the Indenture and a successor depository is not appointed by the Company within 90 days, (ii) the Company determines that the Notes shall no longer be represented by Global Certificates and executes and delivers to the Trustee a Company order to such effect or (iii) an Event of Default or event which, with notice or lapse of time or both, would constitute and Event of Default with respect to the Notes shall have occurred and be continuing, the Global Certificates will be exchanged for Notes in definitive form of like tenor and of an equal aggregate principal amount, in authorized denominations. Such definitive Notes shall be registered in such name or names as the Depository shall instruct the Trustee. It is expected that such instructions may be based upon directions received by the Depository from participants with respect to ownership of beneficial interests in Global Certificates. DTC has advised the Company as follows: DTC is a limited-purpose trust company organized under the New York Banking Law, a "banking organization" within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" 48 52 within the meaning of the New York Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the New York Uniform Commercial Code and a "clearing agency" registered pursuant to the provisions of Section 17A of the Exchange Act. DTC holds securities that its participants deposit with DTC and facilitates the settlement among participants of securities transactions, such as transfers and pledges, in deposited securities through electronic computerized book-entry changes in participants' accounts, thereby eliminating the need for physical movement of securities certificates. Direct participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. Access to the DTC system is also available to others such as securities brokers and dealers, banks and trust companies that clear through or maintain a custodial relationship with a direct participant, either directly or indirectly ("indirect participants"). The rules applicable to DTC and its participants are on file with the Commission. Although DTC has agreed to the foregoing procedures in order to facilitate transfers of interests in the Global Certificates among participants of DTC, it is under no obligation to perform or continue to perform such procedures, and such procedures may be discontinued at any time. Neither the Company nor the Trustee will have any responsibility for the performance by DTC or its participants or indirect participants of their respective obligations under the rules and procedures governing their operations. CERTIFICATED NOTES. Notes originally purchased by or transferred to (i) institutional "accredited investors" (as defined in Rule 501 (a)(1), (2), (3) or (7) under the Securities Act) who are not "qualified institutional buyers" (as defined in Rule 144A under the Securities Act) ("QIBs"), (ii) except as described below, Persons outside the United States pursuant to sales in accordance with Regulation S under the Securities Act or (iii) any other Persons who are not QIBs (collectively, "Non-Global Purchasers") will be issued in registered form (the "Certified Notes"). Upon the transfer to a QIB of Certificated Notes initially issued to a Non-Global Purchaser, such Certificated Notes will be exchanged for an interest in the Global Certificate representing the principal amount of Notes being transferred. Notes originally purchased by persons outside the United States of America pursuant to sales in accordance with Regulation S under the Securities Act will be represented upon issuance by a temporary global Note certificate (the "Temporary Certificate") which will not be exchangeable for Certificated Notes until the expiration of the "40-day restricted period" within the meaning of Rule 903(c)(3) of Regulation S under the Securities Act. The Temporary Certificate will be registered in the name of, and held by, a temporary certificate holder until the expiration of such 40-day restricted period, at which time the Temporary Certificate will be delivered to the Trustee in exchange for Certificated Notes registered in the names requested by such temporary certificate holder. In addition, until the expiration of such 40-day restricted period, transfers of interest in the Temporary Certificate can be effected only through such temporary certificate holder in accordance with the requirements set forth in "Notice to Investors." In case any Note shall become mutilated, defaced, destroyed, lost or stolen, the Company will execute and, upon the Company's request, the Trustee will authenticate and deliver a new 49 53 Note, of like tenor and equal principal amount in exchange and substitution for such Note (upon surrender and cancellation thereof) or in lieu of and substitution for such Note. In case such Note is destroyed, lost or stolen, the applicant for a substituted Note shall furnish to the Company and the Trustee such security or indemnity as may be required by them to hold each of them harmless, and, in every case of destruction, loss or theft of such Note, the applicant shall also furnish to the Company or the Trustee satisfactory evidence of the destruction, loss or theft of such Note and of the ownership thereof. Upon the issuance of any substituted Note, the Company may require the payment by the registered holder thereof of a sum sufficient to cover fees and expenses connected therewith. REGARDING THE TRUSTEE The Trust Indenture Act contains limitations on the rights of the Trustee, should it become a creditor of the Company, to obtain payment of claims in certain cases or to realize on certain property received by it in respect of any such claims, as security or otherwise. The Trustee is permitted to engage in other transactions with the Company and its subsidiaries from time to time, provided that if the Trustee acquires any conflicting interest it must eliminate such conflict upon the occurrence of an Event of Default, or else resign. The Trustee currently acts as trustee with respect to the Company's Liquid Yield Option Notes and as a Co-Agent with respect to the Company's Revolving Credit Facility. The Company also has normal banking relationships with the Trustee. REGISTRATION RIGHTS Pursuant to the Registration Rights Agreement, the Company agreed to file with the Commission the Exchange Offer Registration Statement and, upon its effectiveness, offer to the Holders of Transfer Restricted Securities pursuant to the Exchange Offer who are able to make certain representations the opportunity to exchange their Transfer Restricted Securities for New Notes. If (i) the Company is not permitted to consummate the Exchange Offer because the Exchange Offer is not permitted by applicable law or Commission policy or (ii) any Holder of Transfer Restricted Securities notifies the Company that (A) it is prohibited by law or Commission policy from participating in the Exchange Offer or (B) that it may not resell the New Notes acquired by it in the Exchange Offer to the public without delivering a prospectus and the prospectus contained in the Exchange Offer Registration Statement is not appropriate or available for such resales or (c) that it is a broker-dealer and holds Notes acquired directly from the Company or an affiliate of the Company, the Company will file with the Commission a Shelf Registration Statement to cover resales of the Notes by the holders thereof who satisfy certain conditions relating to the provision of information in connection with the Shelf Registration Statement. The Company will use its best efforts to cause the applicable registration statement to be declared effective as promptly as possible by the Commission. For purposes of the foregoing, "Transfer Restricted Securities" means each Old Note until (i) the date on which such Old Note has been exchanged by a person other than a broker-dealer for a New Note in the Exchange Offer, (ii) following the exchange by a broker-dealer in the Exchange Offer of an Old 50 54 Note for a New Note, the date on which such New Note is sold to a purchaser who receives from such broker-dealer on or prior to the date of such sale a copy of this Prospectus, (iii) the date on which such Old Note has been effectively registered under the Securities Act and disposed of in accordance with the Shelf Registration Statement or (iv) the date on which such Old Note is distributed to the public pursuant to Rule 144 or Rule 145 under the Act. The Registration Rights Agreement also provides that if obligated to file the Shelf Registration Statement, the Company will use its best efforts to cause such Shelf Registration Statement to be declared effective by the Commission on or prior to 120 days after such obligation arises and to use its best efforts to cause such Shelf Registration Statement to remain effective and usable for a period of three years following the initial effectiveness thereof. If the Company is obligated to file the Shelf Registration Statement and such Shelf Registration Statement is not declared effective within 1880 days after the Closing Date of the Old Notes (such event being a "Shelf Registration Default"), then the Company will pay to each holder of Transfer Restricted Securities, with respect to the first 90-day period immediately following such Shelf Registration Default, liquidated damages in an amount equal to one-half of one percentage point (.5%) per annum of the principal amount of Transfer Restricted Securities held by such holder. Following the cure of all Shelf Registration Defaults, the payment of liquidated damages will cease. Holders of Notes will be required to make certain representations to the Company in order to participate in the Exchange Offer and will be required to deliver information to be used in connection with the Shelf Registration Statement and to provide comments on the Shelf Registration Statement within the time periods set forth in the Registration Rights Agreement in order to have their Notes included in the Shelf Registration Statement and benefit form the provisions regarding liquidated damages set forth above. In addition, for so long as any Transfer Restricted Securities are outstanding during any period when the Company is not subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company will continue to provide to Holders of Transfer Restricted Securities and to prospective purchasers of such Transfer Restricted Securities the information required by Rule 144A(d)(4). DESCRIPTION OF OLD NOTES The terms of the Old Notes are identical in all material respects to the New Notes, except that (i) the Old Notes have not been registered under the Securities Act, are subject to certain restrictions on transfer and are entitled to certain registration rights under the Registration Rights Agreement (which rights will terminate upon consummation of the Exchange Offer, except to the extent that the Initial Purchasers may have certain registration rights under limited circumstances); (ii) the New Notes are issuable in minimum denominations of $1,000 and integral multiples thereof compared to minimum denominations of $250,000 and integral multiples of $1,000 in excess thereof for the Old Notes; and (iii) the New Notes will not provide for any increase in the interest rate thereon. In that regard, the Old Notes provide that, in the event that the Exchange Offer is not consummated or a shelf registration statement (the "Shelf Registration Statement") with respect to the resale of the Old Notes is not declared effective on 51 55 or prior to November 17, 1995, the interest rate on the Old Notes will increase by 0.50% per annum following November 17, 1995; provided, however, that if the Company requests holders of Old Notes to provide certain information called for by the Registration Statement, then Old Notes owned by holders who do not deliver such information to the Company or who do not provide comments on the Shelf Registration Statement when required pursuant to the Registration Rights Agreement will not be entitled to any such increase in the interest rate. Upon the consummation of the Exchange Offer or the effectiveness of a Shelf Registration Statement, as the case may be, after November 17,1995, the interest rate on any Old Notes which remain outstanding will be reduced, from the date of such consummation or effectiveness, as the case may be, to 7.0% per annum and the Old Notes will not thereafter be entitled to any increase in the interest rate thereon. The New Notes are not entitled to any such increase in the interest rate thereon. In addition, the Old Notes and the New Notes will constitute a single series of debt securities under the Indenture. Accordingly, holders of Old Notes should review the information set forth under "Risk Factors-- Consequences of Failure to Exchange" and "Description of Notes." CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES The following summary describes certain United States Federal income tax considerations to holders of the New Notes who are subject to U.S. net income tax with respect to the New Notes ("U.S. persons") and who will hold the New Notes as capital assets. There can be no assurance that the U.S. Internal Revenue Service (the "IRS") will take a similar view of the purchase, ownership or disposition of the New Notes. This discussion is based upon the provisions of the Internal Revenue Code of 1986, as amended, and regulations, rulings and judicial decisions now in effect, all of which are subject to change. It does not include any description of the tax laws of any state, local or foreign governments or any estate or gift tax considerations that may be applicable to the New Notes or holders thereof. It does not discuss all aspects of U.S. Federal income taxation that may be relevant to a particular investor in light of his particular investment circumstances or to certain types of investors subject to special treatment under the U.S. Federal income tax laws (for example, dealers in securities or currencies, S corporations, life insurance companies, tax-exempt organizations, taxpayers subject to the alternative minimum tax and non-U.S. persons) and also does not discuss New Notes held as a hedge against currency risks or as part of a straddle with other investments or as part of a "synthetic security" or other integrated investment (including a "conversion transaction") comprised of a New Note and one or more other investments, or situations in which the functional currency of the holders is not the U.S. dollar. EXCHANGE OF NOTES The exchange of Old Notes for New Notes should not be a taxable event to holders for federal income tax purposes. The exchange of Old Notes for the New Notes pursuant to the Exchange Offer should not be treated as an "exchange" for federal income tax purposes because the New Notes should not be considered to differ materially in kind or extent from the Old 52 56 Notes. If, however, the exchange of the Old Notes for the New Notes were treated as an exchange for federal income tax purposes, such exchange should constitute a recapitalization for federal income tax purposes. Accordingly, the New Notes should have the same issue price as the Old Notes, and a holder should have the same adjusted basis and holding period in the New Notes as it had in the Old Notes immediately before the exchange. INTEREST ON THE NEW NOTES A holder of a New Note will be required to report as ordinary interest income for U.S. Federal income tax purposes interest earned on the New Note in accordance with the holder's method of tax accounting. DISPOSITION OF NEW NOTES A holder's tax basis for a New Note generally will be the holder's purchase price for the Old Note. Upon the sale, exchange, redemption, retirement or other disposition of a New Note, a holder will recognize gain or loss equal to the difference (if any) between the amount realized and the holder's tax basis in the New Note. Such gain or loss will be long-term capital gain or loss (with certain exceptions to the characterization as capital gain if the New Note was acquired at a market discount). BACKUP WITHHOLDING A holder of a New Note may be subject to backup withholding at the rate of 31% with respect to interest paid on the New Note and proceeds from the sale, exchange, redemption or retirement of the New Note, unless such holder(s) is a corporation or comes within certain other exempt categories and, when required, demonstrates that fact or (b) provides a correct taxpayer identification number, certifies as to no loss of exemption from backup withholding and otherwise complies with applicable requirements of the backup withholding rules. A holder of a New Note who does not provide the Company with his correct taxpayer identification number may be subject to penalties imposed by the IRS. A holder of a New Note who is not a U.S. person will generally be exempt from backup withholding and information reporting requirements, but may be required to comply with certification and identification procedures in order to obtain an exemption from backup withholding and information reporting. Any amount paid as backup withholding will be creditable against the holder's U.S. Federal income tax liability. 53 57 PLAN OF DISTRIBUTION Each broker-dealer that receives New Notes for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such New Notes. This Prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of New Notes received in exchange for Old Notes where such Old Notes were acquired as a result of market-making activities or other trading activities. The Company has agreed that for a period of 90 days after the Expiration Date, it will make this Prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. The Company will not receive any proceeds from any sale of New Notes by broker-dealers. New Notes received by broker-dealers for their own account pursuant to the Exchange Offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the New Notes or a combination of such methods of resale, at market prices prevailing at the time of resale, at prices related to such prevailing market prices or negotiated prices. Any such resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any such broker-dealer and/or the purchasers of any such New Notes. Any broker-dealer that resells New Notes that were received by it for its own account pursuant to the Exchange Offer and any broker or dealer that participates in a distribution of such New Notes may be deemed to be an "underwriter" within the meaning of the Securities Act and any profit on any such resale of New Notes and any commissions or concessions received by any such persons may be deemed to be underwriting compensation under the Securities Act. The Letter of Transmittal states that by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. For a period of 270 days after the Expiration Date the Company will promptly send additional copies of this Prospectus and any amendment or supplement to this Prospectus to any broker-dealer that requests such documents in the Letter of Transmittal. The Company has agreed to pay all expenses incident to the Exchange Offer other than commissions or concessions of any brokers or dealers and will indemnify the holders of the Notes (including any broker-dealers) against certain liabilities, including liabilities under the Securities Act. DESCRIPTION OF CAPITAL STOCK GENERAL RPM's authorized capital stock consists of 100,000,000 Common Shares, without par value. There were 56,957,000 shares outstanding as of May 31, 1995. All presently outstanding RPM Common Shares have been duly authorized and validly issued, and are fully paid and nonassessable. Dividends, which may be declared at the discretion of the Board of Directors of RPM, must be paid equally on all issued and outstanding RPM Common Shares out 54 58 of funds legally available therefor. Upon liquidation, any excess net assets after all payments of debts and costs must be paid to shareholders in proportion to the number of RPM Common Shares held. RPM Common Shares are not subject to preemptive rights, conversion rights, redemption provisions or sinking fund provisions. The holder of each RPM Common Share is entitled to one vote on all matters submitted to shareholders generally, except that shareholders have the right to cumulate their votes for the election of directors as permitted by Ohio law. The Board of Directors is divided into three Classes with the term of office of one of such Classes expiring in each year. At each Annual Meeting of Shareholders the successors to the Directors of the Class whose term is expiring at that time are elected to hold office for a term of three years. Classification of the Board of Directors increases the number of RPM Common Shares necessary under cumulative voting to elect a Director in any given year. Subject to the provisions of Articles Seventh and Eighth of RPM's Amended Articles of Incorporation (the "Amended Articles"), as hereinafter summarized, all matters submitted to a vote of shareholders are determined by a vote of the holders of shares entitling them to exercise a majority of the voting power of RPM present in person or by proxy at a meeting called to consider such matter. Article Seventh of RPM's Amended Articles provides, in essence, that proposals (i) with respect to a merger, consolidation or acquisition wherein the existing shareholders of RPM would hold less than two-thirds of the voting power of RPM, or of the surviving or new corporation, immediately after consummation of the transaction, and (ii) with respect to a sale of substantially all of the assets of RPM, both require adoption or approval by two-thirds of the voting power of RPM. Article Eighth of RPM's Amended Articles provides, in essence, that the affirmative vote of at least 80% of the voting power of RPM is required to effect a merger, consolidation, sale, lease or exchange of substantially all of the assets of RPM where the other party to the transaction, including its "affiliates" and "associated persons," as defined, is a holder, directly or indirectly, of 5% or more of the outstanding shares of any class of RPM entitled to vote at a meeting called to consider such a proposed transaction, as of the record date used to determine the shareholders entitled to vote upon such transaction. The Board of Directors, acting in good faith, shall make a conclusive determination as to whether the proposed transaction requires an 80% vote of shareholders. The requirement for approval by an 80% vote shall not be applicable to proposals which received the formal approval of the Board of Directors of RPM prior to the acquisition of the 5% share interest by the other party, provided that with respect to any proposed transaction as to which the 80% voting requirement would otherwise be applicable there has also been a disclosure to all shareholders of any inducements in connection with the proposed transaction offered to officers and Directors of RPM which are not extended to all shareholders. 55 59 OHIO LAW As an Ohio corporation, RPM is subject to certain provisions of Ohio law which may discourage or render more difficult an unsolicited takeover of RPM. Among these are provisions that (i) prohibit certain mergers, sales of assets, issuances or purchases of securities, liquidation or dissolution, or reclassification of the then outstanding shares of an Ohio corporation involving certain holders of stock representing 10% or more of the voting power, unless such transactions are either approved by the directors in office prior to the 10% shareholder becoming such or involve a 10% shareholder which has been such for at least three years and certain requirements related to the price and form of consideration to be received by shareholders are met; and (ii) provide Ohio corporations with the right to recover profits realized under certain circumstances by persons engaged in "greenmailing" or who otherwise sell securities of a corporation within 18 months of proposing to acquire such corporation. In addition, pursuant to Section 1701.831 of the Ohio Revised Code, the purchase of certain levels of voting power of RPM (one-fifth or more, one-third or more, or a majority) can be made only with the prior authorization of the holders of at least a majority of the total voting power of RPM and the separate prior authorization of the holders of at least a majority of the voting power held by shareholders other than the proposed purchaser, officers of RPM and Directors of RPM who are also employees. TRANSFER AGENT AND REGISTRAR The transfer agent and registrar for RPM's Common Shares is Society National Bank, Cleveland, Ohio. LEGAL MATTERS Certain legal matters in connection with the Notes offered hereby will be passed upon for the Company by Calfee, Halter & Griswold, Cleveland, Ohio and Brown & Wood, New York, New York. William A. Papenbrock, Esq., a partner of Calfee, Halter & Griswold, is a Director of the Company and as of May 31, 1995 owned 8,907 Common Shares of the Company. 56 60 INDEPENDENT PUBLIC ACCOUNTANTS The consolidated financial statements of the Company included in its Annual Report on Form 10-K for the fiscal year ended May 31, 1995 have been examined by Ciulla Stephens & Co., independent public accountants, as set forth in their report included therein and incorporated herein by reference. The consolidated financial statements of NDSI for the fiscal year ended December 31, 1994 included in the Company's Current Report on Form 8-K dated July 24, 1995 have been examined by KPMG Peat Marwick LLP, independent public accountants, as set forth in their report therein and incorporated herein by reference. The report of KPMG Peat Marwick LLP covering the December 31, 1994 financial statements of NDSI contains an explanatory paragraph that states that NDSI's wholly owned subsidiary, Dryvit Systems, Inc., has experienced rust related warranty expense arising from prior years sales. No reasonable estimate of unreported claims could be made at December 31, 1994 and accordingly, the financial statements do not include any adjustments relating to the outcome of this uncertainty. The consolidated financial statements referred to above are incorporated herein by reference in reliance upon such reports and upon the authority of such firms as experts in accounting and auditing. 57 61
=================================================== =================================================== No person is authorized in connection with any offering made hereby to give any information or to make any representation not contained in this Prospectus and, if given or made, such information or representation must not be relied upon as having been authorized by the Company. This Prospectus does not constitute an offer to sell or a solicitation of an offer to buy any security other than the Notes offered hereby, nor does it constitute an offer to sell or a solicitation of an offer to buy any of the Notes to any person in any jurisdiction in which it is unlawful to make such an offer or solicitation to such person. Neither the delivery of this Prospectus or the accompanying Letter of Transmittal nor any sale [RPM, INC. LOGO] made hereunder shall under any circumstances create any implication that the information contained herein is correct as of any date subsequent to the date hereof. ____________________ TABLE OF CONTENTS Page ---- AVAILABLE INFORMATION . . . . . . . . . . . . 4 Offer to Exchange INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE 5 its PROSPECTUS SUMMARY . . . . . . . . . . . . . 6 7.0% Senior Notes Due 2005 ACQUISITION OF NARRAGANSETT/DSI ACQUISITION CO., ($150,000,000 principal amount INC. AND ITS WHOLLY OWNED SUBSIDIARY DRYVIT outstanding) SYSTEMS, INC. . . . . . . . . . . . . . . 15 for 7.0% Senior Exchange Notes THE COMPANY . . . . . . . . . . . . . . . . . 15 Due 2005 BUSINESS . . . . . . . . . . . . . . . . . . 15 RISK FACTORS . . . . . . . . . . . . . . . . 18 ($150,000,000 principal amount THE EXCHANGE OFFER . . . . . . . . . . . . . 20 outstanding) USE OF PROCEEDS . . . . . . . . . . . . . . . 32 CAPITALIZATION . . . . . . . . . . . . . . . 32 SELECTED FINANCIAL INFORMATION . . . . . . . 34 DESCRIPTION OF NOTES . . . . . . . . . . . . 35 DESCRIPTION OF OLD NOTES . . . . . . . . . . 51 CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES . . . . . . . . . . . . . . . 52 _________________ PLAN OF DISTRIBUTION . . . . . . . . . . . . 54 DESCRIPTION OF CAPITAL STOCK . . . . . . . . 54 OFFER TO EXCHANGE -- LEGAL MATTERS . . . . . . . . . . . . . . . . 56 PROSPECTUS INDEPENDENT PUBLIC ACCOUNTANTS . . . . . . . 57 _________________ ______________________ _____________, 1995 =================================================== ===================================================
62 PART II. INFORMATION NOT REQUIRED IN PROSPECTUS Item 20. Indemnification of Directors and Officers. ----------------------------------------- Ohio Revised Code Section 1701.13(E) and Article VI of Registrant's Amended Code of Regulations (incorporated herein by reference as Exhibit 3.2) provide for indemnification of Directors and officers against certain liabilities. The Registrant has purchased a Directors and Officers Liability Insurance Policy (incorporated herein by reference as Exhibit 99.1). The Registrant has entered into Indemnification Agreements with each of its Directors and executive officers providing for additional indemnification protection beyond that provided by the Directors and Officers Liability Insurance Policy. A copy of the form of Indemnification Agreement is incorporated herein by reference and is filed as Exhibit 99.2 to this Registration Statement. Reference is made to Section 5 of the Registration Rights Agreement (Exhibit 4.6 to the Registration Statement) which provides indemnification to the Registrant's officers, Directors and controlling persons against certain civil liabilities, including liabilities under the Securities Act. Item 21. Exhibits and Financial Statement Schedules. ------------------------------------------ (a) EXHIBITS. See the Exhibit Index at page E-1 of this Registration Statement. (b) FINANCIAL STATEMENT SCHEDULES. The financial statement schedules required by this item are incorporated by reference from the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1994. II-1 63 Item 22. Undertakings. ------------ (a) The undersigned Registrant hereby undertakes: (1) To file, during the period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (A) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (B) To reflect in the prospectus any facts or event 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; (C) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement; PROVIDED, HOWEVER, that paragraphs (1)(A) and 1(B) do not apply if the registration statement is on Form S-3 or Form S-8, and 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 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) 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 foregoing provisions, 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 whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. (c) The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request. (d) The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective. II-2 64 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant has duly caused Amendment No. 2 to this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized in the City of Cleveland and State of Ohio, on the 6th day of October, 1995. RPM, Inc. By /s/ Thomas C. Sullivan -------------------------------- Thomas C. Sullivan, Chairman and Chief Executive Officer Pursuant to the requirements of the Securities Act of 1933, Amendment No. 2 to this Registration Statement has been signed by the following persons in the capacities indicated and on the 6th day of October, 1995.
SIGNATURE TITLE --------- ----- /s/ Thomas C. Sullivan Chairman of the Board of - ------------------------------------- Directors and Chief Executive Officer (principal Thomas C. Sullivan executive officer) /s/ James A. Karman President, Chief Operating - -------------------------------------- James A. Karman Officer and Director /s/ Frank C. Sullivan Vice President and Chief - --------------------------------------- Financial Officer (principal financial officer) Frank C. Sullivan /s/ Glenn R. Hasman Vice President -- - -------------------------------------- Administration (principal accounting officer) Glenn R. Hasman /s/ Max D.Amstutz* Director - --------------------------------------- Max D. Amstutz /s/ Edward B. Brandon* Director - -------------------------------------- Edward B. Brandon /s/ Lorrie Gustin* Director - ------------------------------------------ Lorrie Gustin
II-3 65
SIGNATURE TITLE --------- ----- /s/ Roy H. Holdt* Director - ---------------------------------------- Roy H. Holdt /s/ E. Bradley Jones* Director - ----------------------------------------- E. Bradley Jones /s/ Donald K. Miller* Director - ---------------------------------------- Donald K. Miller /s/ John H. Morris, Jr. Director - ---------------------------------------- John H. Morris, Jr. /s/ Kevin O'Donnell* Director - --------------------------------------- Kevin O'Donnell /s/ William A. Papenbrock* Director - ------------------------------------- William A. Papenbrock /s/ Stephen Stranahan* Director - ---------------------------------------- Stephen Stranahan * The undersigned, by signing his name hereto, does hereby sign this Amendment No. 2 to this Registration Statement on behalf of the above- named Directors and executive officers of RPM, Inc. pursuant to a Power of Attorney executed on behalf of each of such Directors and executive officers and which has been filed with the Securities and Exchange Commission. By/s/ Thomas C. Sullivan - ------------------------ Thomas C. Sullivan, Attorney-in-Fact
II-4 66 Exhibit 23.1 CONSENT OF INDEPENDENT AUDITORS We hereby consent to the incorporation by reference in the Prospectus constituting part of this Registration Statement on Form S-4 of our report dated July 7, 1995 which appears in the Annual Report on Form 10-K for the fiscal year ended May 31, 1995 of RPM, Inc. and of our report on the Financial Statement Schedules which appears in such Annual Report on Form 10-K. We also consent to the reference to our firm made under the heading "INDEPENDENT PUBLIC ACCOUNTANTS" in the Prospectus. /s/ CIULLA STEPHENS & CO. CIULLA STEPHENS & CO. Cleveland, Ohio October 5, 1995 II-5 67 Exhibit 23.2 CONSENT OF INDEPENDENT AUDITORS We consent to the incorporation by reference in the Prospectus constituting part of this Amendment No. 2 to Registration Statement on Form S-4 of our report dated February 28, 1995 which appears in the Current Report on Form 8-K, dated July 24, 1995, of RPM, Inc. and to the reference to our firm made under the heading "INDEPENDENT PUBLIC ACCOUNTANTS" in the Prospectus. Our report dated February 28, 1995 contains an explanatory paragraph that states that Narragansett/DSI Acquisition Co., Inc.'s wholly owned subsidiary, Dryvit Systems, Inc., has experienced rust related warranty expense arising from prior years sales. Dryvit Systems, Inc. has made provision for reported claims; however, no provision has been made for unreported claims as they cannot be reasonably estimated. Accordingly, no additional provision for any liability that may result has been recognized in the financial statements. /s/ KPMG PEAT MARWICK LLP KPMG PEAT MARWICK LLP Providence, Rhode Island October 5, 1995 II-6 68 Exhibit 23.3 CONSENT OF COUNSEL The consent of Calfee, Halter & Griswold is contained in their opinion filed as Exhibit 5.1 to this Registration Statement. II-7 69 Exhibit 23.4 CONSENT OF COUNSEL The consent of Brown & Wood is contained in their opinion filed as Exhibit 5.2 to this Registration Statement. II-8 70 RPM, INC. Exhibit Index -------------
Sequential ---------- Description Page ----------- ---- Exhibit No. ----------- 3.1 Amended Articles of Incorporation, as amended . . . . . . . . . . . . . . . (A)(B)(C) 3.2 Amended Code of Regulations . . . . . . . . . . . . . . . . . . . . . . . . (D) 4.1 Specimen Certificate of Common Shares, without par value, of RPM, Inc. . . (E) 4.2 Specimen LYONs Certificate . . . . . . . . . . . . . . . . . . . . . . . . (C) 4.3 Specimen Note Certificate for New Notes . . . . . . . . . . . . . . . . . . * 4.4 Specimen Note Certificate for Old Notes . . . . . . . . . . . . . . . . . . * 4.5 Indenture, dated as of June 1, 1995, between RPM, Inc. and The First National Bank of Chicago, as Trustee . . . . . . . . . . . . . . . . . . . * 4.6 Registration Rights Agreement, dated as of June 20, 1995, among RPM, Inc., Chase Securities, Inc. and Bear, Stearns & Co. Inc. . . . . . . . . . . . . * 5.1 Opinion of Calfee, Halter & Griswold as to the validity of the Notes . . . * 5.2 Opinion of Brown & Wood as to the validity of the Notes . . . . . . . . . . * 23.1 Consent of Ciulla Stephens & Co. (See page II-5 of this Registration Statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.2 Consent of KPMG Peat Marwick LLP. (See page II-6 of this Registration Statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.3 Consent of Calfee, Halter & Griswold. (See page II-7 of this Registration Statement) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23.4 Consent of Brown & Wood. (See page II-8 of this Registration Statement) . 24.1 Power of Attorney . . . . . . . . . . . . . . . . . . . . . . . . . . . . * 25.1 Form T-1 Statement of Eligibility of The First National Bank of Chicago . . * 99.1 Executive Risk Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . (F) 99.2 Form of Indemnification Agreement entered into by and between the Company and each of its Directors and Executive Officers . . . . . . . . . . . . . (G) 99.3 Plan and Agreement of Merger among RPM, Inc., Narragansett/DSI Acquisition Co., Inc. ("NDSI") and NDSI's securityholders. . . . . . . . . . . . . . . (H) 99.4 Form of Letter of Transmittal . . . . . . . . . . . . . . . . . . . . . . . 99.5 Form of Notice of Guaranteed Delivery . . . . . . . . . . . . . . . . . . . 99.6 Form of Exchange Agent Agreement . . . . . . . . . . . . . . . . . . . . . 99.7 Acceleration Request . . . . . . . . . . . . . . . . . . . . . . . . . . . - --------------------- * Previously filed
E-1 71 (A) Incorporated herein by reference to the appropriate exhibit to the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1984. (B) Incorporated herein by referenced to the appropriate exhibit to the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1987. (C) Incorporated herein by reference to the appropriate exhibit to the Company's Form S-3 Registration Statement (Reg. No. 33-50868). (D) Incorporated herein by reference to the appropriate exhibit to the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1988. (E) Incorporated herein by reference to the appropriate exhibit to the Company's Registration Statement on Form S-3 (Reg. No. 33-39849). (F) Incorporated herein by reference to the appropriate exhibit to the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1989. (G) Incorporated herein by reference to the appropriate exhibit to the Company's Annual Report on Form 10-K for the fiscal year ended May 31, 1991. (H) Incorporated herein by reference to the appropriate exhibit to the Company's Current Report on Form 8-K, dated July 24, 1995. E-2 EX-99.4 2 EX-99.4 1 EXHIBIT 99.4 LETTER OF TRANSMITTAL ------------ RPM, INC. Offer to Exchange its 7.0% Notes Due 2005 which have been registered under the Securities Act of 1933 for any and all of its outstanding 7.0% Notes Due 2005 Pursuant to the Prospectus dated October 10, 1995 -------------------------- THE EXCHANGE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON NOVEMBER 10, 1995, UNLESS THE OFFER IS EXTENDED -------------------------- The Exchange Agent for the Exchange Offer is: THE FIRST NATIONAL BANK OF CHICAGO BY MAIL: BY OVERNIGHT DELIVERY OR HAND: The First National Bank of Chicago The First National Bank of Chicago c/o First Chicago Trust Company of New York c/o First Chicago Trust Company of New York Attn: Corporate Trust Administration Attn: Corporate Trust Administration 14 Wall Street 14 Wall Street 8th Floor, Window 2 8th Floor, Window 2 New York, NY 10005 New York, NY 10005
To Confirm by Telephone or for Information: (212) 240-8862 Facsimile Transmissions: (212) 240-8938 DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS CONTAINED HEREIN SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED. Capitalized terms used but not defined herein shall have the same meaning given them in the Prospectus (as defined below). This Letter of Transmittal is to be completed by holders of Old Notes (as defined below) either if Old Notes are to be forwarded herewith or if tenders of Old Notes are to be made by book-entry transfer to an account maintained by The First National Bank of Chicago (the "Exchange Agent") at The Depository Trust Company ("DTC") pursuant to the procedures set forth in "The Exchange Offer - Procedures for Tendering Old Notes" in the Prospectus. Holders of Old Notes whose certificates (the "Certificates") for such Old Notes are not immediately available or who cannot deliver their Certificates and all other required document to the Exchange Agent on or prior to the Expiration Date (as defined in the Prospectus) or who cannot complete the procedures for book-entry transfer on a timely basis, must tender their Old Notes according to the guaranteed delivery procedures set forth in "The Exchange Offer - Guaranteed Delivery Procedures" in the Prospectus. See Instruction 1. Delivery of documents to DTC does not constitute delivery to the Exchange Agent. 2 NOTE: SIGNATURES MUST BE PROVIDED BELOW PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY ALL TENDERING HOLDERS COMPLETE THIS BOX:
======================================================================================================================== DESCRIPTION OF OLD NOTES TENDERED - ------------------------------------------------------------------------------------------------------------------------ If blank, please print name and address of Old Notes tendered registered holders (Attach additional list if necessary) - ------------------------------------------------------------------------------------------------------------------------ Principal Amount of Certificate Principal Old Number(s)* Amount Notes Tendered (if of Old Notes less than all)** - ------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------ - ------------------------------------------------------------------------------------------------------------------------ TOTAL AMOUNT TENDERED: * Need not be completed by book-entry holders. ** Old Notes may be tendered in whole or in part in denominations of $1,000 and integral multiples thereof, provided that if any Old Notes are tendered for exchange in part, the untendered principal amount thereof must be $250,000 or any integral multiple of $1,000 in excess thereof. All Old Notes held shall be deemed tendered unless a lesser number is specified in this column. ========================================================================================================================
(BOXES BELOW TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY) [ ] CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH DTC AND COMPLETE THE FOLLOWING: Name of Tendering Institution ___________________________________________ DTC Account Number ______________________________________________________ Transaction Code Number _________________________________________________ [ ] CHECK HERE AND ENCLOSE A PHOTOCOPY OF THE NOTICE OF GUARANTEED DELIVERY IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE FOLLOWING: Name of Registered Holder(s) ____________________________________________ Window Ticket Number (if any) ___________________________________________ Date of Execution of Notice of Guaranteed Delivery ______________________ Name of Institution which Guaranteed Delivery ___________________________ If Guaranteed Delivery is to be made by Book-Entry Transfer: Name of Tendering Institution _________________________________________ DTC Account Number ____________________________________________________ Transaction Code Number _______________________________________________ [ ] CHECK HERE IF TENDERED BY BOOK-ENTRY TRANSFER AND NON-EXCHANGED OLD NOTES ARE TO BE RETURNED BY CREDITING THE DTC ACCOUNT NUMBER SET FORTH ABOVE. [ ] CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE OLD NOTES FOR ITS OWN ACCOUNT AS A RESULT OF MARKET MAKING OR OTHER TRADING ACTIVITIES (A "PARTICIPATING BROKER-DEALER") AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO. Name ____________________________________________________________________ Address: ________________________________________________________________ _________________________________________________________________ 2 3 Ladies and Gentlemen: The undersigned hereby tenders to RPM, Inc., an Ohio corporation (the "Company"), the above described aggregate principal amount of the Company's 7.0% Notes due 2005 (the "Old Notes") in exchange for a like aggregate principal amount of the Company's 7.0% Notes Due 2005 (the "New Notes") which have been registered under the Securities Act of 1933 (the "Securities Act"), upon the terms and subject to the conditions set forth in the Prospectus dated October 10, 1995 (as the same may be amended or supplemented from time to time, the "Prospectus"), receipt of which is acknowledged, and in this Letter of Transmittal (which, together with the Prospectus, constitute the "Exchange Offer"). Subject to and effective upon the acceptance for exchange of all or any portion of the Old Notes tendered herewith in accordance with the terms and conditions of the Exchange Offer (including, if the Exchange Offer is extended or amended, the terms and conditions of any such extension or amendment), the undersigned hereby sells, assigns and transfers to or upon the order of the Company all right, title and interest in and to such Old Notes as are being tendered herewith. The undersigned hereby irrevocably constitutes and appoints the Exchange Agent as its agent and attorney-in-fact (with full knowledge that the Exchange Agent is also acting as agent of the Company in connection with the Exchange Offer) with respect to the tendered Old Notes, with full power of substitution (such power of attorney being deemed to be an irrevocable power coupled with an interest), subject only to the right of withdrawal described in the Prospectus, to (i) deliver Certificates for Old Notes to the Company together with all accompanying evidences of transfer and authenticity to, or upon the order of, the Company, upon receipt by the Exchange Agent, as the undersigned's agent, of the New Notes to be issued in exchange for such Old Notes, (ii) present Certificates for such Old Notes for transfer, and to transfer the Old Notes on the books of the Company, and (iii) receive for the account of the Company all benefits and otherwise exercise all rights of beneficial ownership of such Old Notes, all in accordance with the terms and conditions of the Exchange Offer. The undersigned hereby represents and warrants that the undersigned has full power and authority to tender, exchange, sell, assign and transfer the Old Notes tendered hereby and that, when the same are accepted for exchange, the Company will acquire good, marketable and unencumbered title thereto, free and clear of all liens, restrictions, charges and encumbrances, and that the Old Notes tendered hereby are not subject to any adverse claims or proxies. The undersigned will, upon request, execute and deliver any additional documents deemed by the Company or the Exchange Agent to be necessary or desirable to complete the exchange, assignment and transfer of the Old Notes tendered hereby, and the undersigned will comply with its obligations under the Registration Rights Agreement. The undersigned has read and agrees to all of the terms of the Exchange Offer. The name(s) and address(es) of the registered holder(s) of the Old Notes tendered hereby should be printed above, if they are not already set forth above, as they appear on the Certificates representing such Old Notes. The Certificate number(s) and the Old Notes that the undersigned wishes to tender should be indicated in the appropriate boxes above. 3 4 If any tendered Old Notes are not exchanged pursuant to the Exchange Offer for any reason, or if Certificates are submitted for more Old Notes than are tendered or accepted for exchange, Certificates for such nonexchanged or nontendered Old Notes will be returned (or, in the case of Old Notes tendered by book-entry transfer, such Old Notes will be credited to an account maintained at DTC), without expense to the tendering holder, promptly following the expiration or termination of the Exchange Offer. The undersigned understands that tenders of Old Notes pursuant to any one of the procedures described in "The Exchange Offer - Procedures for Tendering Old Notes" in the Prospectus and in the instructions hereto will, upon the Company's acceptance for exchange of such tendered Old Notes, constitute a binding agreement between the undersigned and the Company upon the terms and subject to the conditions of the Exchange Offer. The undersigned recognizes that, under certain circumstances set forth in the Prospectus, the Company may not be required to accept for exchange any of the Old Notes tendered hereby. Unless otherwise indicated herein in the box entitled "Special Issuance Instructions" below, the undersigned hereby directs that the New Notes be issued in the name(s) of the undersigned or, in the case of a book-entry transfer of Old Notes, that such New Notes be credited to the account indicated above maintained at DTC. If applicable, substitute Certificates representing Old Notes not exchanged or not accepted for exchange will be issued to the undersigned or, in the case of a book-entry transfer of Old Notes, will be credited to the account indicated above maintained at DTC. Similarly, unless otherwise indicate under "Special Delivery Instructions," please deliver New Notes to the undersigned at the address shown below the undersigned's signature. By tendering Old Notes and executing this Letter of Transmittal, the undersigned hereby represents and agrees that (i) the undersigned is not an "affiliate" of the Company, (ii) any New Notes to be received by the undersigned are being acquired in the ordinary course of its business, (iii) the undersigned has no arrangement or understanding with any person to participate in a distribution (within the meaning of the Securities Act) of New Notes to be received in the Exchange Offer, and (iv) if the undersigned is not a broker-dealer, the undersigned is not engaged in, and does not intend to engage in, a distribution (within the meaning of the Securities Act) of such New Notes. By tendering Old Notes pursuant to the Exchange Offer and executing this Letter of Transmittal, a holder of Old Notes which is a broker-dealer represents and agrees, consistent with certain interpretive letters issued by the Staff of the Division of Corporation Finance of the Securities and Exchange Commission to third parties, that (a) such Old Notes held by the broker-dealer are held only as a nominee, or (b) such Old Notes were acquired by such broker-dealer for its own account as a result of market-making activities or other trading activities and it will deliver the Prospectus (as amended or supplemented from time to time) meeting the requirements of the Securities Act in connection with any resale of such New Notes (provided that, by so acknowledging and by delivering a Prospectus, such broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act). 4 5 The Company has agreed that, subject to the provisions of the Registration Rights Agreement, the Prospectus, as it may be amended or supplemented from time to time, may be used by a Participating Broker-Dealer (as defined below) in connection with resales of New Notes received in exchange for Old Notes, where such Old Notes were acquired by such Participating Broker-Dealer for its own account as a result of market-making activities or other trading activities, for a period ending 90 days after the Expiration Date (subject to extension under certain limited circumstances described in the Prospectus) or, if earlier, when all such New Notes have been disposed of by such Participating Broker- Dealer. In that regard, each broker-dealer who acquired Old Notes for its own account as a result of market-making or other trading activities (a "Participating Broker-Dealer"), by tendering such Old Notes and executing this Letter of Transmittal, agrees that, upon receipt of notice from the Company of the occurrence of any event or the discovery of any fact which makes any statement contained or incorporated by reference in the Prospectus untrue in any material respect or which causes the Prospectus to omit to state a material fact necessary in order to make the statements contained or incorporated by reference therein, in light of the circumstances under which they were made, not misleading or of the occurrence of certain other events specified in the Registration Rights Agreement, such Participating Broker-Dealer will suspend the sale of New Notes pursuant to the Prospectus until the Company has amended or supplemented the Prospectus to correct such misstatement or omission and has furnished copies of the amended or supplemented Prospectus to the Participating Broker-Dealer or the Company has given notice that the sale of the New Notes may be resumed, as the case may be. If the Company gives such notice to suspend the sale of the New Notes, it shall extend the 90-day period referred to above during which Participating Broker-Dealers are entitled to use the Prospectus in connection with the resale of New Notes by the number of days during the period from and including the date of the giving of such notice to and including the date when Participating Broker-Dealers shall have received copies of the supplemented or amended Prospectus necessary to permit resales of the New Notes or to and including the date on which the Company has given notice that the sale of New Notes may be resumed, as the case may be. Holders of Old Notes whose Old Notes are accepted for exchange will not receive accrued interest on such Old Notes for any period from and after the last Interest Payment Date to which interest has been paid or duly provided for on such Old Notes prior to the original issue date of the New Notes or, if no such interest has been paid or duly provided for, will not receive any accrued interest on such Old Notes, and the undersigned waives the right to receive any interest on such Old Notes accrued from and after such Interest Payment Date or, if no such interest has been paid or duly provided for, from and after June 1, 1995. All authority herein conferred or agreed to be conferred in this Letter of Transmittal shall survive the death or incapacity of the undersigned and any obligation of the undersigned hereunder shall be binding upon the heirs, executors, administrators, personal representatives, trustees in bankruptcy, legal representatives, successors and assigns of the undersigned. Except as stated in the Prospectus, this tender is irrevocable. 5 6 HOLDERS SIGN HERE (See Instructions 2, 5 and 6) (Please Complete Substitute Form W-9 Below) (Note: Signature(s) must be guaranteed if required by Instruction 2) Must be signed by registered holder(s) exactly as name(s) appear(s) on Certificate(s) for the Old Notes hereby tendered or on a security position listing, or by any person(s) authorized to become the registered holder(s) by endorsements and documents transmitted herewith (including such opinions of counsel, certifications and other information as may be required by the Company or the Trustee for the Old Notes to comply with the restrictions on transfer applicable to the Old Notes). If signature is by an attorney-in-fact, executor, administrator, trustee, guardian, officer of a corporation or another acting in a fiduciary capacity or representative capacity, please set forth the signer's full title. See Instruction 5. _______________________________________________________________________________ (Signature(s) of Holder(s)) Date ____________, 1995 Name(s)________________________________________________________________________ (Please Print) Address________________________________________________________________________ (Include Zip Code) Area Code and Telephone Number_________________________________________________ _______________________________________________________________________________ (Tax Identification or Social Security Number(s)) GUARANTEE OF SIGNATURE(S) (SEE INSTRUCTIONS 2 AND 5) Authorized Signature___________________________________________________________ Name___________________________________________________________________________ (Please Print) Date ____________, 1995 Capacity or Title______________________________________________________________ Name of Firm___________________________________________________________________ Address________________________________________________________________________ (Include Zip Code) Area Code and Telephone Number_________________________________________________ 6 7
SPECIAL ISSUANCE INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS (SEE INSTRUCTIONS 1, 5 AND 6) (SEE INSTRUCTIONS 1, 5 AND 6) To be completed ONLY if the New Notes are to be To be completed ONLY if New Notes are to be issued in the name of someone other than the sent to someone other than the registered registered holder of the Old Notes whose name(s) holder of the Old Notes whose name(s) appear(s) appear(s) above. above, or to such registered holder(es) at an address other than that shown above. Issue New Notes to: Mail New Notes to: Name ---------------------------------------------- (Please Print) Name -------------------------------------------- (Please Print) Address ------------------------------------------- Address ----------------------------------------- -------------------------------------------------- ------------------------------------------------ -------------------------------------------------- (Include Zip Code) ------------------------------------------------ (Include Zip Code) -------------------------------------------------- (Taxpayer Identification or Social Security No.) ------------------------------------------------ (Taxpayer Identification or Social Security No.)
INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER 1. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES; GUARANTEED DELIVERY PROCEDURES. This Letter of Transmittal is to be completed either if (a) Certificates are to be forwarded herewith or (b) tenders are to be made pursuant to the procedures for tender by book- entry transfer set forth in "The Exchange Offer - Procedure for Tendering Old Notes" in the Prospectus. Certificates, or timely confirmation of a book-entry transfer of such Old Notes into the Exchange Agent's account at DTC, as well as this Letter of Transmittal (or facsimile thereof), properly completed and duly executed, with any required signature guarantees, and any other documents required by this Letter of Transmittal, must be received by the Exchange Agent at its address set forth herein on or prior to the Expiration Date. Old Notes may be tendered in whole or in part in the principal amount of $1,000 and integral multiples of $1,000, provided that, if any Old Notes are tendered for exchange in part, the untendered principal amount thereof must be $250,000 or any integral multiple of $1,000 in excess thereof. Holders who wish to tender their Old Notes and (i) whose Old Notes are not immediately available or (ii) who cannot deliver their Old Notes, this Letter of Transmittal and all other required documents to the Exchange Agent on or prior to the Expiration Date or (iii) who cannot complete the procedures for delivery by book-entry transfer on a timely basis, may tender their Old Notes by properly completing and duly executing a Notice of Guaranteed Delivery pursuant to the guaranteed delivery procedures set forth in "The Exchange Offer - - Guaranteed Delivery 7 8 Procedures" in the Prospectus. Pursuant to such procedures: (i) such tender must be made by or through an Eligible Institution (as defined below); (ii) a properly completed and duly executed Notice of Guaranteed Delivery, substantially in the form made available by the Company, must be received by the Exchange Agent on or prior to the Expiration Date; and (iii) the Certificates (or a book-entry confirmation (as defined in the Prospectus)) representing all tendered Old Notes, in proper form for transfer, together with a Letter of Transmittal (or facsimile thereof), properly completed and duly executed, with any required signature guarantees and any other documents required by this Letter of Transmittal, must be received by the Exchange Agent within three business days after the Expiration Date, all as provided in "The Exchange Offer - Guaranteed Delivery Procedures" in the Prospectus. The Notice of Guaranteed Delivery may be delivered by hand or transmitted by facsimile or mail to the Exchange Agent, and must include a guarantee by an Eligible Institution in the form set forth in such Notice. For Old Notes to be properly tendered pursuant to the guaranteed delivery procedure, the Exchange Agent must receive a Notice of Guaranteed Delivery on or prior to the Expiration Date. As used herein and in the Prospectus, "Eligible Institution" means a firm or other entity identified in Rule 17Ad-15 under the Exchange Act as "an eligible guarantor institution," including (as such terms are defined therein) (i) a bank; (ii) a broker, dealer, municipal securities broker or dealer or government securities broker or dealer; (iii) a credit union; (iv) a national securities exchange, a registered securities association or clearing agency; or (v) a savings association that is a participant in a Securities Transfer Association. THE METHOD OF DELIVERY OF CERTIFICATES, THIS LETTER OF TRANSMITTAL AND ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING HOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE EXCHANGE AGENT. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, OR OVERNIGHT DELIVERY SERVICE IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY. The Company will not accept any alternative, conditional or contingent tenders. Each tendering holder, by execution of a Letter of Transmittal (or facsimile thereof), waives any right to receive any notice of the acceptance of such tender. 2. GUARANTEE OF SIGNATURES. No signature guarantee on this Letter of Transmittal is required if: (i) this Letter of Transmittal is signed by the registered holder (which term, for purposes of this document, shall include any participant in DTC whose name appears on a security position listing as the owner of the Old Notes) of Old Notes tendered herewith, unless such holder(s) has completed either the box entitled "Special Issuance Instructions" or the box entitled "Special Delivery Instructions" above, or (ii) such Old Notes are tendered for the account of a firm that is an Eligible Institution. 8 9 In all other cases, an Eligible Institution must guarantee the signature(s) on this Letter of Transmittal. See Instruction 5. 3. INADEQUATE SPACE. If the space provided in the box captioned "Description of Old Notes" is inadequate, the Certificate number(s) and/or the principal amount of Old Notes and any other required information should be listed on a separate signed schedule which is attached to this Letter of Transmittal. 4. PARTIAL TENDERS AND WITHDRAWAL RIGHTS. Tenders of Old Notes will be accepted only in the principal amount of $1,000 and integral multiples thereof, provided that if any Old Notes are tendered for exchange in part, the untendered principal amount thereof must be $250,000 or any integral multiple of $1,000 in excess thereof. If less than all the Old Notes evidenced by any certificate submitted are to be tendered, fill in the principal amount of Old Notes which are to be tendered in the box entitled "Principal Amount of Old Notes Tendered (if less than all)." In such case, new Certificate(s) for the remainder of the Old Notes that were evidenced by your Certificate(s) will only be sent to the holder of the Old Note, promptly after the Expiration Date. All Old Notes represented by Certificates delivered to the Exchange Agent will be deemed to have been tendered unless otherwise indicated. Except as otherwise provided herein, tenders of Old Notes may be withdrawn at any time on or prior to the Expiration Date. In order for a withdrawal to be effective on or prior to that time, a written, telegraphic telex or facsimile transmission of such notice of withdrawal must be timely received by the Exchange Agent at one of its addresses set forth above or in the Prospectus on or prior to the Expiration Date. Any such notice of withdrawal must specify the name of the person who tendered the Old Notes to be withdrawn, the aggregate principal amount of Old Notes to be withdrawn, and (if Certificates for Old Notes have been tendered) the name of the registered holder of the Old Notes as set forth on the Certificate of the Old Notes, if different from that of the person who tendered such Old Notes. If Certificates for the Old Notes have been delivered or otherwise identified to the Exchange Agent, then prior to the physical release of such Certificates for the Old Notes, the tendering holder must submit the serial numbers shown on the particular Certificates for the Old Notes to be withdrawn and the signature on the notice of withdrawal must be guaranteed by an Eligible Institution, except in the case of Old Notes tendered for the account of an Eligible Institution. If Old Notes have been tendered pursuant to the procedures of book-entry transfer set forth in "The Exchange Offer - Procedures for Tendering Old Notes," the notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawal of Old Notes, in which case a notice of withdrawal will be effective if delivered to the Exchange Agent by written, telegraphic, telex or facsimile transmission. Withdrawals of tenders of Old Notes may not be rescinded. Old Notes properly withdrawn will not be deemed validly tendered for purposes of the Exchange Offer, but may be retendered at any subsequent time on or prior to the Expiration Date by following any of the procedures described in the Prospectus under "The Exchange Offer - Procedure for Tendering Old Notes." All questions as to the validity, form and eligibility (including time of receipt) of such withdrawal notices will be determined by the Company, in its sole discretion, whose 9 10 determination shall be final and binding on all parties. Neither the Company, any affiliates or assigns of the Company, the Exchange Agent nor any other person shall be under any duty to give any notification of any irregularities in any notice of withdrawal or incur any liability for failure to give any such notification. Any Old Notes which have been tendered but which are withdrawn will be returned to the holder thereof without cost to such holder promptly after withdrawal. 5. SIGNATURES ON LETTER OF TRANSMITTAL, ASSIGNMENTS AND ENDORSEMENTS. If this Letter of Transmittal is signed by the registered holder(s) of the Old Notes tendered hereby, the signature(s) must corresponded exactly with the name(s) as written on the face of the Certificate(s) without alteration, enlargement or any change whatsoever. If any of the Old Notes tendered hereby are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal. If any tendered Old Notes are registered in different name(s) on several Certificates, it will be necessary to complete, sign and submit as many separate Letters of Transmittal (or facsimiles thereof) as there are different registrations of Certificates. If this Letter of Transmittal or any Certificates or bond powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing and must submit proper evidence satisfactory to the Company, in its sole discretion, of such persons' authority to so act. When this Letter of Transmittal is signed by the registered owner(s) of the Old Notes listed and transmitted hereby, no endorsement(s) of Certificate(s) or separate bond power(s) are required unless New Notes are to be issued in the name of a person other than the registered holder(s). Signature(s) on such Certificate(s) or bond power(s) must be guaranteed by an Eligible Institution. If this Letter of Transmittal is signed by a person other than the registered owner(s) of the Old Notes listed, the Certificates must be endorsed or accompanied by appropriate bond powers, signed exactly as the name or names of the registered owner(s) appear(s) on the Certificates, and also must be accompanied by such opinions of counsel, certifications and other information as the Company or the Trustee for the Old Notes may require in accordance with the restrictions on transfer applicable to the Old Notes. Signatures on such certificates or bond powers must be guaranteed by an Eligible Institution. 6. SPECIAL ISSUANCE AND DELIVERY INSTRUCTIONS. If New Notes are to be issued in the name of a person other than the signer of this Letter of Transmittal, or if New Notes are to be sent to someone other than the signer of this Letter of Transmittal or to an address other than that shown above, the appropriate boxes on this Letter of Transmittal should be completed. Certificates for Old Notes not exchanged will be returned by mail or, if tendered by book-entry transfer, by crediting the account indicated above maintained at DTC. See Instruction 4. 10 11 7. IRREGULARITIES. The Company will determine, in its sole discretion, all questions as to the form of documents, validity, eligibility (including time of receipt) and acceptance for exchange of any tender of Old Notes, which determination shall be final and binding on all parties. The Company reserves the absolute right to reject any and all tenders determined by it not to be in proper form for the acceptance of which, or exchange for, may, in the view of counsel to the Company, be unlawful. The Company also reserves the absolute right, subject to applicable law, to waive any conditions or irregularity in any tender of Old Notes of any particular holder whether or not similar conditions or irregularities are waived in the case of other holders. The Company's interpretation of the terms and conditions of the Exchange Offer (including this Letter of Transmittal and the instructions hereto) will be final and binding. No tender of Old Notes will be deemed to have been validly made until all irregularities with respect to such tender have been cured or waived. Neither the Company, any affiliates or assigns of the Company, the Exchange Agent, nor any other person shall be under any duty to give notification of any irregularities in tenders or incur any liability for failure to give such notification. 8. QUESTIONS, REQUESTS FOR ASSISTANCE AND ADDITIONAL COPIES. Questions and requests for assistance may be directed to the Exchange Agent at its address and telephone number set forth on the front of this Letter of Transmittal. Additional copies of the Prospectus, the Notice of Guaranteed Delivery and the Letter of Transmittal may be obtained from the Exchange Agent or from your broker, dealer, commercial bank, trust company or other nominee. 9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under U.S. Federal income tax law, a holder whose tendered Old Notes are accepted for exchange is required to provide the Exchange Agent with such holder's correct taxpayer identification number ("TIN") on Substitute Form W-9 below. If the Exchange Agent is not provided with the correct TIN, the Internal Revenue Service (the "IRS") may subject the holder or other payee to a $50 penalty. In addition, payments to such holders or other payees with respect to Old Notes exchanged pursuant to the Exchange Offer may be subject to 31% backup withholding. The box in Part 2 of the Substitute Form W-9 may be checked if the tendering holder has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the box in Part 2 is checked, the holder or other payee must also complete the Certificate of Awaiting Taxpayer Identification Number below in order to avoid backup withholding. Notwithstanding that the box in Part 2 is checked and the Certificate of Awaiting Taxpayer Identification Number is completed, the Exchange Agent will withhold 31% of all payments made prior to the time a properly certified TIN is provided to the Exchange Agent. The Exchange Agent will retain such amounts withheld during the 60 day period following the date of the Substitute Form W-9. If the holder furnishes the Exchange Agent with its TIN within 60 days after the date of the Substitute Form W-9, the amounts retained during the 60 day period will be remitted to the holder and no further amounts shall be retained or withheld from payments made to the holder thereafter. If, however, the holder has not provided the 11 12 Exchange Agent with its TIN within such 60 day period, amounts withheld will be remitted to the IRS as backup withholding. In addition, 31% of all payments made thereafter will be withheld and remitted to the IRS until a correct TIN is provided. The holder is required to give the Exchange Agent the TIN (e.g., social security number or employer identification umber) of the registered owner of the Old Notes or of the last transferee appearing on the transfers attached to, or endorsed on, the Old Notes. If ;the Old Notes are registered in more than one name or are not in the name of the actual owner, consult the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional guidance on which number to report. Certain holders (including, among others, corporations, financial institutions and certain foreign persons) may not be subject to these backup withholding and reporting requirements. Such holders should nevertheless complete the attached Substitute Form W-9 below, and write "exempt" on the face thereof, to avoid possible erroneous backup withholding. A foreign person may qualify as an exempt recipient by submitting a properly competed IRS Form W-8, signed under penalties of perjury, attesting to that holder's exempt status. Please consult the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional guidance on which holders are exempt from backup withholding. Backup withholding is not an additional U.S. Federal income tax. Rather, the U.S. Federal income tax liability of a person subject to backup withhold will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained. 10. LOST, DESTROYED OR STOLEN CERTIFICATES. If any Certificate(s) representing Old Notes have been lost, destroyed or stolen, the holder should promptly notify the Exchange Agent. The holder will then be instructed as to the steps that must be taken in order to replace the Certificate(s). This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost, destroyed or stolen Certificate(s) have been followed. 11. SECURITY TRANSFER TAXES. Holders who tender their Old Notes for exchange will not be obligated to pay any transfer taxes in connection therewith. If, however, New Notes are to be delivered to, or are to be issued in the name of, any person other than the registered holder of the Old Notes tendered, or if a transfer tax is imposed for any reason other than the exchange of Old Notes in connection with the Exchange Offer, then the amount of any such transfer tax (whether imposed on the registered holder or any other persons) will be payable by the tendering holder. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted with the Letter of Transmittal, the amount of such transfer taxes will be billed directly to such tendering holder. IMPORTANT: THIS LETTER OF TRANSMITTAL (OR FACSIMILE THEREOF) AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE. 12 13 TO BE COMPLETED BY ALL TENDERING SECURITYHOLDERS (SEE INSTRUCTION 9) PAYER'S NAME: THE FIRST NATIONAL BANK OF CHICAGO
SUBSTITUTE Part 1 - PLEASE PROVIDE YOUR TIN TIN IN THE BOX AT RIGHT AND ------------------------------------ Form W-9 CERTIFY BY SIGNING AND DATING Social Security Number or BELOW Employer Identification Number Department of the Treasury Part 2 Internal Revenue Service Awaiting TIN [ ] CERTIFICATION - UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT (1) the number shown on this form is my correct taxpayer identification number (or I am waiting for a number to be issued to me), (2) I am not subject to backup withholding either because (i) I am exempt from backup withholding, (ii) I have not been notified by the Internal Revenue Service ("IRS") that I am subject to backup withholding has a result of a failure to report all interest or dividends, or (iii) the IRS has notified me that I am no longer subject to backup withholding, and (3) any other information provided on this form is true and correct. Payer's Request for Taxpayer SIGNATURE Identification Number (TIN) ----------------------------------------------------------------- and Certification DATE ---------------------------------------------------------------------- You must cross out item (iii) in Part (2) above if you have been notified by the IRS that you are subject to backup withholding because of underreporting interest or dividends on your tax return and you have not been notified by the IRS that you are no longer subject to backup withholding.
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY IN CERTAIN CIRCUMSTANCES RESULT IN BACKUP WITHHOLDING OF 31% OF ANY AMOUNTS PAID TO YOU PURSUANT TO THE EXCHANGE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS. CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office or (2) I intend to mail or deliver an application in the near future. In understand that if I do not provide a taxpayer identification number by the time of payment, 31% of all payments made to me on account of the New Notes shall be retained until I provide a taxpayer identification number to the Exchange Agent and that, if I do not provide my taxpayer identification number within 60 days, such retained amounts shall be remitted to the Internal Revenue Service as backup withholding and 31% of all reportable payments made to me thereafter will be withheld and remitted to the Internal Revenue Service until I provide a taxpayer identification number. Signature______________________________ Date_____________________________ 13 EX-99.5 3 EXHIBIT 99.5 1 EXHIBIT 99.5 NOTICE OF GUARANTEED DELIVERY ------------ FOR TENDER OF 7.00% SENIOR NOTES DUE 2005 OF RPM, INC. The Notice of Guaranteed Delivery, or one substantially equivalent to this form, must be used to accept the Exchange Offer (as defined below) if (i) certificates of the Company's (as defined below) 7.0% Senior Notes Due 2005 (the "Old Notes") are not immediately available, (ii) Old Notes, the Letter of Transmittal and all other required documents cannot be delivered to The First National Bank of Chicago (the "Exchange Agent") on or prior to the Expiration Date (as defined in the Prospectus referred to below) or (iii) the procedures for delivery by book-entry transfer cannot be completed on a timely basis. This Notice of Guaranteed Delivery may be delivered by hand, overnight courier or mail, or transmitted by facsimile transmission, to the Exchange Agent. See "The Exchange Offer - Prospectus for Tendering Old Notes" in the Prospectus. The Exchange Agent for the Exchange Offer is: THE FIRST NATIONAL BANK OF CHICAGO
By Mail: By Overnight Delivery or Hand: ------- ----------------------------- The First National Bank of Chicago The First National Bank of Chicago c/o First Chicago Trust Company c/o First Chicago Trust Company of New York of New York Attn: Corporate Trust Administration Attn: Corporate Trust Administration 14 Wall Street 14 Wall Street 8th Floor, Window 2 8th Floor, Window 2 New York, NY 10005 New York, NY 10005
To Confirm by Telephone or for Information: (212) 240-8862 Facsimile Transmissions: (212) 240-8938 DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF THIS NOTICE OF GUARANTEED DELIVERY VIA FACSIMILE TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE INSTRUCTIONS THERETO, SUCH SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE SIGNATURE BOX ON THE LETTER OF TRANSMITTAL. 2 Ladies and Gentlemen: The undersigned hereby tenders to RPM, Inc., an Ohio corporation (the "Company"), upon the terms and subject to the conditions set forth in the Prospectus dated October 10, 1995 (as the same may be amended or supplemented from time to time, the "Prospectus"), and the related Letter of Transmittal (which together constitute the "Exchange Offer"), receipt of which is hereby acknowledged, the aggregate principal amount of Old Notes set forth below pursuant to the guaranteed delivery procedures set forth in the Prospectus under the caption "The Exchange Offer - Procedures for Tendering Old Notes."
Aggregate Principal Name(s) of Registered Holder(s): Amount Tendered: ----------------- ------------------------------ Certificate No(s). (if available): ____ Address(es): ____________ - --------------------------------- ------------------------------ - --------------------------------- ------------------------------ If Old Notes will be tendered by Area Code and Telephone book-entry transfer, provide the Number(s):____________________ following information: ------------------------------ DTC Account Number:______________ Signature(s):_________________ Date: ---------------------------- ------------------------------
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED 2 3 GUARANTEE (NOT TO BE USED FOR SIGNATURE GUARANTEE) The undersigned, a firm or other entity identified in Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended, as an "eligible guarantor institution," including (as such terms are defined therein): (i) a bank; (ii) a broker, dealer, municipal securities broker, municipal securities dealer, government securities broker, government securities dealer; (iii) a credit union; (iv) a national securities exchange, registered securities association or clearing agency; or (v) a savings association that is a participant in a Securities Transfer Association recognized program (each of the foregoing being referred to as an "Eligible Institution"), hereby guarantees to deliver to the Exchange Agent, at one of its addresses set forth above, either the Old Note tendered hereby in proper form for transfer, or confirmation of the book-entry transfer of such Old Note to the Exchange Agent's account at The Depositary Trust Company ("DTC"), pursuant to the procedures for book-entry transfer set forth in the Prospectus, in either case together with one or more properly completed and duly executed Letter(s) of Transmittal (or facsimile thereof) and any other required documents within three business days after the date of execution of this Notice of Guaranteed Delivery. The undersigned acknowledges that it must deliver the Letter(s) of Transmittal and the Old Notes(s) tendered hereby to the Exchange Agent within the time period set forth above and that failure to do so could result in a financial loss to the undersigned. Name of Firm: ------------------------------------- ------------------------------------------ (Authorized Signature) Address: Title: ------------------------------------------ ----------------------------------- Name: - -------------------------------------------------- ------------------------------------- (Zip Code) (Please type or print) Area Code and Telephone Number: Date: --------------------------------- -------------------------------------
NOTE: DO NOT SEND OLD NOTES WITH THIS NOTICE OF GUARANTEED DELIVERY. ACTUAL SURRENDER OF OLD NOTES MUST BE MADE PURSUANT TO, AND BE ACCOMPANIED BY, A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS. 3 EX-99.6 4 EXHIBIT 99.6 1 EXHIBIT 99.6 ------------ October 10, 1995 The First National Bank of Chicago One First National Plaza, Mail Suite 0126 Chicago, Illinois 60670-0126 Ladies and Gentlemen: RPM, Inc., an Ohio corporation (the "Company"), hereby appoints The First National Bank of Chicago ("First Chicago") to act as exchange agent (the "Exchange Agent") in connection with an exchange offer by the Company to exchange up to $150,000,000 aggregate principal amount of its 7.0% Senior Notes Due 2005 (the "New Notes"), which have been registered under the Securities Act of 1933, as amended (the "Securities Act"), for a like principal amount of its outstanding 7.00% Senior Notes Due 2005 (the "Old Notes" and together with the New Notes, the "Notes"). The terms and conditions of the exchange offer are set forth in a Prospectus dated October 10, 1995 (as the same may be amended or supplemented from time to time, the "Prospectus") and in the related Letter of Transmittal, which together constitute the "Exchange Offer." The registered holders of the Notes are hereinafter referred to as the "Holders." Capitalized terms used herein and not defined shall have the respective meanings described thereto in the Prospectus. On the basis of the representations, warranties and agreements of the Company and First Chicago contained herein and subject to the terms and conditions hereof, the following sets forth the agreement (the "Agreement") between the Company and First Chicago as Exchange Agent for the Exchange Offer: 2 1. APPOINTMENT AND DUTIES AS EXCHANGE AGENT. ---------------------------------------- a. The Company hereby authorizes and acknowledges that First Chicago has been retained pursuant to this Agreement to act solely as Exchange Agent in connection with the Exchange Offer and First Chicago agrees to act as Exchange Agent in connection with the Exchange Offer. As Exchange Agent, First Chicago will perform those services as are outlined herein, which are specifically set forth in the section of the Prospectus captioned "The Exchange Offer" and in the Letter of Transmittal and which are customarily performed by an exchange agent in connection with an exchange offer of like nature, including, but not limited to, accepting tenders of Old Notes, reasonably assisting the Company in the preparation of the documentation necessary to effect the transactions herein contemplated (without assuming responsibility for such documentation, unless such information has been furnished to the Company in writing by First Chicago) and communicating generally regarding the Exchange Offer with brokers, dealers, commercial banks, trust companies and other persons, including Holders of the Old Notes; provided, however, that in no way will First Chicago's general duty to act in good faith and without gross negligence or willful misconduct be discharged by the foregoing. b. First Chicago will examine each of the Letters of Transmittal and certificates for Old Notes and any other documents delivered or mailed to First Chicago by or for Holders of the Old Notes, and any book-entry confirmations (as defined in the Prospectus) received by First Chicago with respect to the Old Notes, to ascertain whether: (i) the Letters of Transmittal and any such other documents are duly executed and properly completed in accordance with the instructions set forth therein and that such book-entry confirmations are 2 3 in due and proper form and contain the information required to be set forth therein, and (ii) the Old Notes have otherwise been properly tendered. In each case where the Letters of Transmittal or any other documents have been improperly completed or executed or where book-entry confirmations are not in due and proper form or omit certain information, or any of the certificates for Old Notes are not in proper form for transfer or some other irregularity in connection with the tender or acceptance of the Old Notes exists, First Chicago will endeavor, subject to the terms and conditions of the Exchange Offer, to advise the tendering Holders of the irregularity and to take any other action as may be necessary or advisable to cause such irregularity to be corrected. Notwithstanding the above, First Chicago shall not be under any duty to give any notification of any irregularities in tenders or incur any liability for failure to give any such notification. c. With the approval of the Chief Executive Officer, the President or any Vice President of the Company, (such approval, if given orally, to be promptly confirmed in writing) or any other party designated by any such officer (such designation, if given orally, to be promptly confirmed in writing), First Chicago is authorized to waive any irregularities in connection with any tender of Old Notes pursuant to the Exchange Offer. d. Tenders of Old Notes may be made only as set forth in the Letter of Transmittal and in the section of the Prospectus captioned "The Exchange Offer" and Old Notes shall be considered properly tendered only when tendered in accordance with such procedures set forth therein. Notwithstanding the provisions of this paragraph, Old Notes which the Chief Executive Officer, the President, any Vice President or any other designated officer of the Company (such designation, if given orally, to be promptly confirmed in 3 4 writing), shall approve (such approval, if given orally, to be promptly confirmed in writing) as having been properly tendered shall be considered to be properly tendered. e. First Chicago shall advise the Company with respect to any Old Notes received as soon as possible after 5:00 p.m., New York City time, on the Expiration Date and accept its instructions with respect to disposition of such Old Notes. f. First Chicago shall ensure (i) that each Letter of Transmittal and, if required pursuant to the terms of the Exchange Offer, the related Old Notes or a bond power are duly executed (with signatures guaranteed where required) by the appropriate parties in accordance with the terms of the Exchange Offer; (ii) in those instances where the person executing the Letter of Transmittal (as indicated on the Letter of Transmittal) is acting in a fiduciary or a representative capacity, proper evidence of his or her authority so to act is submitted; (iii) in those instances where Old Notes are tendered by persons other than the registered holder of such Old Notes, that customary transfer requirements, including any applicable transfer taxes, and the requirements imposed by the transfer restrictions on the Old Notes (including any applicable requirements for certifications, legal opinions or other information) are fulfilled; (iv) that Old Notes tendered in part are tendered in principal amounts of $1,000 and integral multiples thereof and that if any Old Notes are tendered for exchange in part, the untendered principal amount thereof is $250,000 or any integral multiple of $1,000 in excess thereof; and (v) First Chicago shall deliver certificates for Old Notes tendered in part to the transfer agent for split-up and shall return any untendered Old Notes or Old Notes which have not been accepted by the Company to the Holders promptly after the expiration or termination of the Exchange Offer. 4 5 g. Upon acceptance by the Company of any Old Notes duly tendered pursuant to the Exchange Offer (such acceptance if given orally, to be promptly confirmed in writing), First Chicago will cause New Notes in exchange therefor to be issued as promptly as possible (subject to receipt from the Company of appropriate certificates under the related Indenture) and First Chicago will deliver such New Notes on behalf of the Company at the rate of $1,000 principal amount of New Notes for each $1,000 principal amount of Old Notes tendered as promptly as possible after acceptance by the Company of the Old Notes for exchange and notice (such notice if given orally, to be promptly confirmed in writing) of such acceptance by the Company; provided, however, that in all cases, Old Notes tendered pursuant to the Exchange Offer will be exchanged only after timely receipt by First Chicago of certificates for such Old Notes (or a book-entry confirmation), a properly completed and duly executed Letter of Transmittal (or facsimile thereof) with any required signature guarantees and any other required documents. Unless otherwise instructed by the Company, First Chicago shall issue New Notes only in denominations of $1,000 or any integral multiple thereof. h. Tenders pursuant to the Exchange Offer are irrevocable, except that, subject to the terms and the conditions set forth in the Prospectus and the Letter of Transmittal, Old Notes tendered pursuant to the Exchange Offer may be withdrawn at any time on or prior to the Expiration Date in accordance with the terms of the Exchange Offer. i. Notice of any decision by the Company not to exchange any Old Notes tendered shall be given by the Company either orally (if given orally, to be promptly confirmed in writing) or in a written notice to First Chicago. 5 6 j. If, pursuant to the Exchange Offer, the Company does not accept for exchange all or part of the Old Notes tendered because of an invalid tender or otherwise, First Chicago shall, upon notice from the Company (such notice if given orally, to be promptly confirmed in writing), promptly after the expiration or termination of the Exchange Offer return such certificates for unaccepted Old Notes (or effect appropriate book-entry transfer), together with any related required documents and the Letters of Transmittal relating thereto that are in First Chicago's possession, to the persons who deposited such certificates. k. Certificates for reissued Old Notes, unaccepted Old Notes or New Notes shall be forwarded by (a) first-class certified mail, return receipt requested under a blanket surety bond obtained by First Chicago protecting First Chicago and the Company from loss or liability arising out of the non-receipt or non-delivery of such certificates or (b) by registered mail insured by First Chicago separately for the replacement value of each such certificate. l. First Chicago is not authorized to pay or offer to pay any concessions, commissions or solicitation fees to any broker, dealer, commercial bank, trust company or other nominee or to engage or use any person to solicit tenders. m. As Exchange Agent, First Chicago: (i) shall have no duties or obligations other than those specifically set forth in the Prospectus, the Letter of Transmittal or herein or as may be subsequently agreed to in writing; (ii) will make no representations and will have no responsibilities as to the validity, value or genuineness of any of the certificates for the Old Notes deposited pursuant to the Exchange Offer, and will not be required to and will make no 6 7 representation as to the validity, value or genuineness of the Exchange Offer; provided, however, that in no way will First Chicago's general duty to act in good faith and without gross negligence or willful misconduct be limited by the foregoing; (iii) shall not be obligated to take any legal action hereunder which might in First Chicago's reasonable judgment involve any expense or liability, unless First Chicago shall have been furnished with reasonable indemnity; (iv) may reasonably rely on and shall be protected in acting in reliance upon any certificate, instrument, opinion, notice, letter, telegram or other document or security delivered to First Chicago and reasonably believed by First Chicago to be genuine and to have been signed by the proper party or parties; (v) may reasonably act upon any tender, statement, request, comment, agreement or other instrument whatsoever not only as to its due execution and validity and effectiveness of its provisions, but also as to the truth and accuracy of any information contained therein, which First Chicago believes in good faith to be genuine and to have been signed or represented by a proper person or persons acting in a fiduciary or representative capacity (so long as proper evidence of such fiduciary's or representative's authority so to act is submitted to First Chicago) and First Chicago examines and reasonably concludes that such evidence properly establishes such authority; 7 8 (vi) may rely on and shall be protected in acting upon written or oral instructions from the Chief Executive Officer, the President, any Vice President or any other designated officer of the Company (such designation, if given orally, to be promptly confirmed in writing); (vii) may consult with its own counsel with respect to any questions relating to First Chicago's duties and responsibilities and the written opinion of such counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted to be taken by First Chicago hereunder in good faith and in accordance with the written opinion of such counsel; and (viii) shall not advise any person tendering Old Notes pursuant to the Exchange Offer as to whether to tender or refrain from tendering all or any portion of its Old Notes or as to the market value, decline or appreciation in market value of any Old Notes that may or may not occur as a result of the Exchange Offer or as to the market value of the New Notes. n. First Chicago shall take such action as may from time to time be requested by the Company (and such other action as First Chicago may reasonably deem appropriate) to furnish copies of the Prospectus, Letter of Transmittal and the Notice of Guaranteed Delivery or such other forms as may be approved from time to time by the Company, to all persons requesting such documents and to accept and comply with telephone requests for information relating to the Exchange Offer, provided that such information shall relate only to the procedures for tendering into (or withdrawing from) the Exchange Offer. The Company will furnish you with copies of such documents at your request. 8 9 o. First Chicago shall advise orally and promptly thereafter confirm in writing to the Company and such other person or persons as the Company may request, daily (and more frequently during the week immediately preceding the Expiration Date and if otherwise reasonably requested) up to and including the Expiration Date, the aggregate principal amount of Old Notes which have been duly tendered pursuant to and in compliance with the terms of the Exchange Offer and the items received by First Chicago pursuant to the Exchange Offer and this Agreement, separately reporting and giving cumulative totals as to items properly received and items improperly received. In addition, First Chicago will also provide, and cooperate in making available to the Company, or any such other person or persons upon request (such request if made orally, to be promptly confirmed in writing) made from time to time, such other information as the Company may reasonably request. Such cooperation shall include, without limitation, the granting by First Chicago to the Company, and such person or persons as the Company may request, access to those persons on First Chicago's staff who are responsible for receiving tenders, in order to ensure that immediately prior to the Expiration Date the Company shall have received adequate information in sufficient detail to enable the Company to decide whether to extend the Exchange Offer. First Chicago shall prepare a final list of all persons whose tenders were accepted, the aggregate principal amount of Old Notes tendered, the aggregate principal amount of Old Notes accepted and deliver said list to the Company. p. Letters of Transmittal, book-entry confirmations and Notices of Guaranteed Delivery shall be stamped by First Chicago as to the date and the time of receipt thereof and shall be preserved by First Chicago for a period of time at least equal to the period of time 9 10 First Chicago preserves other records pertaining to the transfer of securities, or one year, whichever is longer, and thereafter shall be delivered by First Chicago to the Company. First Chicago shall dispose of unused Letters of Transmittal and other surplus materials by returning them to the Company. q. First Chicago hereby expressly waives any lien, encumbrance or right of set-off whatsoever that First Chicago may have with respect to funds deposited with it for the payment of transfer taxes by reasons of amounts, if any, advanced to the Company, or any of its subsidiaries or affiliates pursuant to any loan or credit agreement with First Chicago or for compensation owed to First Chicago hereunder or for any other matter. 2. COMPENSATION. Pursuant to a letter agreement, dated as of May 25, 1995 (the "Bond Trusteeships Fee Schedule"), between the Company and First Chicago, no additional compensation will be payable to First Chicago in its capacity as Exchange Agent, it being understood and agreed that the Acceptance Fee and the Annual Administration Fee payable pursuant to the Bond Trusteeships Fee Schedule are intended to cover, among other things, the services of First Chicago as Exchange Agent; provided, further, that First Chicago reserves the right to receive reimbursement from the Company for any reasonable out-of-pocket expenses incurred as Exchange Agent in performing the services described herein. 3. INDEMNIFICATION. a. The Company hereby agrees to protect, defend, indemnify and hold harmless First Chicago against and from any and all costs, losses, liabilities, expenses (including reasonable counsel fees and disbursements) and claims imposed upon or asserted against First 10 11 Chicago on account of any action taken or omitted to be taken by First Chicago in connection with its acceptance of or performance of its duties under this Agreement and the documents related thereto as well as the reasonable costs and expenses of defending itself against any claim or liability arising out of or relating to this Agreement and the documents related thereto. This indemnification shall survive the release, discharge, termination, and/or satisfaction of this Agreement. Anything in this Agreement to the contrary notwithstanding, the Company shall not be liable for indemnification or otherwise for any loss, liability, cost or expense to the extent arising out of First Chicago's bad faith, gross negligence or willful misconduct. In no case shall the Company be liable under this indemnification agreement with respect to any claim against First Chicago unless the Company shall be notified by First Chicago, by letter, of the written assertion of a claim against First Chicago or of any other action commenced against First Chicago, promptly after First Chicago shall have received any such written assertion or shall have been served with a summons in connection therewith. The Company shall be entitled to participate at its own expense in the defense of any such claim or other action, and, if the Company so elects, the Company may assume the defense of any pending or threatened action against First Chicago in respect of which indemnification may be sought hereunder, in which case the Company shall not thereafter be responsible for the fees and disbursements of legal counsel for First Chicago under this paragraph; provided that the Company shall not be entitled to assume the defense of any such action if the named parties to such action include both the Company and First Chicago and representation of both parties by the same legal counsel would, in the written opinion of counsel for First Chicago, be inappropriate due to conflicting interests between them. In the 11 12 event First Chicago shall engage legal counsel as a result of events set forth in the immediately preceding proviso, the Company shall be responsible for the fees and disbursements of such counsel. It is understood, however, that the Company shall not be liable under this paragraph for the fees and disbursements of more than one legal counsel for First Chicago. In the event that the Company shall assume the defense of any such suit, the Company shall not therewith be liable for the fees and expenses of any counsel retained by First Chicago. b. First Chicago agrees that, without the prior written consent of the Company (which consent shall not be unreasonably withheld), it will not settle, compromise or consent to the entry of any judgment in any pending or threatened claim, action or proceeding in respect of which indemnification could be sought in accordance with the indemnification provision of this Agreement (whether or not First Chicago or the Company or any of its directors, officers and controlling persons is an actual or potential party to such claim, action or proceeding), unless such settlement, compromise or consent includes an unconditional release of the Company and its directors, officers and controlling persons from all liability arising out of such claim, action or proceeding. 4. TAX INFORMATION. a. First Chicago shall arrange to comply with all requirements under the tax laws of the United States, including those relating to missing Tax Identification Numbers, and shall file any appropriate reports with the Internal Revenue Service. The Company understands that First Chicago is required, in certain instances, to deduct 31% with respect to interest paid on the New Notes and proceeds from the sale, exchange, redemption or 12 13 retirement of the New Notes from Holders who have not supplied their correct Taxpayer Identification Number or required certification. Such funds will be turned over by First Chicago to the Internal Revenue Service. b. First Chicago shall notify the Company of the amount of any transfer taxes payable in respect of the exchange of Old Notes and, upon receipt of written approval from the Company shall deliver or cause to be delivered, in a timely manner, to each governmental authority to which any transfer taxes are payable in respect of the exchange of Old Notes, a check in the amount of all transfer taxes so payable, and the Company shall reimburse First Chicago for the amount of any and all transfer taxes payable in respect of the exchange of Old Notes; provided, however, that First Chicago shall reimburse the Company for amounts refunded to it in respect of its payment of any such transfer taxes, at such time as such refund is received by First Chicago. 5. GOVERNING LAW. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York applicable to contracts executed in and to be performed in that state. 6. NOTICES. Any communication or notice provided for hereunder shall be in writing and shall be given (and shall be deemed to have been given upon receipt) by delivery in person, telecopy, or overnight delivery or by registered or certified mail (postage prepaid, return receipt requested) to the applicable party at the addresses indicated below: 13 14 If to the Company: RPM, Inc. P.O. Box 777 2628 Pearl Road Medina, Ohio 44258 Telecopier No.: (216) 225-8743 Attention: Frank C. Sullivan, Vice President and Chief Financial Officer With a copy to: Calfee, Halter & Griswold 1400 McDonald Investment Center 800 Superior Avenue Cleveland, Ohio 44114 Telecopier No.: (216) 241-0816 Attention: William A. Papenbrock, Esq. If to First Chicago: The First National Bank of Chicago One First National Plaza Mail Suite 0126 Chicago, Illinois 60670-0126 Telecopier No. (312) 407-4656 Attention: Richard D. Manella, Esq. or, as to each party, at such other address as shall be designated by such party in a written notice complying as to delivery with the terms of this Section. 7. PARTIES IN INTEREST. This Agreement shall be binding upon and inure solely to the benefit of each party hereto and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. Without limitation to the foregoing, the parties hereto 14 15 expressly agree that no holder of Old Notes or New Notes shall have any right, benefit or remedy of any nature whatsoever under or by reason of this Agreement. 8. COUNTERPARTS; SEVERABILITY. This Agreement may be executed in one or more counterparts, and by different parties hereto on separate counterparts, each of which when so executed shall be deemed an original, and all of such counterparts shall together constitute one and the same agreement. If any term or other provision of this Agreement or the application thereof is invalid, illegal or incapable of being enforced by any rule of law, or public policy, all other provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the agreements contained herein is not affected in any manner adverse to any party. Upon such determination that any term or provision or the application thereof is invalid, illegal or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the agreements contained herein may be performed as originally contemplated to the fullest extent possible. 9. CAPTIONS. The descriptive headings contained in this Agreement are included for convenience of reference only and shall not affect in any way the meaning or interpretation of this Agreement. 10. ENTIRE AGREEMENT; AMENDMENT. This Agreement constitutes the entire understanding of the parties hereto with respect to the subject matter hereof. This Agreement may not be amended or modified nor may any provision hereof be waived except in writing signed by each party to be bound thereby. 15 16 11. TERMINATION. This Agreement shall terminate upon the earlier of (a) the 90th day following the expiration, withdrawal, or termination of the Exchange Offer, (b) the close of business on the date of actual receipt of written notice by First Chicago from the Company stating that this Agreement is terminated, (c) one year following the date of this Agreement, or (d) the time and date on which this Agreement shall be terminated by mutual consent of the parties hereto. 12. RESIGNATION OF EXCHANGE AGENT. First Chicago as Exchange Agent reserves the right to resign at any time by giving written notice of its resignation, specifying the effective date thereof, to the Company. Within 45 days after receiving the aforesaid notice, the Company shall seek to appoint a successor Exchange Agent to which First Chicago shall distribute the monies and other property then held hereunder. If a successor Exchange Agent has not been appointed by the Company and/or has not accepted such appointment by the end of such 45 day period, First Chicago may apply to a court of competent jurisdiction for the appointment of a successor Exchange Agent and the reasonable fees, costs and expenses (including the reasonable fees and disbursements of legal counsel) which it incurs in connection with such a proceeding shall be paid by the Company. Anything in this Agreement to the contrary notwithstanding, the resignation of First Chicago as Exchange Agent shall not be effective until a successor Exchange Agent is appointed by the Company and has accepted such appointment. 13. MISCELLANEOUS. a. First Chicago hereby acknowledges receipt of the Prospectus and the Letter of Transmittal and the Notice of Guaranteed Delivery and further acknowledges that it has 16 17 examined each of them. Any inconsistency between this Agreement, on the one hand, and the Prospectus and the Letter of Transmittal and the Notice of Guaranteed Delivery (as they may be amended or supplemented from time to time), on the other hand, shall be resolved in favor of the latter three documents, except with respect to the duties, liabilities and indemnification of First Chicago as Exchange Agent which shall be controlled by this Agreement. Kindly indicate your willingness to act as Exchange Agent and First Chicago's acceptance of the foregoing provisions by signing in the space provided below for that purpose and returning to the Company a copy of this Agreement so signed, whereupon this Agreement and First Chicago's acceptance shall constitute a binding agreement between First Chicago and the Company. Very truly yours, RPM, INC. ______________________________ Frank C. Sullivan Vice President and Chief Financial Officer Accepted and agreed to as of the date first written above: THE FIRST NATIONAL BANK OF CHICAGO By: ______________________________ Name: Title: 373/06821AYD.351 17 EX-99.7 5 EXHIBIT 99.7 1 EXHIBIT 99.7 ------------ October 6, 1995 Securities and Exchange Commission Judiciary Plaza 450 Fifth Street, N.W. Washington, D.C. 20549 Re: RPM, Inc. Form S-4 Registration Statement (Reg. No. 33-61541) ------------------------------- RPM, Inc. hereby requests that the effective date of the above-referenced Registration Statement be accelerated to 9:30 a.m. on Tuesday, October 10, 1995 or as soon thereafter as is practicable. Very truly yours, Frank C. Sullivan Vice President and Chief Financial Officer -----END PRIVACY-ENHANCED MESSAGE-----