As
filed with the Securities and Exchange Commission on March 4, 2008
Registration
No. 333-_______________
UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
___________________________
FORM
S-3
REGISTRATION
STATEMENT
UNDER
THE
SECURITIES ACT OF 1933
___________________________
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BorgWarner
Inc.
(Exact name
of registrant as specified in its
charter)
|
|
Delaware
(State or
other jurisdiction of
incorporation
or organization)
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13-3404508
(I.R.S.
employer
identification
number)
|
___________________________
3850
Hamlin Road
Auburn
Hills, MI 48326
(248)
754-9200
(Address, including
zip code, and telephone number,
including area
code, of registrant’s principal executive offices)
___________________________
John
J. Gasparovic, Esq.
Vice
President, General Counsel, and Secretary
BorgWarner
Inc.
3850
Hamlin Road
Auburn
Hills, MI 48326
(248)
754-9200
(Name, address,
including zip code, and telephone
number, including
area code, of agent for service)
___________________________
Copy
to:
|
Brad
B. Arbuckle, Esq.
Miller
Canfield Paddock and Stone, P.L.C.
840
West Long Lake Road, Suite 200
Troy,
Michigan 48098
(248)
267-3283
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Approximate date of commencement of
proposed sale to the public: From time to time after this
registration statement becomes effective.
If
the only securities being registered on this form are being offered pursuant to
dividend or interest reinvestment plans, please check the following
box. ¨
If
any of the securities being registered on this form are to be offered on a
delayed or continuous basis pursuant to rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. ý
If
this form is filed to register additional securities for an offering pursuant to
Rule 462(b) under the Securities Act, please check the following box and list
the Securities Act registration statement number of the earlier effective
registration statement for the same offering. ¨
If
this form is a post-effective amendment filed pursuant to Rule 462(c) under the
Securities Act, check the following box and list the Securities Act registration
statement number of the earlier effective registration statement for the same
offering. ¨
If
this Form is a registration statement pursuant to General Instruction I.D. or a
post-effective amendment thereto that shall become effective upon filing with
the Commission pursuant to Rule 462(e) under the Securities Act, check the
following box. ¨
If
this form is a post-effective amendment to a registration statement filed
pursuant to General Instruction I.D. filed to register additional securities or
additional classes of securities pursuant to Rule 413(b) under the Securities
Act, check the following box. ¨
CALCULATION
OF REGISTRATION FEE
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Title
of Each Class of Securities
To
Be Registered(1)
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Amount
To
Be
Registered
(1)
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Proposed
Maximum
Aggregate
Price
Per
Unit (1)
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Proposed
Maximum
Aggregate
Offering
Price (1)(2)
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Amount
of Registration
Fee
(3)
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Debt
Securities (4)
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||||
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Preferred
Stock, par value $0.01 per share
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||||
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Voting Common
Stock, par value $0.01 per share (5)
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||||
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Non-Voting
Common Stock, par value $0.01 per share (5)
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||||
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Depositary
Shares (6)
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||||
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Warrants
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||||
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Units
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||||
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Total
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$750,000,000
(7)
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100%
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$750,000,000
(7)
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$29,475.00
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(1)
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There are
being registered hereunder such indeterminate number of shares of common
stock and preferred stock, such indeterminate principal amount of debt
securities, such indeterminate number of depositary shares, such
indeterminate number of warrants to purchase common stock, preferred stock
or debt securities, and such indeterminate number of units as shall have
an aggregate initial offering price not to exceed $750,000,000 (or the
equivalent thereof in one or more foreign currencies, foreign currency
units or composite currencies). Any securities registered
hereunder may be sold separately or as units with other securities
registered hereunder. The proposed maximum initial offering
price per unit will be determined, from time to time, by the registrant in
connection with the issuance by the registrant of the securities
registered hereunder. The securities registered also include
such indeterminate number of shares of common stock and preferred stock
and amount of debt securities as may be issued upon conversion of or
exchange for preferred stock or debt securities that provide for
conversion or exchange, upon exercise of warrants or pursuant to the
anti-dilution provisions of any such securities. In addition,
pursuant to Rule 416 under the Securities Act, the shares being registered
hereunder include such indeterminate number of shares of common stock and
preferred stock as may be issuable with respect to the shares being
registered hereunder as a result of stock splits, stock dividends or
similar transactions.
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(2)
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The proposed
maximum aggregate offering price per class of security will be determined
from time to time by the registrant in connection with the issuance by the
registrant of the securities registered hereunder and is not specified as
to each class of security pursuant to General Instruction II.D. of Form
S-3 under the Securities Act.
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(3)
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Calculated
pursuant to Rule 457(o) under the Securities
Act.
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(4)
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If any debt
securities are issued at an original issued discount, then the offering
price of such debt securities shall be in such greater principal amount as
shall result in an aggregate initial offering price not to exceed
$750,000,000 (or the equivalent thereof in one or more foreign currencies,
foreign currency units or composite currencies), less the aggregate dollar
amount of all securities previously issued
hereunder.
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(5)
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Each share of
common stock includes one preferred share purchase right. No
separate consideration is payable for the preferred share purchase
rights.
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(6)
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In the event
that we elect to offer to the public fractional interests in shares of
preferred stock registered hereunder, depositary shares, evidenced by
depositary receipts issued under a deposit agreement, will be distributed
to those persons purchasing such fractional interests, and the shares of
preferred stock will be issued to the depositary under any such
agreement.
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(7)
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The aggregate
amount of voting common stock registered hereunder is further limited to
that which is permissible under Rule 415(a)(4) under the Securities
Act. The securities registered hereunder may be sold
separately, together or as units with other securities registered
hereunder.
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$750,000,000
Debt Securities
Preferred
Stock
Voting Common
Stock
Non-Voting Common
Stock
Depositary
Shares
Warrants
Units
_______________________________________________
We
may offer any combination of the securities described in this prospectus in
different series from time to time in amounts, at prices and on terms to be
determined at or prior to the time of the offering. We will provide
you with specific terms of the applicable offered securities in one or more
supplements to this prospectus. The aggregate initial offering price
of the securities that we may issue under this prospectus will not exceed
$750,000,000.
We
urge you to read this prospectus and any accompanying prospectus supplement
carefully before you make your investment decision. This prospectus
may not be used to make sales of the offered securities unless it is accompanied
by a prospectus supplement describing the method and terms of the offering of
those offered securities. We may sell the securities, or we may
distribute them through underwriters or dealers. In addition, the
underwriters may overallot a portion of the securities.
Our voting common
stock is listed for trading on the New York Stock Exchange, Inc. under the
symbol “BWA.” Unless we state otherwise in a prospectus supplement,
we will not list any other of these securities on any securities
exchange. On March 3, 2008, the last reported sale price of our
voting common stock on the New York Stock Exchange was
$42.80. Prospective purchasers of voting common stock are urged to
obtain current information as to the market prices of the voting common
stock.
Neither
the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or determined if this prospectus or
any accompanying prospectus supplement is truthful or complete. Any
representation to the contrary is a criminal offense.
Our principal
office is located at 3850 Hamlin Road, Auburn Hills, Michigan
48326. Our telephone number is (248) 754-9200. Our website
can be found at www.borgwarner.com.
The date of this
prospectus is March 4, 2008.
An investment in
these securities involves risks. See Item 1.A Risk Factors in our
Annual Report on Form 10-K for the year ended December 31, 2007.
TABLE
OF CONTENTS
Page
| 39 |
No person is
authorized to give any information or to make any representations other than
those contained or incorporated by reference in this prospectus or the
accompanying prospectus supplement, and, if given or made, such information or
representations must not be relied upon as having been
authorized. This prospectus and the accompanying prospectus
supplement do not constitute an offer to sell or the solicitation of an offer to
buy any securities other than the securities described in the accompanying
prospectus supplement or an offer to sell or the solicitation of an offer to buy
such securities in any circumstances in which such offer or solicitation is
unlawful. Neither the delivery of this prospectus or the accompanying
prospectus supplement, nor any sale made hereunder and thereunder shall, under
any circumstances, create any implication that there has been no change in our
affairs since the date hereof or that the information contained or incorporated
by reference herein or therein is correct as of any time subsequent to the date
of such information.
Certain statements
contained or incorporated by reference in this prospectus, including without
limitation, statements containing the words “believes,” “anticipates,” “hopes,”
“intends,” “expects,” “plans,” and other similar words may constitute
“forward-looking statements” within the meaning of the Private Securities
Litigation Reform Act of 1995. All statements, other than statements
of historical fact contained or incorporated by reference in this prospectus,
that we expect or anticipate will or may occur in the future, including, without
limitation, statements included in this prospectus under “About BorgWarner Inc.”
and located elsewhere in this prospectus regarding our financial position,
business strategy and measures to implement that strategy, including changes to
operations, competitive strengths, goals, expansion and growth of our business
and operations, plans, references to future success and other such matters, are
forward-looking statements. These statements are based on assumptions
and analyses made by us in light of our experience and our perception of
historical trends, current conditions and expected future developments, as well
as other factors we believe are appropriate in the
circumstances. These forward-looking statements involve known and
unknown risks, uncertainties and other factors, including those described in the
section entitled “Risk Factors” in this prospectus or supplements to be provided
with this prospectus, as well as other factors that might be described from time
to time in our reports filed with the SEC, that may cause our actual results to
differ materially from expectations.
Consequently, all
of the forward-looking statements contained or incorporated by reference in this
prospectus are qualified by these cautionary statements, and there can be no
assurances that the actual results or developments anticipated by us will be
realized or, even if substantially realized, that they will have the expected
consequences to, or effects on, us and our subsidiaries or our business or
operations. Given these uncertainties, prospective investors are cautioned not
to place undue reliance on those forward-looking statements. All
subsequent forward-looking statements attributable to us or persons acting on
our behalf are expressly qualified in their entirety by any of those factors
described above and in the documents containing such forward-looking
statements. We disclaim any obligation to update or to announce
publicly any updates or revisions to any of the forward-looking statements
contained or incorporated by reference in this prospectus to reflect any change
in our expectations with regard thereto or any change in events, conditions,
circumstances or assumptions underlying the statements.
This prospectus is
part of a registration statement that we filed with the Securities and Exchange
Commission (“SEC”) using a “shelf”
registration process. Under this shelf process, we may sell any
combination of the securities described in this prospectus in one or more
offerings up to a total dollar amount of proceeds of
$750,000,000. This prospectus provides you with a general description
of the securities we may offer. However, it does not contain all of
the information in the registration statement. Each time we sell
securities, we will provide a prospectus supplement or more than one prospectus
supplement, together with one or more pricing supplements and/or product
supplements (together referred to herein as a “prospectus supplement”) that will
contain specific information about the terms of the
offering. Prospectus supplements may also add, update or change
information contained in this prospectus. We urge you to read both
this prospectus and any prospectus supplement, together with additional
information described under the heading “Where You Can Find More
Information.”
The information in
this prospectus speaks only as of the date indicated on the cover of this
document unless the information specifically indicates that another date
applies.
References in this
prospectus to the terms “we” or “us” or other similar terms mean BorgWarner Inc.
unless we state otherwise or the context indicates otherwise.
We
are a leading, global supplier of highly engineered systems and components,
primarily for powertrain applications. The Company’s products help
improve vehicle performance, fuel efficiency, air quality and vehicle
stability. These products are manufactured and sold worldwide,
primarily to original equipment manufacturers (“OEMs”) of light-vehicles (i.e.,
passenger cars, sport-utility vehicles (“SUVs”), cross-over vehicles, vans and
light-trucks). The Company’s products are also sold to other OEMs of
commercial trucks, buses and agricultural and off-highway
vehicles. The Company also manufactures and sells its products to
certain Tier One vehicle systems suppliers and into the aftermarket for light
and commercial vehicles. The Company operates manufacturing
facilities serving customers in the Americas, Europe and Asia, and is an
original equipment supplier to every major automotive OEM in the
world.
The Company reports
its results under two reporting segments: Engine and Drivetrain. The
Engine Group’s products currently fall into the following major categories:
turbochargers, chain products, emissions systems, thermal systems, diesel cold
start and gasoline ignition technology and diesel cabin heaters. The
Drivetrain Group’s major products are transmission components and systems, and
4WD and AWD torque management systems.
Our executive
offices are located at 3850 Hamlin Road, Auburn Hills, Michigan
48326. Our telephone number is (248) 754-9200. Our website
can be found at www.borgwarner.com.
Additional
information regarding us, including our audited financial statements and
descriptions of our business, is contained in the documents incorporated by
reference in this prospectus. See “Where You Can Find More
Information” below and “Incorporation of Documents by Reference”
below.
Unless we inform
you otherwise in a prospectus supplement, we intend to use the net proceeds of
any securities sold for general corporate purposes, which may include, among
other things, additions to working capital, repayment or refinancing of existing
indebtedness or other corporate obligations, financing of capital expenditures
and acquisitions, investment in existing and future projects, and repurchases
and redemptions of securities. Pending any specific application, we
may initially invest funds in short-term marketable securities or apply them to
the reduction of short-term indebtedness.
Our consolidated
ratios of earnings to fixed charges for the periods indicated below were as
follows:
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Year
Ended December 31,
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2007
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2006
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2005
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2004
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2003
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8.45x
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5.88x
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6.75x
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8.55x
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7.04x
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In
the computation of our ratios of earnings to fixed charges, earnings consist of
earnings before income taxes, minority interests and equity in affiliate
earnings, plus fixed charges, amortization of capitalized interest, and
dividends received from equity affiliates, less capitalized
interest. Fixed charges consist of interest expensed and capitalized
and one-third of rental expense (approximate portion representing
interest).
This prospectus
contains a summary of the debt securities, preferred stock, voting common stock,
non-voting common stock, depositary shares, warrants and units that we may
offer. These summaries are not meant to be a complete description of
each security. However, this prospectus and the accompanying
prospectus supplement contain the material terms and conditions for each
security.
Any of the
securities described herein and in a prospectus supplement may be issued
separately or as part of a unit consisting of two or more securities, which may
or may not be separable from one another.
The following
descriptions of the terms of the debt securities set forth certain general terms
and provisions of the debt securities. The particular terms of the
debt securities offered by any prospectus supplement and the extent, if any, to
which such general provisions may apply to the debt securities so offered will
be described in the prospectus supplement relating to such offered debt
securities. To the extent that any prospectus supplement is
inconsistent with any provision in this summary, the information contained in
such prospectus supplement will control.
The debt securities
that will be our senior debt securities will be issued under an Indenture dated
as of September 23, 1999, as supplemented (the “Senior Debt Indenture”),
between us and The Bank of New York Trust Company, N.A. (the “Senior
Trustee”). The debt securities that will be our subordinated debt
(“Subordinated Debt Securities”) will be issued under an Indenture (the
“Subordinated Debt Indenture” and, collectively with the Senior Debt Indenture,
the “Indentures”), to be entered into between us and a trustee to be determined
(the “Subordinated Trustee”).
The Senior Debt
Indenture has been filed with the SEC as an exhibit to our current report on
Form 8-K filed October 6, 1999 and is incorporated herein by
reference. The forms of the senior debt securities have been filed,
or will be filed, with the SEC and incorporated by reference as exhibits to the
registration statement and you should read them for the provisions that may be
important to you. The forms of the Subordinated Debt Indenture and
the Subordinated Debt Securities have been filed, or will be filed, with the SEC
and incorporated by reference as exhibits to the registration statement and you
should read them for the provisions that may be important to you. The
Indentures are subject to and governed by the Trust Indenture Act of 1939, as
amended (the “Trust Indenture Act”).
We
have summarized certain provisions of the Indentures and the debt securities
below. The summary is not complete and is subject to, and qualified
in its entirety by reference to, the Indentures and the debt
securities. Capitalized terms used in the summary have the meanings
set forth in the applicable Indenture unless otherwise defined
herein.
General
The debt securities
will be our unsecured senior or subordinated obligations.
The Indentures do
not limit the amount of debt securities that we may issue thereunder and provide
that we may issue debt securities under the Indentures from time to time in one
or more series.
Reference is made
to the prospectus supplement for the following terms of and information relating
to the offered debt securities (to the extent such terms are applicable to such
debt securities):
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·
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classification
as senior or subordinated debt
securities;
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·
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the specific
designation, aggregate principal amount, purchase price and denomination
of the offered debt securities;
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·
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the currency
or units based on or relating to currencies in which such debt securities
are denominated and/or in which principal (and premium, if any) and/or any
interest will or may be payable;
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·
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any date of
maturity;
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·
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the method by
which amounts payable in respect of principal, premium (if any) or
interest on, or upon the redemption of, such debt securities may be
calculated, and any currencies or indices, or value, rate or price,
relevant to such calculation;
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·
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interest rate
or rates (or the method by which such rate or rates will be determined),
if any;
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·
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the date or
dates on which any such interest or other amounts will be
payable;
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·
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the place or
places where the principal of and interest, if any, on the offered debt
securities will be payable;
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·
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any
redemption, repayment or sinking fund provisions for the offered debt
securities;
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·
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whether the
offered debt securities will be issuable in registered form or bearer form
(“Bearer Securities”) or both and, if Bearer Securities are issuable, any
restrictions applicable to the exchange of one form for another and to the
offer, sale and delivery of Bearer
Securities;
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·
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any
applicable U.S. federal income tax consequences, including whether and
under what circumstances we will pay additional amounts on offered debt
securities held by a person who is not a U.S. person (as defined in this
prospectus or the applicable prospectus supplement) in respect of any tax,
assessment or governmental charge withheld or deducted and, if so, whether
we will have the option to redeem such debt securities rather than pay
such additional amounts;
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·
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the
anticipated market for the offered debt securities;
and
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·
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any other
specific terms of the offered debt securities, including any additional or
different events of default, remedies or covenants provided for with
respect to such debt securities, and any terms which may be required by or
advisable under applicable laws or
regulations.
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Debt securities may
be presented for exchange and registered debt securities may be presented for
transfer in the manner, at the places and subject to the restrictions set forth
in the debt securities and the prospectus supplement. Such services
will be provided without charge, other than any tax or other governmental charge
payable in connection therewith, but subject to the limitations provided in the
applicable Indenture. Bearer Securities and the coupons, if any,
attached to such Bearer Securities will be transferable by
delivery.
Debt securities may
bear interest at a fixed rate or a floating rate. Debt securities
bearing no interest or interest at a rate that at the time of issuance is below
the prevailing market rate may be sold at a discount below their stated
principal amount. Special U.S. federal income tax considerations
applicable to any such discounted debt securities or to certain debt securities
issued at par which are treated as having been issued at a discount for U.S.
federal income tax purposes, will be described in the relevant prospectus
supplement.
We
may issue debt securities from time to time with payment terms that are
calculated by reference to the value or price of one or more currencies or
indices. Holders of such debt securities may receive a payment of the
principal amount on any principal payment date, or a payment of interest on any
interest payment date, that is greater than or less than the amount of principal
or interest otherwise payable on such dates, or a redemption amount on any
redemption date that is greater than or less than the principal amount of such
debt securities, depending upon the value or price on such dates of the
applicable currency or index. Information for determining the amount
of principal, premium (if any), interest or redemption amounts payable on any
date, the currencies, commodities or indices to which the amount payable on such
date is linked and certain additional tax considerations will be set forth in
the relevant prospectus supplement.
Certain
Definitions
“Attributable
Indebtedness” means, with respect to any Sale/Leaseback Transaction as of any
particular time, the present value (discounted at the rate of interest implicit
in the terms of the lease) of the obligations of the lessee under such lease for
Net Rental Payments during the remaining term of the lease (including any period
for which such lease has been extended).
“Consolidated Net
Tangible Assets” means the total amount of assets (less applicable reserves and
other properly deductible items) after deducting therefrom (1) all current
liabilities (excluding any current liabilities which are by their terms
extendible or renewable at the option of the obligor thereon to a time more than
12 months after the time as of which the amount thereof is being computed), (2)
all goodwill, trade names, trademarks, patents, unamortized debt discount and
expense and other like intangibles and (3) appropriate adjustments on account of
minority interests of other Persons holding stock of our Subsidiaries, all as
set forth on our most recent balance sheet (but, in any event, as of a date
within 150 days of the date of determination) and computed in accordance with
generally accepted accounting principles.
“Consolidated Net
Worth” means the amount of total stockholders’ equity shown in our most recent
consolidated statement of financial position.
“Current Assets” of
any Person includes all assets of such Person that would in accordance with
generally accepted accounting principles be classified as current
assets.
“Current
Liabilities” of any Person includes all liabilities of such Person that would in
accordance with generally accepted accounting principles be classified as
current liabilities.
“Net Rental
Payments” under any lease for any period means the sum of the rental and other
payments required to be paid in such period by the lessee thereunder, not
including, however, any amounts required to be paid by such lessee (whether or
not designated as rental or additional rental) on account of maintenance and
repairs, insurance, taxes, assessments or similar charges.
“Non-Recourse
Indebtedness” means our indebtedness or the indebtedness of any of our
Subsidiaries in respect of which the recourse of the holder of such
indebtedness, whether direct or indirect and whether contingent or otherwise, is
effectively limited to specified assets, and with respect to which neither we
nor any of our Subsidiaries provide any credit support.
“Person” means any
individual, corporation, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization or government or any agency or
political subdivision thereof.
“Principal
Property” means any manufacturing plant or warehouse, together with the land
upon which it is erected and fixtures comprising a part thereof, that we own or
that is owned by one of our Subsidiaries which constitutes a “significant
subsidiary” as defined in Rule 1-02 of Regulation S-X of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and is located in the United
States, the gross book value (without deduction of any reserve for depreciation)
of which on the date as of which the determination is being made is an amount
which exceeds 1% of Consolidated Net Tangible Assets, other than any such
manufacturing plant or warehouse or any portion thereof (together with the land
upon which it is erected and fixtures comprising a part thereof) (1) which is
financed by industrial development bonds or (2) which, in the opinion of our
board of directors, is not of material importance to our total business
conducted and the total business conducted by our Subsidiaries, taken as a
whole. As of the date of this prospectus, we have only one
manufacturing plant or warehouse that constituted a Principal
Property.
“Sale/Leaseback
Transaction” means any arrangement with any Person pursuant to which we or any
of our Subsidiaries lease for a period of more than three years, any real or
personal property, which property we have or such Subsidiary has sold or
transferred or will sell or transfer to such Person in contemplation of such
leasing.
“Subsidiary” of a
Person means (1) any corporation more than 50% of the outstanding securities
having ordinary voting power of which is owned, directly or indirectly, by such
Person or by one or more of its Subsidiaries, or by such Person and one or more
of its Subsidiaries, or (2) any partnership or similar business organization
more than 50% of the ownership interests having ordinary voting power of which
shall at the time be so owned. For the purposes of this definition,
“Securities Having Ordinary Voting Power” means securities or other equity
interests that ordinarily have voting power for the election of directors, or
persons having management power with respect to the Person, whether at all times
or only so long as no senior class of securities has such voting power by reason
of any contingency.
Senior
Debt
The debt securities
and coupons, if any, appertaining thereto that will constitute part of our
senior debt will be issued under the Senior Debt Indenture and will rank pari passu with all of our
other unsecured and unsubordinated debt.
Limitation
On Liens
The Senior Debt
Indenture provides that we will not, and will not permit any of our Subsidiaries
to, issue, assume or guarantee any indebtedness for money borrowed (“Debt”) if
such Debt is secured by a mortgage, pledge, security interest or lien (a
“Mortgage” or “Mortgages”) upon any of our Principal Properties or of any of our
Subsidiaries’ Principal Properties or upon any shares of stock or other stock or
other equity interest or indebtedness of any of our Subsidiaries (whether such
property, shares of stock or other equity interest or indebtedness is now owned
or hereafter acquired) which owns any Principal Property, without in any such
case effectively providing that the debt securities shall be secured equally and
ratably with (or prior to) such Debt; provided, however, that the
foregoing restrictions shall not apply to:
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·
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mortgages
existing on the date the debt securities are originally issued or
mortgages provided for under the terms of agreements existing on such
date;
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·
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mortgages on
Current Assets securing Current
Liabilities;
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·
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mortgages on
any property we or any of our Subsidiaries acquire, construct, alter or
improve after the date of the Indenture that are created or assumed
contemporaneously with or within one year after such acquisition (or, in
the case of property constructed, altered or improved, after the
completion and commencement of commercial operation of such property,
whichever is later) to secure or provide for the payment of the purchase
price or cost of such property, provided that in the case of any such
construction, alteration or improvement the mortgages shall not apply to
any property we or any of our Subsidiaries theretofore owned, other than
(1) the property so altered or improved and (2) any theretofore unimproved
real property on which the property so constructed or altered, or the
improvement, is located;
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·
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existing
mortgages on property we or any of our Subsidiaries acquire (including
mortgages on any property acquired from a Person that is consolidated with
or merged with or into us or any of our Subsidiaries) or mortgages
outstanding at the time any Person becomes one of our Subsidiaries that
are not incurred in connection with such entity becoming one of our
Subsidiaries;
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mortgages in
our or any of our Subsidiaries’
favor;
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mortgages on
any property (1) in favor of domestic or foreign governmental bodies to
secure partial, progress, advance or other payments pursuant to any
contract or statute, (2) securing indebtedness incurred to finance all or
any part of the purchase price or cost of constructing, installing or
improving the property subject to such mortgages, including mortgages to
secure Debt of the pollution control or industrial revenue bond type, or
(3) securing indebtedness issued or guaranteed by the United States, any
state, any foreign country or any department, agency, instrumentality or
political subdivision of any such jurisdiction;
and
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any
extension, renewal or replacement (or successive extensions, renewals or
replacements), in whole or in part, of any mortgage referred to in the
foregoing bullet points; provided, however, that the principal amount of
Debt secured thereby shall not exceed the principal amount of Debt so
secured at the time of such extension, renewal or replacement, together
with the reasonable costs related to such extension, renewal or
replacement, and that such extension, renewal or replacement shall be
limited to all or a part of the property that secured the mortgage so
extended, renewed or replaced (plus improvements on such
property).
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Notwithstanding the
foregoing, we and any of our Subsidiaries may, without securing the debt
securities, issue, assume or guarantee secured Debt (that would otherwise be
subject to the foregoing restrictions) in an aggregate amount that, together
with all other such secured Debt and the aggregate amount of our and our
Subsidiaries’ Attributable Indebtedness deemed to be outstanding in respect of
all Sale/Leaseback Transactions entered into pursuant to the provisions
described below under “— Limitation on Sale/Leaseback Transactions” (excluding
any such Sale/Leaseback Transactions the proceeds of which have been applied in
accordance with clauses (2) or (3) under the “— Limitation on Sale/Leaseback
Transactions” covenant described below), does not exceed 10% of the Consolidated
Net Worth, as shown on a consolidated balance sheet as of a date not more than
90 days prior to the proposed transaction we prepare in accordance with
generally accepted accounting principles in the United States of
America.
Limitation
On Sale/Leaseback Transactions
The Senior Debt
Indenture provides that we will not, and will not permit any of our Subsidiaries
to, enter into any Sale/Leaseback Transaction with any Person (other than us or
one of our Subsidiaries) unless:
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(1)
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at the time
of entering into such Sale/Leaseback Transaction, we or such Subsidiary
would be entitled to incur Debt, in a principal amount equal to the
Attributable Indebtedness with respect to such Sale/Leaseback Transaction,
secured by a mortgage on the property subject to such Sale/Leaseback
Transaction, pursuant to the provisions of the covenant described under “—
Limitation on Liens” without equally and ratably securing the debt
securities pursuant to such
provisions;
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(2)
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after the
date on which debt securities are first issued, and within a period
commencing six months prior to the consummation of such Sale/Leaseback
Transaction and ending six months after the consummation thereof, we or
such Subsidiary shall have expended for property used or to be used in our
or such Subsidiary’s ordinary course of business (including amounts
expended for additions, expansions, alterations, repairs and improvements
thereto) an amount equal to all or a portion of the net proceeds of such
Sale/Leaseback Transaction, and we shall have elected to designate such
amount as a credit against such Sale/Leaseback Transaction (with any such
amount not being so designated to be applied as set forth in clause (3)
below); or
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(3)
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during the
12-month period after the effective date of such Sale/Leaseback
Transaction, we shall have applied to the voluntary defeasance or
retirement of debt securities or any of our pari passu indebtedness
an amount equal to the net proceeds of the sale or transfer of the
property leased in such Sale/Leaseback Transaction, which amount shall not
be less than the fair value of such property at the time of entering into
such Sale/Leaseback Transaction (adjusted to reflect any amount we
expended as set forth in clause (2) above), less an amount equal to the
principal amount of such debt securities and pari passu indebtedness
we voluntarily defeased or retired within such 12-month period and not
designated as a credit against any other Sale/Leaseback Transaction we or
any of our Subsidiaries entered into during such
period.
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Unless otherwise
specified in the prospectus supplement relating to a particular series of
offered debt securities, the covenants applicable to the debt securities would
not necessarily afford holders protection in the event that we are involved in a
highly leveraged or other transaction, or in the event of a material adverse
change in our financial position or results of operations. Unless
otherwise specified in the prospectus supplement relating to a particular series
of offered debt securities, the debt securities do not contain any other
provisions that are designed to afford protection in the event that we are
involved in a highly leveraged transaction.
Subordinated
Debt
The debt securities
and coupons, if any, attached to such debt securities that will constitute part
of the Subordinated Debt Securities will be issued under the Subordinated Debt
Indenture and will be subordinate and junior in right of payment, to the extent
and in the manner set forth in the Subordinated Debt Indenture, to all of our
Senior Indebtedness. The Subordinated Debt Indenture defines “Senior
Indebtedness” as all of our indebtedness, including indebtedness we have
guaranteed or assumed, for borrowed money or evidenced by bonds, debentures,
notes, letters of credit, interest rate exchange agreements, currency exchange
agreements, commodity forward contracts or other similar instruments, or
indebtedness or obligations with respect to any lease of real or personal
property whether existing on the date hereof or hereinafter incurred, and any
guarantee, amendments, renewals, extensions, modifications and refundings of any
such indebtedness or obligation, provided that Senior Indebtedness shall not
include (1) obligations that, when incurred and without respect to any election
under Section 1111(b) of Title 11, United States Code, were without recourse to
the issuer, (2) our obligations to any of our Subsidiaries and (3) any other
obligations which by the terms of the instrument creating or evidencing the same
are specifically designated as not being senior in right of payment to the
Subordinated Debt Securities.
In
the event (1) of any insolvency or bankruptcy proceedings, or any receivership,
liquidation or other similar proceedings including reorganization in respect of
our company or a substantial part of our property, or (2) that (a) a default
shall have occurred with respect to the payment of principal of (and premium, if
any) or any interest on or other monetary amounts due and payable on any Senior
Indebtedness or (b) there shall have occurred an event of default (other than a
default in the payment of principal, premium, if any, or interest, or other
monetary amounts due and payable) with respect to any Senior Indebtedness, as
defined therein or in the instrument under which the same is outstanding,
permitting the holder or holders thereof to accelerate the maturity thereof, and
such default or event of default shall not have been cured or waived or shall
not have ceased to exist, unless, in the case of a default under clause (b)
above, the default with respect to the Senior Indebtedness is cured or waived,
or 180 days pass after notice of the default is given to the holders of Senior
Indebtedness (unless the maturity of such Senior Indebtedness has been
accelerated), then the holders of all Senior Indebtedness shall first be
entitled to receive payment of the full amount unpaid thereon, or provision
shall be made, in accordance with the relevant Senior Indebtedness, for such
payment in money or money’s worth, before the holders of any of the Subordinated
Debt Securities or coupons are entitled to receive a payment on account of the
principal of (and premium, if any) or any interest on the indebtedness evidenced
by such Subordinated Debt Securities or of such coupons. No new
period of suspension of payments under clause (b) above may be commenced by
reason of the same event of default (or any other event of default that existed
or was continuing on the date of the commencement of such period) within twelve
months after the first such notice relating thereto. Without
limitation of the foregoing, upon any acceleration of the Subordinated Debt
Securities because of an event of default, we must promptly notify the holders
of Senior Indebtedness of such acceleration, and may not pay the Subordinated
Debt Securities unless (A) 120 days pass after such acceleration and (B) the
terms of the Subordinated Debt Indenture permit such payment at such
time.
By
reason of such subordination, in the event of our bankruptcy, insolvency or
liquidation, our creditors who are holders of Senior Indebtedness and our
general creditors may recover more, ratably, than holders of the Subordinated
Debt Securities. Certain of our contingent obligations, including
certain guarantees, letters of credit, interest rate exchange agreements,
currency exchange agreements and commodity forward contracts, would constitute
Senior Indebtedness if we became obligated to pay such contingent
obligations.
We
expect from time to time to incur additional indebtedness constituting Senior
Indebtedness. The Subordinated Debt Indenture does not prohibit or
limit the incurrence of additional Senior Indebtedness or any other indebtedness
and does not require us to adhere to financial covenants or similar
restrictions. To the extent we issue Subordinated Debt Securities, we
refer you to the applicable prospectus supplement for the amount of Senior
Indebtedness outstanding.
Conversion
and Exchange
The terms, if any,
on which debt securities of any series will be convertible into or exchangeable
for our common stock or preferred stock, property or cash, or a combination of
any of the foregoing, will be summarized in the prospectus supplement relating
thereto. Such terms may include provisions for conversion or
exchange, either on a mandatory basis, at the option of the holder, or at our
option, in which case the number of our shares of common stock or preferred
stock to be received by the holders of the debt securities would be calculated
according to the factors and at such time as summarized in the related
prospectus supplement. The prospectus supplement will also summarize
the material federal income tax consequences applicable to such convertible or
exchangeable debt securities.
Events
of Default
An
“Event of Default” is defined under each Indenture with respect to debt
securities of any series issued under such Indenture as being:
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default in
the payment of any interest on any debt security when it becomes due and
payable, and continuance of such default for a period of 30
days;
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default in
the payment of the principal of any debt security at its
maturity;
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default in
our performance (or our breach) of any of our covenants or agreements in
such Indenture, continued for 90 days after we receive written
notice;
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acceleration
of, or any failure to pay at final maturity, any of our or our
Subsidiaries’ Debt (other than the debt securities or Non-Recourse
Indebtedness) in an aggregate amount in excess of $25 million if such
acceleration is not rescinded or annulled, or such indebtedness shall not
have been discharged, within 15 days after we receive written notice
thereof; and
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certain
events of our or of one of our Significant Subsidiaries’ bankruptcy,
insolvency or reorganization.
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Each Indenture
provides that if an Event of Default, other than certain events with respect to
our bankruptcy, insolvency or reorganization, shall occur and be continuing,
then the Senior Trustee or the Subordinated Trustee, as the case may be, or the
holders of not less than 25% in aggregate principal amount of the outstanding
debt securities may, by a notice in writing to us (and to the Senior Trustee or
the Subordinated Trustee, as the case may be, if given by the holders), declare
the principal of the debt securities, and all accrued and unpaid interest
thereon, to be due and payable immediately. If an Event of Default
with respect to certain events of our bankruptcy, insolvency or reorganization
shall occur and be continuing, then the principal on the debt securities, and
all accrued and unpaid interest thereon, shall be due and payable immediately
without any act on the part of the Senior Trustee or the Subordinated Trustee,
as the case may be, or any holder.
The holders of not
less than a majority in principal amount of the outstanding debt securities may,
on behalf of the holders of all of the debt securities, waive any past default
under the Indenture and its consequences, except a default (1) in respect of the
payment of principal of or interest on the debt securities or (2) in respect of
a covenant or provision that cannot be modified or amended without the consent
of each holder.
Under each
Indenture we are required to file annually with the Senior Trustee or the
Subordinated Trustee, as the case may be, an officers’ certificate as to our
compliance with all conditions and covenants. Each Indenture will
provide that the Senior Trustee or the Subordinated Trustee, as the case may be,
may withhold notice to the holders of the debt securities of any default (except
payment defaults on the debt securities) if it considers it to be in the
interest of such holders to do so.
Subject to the
provisions of each Indenture relating to the duties of the Senior Trustee or the
Subordinated Trustee, as the case may be, each Indenture provides that when an
Event of Default occurs and is continuing, the Senior Trustee or the
Subordinated Trustee, as the case may be, will be under no obligation to
exercise any of its rights or powers under such Indenture at the request or
direction of any of the holders, unless such holders shall have offered to the
Senior Trustee or the Subordinated Trustee, as the case may be, reasonable
security or indemnity. Subject to such provisions concerning the
rights of the Senior Trustee or the Subordinated Trustee, as the case may be,
the holders of a majority in aggregate principal amount of the outstanding debt
securities will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Senior Trustee or the
Subordinated Trustee, as the case may be, or exercising any trust or power
conferred on the Senior Trustee or the Subordinated Trustee, as the case may be,
under such Indenture.
Consolidation,
Merger and Sale of Assets
Each Indenture
provides that we will not consolidate with or merge into any other corporation,
or convey, transfer or lease, or permit one or more of our Significant
Subsidiaries to convey, transfer or lease, all or substantially all of our
property and assets on a consolidated basis, to any Person unless (1) either we
are the continuing corporation or such corporation or Person assumes by
supplemental indenture all of our obligations under such Indenture and the debt
securities issued thereunder, (2) immediately after such transaction no Default
or Event of Default shall exist and (3) the surviving corporation or such Person
is a corporation, partnership or trust organized and validly existing under the
laws of the United States of America, any state thereof or the District of
Columbia.
Modification
or Waiver
Each Indenture
provides that we may modify and amend such Indenture, and the Senior Trustee or
the Subordinated Trustee, as the case may be, may modify and amend such
Indenture with the consent of the holders of not less than a majority in
principal amount of the outstanding debt securities; provided that no such
modification or amendment may, without the consent of each holder, among other
things:
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change the
maturity of the principal of, or any installment of interest on, the debt
securities;
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reduce the
principal amount of, or the rate of interest on, the debt
securities;
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change the
place or currency of payment of principal of, or interest on, the debt
securities;
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impair the
right to institute suit for the enforcement of any such payment on or
after the maturity thereof;
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reduce the
percentage of holders necessary to modify or amend such Indenture or to
consent to any waiver thereunder or reduce the requirements for voting or
quorum described below; or
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modify the
foregoing requirements or reduce the percentage of outstanding debt
securities necessary to waive any past
default.
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Each Indenture
provides that we may modify and amend such Indenture, and the Senior Trustee or
the Subordinated Trustee, as the case may be, may modify and amend such
Indenture without the consent of any holder for any of the following
purposes:
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to evidence
the succession of another Person to our company and the assumption by such
Person of our covenants contained in such Indenture and the debt
securities;
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to add
covenants of our company for the benefit of the holders or to surrender
any right or power conferred upon our
company;
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to add Events
of Default;
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to secure the
debt securities;
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to evidence
and provide for the acceptance of appointment by a successor Senior
Trustee or a successor Subordinated Trustee, as the case may
be;
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to cure any
ambiguity, defect or inconsistency in such Indenture; provided such action
does not adversely affect the interests of the
holders;
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to supplement
any of the provisions of such Indenture to the extent necessary to permit
or facilitate defeasance and discharge of the debt securities; provided
such action shall not adversely affect the interests of the holders;
or
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to conform
with the requirements of the Trust Indenture
Act.
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Defeasance
and Covenant Defeasance
We
may, at our option and at any time, terminate our obligations with respect to
the outstanding debt securities (“Defeasance”). Defeasance means that
we will be deemed to have paid and discharged the entire indebtedness
represented by the outstanding debt securities, except for (1) the rights of the
holders of outstanding debt securities to receive payment in respect of the
principal of and interest on such debt securities when such payments are due,
(2) our obligations to issue temporary debt securities, register and transfer or
exchange any debt securities, replace mutilated, destroyed, lost or stolen debt
securities, maintain an office or agency for payments in respect of the debt
securities and segregate and hold money in trust, (3) the rights, powers,
trusts, duties and immunities of the Senior Trustee or the Subordinated Trustee,
as the case may be, and (4) the Defeasance provisions of the applicable
Indenture. In addition, we may, at our option and at any time, elect
to terminate our obligations with respect to the debt securities (being
primarily the restrictions described under “— Limitation on Liens” and “—
Limitation on Sale/Leaseback Transactions”), and any omission to comply with
such obligations will not constitute a Default or an Event of Default with
respect to the debt securities (“Covenant Defeasance”).
In
order to exercise either Defeasance or Covenant Defeasance:
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we must
irrevocably deposit with the Senior Trustee or the Subordinated Trustee,
as the case may be, in trust, for the benefit of the holders, cash in
United States dollars, U.S. Government Obligations, or a combination
thereof, in such amounts as will be sufficient, in the opinion of a
nationally recognized firm of independent public accountants, to pay the
principal of and interest on the outstanding debt securities to
maturity;
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we must
deliver to the Senior Trustee or the Subordinated Trustee, as the case may
be, an opinion of counsel to the effect that the holders of the
outstanding debt securities will not recognize income, gain or loss for
federal income tax purposes as a result of such Defeasance or Covenant
Defeasance, and will be subject to federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if
such Defeasance or Covenant Defeasance had not occurred (in the case of
Defeasance, such opinion must refer to and be based upon a ruling of the
Internal Revenue Service issued, or a change in applicable federal income
tax laws occurring, after the date
hereof);
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no Default or
Event of Default shall have occurred and be continuing on the date of such
deposit or, insofar as the last bullet point under the first paragraph
under “— Events of Default” is concerned, at any time during the period
ending the 91st day after the date of deposit (it being understood that
this condition shall not be deemed satisfied until the expiration of such
period);
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such
Defeasance or Covenant Defeasance shall not cause the Senior Trustee or
the Subordinated Trustee, as the case may be, to have a conflicting
interest (as defined by the Trust Indenture Act) with respect to any of
our securities;
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such
Defeasance or Covenant Defeasance shall not result in a breach or
violation of, or constitute a default under, the applicable Indenture or
any material agreement or instrument to which we are a party or by which
we are bound; and
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we shall have
delivered to the Senior Trustee or the Subordinated Trustee, as the case
may be, an officers’ certificate and an opinion of counsel, each stating
that all conditions precedent under the applicable Indenture to either
Defeasance or Covenant Defeasance, as the case may be, have been complied
with and that no violations under agreements governing any other
outstanding Debt would result.
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Satisfaction
and Discharge
Each Indenture
provides that it will be discharged and will cease to be of further effect
(except as to any surviving rights of registration of transfer or exchange of
the debt securities, as expressly provided for in such Indenture) as to all
outstanding debt securities when (1) either (a) all the debt securities
theretofore authenticated and delivered (except lost, stolen or destroyed debt
securities which have been replaced or paid and debt securities for whose
payment money or certain U.S. Government Obligations has theretofore been
deposited in trust or segregated and held in trust by us and thereafter repaid
to us or discharged from such trust) have been delivered to the Senior Trustee
or the Subordinated Trustee, as the case may be, for cancellation or (b) all
debt securities not theretofore delivered to the Senior Trustee or the
Subordinated Trustee, as the case may be, for cancellation have become due and
payable or will become due and payable at maturity within one year and we have
irrevocably deposited or caused to be deposited with the Senior Trustee or the
Subordinated Trustee, as the case may be, funds in an amount sufficient to pay
and discharge the entire indebtedness on the debt securities not theretofore
delivered to the Senior Trustee or the Subordinated Trustee, as the case may be,
for cancellation, for principal of and interest on the debt securities to the
date of deposit together with irrevocable instructions from us directing the
Senior Trustee or the Subordinated Trustee, as the case may be, to apply such
funds to the payment thereof at maturity; (2) we have paid or have caused to be
paid all other sums payable under such Indenture by us; and (3) we have
delivered to the Senior Trustee or the Subordinated Trustee, as the case may be,
an officers’ certificate and an opinion of counsel stating that all conditions
precedent under such Indenture relating to the satisfaction and discharge of
such Indenture have been complied with.
Legal
Ownership
Street
Name and Other Indirect Holders
Investors who hold
debt securities in “street name” through accounts at banks or brokers will
generally not be recognized by us as legal holders of debt
securities. Instead, we, the Senior Trustee and the Subordinated
Trustee will recognize only the registered holder, bank or broker, or the
financial institution the bank or broker uses to hold its debt
securities. These intermediary banks, brokers and other financial
institutions pass along principal, interest and other payments on the debt
securities, either because they agree to do so in their customer agreements or
because they are legally required to do so. Street name and other
indirect holders should consult their banks or brokers for information on their
procedures with respect to these matters.
Direct
Holders
Our obligations, as
well as the obligations of the Senior Trustee and the Subordinated Trustee and
those of any third parties employed by us, the Senior Trustee and the
Subordinated Trustee, under the debt securities run only to persons who are
registered as holders of debt securities. As noted above, we do not
have obligations to you if you hold in street name or other indirect means,
either because you choose to hold debt securities in that manner or because the
debt securities are issued in the form of global securities as described
below. For example, once we make payment to the registered holder, we
have no further responsibility for the payment even if that holder is legally
required to pass the payment along to you as a street name customer but does not
do so.
Global
Securities
If
we choose to issue debt securities in the form of global securities, the
ultimate beneficial owners of global securities can only be indirect
holders. We require that the global security be registered in the
name of a financial institution we select. We also require that the
debt securities included in the global security not be transferred to the name
of any other direct holder unless the special circumstances described in the
section “Forms of Securities” below occur. The financial institution
that acts as the sole direct holder of the global security is called the
depositary. Any person wishing to own a security must do so
indirectly by virtue of an account with a broker, bank or other financial
institution that in turn has an account with the depositary. Each
prospectus supplement will indicate whether a series of debt securities covered
by that prospectus supplement will be issued only in the form of global
securities.
The
Trustees
The Indentures and
provisions of the Trust Indenture Act incorporated by reference therein contain
limitations on the rights of the Senior Trustee or the Subordinated Trustee, as
the case may be thereunder, should the Senior Trustee or the Subordinated
Trustee, as the case may be, become one of our creditors, to obtain payment of
claims in certain cases. We may from time to time maintain bank
accounts and have other customary banking relationships with and obtain credit
facilities and lines of credit from the Senior Trustee or the Subordinated
Trustee, in the ordinary course of business; provided, however, that if the
Senior Trustee or the Subordinated Trustee, as the case may be, acquires any
conflicting interest (as defined in Section 310(b) of the Trust Indenture Act),
it must eliminate such conflict or resign.
We
have appointed the Senior Trustee, at the offices specified in the Senior Debt
Indenture, as registrar, principal paying agent and transfer agent for the
senior debt securities. We will appoint the Subordinated Trustee, at
the offices specified in the Subordinated Debt Indenture, as registrar,
principal paying agent and transfer agent for the Subordinated Debt
Securities. In such capacities, the Senior Trustee or the
Subordinated Trustee, as the case may be, will be responsible for, among other
things, (1) maintaining a record of the aggregate holdings of global securities
and accepting debt securities for exchange and registration of transfer, (2)
ensuring that payments of principal of and interest on global securities and
other debt securities received from us by the Senior Trustee or the Subordinated
Trustee, as the case may be, are duly paid to The Depository Trust Company
(“DTC”) or its nominee or the holders thereof, as the case may be, and (3)
transmitting to us any notices from holders of debt securities. We
will cause the transfer agent to act as a registrar. We may vary or
terminate the appointment of the transfer agent or appoint additional or other
transfer agents or approve any change in the office through which any transfer
agent acts.
Authorized
Preferred Stock
Our restated
certificate of incorporation authorizes us to issue 5,000,000 shares of
preferred stock, par value $0.01 per share. We may issue shares of
preferred stock from time to time in one or more series, without stockholder
approval, when authorized by our board of directors.
Upon issuance of a
particular series of preferred stock, our board of directors is authorized, to
specify:
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the number of
shares to be included in the
series;
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the annual
dividend rate for the series and any restrictions or conditions on the
payment of dividends;
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the manner in
which dividends are to be paid;
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the
redemption price, if any, and the terms and conditions of
redemption;
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any
retirement or sinking fund provisions for the purchase or redemption of
the series;
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if the series
is convertible or exchangeable, the terms and conditions of conversion or
exchange;
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the amounts
payable to holders upon our liquidation, dissolution or winding
up;
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the priority
of such series;
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the voting
rights of such series; and
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any other
rights, preferences and limitations relating to the
series.
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The ability of our
board of directors to authorize, without stockholder approval, the issuance of
preferred stock with conversion and other rights, may adversely affect the
rights of holders of our voting common stock, non-voting common stock or other
series of preferred stock that may be outstanding.
No
shares of our preferred stock are currently issued and
outstanding. Five hundred thousand shares of preferred stock have
been designated as Series A Junior Participating Preferred Stock reserved for
issuance under the Rights Agreement, dated as of July 22, 1998, between us and
Mellon Investor Services, L.L.C., as rights agent. See “Description of Common
Stock―Stockholder Rights Plan” below.
Specific
Terms of a Series of Preferred Stock
The preferred stock
we may offer will be issued in one or more series. Shares of
preferred stock, when issued against full payment of its purchase price, will be
fully paid and non-assessable. Their par value or liquidation
preference, however, will not be indicative of the price at which they will
actually trade after their issue. If necessary, the prospectus
supplement will provide a description of U.S. federal income tax consequences
relating to the purchase and ownership of the series of preferred stock offered
by that prospectus supplement.
The preferred stock
will have the dividend, liquidation, redemption and voting rights discussed
below, unless otherwise described in a prospectus supplement relating to a
particular series. A prospectus supplement will discuss the following
features of the series of preferred stock to which it relates:
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the
designations and stated value per
share;
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the number of
shares offered;
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the amount of
liquidation preference per share;
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the initial
public offering price at which the preferred stock will be
issued;
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the dividend
rate, the method of its calculation, the dates on which dividends would be
paid and the dates, if any, from which dividends would
cumulate;
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whether
dividends are to be paid in cash or other securities or
property;
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any
redemption or sinking fund
provisions;
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the voting
rights of the preferred stock;
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any
conversion or exchange rights; and
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any
additional dividend, liquidation, redemption, sinking fund and other
rights, preferences, privileges, limitations and
restrictions.
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Rank
Unless otherwise
stated in the prospectus supplement, the preferred stock will have priority over
our voting and non-voting common stock with respect to dividends and
distribution of assets, but will rank junior to all our outstanding indebtedness
for borrowed money. Any series of preferred stock could rank senior,
equal or junior to our other capital stock, as may be specified in a prospectus
supplement, as long as our restated certificate of incorporation so
permits.
Dividends
Holders of each
series of preferred stock shall be entitled to receive cash dividends to the
extent specified in the prospectus supplement when, as and if declared by our
board of directors, from funds legally available for the payment of
dividends. The rates and dates of payment of dividends of each series
of preferred stock will be stated in the prospectus
supplement. Dividends will be payable to the holders of record of
preferred stock as they appear on our books on the record dates fixed by our
board of directors. Dividends on any series of preferred stock may be
cumulative or non-cumulative, as discussed in the prospectus
supplement.
Convertibility
and Exchangeability
Shares of a series
of preferred stock may be convertible or exchangeable into shares of our common
stock, another series of preferred stock or other securities or
property. The conversion or exchange may be mandatory or
optional. The applicable prospectus supplement will specify whether
the preferred stock being offered has any conversion or exchange features, and
will describe all the related terms and conditions.
Redemption
The terms, if any,
on which shares of preferred stock of a series may be redeemed will be discussed
in the prospectus supplement.
Liquidation
Upon any voluntary
or involuntary liquidation, dissolution or winding up of the affairs of our
company, holders of each series of preferred stock will be entitled to receive
distributions upon liquidation in the amount described in the related prospectus
supplement plus an amount equal to any accrued and unpaid dividends for the
then-current dividend period (including any accumulation in respect of unpaid
dividends for prior dividend periods, if dividends on that series of preferred
stock are cumulative). These distributions will be made before any
distribution is made on any securities ranking junior to the preferred stock
with respect to liquidation, including our common stock. If the
liquidation amounts payable relating to the preferred stock of any series and
any other securities ranking on a parity regarding liquidation rights are not
paid in full, the holders of the preferred stock of that series will share
ratably in proportion to the full liquidation preferences of each
security. Holders of our preferred stock will not be entitled to any
other amounts from us after they have received their full liquidation
preference.
Transfer
Agent
The transfer agent
for each series of preferred stock will be named and described in the prospectus
supplement for that series.
The following
summary description of our common stock is based on the provisions of our
restated certificate of incorporation and by-laws and the applicable provisions
of the Delaware general corporation law. This information is
qualified entirely by reference to the provisions of our restated certificate of
incorporation, our by-laws and the Delaware general corporation
law. For information on how to obtain copies of our restated
certificate of incorporation and by-laws, see “Where You Can Find More
Information” below.
Authorized
Capital
We
currently have authority to issue 180,000,000 shares of capital stock,
consisting of 5,000,000 shares of preferred stock, $0.01 par value, 150,000,000
shares of voting common stock, $0.01 par value, and 25,000,000 shares of
non-voting common stock, $0.01 par value. As of December 31, 2007,
116,128,572 shares of our voting common stock were issued and outstanding, and
no shares of our non-voting common stock or preferred stock were issued or
outstanding.
The rights of the
holders of our voting and non-voting common stock discussed below are subject to
the rights that our board of directors may from time to time confer on holders
of our preferred stock issued in the future. These rights may
adversely affect the rights of holders of our voting common stock, non-voting
common stock, or both.
Requirements
for Advance Notification or Stockholder Proposals and Nominations
Our by-laws contain
provisions requiring that a stockholder deliver advance notice of any business
that such stockholder intends to raise at an annual meeting of stockholders and
providing for procedures to be followed if a stockholder wishes to nominate a
person to be elected as a director. To be timely, the stockholder
must give written notice to our Secretary not less than 90 days or more than 120
days prior to the first anniversary of the preceding year’s annual
meeting. If the date of the next annual meeting is more than 30 days
before, or more than 60 days after, the first anniversary of the preceding
year’s annual meeting, the stockholder must deliver notice to our Secretary not
earlier than the 120th day prior to such annual meeting and not later than the
close of business on the later of the 90th day prior to such annual meeting or
the 10th day following the day on which public announcement of the date of such
meeting is first made.
The notice must
provide information about the stockholder giving the notice and the beneficial
owner, if any, on whose behalf the nomination or proposal is being made, each
person whom the stockholder proposes to nominate for election or reelection as
director, and the business to be brought before the meeting. In
addition, if we plan to increase the size of our board of directors,
and we do not publicly announce all of the nominees for election or specify the
size of the increased board of directors at least 70 days prior to the first
anniversary of the preceding year’s annual meeting, a stockholder will have 10
days following the date of our public announcement to give notice with respect
to nominees for any new positions created by such increase.
Special
Meetings
Subject to the
rights of holders of preferred stock, special meetings of stockholders may be
called only by our board of directors pursuant to a resolution approved by a
majority of the total number of directors, or by a person or committee expressly
so authorized by our board of directors pursuant to a resolution approved by a
majority of the total number of directors. According to our by-laws,
if we call a special meeting to elect directors to our board of directors, a
stockholder may nominate individuals for election if such stockholder delivers
notice to our Secretary not earlier than the 120th day prior to such special
meeting and not later than the close of business on the later of the 90th day
prior to such special meeting or the 10th day following the day on which public
announcement is first made of the date of the special meeting and of the
nominees proposed by our board of directors to be elected at such
meeting.
Voting
Rights
Each holder of our common stock is entitled to
one vote per share in the election of directors and on all other matters
submitted to a vote of stockholders, and does not have cumulative voting
rights. In general, holders of our non-voting common stock do not
have voting rights, other than those required by law. However,
holders of non-voting common stock may vote as a separate class on amendments to
the restated certificate of incorporation that adversely affect their powers,
preferences or special rights as holders of non-voting common
stock.
Conversion
Rights
Qualified institutional investors who are
subject to regulatory requirements that forbid or limit their right to own
general voting stock may convert their common stock into non-voting common stock
on a share-for-share basis as needed to satisfy applicable regulatory
requirements, or directly purchase non-voting common stock because of such
regulatory requirements. Thereafter, the non-voting common stock may
be converted into common stock on a share-for-share basis in such circumstances
as are permitted by applicable regulatory requirements.
Dividends
Subject to any preferential rights of any of
our outstanding preferred stock, holders of our common stock and non-voting
common stock, treated as a single class, are entitled to receive, based on the
number of shares held, cash dividends when and as declared by our board of
directors from funds legally available for such purpose.
Rights
Upon Liquidation
If we liquidate, holders of our common stock
and non-voting common stock, treated as a single class, are entitled to receive,
based on the number of shares held, all of the assets available for distribution
to stockholders after payment of all prior claims, including any preferential
liquidation rights of any preferred stock outstanding at that
time. The holders of our common stock and non-voting common stock do
not have any redemption rights.
No
Action by Written Consent
Subject to the
rights of holders of preferred stock, any action required or permitted to be
taken by our stockholders must be effected at an annual or special meeting of
stockholders and may not be affected by any consent in writing by such
stockholders.
Other
Rights
The holders of our common stock and non-voting
common stock do not have preemptive rights to subscribe to any additional shares
of any class of our capital stock. All of our outstanding shares of
common stock are, and, upon conversion or exchange, any issued shares of our
common stock and/or non-voting common stock will be, fully paid and
non-assessable. Our common stock and non-voting common stock do not
have any sinking fund provisions.
Our voting common stock is listed for trading
on the New York Stock Exchange under the symbol “BWA” and the transfer agent and
registrar for our voting common stock is Mellon Investor Services,
L.L.C.
Some
Important Charter and Statutory Provisions
Our restated certificate of incorporation
provides for the division of our board of directors into three classes of
directors, each serving staggered, three-year terms. In addition, our
restated certificate of incorporation and our by-laws provide that directors may
be removed only for cause and only upon the affirmative vote of holders of at
least 80% of our outstanding voting power. Our restated certificate
of incorporation further provides generally that any alteration, amendment or
repeal of its sections regarding the composition, election and classification of
our board of directors requires the approval of the holders of at least 80% of
our outstanding voting power.
Our restated certificate of incorporation also
provides that when it is evaluating any proposal from another party to (1) make
a tender offer for our equity securities, (2) merge or consolidate us with
another corporation or (3) purchase or otherwise acquire substantially all of
our properties and assets, our board of directors must give due consideration to
all relevant factors, including the social and economic effects on our
employees, customers, suppliers and other constituents and the communities in
which we operate or are located.
Our restated certificate of incorporation
provides that a director will not be personally liable for monetary damages to
us or our stockholders for breach of fiduciary duty as a director, except for
liability:
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for any
breach of the director’s duty of loyalty to us or our
stockholders;
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for acts or
omissions not in good faith or which involve intentional misconduct or a
knowing violation of law;
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for paying a
dividend or approving a stock repurchase or redemption in violation of
Section 174 of the Delaware general corporation law;
or
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for any
transaction from which the director derived an improper personal
benefit.
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Our restated
certificate of incorporation also provides that each of our current or former
directors, officers, employees or agents, or each such person who is or was
serving or who had agreed to serve at our request as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise (including the heirs, executors, administrators or estate of
that person), will be indemnified by us to the fullest extent permitted by the
Delaware general corporation law. Our restated certificate of
incorporation also specifically authorizes us to enter into agreements with any
person providing for indemnification greater or different than that provided by
our restated certificate of incorporation.
These provisions may have the effect of
deterring hostile takeovers or delaying changes in control of our company or our
management.
We are subject to the provisions of Section 203
of the Delaware general corporation law. In general, the statute
prohibits a publicly held Delaware corporation from engaging in a “business
combination” with an “interested stockholder” for a period of three years after
the date of the transaction in which the person became an interested
stockholder, unless:
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(1)
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prior to that
date, the board of directors approved either the business combination or
the transaction that resulted in the stockholder becoming an interested
stockholder;
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(2)
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when the
transaction that resulted in such person becoming an interested
stockholder was completed, the interested stockholder owned at least 85%
of the voting stock of the corporation outstanding at the time the
transaction began, excluding, for purposes of determining the number of
shares outstanding, shares owned by some directors or employee stock
plans; or
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(3)
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on or after
the date the stockholder became an interested stockholder, the business
combination is approved by the board of directors and authorized by the
affirmative vote, and not by the written consent, of at least two-thirds
of outstanding voting stock, excluding the stock owned by the interested
stockholder.
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For purposes of
Section 203, a “business combination” includes a merger, asset sale, or other
transaction resulting in a financial benefit to the interested
stockholder. An “interested stockholder” is a person, other than the
corporation and any direct or indirect majority-owned subsidiary of the
corporation, who together with affiliates and associates, owns or, as an
affiliate or associate, within three years prior, did own, 15% or more of the
corporation’s outstanding voting stock.
Stockholder
Rights Plan
On July 21, 1998, our board of directors
adopted a stockholder rights plan and, on July 22, 1998, signed a rights
agreement with Mellon Investor Services, L.L.C., as rights agent. A
copy of our rights agreement has been filed as an exhibit to the registration
statement of which this prospectus is a part and is incorporated by reference
into this prospectus. Under our stockholder rights plan, one
preferred stock purchase right is attached to each outstanding share of our
common stock. We refer to these preferred stock purchase rights as
the “rights.” Each share of common stock and each share of non-voting
common stock issued in the future will also receive a right until the rights
become exercisable. Until a right is exercised, the holder of a right
does not have any additional rights as a stockholder. These rights
will expire on July 22, 2008, unless they are previously redeemed or exchanged
by us as described below. These rights trade automatically with our common stock
and non-voting common stock and will separate from the common stock and
non-voting common stock and become exercisable only under the circumstances
described below.
In general, the rights will become exercisable
when the first of the following events happen:
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(1)
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ten calendar
days after a public announcement that a person or group has acquired
beneficial ownership of 20% or more of the sum of our outstanding common
stock and non-voting common stock;
or
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(2)
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ten business
days, or such other date determined by our board of directors, after the
beginning of, or announcement of an intention to begin, a tender offer or
exchange offer that would result in a person or group beneficially owning
20% or more of the sum of our outstanding common stock and non-voting
common stock.
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If the rights become exercisable, holders of
the rights will be able to purchase from us one one-hundredth of a share of our
Series A Junior Participating Preferred Stock at a price of $300, subject to
adjustment. However, all rights owned by any persons or groups
triggering the event shall be void. If a person or group acquires 20%
or more of the sum of our outstanding common stock and non-voting common stock
then each right will entitle the holder (other than the 20% or more person or
group that triggered the rights) to purchase a number of shares of our common
stock in respect of rights attached to our common stock, or a number of shares
of our non-voting common stock in respect of rights attached to our non-voting
common stock, in either case having a market value of two times the exercise
price of the right.
If we are acquired in a merger or other
business combination transaction, or 50% or more of our consolidated assets or
earning power are sold after a person or group acquires 20% or more of the sum
of our outstanding common stock and non-voting common stock, then each right
will entitle the holder (other than the 20% or more person or group that
triggered the rights) to purchase a number of shares of common stock of the
surviving or acquiring corporation having a market value of two times the
exercise price of the right.
At any time after a person or group has
acquired beneficial ownership of 20% or more of our outstanding common stock and
non-voting common stock, our board of directors may, at its option, exchange all
or any part of the then outstanding and exercisable rights for shares of common
stock or shares of Series A Preferred Stock at an exchange ratio of one share of
common stock or one one-hundredth of a share of Series A Junior Participating
Preferred Stock per right. However, our board of directors will not
be empowered to affect such exchange at any time after any person or group
becomes the beneficial owner of 50% or more of our outstanding common
stock.
Our board of
directors may redeem the rights for $.01 per right at any time before a person
or group has acquired beneficial ownership of 20% or more of the sum of our
outstanding common stock and non-voting common stock. Our board of
directors may generally reduce the 20% trigger to the higher of (1) the largest
percentage then known to our company beneficially owned by a person or group or
(2) 10%, and may otherwise amend the rights at any time before a person or group
has acquired beneficial ownership of 20% or more of the sum of our outstanding
common stock and non-voting common stock. The rights will expire at
the close of business on July 22, 2008 unless we redeem them before that
date.
Fractional
Shares of Preferred Stock
We
may elect to offer fractional interests in shares of our preferred stock instead
of whole shares of preferred stock. If so, we will allow a depositary
to issue to the public depositary shares, each of which will represent a
fractional interest as described in the prospectus supplement, of a share of
preferred stock.
Deposit
Agreement
The shares of the
preferred stock underlying any depositary shares will be deposited under a
separate deposit agreement between us and a bank or trust company acting as
depositary with respect to that series. The depositary will have its
principal office in the United States and have a combined capital and surplus of
at least $50,000,000. The prospectus supplement relating to a series
of depositary shares will include the name and address of the
depositary. Under the deposit agreement, each owner of a depositary
share will be entitled, in proportion of its fractional interest in a share of
the preferred stock underlying that depositary share, to all the rights and
preferences of that preferred stock, including dividend, voting, redemption,
conversion, exchange and liquidation rights.
Depositary shares
will be evidenced by one or more depositary receipts issued under the deposit
agreement.
Dividends
and Other Distributions
The depositary will
distribute all cash dividends or other cash distributions in respect of the
preferred stock to each record depositary shareholder based on the number of the
depositary shares owned by that holder on the relevant record
date. The depositary will distribute only that amount which can be
distributed without attributing to any depositary shareholders a fraction of one
cent, and any balance not so distributed will be added to and treated as part of
the next sum received by the depositary for distribution to record depositary
shareholders.
If
there is a distribution other than in cash, the depositary will distribute
property to the entitled record depositary shareholders, unless the depositary
determines that it is not feasible to make that distribution. In that
case the depositary may, with our approval, adopt the method it deems equitable
and practicable for making that distribution, including any sale of property and
the distribution of the net proceeds from this sale to the concerned
holders.
Each deposit
agreement will also contain provisions relating to the manner in which any
subscription or similar rights we offer to preferred stockholders of the
relevant series will be made available to depositary shareholders.
Withdrawal
of Stock
Upon surrender of
depositary receipts at the depositary’s office, the holder of the relevant
depositary shares will be entitled to the number of whole shares of the related
preferred stock series and any money or other property those depositary shares
represent. Depositary shareholders will be entitled to receive whole
shares of the related preferred stock series on the basis described in the
prospectus supplement, but holders of those whole preferred stock shares will
not afterwards be entitled to receive depositary shares in exchange for their
shares. If the depositary receipts the holder delivers evidence a
depositary share number exceeding the whole share number of the related
preferred stock series to be withdrawn, the depositary will deliver to that
holder a new depositary receipt evidencing the excess number of depositary
shares.
Redemption
and Liquidation
The terms on which
the depositary shares relating to the preferred stock of any series may be
redeemed, and any amounts distributable upon our liquidation, dissolution or
winding up, will be described in the prospectus supplement.
Convertibility
and Exchangeability
Shares of a series
of preferred stock may be convertible or exchangeable into shares of our common
stock, another series of preferred stock or other securities or
property. The conversion or exchange may be mandatory or
optional. The applicable prospectus supplement will specify whether
the preferred stock being offered has any conversion or exchange features, and
will describe all the related terms and conditions.
Voting
Upon receiving
notice of any meeting at which preferred stockholders of any series are entitled
to vote, the depositary will mail the information contained in that notice to
the record depositary shareholders relating to those series of preferred
stock. Each depositary shareholder on the record date will be
entitled to instruct the depositary on how to vote the shares of preferred stock
underlying that holder’s depositary shares. The depositary will vote
the preferred stock shares underlying those depositary shares according to those
instructions, and we will take reasonably necessary actions to enable the
depositary to do so. If the depositary does not receive specific
instructions from the depositary shareholders relating to that preferred stock,
it will abstain from voting those preferred stock shares, unless otherwise
discussed in the prospectus supplement.
Amendment
and Termination of Deposit Agreement
We
and the depositary may amend the depositary receipt form evidencing the
depositary shares and the related deposit agreement. However, any
amendment that significantly affects the rights of the depositary shareholders
will not be effective unless holders of a majority of the outstanding depositary
shares approve that amendment. We or the depositary may terminate a
deposit agreement only if:
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we have
redeemed or reacquired all outstanding depositary shares relating to the
deposit agreement,
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all preferred
stock of the relevant series has been withdrawn,
or
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there has
been a final distribution in respect of the preferred stock of any series
in connection with our liquidation, dissolution or winding up and such
distribution has been made to the related depositary
shareholders.
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Charges
of Depositary
We
will pay all charges of each depositary in connection with the initial deposit
and any redemption of the preferred stock. Depositary shareholders
will be required to pay any other transfer and other taxes and governmental
charges and any other charges expressly provided in the deposit agreement to be
for their accounts.
Title
We
and each depositary and any of our respective agents may treat the registered
owner of any depositary share as the absolute owner of that share, whether or
not any payment in respect of that depositary share is overdue and despite any
notice to the contrary, for any purpose. See “Forms of Securities”
below.
Resignation
and Removal of Depositary
A
depositary may resign at any time by issuing us a notice of resignation, and we
may remove any depositary at any time by issuing it a notice of
removal. Resignation or removal will take effect upon the appointment
of a successor depositary and its acceptance of appointment. That
successor depositary must:
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be appointed
within 60 days after delivery of the notice of resignation or
removal,
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be a bank or
trust company having its principal office in the United States,
and
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have a
combined capital and surplus of at least
$50,000,000.
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Miscellaneous
Each depositary
will forward to the relevant depositary shareholders all our reports and
communications that we are required to furnish to preferred stockholders of any
series.
Neither we nor the
depositary will be liable if either of us is prevented or delayed by law or any
circumstance beyond its control in performing its obligations under any deposit
agreement. Our obligations and the obligations of each depositary
under any deposit agreement will be limited to performance in good faith of
their duties under that agreement, and they will not be obligated to prosecute
or defend any legal proceeding in respect of any depositary shares or preferred
stock unless they are provided with satisfactory indemnity. They may
rely upon written advice of counsel or accountants, or information provided by
persons presenting preferred stock for deposit, depositary shareholders or other
persons believed to be competent and on documents believed to be
genuine.
We
may issue warrants for the purchase of our debt securities, preferred stock,
common stock, depositary shares or units. Warrants may be issued
independently or together with debt securities, preferred stock, common stock,
depositary shares or units, and may be attached to or separate from those
securities.
Warrant
Agreements
Each series of
warrants will be evidenced by certificates issued under a separate warrant
agreement to be entered into between us and a bank that we select as warrant
agent with respect to such series. The warrant agent will have its
principal office in the U.S. and have a combined capital and surplus of at least
$50,000,000.
Issuance
In Series
The prospectus
supplement relating to a series of warrants will mention the name and address of
the warrant agent. The prospectus supplement will describe the terms
of the series of warrants in respect of which this prospectus is being
delivered, including:
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the offering
price;
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the currency
for which the warrants may be
purchased;
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the
designation and terms of the securities with which the warrants are issued
and the number of warrants issued with each security or each principal
amount of security;
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the date on
which the warrants and the related securities will be separately
transferable;
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in the case
of warrants to purchase debt securities, the principal amount of debt
securities that can be purchased upon exercise, and the price for
purchasing those debt securities;
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in the case
of warrants to purchase preferred stock, depositary shares or common
stock, the number of depositary shares or shares of preferred stock or
common stock, as the case may be, that can be purchased upon the exercise,
and the price for purchasing those
shares;
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in the case
of warrants to purchase units upon exercise, the number and type of units
that can be purchased upon exercise, and the price of those
units;
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the dates on
which the right to exercise the warrants will commence and
expire;
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material U.S.
federal income tax consequences of holding or exercising those
warrants;
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the terms of
the securities issuable upon exercise of those warrants;
and
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any other
terms of the warrants.
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Warrant
certificates may be exchanged for new warrant certificates of different
denominations, may be presented for transfer registration, and may be exercised
at the warrant agent’s corporate trust office or any other office indicated in
the prospectus supplement. If the warrants are not separately
transferable from the securities with which they were issued, this exchange may
take place only if the certificates representing the related securities are also
exchanged. Prior to warrant exercise, warrantholders will not have
any rights as holders of the underlying securities, including the right to
receive any principal, premium, interest, dividends, or payments upon our
liquidation, dissolution or winding up or to exercise any voting
rights.
Exercise
of Warrants
Each warrant will
entitle the holder to purchase the securities specified in the prospectus
supplement at the exercise price mentioned in, or calculated as described in,
the prospectus supplement. Unless otherwise specified in the
prospectus supplement, warrants may be exercised at any time up to 5:00 p.m.,
New York time, on the expiration date mentioned in that prospectus
supplement. After the close of business on the expiration date,
unexercised warrants will become void.
Warrants may be
exercised by delivery of the warrant certificate representing the warrants to be
exercised, or in the case of global securities, as described below under “Forms
of Securities,” by delivery of an exercise notice for those warrants, together
with certain information, and payment to the warrant agent in immediately
available funds, as provided in the prospectus supplement, of the required
purchase amount. The information required to be delivered will be on
the reverse side of the warrant certificate and in the prospectus
supplement. Upon receipt of payment and the warrant certificate or
exercise notice properly executed at the office indicated in the prospectus
supplement, we will, in the time period the relevant warrant agreement provides,
issue and deliver the securities purchasable upon such exercise. If
fewer than all of the warrants represented by such warrant certificates are
exercised, a new warrant certificate will be issued for the remaining amount of
warrants.
If
mentioned in the prospectus supplement, securities may be surrendered as all or
part of the exercise price for warrants.
Antidilution
Provisions
As
will be provided in a prospectus supplement, in the case of warrants to purchase
common stock or securities convertible into or exchangeable for common stock,
the exercise price payable and the number of shares of common stock purchasable
upon warrant exercise may be adjusted in certain events, including:
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the issuance
of a stock dividend to common stockholders or a combination, subdivision
or reclassification of common
stock;
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the issuance
of rights, warrants or options to all common and preferred stockholders
entitling them to purchase common stock for an aggregate consideration per
share less than the current market price per share of common
stock;
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any
distribution to our common stockholders of evidences of our indebtedness
of assets, excluding cash dividends or distributions referred to above;
and
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any other
events mentioned in the prospectus
supplement.
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No
adjustment in the number of shares or securities purchasable upon warrant
exercise will be required until cumulative adjustments require an adjustment of
at least 1% of such number. No fractional shares will be issued upon
warrant exercise, but we will pay the cash value of any fractional shares
otherwise issuable.
Modification
Unless provided
otherwise in an applicable prospectus supplement, we and any warrant agent may
amend any warrant agreement and the terms of the related warrants by executing a
supplemental warrant agreement, without any such warrantholders’ consent, for
the purpose of:
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curing any
ambiguity, any defective or inconsistent provision contained in the
warrant agreement, or making any other corrections to the warrant
agreement that are not inconsistent with the provisions of the warrant
certificates;
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evidencing
the succession of another corporation to us and its assumption of our
covenants contained in the warrant agreement and the
warrants;
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appointing a
successor depository, if the warrants are issued in the form of global
securities;
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evidencing a
successor warrant agent’s acceptance of appointment with respect to the
warrants;
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adding to our
covenants for the warrantholders’ benefit or surrendering any right or
power we have under the warrant
agreement;
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issuing
warrants in definitive form, if such warrants are initially issued in the
form of global securities; or
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amending the
warrant agreement and the warrants as we deem necessary or desirable and
that will not adversely affect the warrantholders’ interests in any
material respect.
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Unless provided
otherwise in an applicable prospectus supplement, we and the warrant agent may
also amend any warrant agreement and the related warrants by a supplemental
agreement with the consent of the holders of a majority of the unexercised
warrants affected by such amendment, for the purpose of adding, modifying or
eliminating any of the warrant agreement’s provisions or of modifying the
warrantholders’ rights. However, no such amendment that:
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reduces the
number or amount of securities receivable upon warrant
exercise;
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shortens the
time period during which the warrants may be
exercised;
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otherwise
adversely affects the exercise rights of warrantholders in any material
respect; or
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reduces the
number of unexercised warrants the consent of holders of which is required
for amending the warrant agreement or the related
warrants
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may be made without
the consent of each holder affected by that amendment.
Consolidation,
Merger and Sale of Assets
Unless provided
otherwise in an applicable prospectus supplement, each warrant agreement will
provide that we may consolidate or merge with or into any other corporation or
sell, lease, transfer or convey all or substantially all of our assets to any
other corporation. However, any successor or acquirer of such assets
must assume all of our obligations under the relevant warrant agreement and for
the unexercised warrants, as appropriate, and we or that successor corporation
must not immediately be in default under that warrant agreement.
Enforceability
of Rights By Holders of Warrants
Each warrant agent
will act solely as our agent under the relevant warrant agreement and will not
assume any obligation or relationship of agency or trust for any
warrantholder. A single bank or trust company may act as warrant
agent for more than one issue of warrants. A warrant agent will have
no duty or responsibility in case we default in performing our obligations under
the relevant warrant agreement or warrant, including any duty or responsibility
to initiate any legal proceedings or to make any demand upon us. Any
warrantholder may, without the warrant agent’s consent or consent of any other
warrantholder, enforce by appropriate legal action its right to exercise that
warrant.
Replacement
of Warrant Certificates
We
will replace any destroyed, lost, stolen or mutilated warrant certificate upon
delivery to us and the relevant warrant agent of satisfactory evidence of the
ownership of that warrant certificate and of its destruction, loss, theft or
mutilation, and (in the case of mutilation) surrender of that warrant
certificate to the relevant warrant agent, unless we have, or the warrant agent
has, received notice that the warrant certificate has been acquired by a bona
fide purchaser. That warrantholder will also be required to provide
indemnity satisfactory to us and the relevant warrant agent before a replacement
warrant certificate will be issued.
Title
We
and the warrant agents and any of our respective agents may treat the registered
holder of any warrant certificate as the absolute owner of the warrants
evidenced by that certificate for any purpose and as the person entitled to
exercise the rights attaching to the warrants so requested, despite any notice
to the contrary. See “Forms of Secuirties” below.
We
may issue units comprised of one or more debt securities, shares of preferred
stock, shares of common stock and warrants in any combination. Each
unit will be issued so that the holder of the unit is also the holder of each
security included in the unit. Thus, the holder of a unit will have
the rights and obligations of a holder of each included security. The
unit agreement under which a unit is issued may provide that the securities
included in the unit may not be held or transferred separately, at any time or
at any time before a specified date.
The prospectus
supplement may describe:
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the
designation and terms of the units and of the securities comprising the
units, including whether and under what circumstances those securities may
be held or transferred separately;
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any
provisions of the governing unit agreement that differ from those
described below; and
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any
provisions for the issuance, payment, settlement, transfer or exchange of
the units or of the securities comprising the
units.
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The provisions
described in this section, as well as those described under “Description of Debt
Securities,” “Description of Preferred Stock,” “Description of Common Stock” and
“Description of Warrants,” will apply to each unit and to any debt security,
preferred stock, common stock or warrant, respectively, included in each
unit.
We
may issue units in such amounts and in as many distinct series as we
wish. This section summarizes terms of the units that apply generally
to all series.
Unit
Agreements
We
will issue the units under one or more unit agreements to be entered into
between us and a bank or other financial institution, as unit
agent. We may add, replace or terminate unit agents from time to
time. We will identify the unit agreement under which each series of
units will be issued and the unit agent under that agreement in the prospectus
supplement.
The following
provisions will generally apply to all unit agreements unless otherwise stated
in the prospectus supplement.
Enforcement
of Rights
The unit agent
under a unit agreement will act solely as our agent in connection with the units
issued under that agreement. The unit agent will not assume any
obligation or relationship of agency or trust for or with any holders of those
units or of the securities comprising those units. The unit agent
will not be obligated to take any action on behalf of those holders to enforce
or protect their rights under the units or the included securities.
Except as indicated
in the next paragraph, a holder of a unit may, without the consent of the unit
agent or any other holder, enforce its rights as holder under any security
included in the unit, in accordance with the terms of that security and the
indenture, warrant agreement or other instrument under which that security is
issued. Those terms are described elsewhere in this prospectus under
the sections relating to debt securities, preferred stock, common stock and
warrants.
Notwithstanding the
foregoing, a unit agreement may limit or otherwise affect the ability of a
holder of units issued under that agreement to enforce its rights, including any
right to bring a legal action, with respect to those units or any securities,
other than debt securities, that are included in those
units. Limitations of this kind will be described in the prospectus
supplement.
Modification
Without Consent of Holders
Unless provided
otherwise in an applicable prospectus supplement, we and the applicable unit
agent may amend any unit or unit agreement without the consent of any
holder:
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to cure any
ambiguity;
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to correct or
supplement any defective or inconsistent provision;
or
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to make any
other change that we believe is necessary or desirable and will not
adversely affect the interests of the affected holders in any material
respect.
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We do not need any
approval to make changes that affect only units to be issued after the changes
take effect. We may also make changes that do not adversely affect a
particular unit in any material respect, even if they adversely affect other
units in a material respect. In those cases, we do not need to obtain
the approval of the holder of the unaffected unit; we need only obtain any
required approvals from the holders of the affected units.
Modification
With Consent of Holders
Unless provided
otherwise in an applicable prospectus supplement, we may not amend any
particular unit or a unit agreement with respect to any particular unit unless
we obtain the consent of the holder of that unit, if the amendment
would:
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impair any
right of the holder to exercise or enforce any right under a security
included in the unit if the terms of that security require the consent of
the holder to any changes that would impair the exercise or enforcement of
that right, or
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reduce the
percentage of outstanding units or any series or class the consent of
whose holders is required to amend that series or class, or the applicable
unit agreement with respect to that series or class, as described
below.
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Unless provided
otherwise in an applicable prospectus supplement, any other change to a
particular unit agreement and the units issued under that agreement would
require the following approval:
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If the change
affects only the units of a particular series issued under that agreement,
the change must be approved by the holders of a majority of the
outstanding units of that series,
or
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If the change
affects the units of more than one series issued under that agreement, it
must be approved by the holders of a majority of all outstanding units of
all series affected by the change, with the units of all the affected
series voting together as one class for this
purpose.
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These provisions
regarding changes with majority approval also apply to changes affecting any
securities issued under a unit agreement, as the governing
document.
In
each case, the required approval must be given by written consent.
Unit
Agreements Will Not Be Qualified Under Trust Indenture Act
No
unit agreement will be qualified as an indenture, and no unit agent will be
required to qualify as a trustee, under the Trust Indenture
Act. Therefore, holders of units issued under unit agreements will
not have the protections of the Trust Indenture Act with respect to their
units.
Title
We
and the unit agents and any of our respective agents may treat the registered
holder of any unit certificate as an absolute owner of the units evidenced by
that certificate for any purpose and as the person entitled to exercise the
rights attaching to the units so requested, despite any notice to the
contrary. See “Forms of Securities” below.
Each debt security,
warrant, purchase contract and unit will be represented either by a certificate
issued in definitive form to a particular investor or by one or more global
securities representing the entire issuance of securities. Both
certificated securities in definitive form and global securities may be issued
either (1) in registered form, where our obligation runs to the holder of the
security named on the face of the security or, if a registry is kept, the
registered owner of the note in the registry, or (2) subject to the limitations
explained below under “--Limitations on Issuance of Bearer Securities and Bearer
Debt Warrants,” in bearer form, where our obligation runs to the bearer of the
security. Definitive securities name you or your nominee as the owner
of the security (other than definitive bearer securities, which the holder
thereof will be the owner), and in order to transfer or exchange these
securities or to receive payments other than interest or other interim payments,
you or your nominee must physically deliver the securities to the trustee,
registrar, paying agent or other agent, as applicable. Registered
global securities name a depositary or its nominee as the owner of the debt
securities, warrants, purchase contracts or units represented by these global
securities (other than global bearer securities, which the holder thereof will
be the owner). The depositary maintains a computerized system that
will reflect each investor’s beneficial ownership of the securities through an
account maintained by the investor with its broker/dealer, bank, trust company
or other representative, as we explain more fully below.
Global
Securities
Registered Global
Securities. We may issue registered debt securities, warrants,
purchase contracts and units in the form of one or more fully registered global
securities that will be deposited with a depositary or its nominee identified in
the applicable prospectus supplement and registered in the name of that
depositary or nominee. In those cases, one or more registered global
securities will be issued in a denomination or aggregate denominations equal to
the portion of the aggregate principal or face amount of the securities to be
represented by registered global securities. Unless and until it is
exchanged in whole for securities in definitive registered form, a registered
global security may not be transferred except as a whole by and among the
depositary for the registered global security, the nominees of the depositary or
any successors of the depositary or those nominees.
If
not described below, any specific terms of the depositary arrangement with
respect to any securities to be represented by a registered global security will
be described in the prospectus supplement relating to those
securities. We anticipate that the following provisions will apply to
all depositary arrangements.
Ownership of
beneficial interests in a registered global security will be limited to persons,
called participants, that have accounts with the depositary or persons that may
hold interests through participants. Upon the issuance of a
registered global security, the depositary will credit, on its book entry
registration and transfer system, the participants’ accounts with the respective
principal or face amounts of the securities beneficially owned by the
participants. Any dealers, underwriters or agents participating in
the distribution of the securities will designate the accounts to be
credited. Ownership of beneficial interests in a registered global
security will be shown on, and the transfer of ownership interests will be
effected only through, records maintained by the depositary, with respect to
interests of participants, and on the records of participants, with respect to
interests of persons holding through participants. The laws of some
states may require that some purchasers of securities take physical delivery of
these securities in definitive form. These laws may impair your
ability to own, transfer or pledge beneficial interests in registered global
securities.
So
long as the depositary, or its nominee, is the registered owner of a registered
global security, that depositary or its nominee, as the case may be, will be
considered the sole owner and holder of the securities represented by the
registered global security for all purposes under the applicable indenture,
warrant agreement, purchase contract or unit agreement. Except as
described below, owners of beneficial interests in a registered global security
will not be entitled to have the securities represented by the registered global
security registered in their names, will not receive or be entitled to receive
physical delivery of the securities in definitive form and will not be
considered the owners or holders of the securities under the applicable
indenture, warrant agreement, purchase contract or unit
agreement. Accordingly, each person owning a beneficial interest in a
registered global security must rely on the procedures of the depositary for
that registered global security and, if that person is not a participant, on the
procedures of the participant through which the person owns its interest, to
exercise any rights of a holder under the applicable indenture, warrant
agreement, purchase contract or unit agreement. We understand that
under existing industry practices, if we request any action of holders or if an
owner of a beneficial interest in a registered global security desires to give
or take any action that a holder is entitled to give or take under the
applicable indenture, warrant agreement, purchase contract or unit agreement,
the depositary for the registered global security would authorize the
participants holding the relevant beneficial interests to give or take that
action, and the participants would authorize beneficial owners owning through
them to give or take that action or would otherwise act upon the instructions of
beneficial owners holding through them.
Principal, interest
payments on debt securities, other amounts due under debt securities and any
payments to holders with respect to warrants, purchase contract or units,
represented by a registered global security registered in the name of a
depositary or its nominee will be made to the depositary or its nominee, as the
case may be, as the registered owner of the registered global
security. None of us, the trustees, the warrant agents, the unit
agents or any of our other agents, agent of the trustees or agent of the warrant
agents or unit agents will have any responsibility or liability for any aspect
of the records relating to payments made on account of beneficial ownership
interests in the registered global security or for maintaining, supervising or
reviewing any records relating to those beneficial ownership
interests.
We
expect that the depositary for any of the securities represented by a registered
global security, upon receipt of any payment of principal, interest, other
amounts or other distribution of underlying securities or other property to
holders on that registered global security, will immediately credit
participants’ accounts in amounts proportionate to their respective beneficial
interests in that registered global security as shown on the records of the
depositary. We also expect that payments by participants to owners of
beneficial interests in a registered global security held through participants
will be governed by standing customer instructions and customary practices, as
is now the case with the securities held for the accounts of customers
registered in “street name,” and will be the responsibility of those
participants.
If
the depositary for any of these securities represented by a registered global
security is at any time unwilling or unable to continue as depositary or ceases
to be a clearing agency registered under the Securities Exchange Act of 1934,
and a successor depositary registered as a clearing agency under the Securities
Exchange Act of 1934 is not appointed by us within 90 days, we will issue
securities in definitive form in exchange for the registered global security
that had been held by the depositary. In addition, the indenture
permits us at any time and in our sole discretion to decide not to have any of
the securities represented by one or more registered global
securities. However, The Depository Trust Company, New York, New York
has advised us that, under its current practices, it would notify its
participants of our request, but will only withdraw beneficial interests from
the global securities at the request of each DTC participant. We will
issue securities in definitive form in exchange for the registered global
security or all the securities representing those securities. Any
securities issued in definitive form in exchange for a registered global
security will be registered in the name or names that the depositary gives to
the relevant trustee, warrant agent, unit agent or other relevant agent of ours
or theirs. It is expected that the depositary’s instructions will be
based upon directions received by the depositary from participants with respect
to ownership of beneficial interests in the registered global security that had
been held by the depositary.
Bearer Global
Securities. The securities may
also be issued in the form of one or more bearer global securities that will be
deposited with a common depositary for the Euroclear System and Clearstream
Banking, societe anonyme or with a nominee for the depositary identified in the
prospectus supplement relating to those securities. The specific
terms and procedures, including the specific terms of the depositary
arrangement, with respect to any securities to be represented by a bearer global
security will be described in the prospectus supplement relating to those
securities.
Limitations
on Issuance of Bearer Securities and Bearer Debt Warrants
In
compliance with United States federal income tax laws and regulations, bearer
securities, including bearer securities in global form, and bearer debt warrants
will not be offered, sold, resold or delivered, directly or indirectly, in the
United States or its possessions or to United States persons, as defined below,
except as otherwise permitted by United States Treasury Regulations Section
1.163-5(c) (2) (i) (D). Any underwriters, agents or dealers
participating in the offerings of bearer securities or bearer debt warrants,
directly or indirectly, must agree that:
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they will
not, in connection with the original issuance of any bearer securities or
during the restricted period, as defined in United States Treasury
Regulations Section 1.163-5(c) (2) (i) (D) (7) which we refer to as the
“restricted period,” offer, sell, resell or deliver, directly or
indirectly, any bearer securities in the United States or its possessions
or to United States persons, other than as permitted by the applicable
Treasury Regulations described above,
and
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they will
not, at any time, offer, sell, resell or deliver, directly or indirectly,
any bearer debt warrants in the United States or its possessions or to
United States persons, other than as permitted by the applicable Treasury
Regulations described above.
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In
addition, any underwriters, agents or dealers must have procedures reasonably
designed to ensure that their employees or agents who are directly engaged in
selling bearer securities or bearer debt warrants are aware of the above
restrictions on the offering, sale, resale or delivery of bearer securities or
bearer debt warrants.
Bearer securities,
other than temporary global debt securities and bearer securities that satisfy
the requirements of United States Treasury Regulations Section 1.163-5(c)(2)
(i)(D)(3)(iii) and any coupons appertaining thereto will not be delivered in
permanent global form or definitive bearer form, and no interest will be aid
thereon, unless we have received a signed certificate in writing, or an
electronic certificate described in United States Treasury Regulations Section
1.163-5(c)(2)(i)(D)(3)(ii), stating that on the date of that certificate the
relevant interest in the bearer security:
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is owned by a
person that is not a United States
person;
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is owned by a
United States person that (a) is a foreign branch of a United States
financial institution, as defined in applicable United States Treasury
Regulations, which we refer to as a “financial institution,” purchasing
for its own account or for resale, or (b) is acquiring the bearer
security through a foreign branch of a United States financial institution
and who holds the bearer security through that financial institution
through that date, and in either case (a) or (b) above, each of those
United States financial institutions agrees, on its own behalf or through
its agent, that it will comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986 and the
Treasury Regulations thereunder;
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or is owned
by a United States or foreign financial institution for the purposes of
resale during the restricted period and, whether or not also described in
the first or second clause above, the financial institution certifies that
it has not acquired the bearer security for purposes of resale directly or
indirectly to a United States person or to a person within the United
States or its possessions.
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We
will not issue bearer debt warrants in definitive form.
We
will make payments on bearer securities and bearer debt warrants only outside
the United States and its possessions except as permitted by the above Treasury
Regulations.
Bearer securities,
other than temporary global securities, and any coupons or talons issued with
bearer securities will bear the following legend: “Any United States person who
holds this obligation will be subject to limitations under the United States
income tax laws, including the limitations provided in sections 165(j) and
1287(a) of the Internal Revenue Code.” The sections referred to in
this legend provide that, with exceptions, a United States person will not be
permitted to deduct any loss, and will not be eligible for capital gain
treatment with respect to any gain realized on the sale, exchange or redemption
of that bearer security or coupon.
As
used in this section, the term bearer securities includes bearer securities that
are part of units and the term bearer debt warrants includes bearer debt
warrants that are part of units. As used herein, the term “United
States person” means a citizen or resident of the United States for United
States federal income tax purposes, a corporation or partnership, including an
entity treated as a corporation or partnership for United States federal income
tax purposes, created or organized in or under the laws of the United States, or
any state of the United States or the District of Columbia, or an estate or
trust the income of which is subject to United States federal income taxation
regardless of its source. As used herein, “United States” means the
United States of America (including the states thereof and the District of
Columbia) and “its possessions” include Puerto Rico, the U.S. Virgin Islands,
Guam, American Samoa, Wake Island and the Northern Mariana Islands.
Form
of Securities Included in Units
The form of any
warrant included in a unit will correspond to the form of the unit and of any
other security included in that unit.
We
may sell the debt securities in and/or outside the United States: (1) through
underwriters or dealers; (2) directly to one or more purchasers; or (3) through
agents. The applicable prospectus supplement with respect to the debt
securities will set forth the terms of the offering of the debt securities,
including the name or names of any underwriters or agents, if any, the purchase
price of the debt securities and the proceeds to us from such
sale. In addition, the applicable prospectus supplement will set
forth any delayed delivery arrangements, any underwriting discounts and other
items constituting underwriters' compensation, any initial public offering price
and any discounts or concessions allowed or re-allowed or paid to
dealers. Any initial public offering price and any discount or
concessions allowed or reallowed or paid to dealers may be changed from time to
time.
If
underwriters are used in the sale, the debt securities will be acquired by the
underwriters for their own account and may be resold from time to time in one or
more transactions including negotiated transactions, at a fixed public offering
price or at varying prices determined at the time of sale. The debt
securities may be offered to the public either through underwriting syndicates
represented by one or more managing underwriters or directly by one or more
firms acting as underwriters. The underwriter or underwriters with
respect to a particular underwritten offering of debt securities will be named
in the prospectus supplement relating to such offering and, if an underwriting
syndicate is used, the managing underwriter or underwriters will be set forth on
the cover of such prospectus supplement. Unless otherwise set forth
in the prospectus supplement relating thereto, the obligations of the
underwriters to purchase the offered debt securities will be subject to
conditions precedent and the underwriters will be obligated to purchase all the
offered debt securities if any are purchased.
If
dealers are used in the sale of debt securities in respect of which this
prospectus is delivered, we will sell such debt securities to the dealers as
principals. The dealers may then resell such debt securities to the
public at varying prices to be determined by such dealers at the time of
resale. The names of the dealers and the terms of the transaction
will be set forth in the prospectus supplement relating thereto.
The debt securities
may be sold through agents we designate from time to time. Any agent
involved in the offer or sale of the debt securities in respect to which this
prospectus is delivered will be named, and any commissions payable by us to such
agent will be set forth, in the prospectus supplement relating
thereto. Unless otherwise indicated in the prospectus
supplement, any such agent will be acting on a best efforts basis for the period
of its appointment.
We
may sell the debt securities directly to institutional investors or others, who
may be deemed to be underwriters within the meaning of the Securities Act of
1933, as amended, with respect to any resale thereof. The terms of
any such sales, including the terms of any bidding or auction process, will be
described in the prospectus supplement relating thereto.
Agents, dealers and
underwriters may be entitled under agreements entered into with us to
indemnification by us against certain civil liabilities, including liabilities
under the Securities Act, or to contribution with respect to payments which such
agents, dealers or underwriters may be required to make in respect
thereof. Agents, dealers and underwriters may be our customers,
engage in transactions with us, or perform services for us in the ordinary
course of business.
In
connection with an offering, certain persons participating in such offering may
engage in transactions that stabilize, maintain or otherwise affect the price of
the debt securities. Specifically, such persons may overallot such
offering, creating a syndicate short position. In addition, such
persons may bid for, and purchase, the debt securities in the open market to
cover syndicate shorts or to stabilize the price of the debt
securities. Finally, such persons may reclaim selling concessions
allowed for distributing the debt securities in an offering, if such persons
repurchase previously distributed debt securities in syndicate covering
transactions, in stabilization transactions or otherwise. Any of
these activities may stabilize or maintain the market price of the debt
securities above independent market levels. Such persons are not
required to engage in these activities, and may end any of these activities at
any time. The debt securities may or may not be listed on a national
securities exchange. We cannot assure you as to the future liquidity
of the trading market, if any, for any debt securities issued.
Legal matters
relating to the securities offered hereby will be passed upon for us by Miller,
Canfield, Paddock and Stone P.L.C., Detroit, Michigan.
The financial
statements, incorporated in this Registration Statement by reference from the
Company’s Annual Report on Form 10-K, and the effectiveness of BorgWarner Inc.’s
internal control over financial reporting, have been audited by Deloitte &
Touche LLP, an independent registered public accounting firm, as stated in their
reports, which are incorporated herein by reference. Such financial
statements have been so incorporated in reliance upon the reports of such firm
given upon their authority as experts in accounting and auditing.
We
are a reporting company and file annual, quarterly and current reports, proxy
statements and other information with the SEC. We have filed with the
SEC a registration statement on Form S-3 under the Securities Act with respect
to the securities we are offering under this prospectus. This
prospectus does not contain all of the information set forth in the registration
statement and the exhibits to the registration statement. For further
information with respect to us and the securities we are offering under this
prospectus, we refer you to the registration statement and the exhibits and
schedules filed as a part of the registration statement. You may read
and copy the registration statement, as well as our reports, proxy statements
and other information, at the SEC’s public reference rooms at 100 F Street,
N.E., Washington, D.C. 20549. You can request copies of these
documents by writing to the SEC and paying a fee for the copying
cost. Please call the SEC at 1-800-SEC-0330 for more information
about the operation of the public reference room. The SEC maintains a
website (http://www.sec.gov)
that contains reports, proxy, and information statements and other information
regarding registrants that file electronically with the SEC (such as
us). In addition, you can read and copy our SEC filings at the
offices of the New York Stock Exchange, Inc., 20 Broad Street, New York, New
York 10005.
The SEC allows us
to “incorporate by reference” certain of our publicly filed documents into this
prospectus, which means that we may disclose material information to you by
referring you to those documents. The information incorporated by
reference is considered to be part of this prospectus and any later information
that we file with the SEC will automatically update and supersede this
information. We incorporate by reference the documents listed below
and any additional documents we file with the SEC under Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act (other than current reports or portions thereof
furnished under Item 2.02 or Item 7.01 of Form 8-K) at any time after the
initial filing of the registration statement, whether before or after it is
declared effective, until the offering of the securities is
terminated.
The following
documents that we previously filed with the SEC (SEC File No. 001-12162) are
incorporated by reference; provided, however, that we are not incorporating, in
each case, any document or information deemed to have been furnished and not
filed in accordance with SEC rules:
|
|
(1)
|
Our Annual
Report on Form 10-K for the fiscal year ended December 31, 2007,
filed on February 14, 2008; and
|
|
|
(2)
|
Our
definitive Proxy Statement on Schedule 14A, relating to our 2007 annual
meeting of stockholders filed on March 23,
2007.
|
We
will provide at no cost to any person to whom a copy of this prospectus is
delivered, on written or oral request, a copy of any or all of the documents
incorporated by reference, other than exhibits to those documents, unless
specifically incorporated by reference. You should direct any
requests for documents to BorgWarner Inc., 3850 Hamlin Road, Auburn Hills,
Michigan 48326, Attention: Corporate Secretary.
No
dealer, salesperson or other person is authorized to provide any information or
to represent anything not contained in this prospectus. You must not
rely on any unauthorized information or representations. This
prospectus is an offer to sell only the securities offered hereby, but only
under circumstances and in jurisdictions where it is lawful to do
so. The information contained in this prospectus is current only as
of its date.
_____________________
$750,000,000
Debt Securities
Preferred
Stock
Voting Common
Stock
Non-Voting Common
Stock
Depository
Shares
Warrants
Units
_____________________
Prospectus
_____________________
March 4,
2008
PART
II
INFORMATION
NOT REQUIRED IN PROSPECTUS
Item
14. Other Expenses
of Issuance and Distribution.
The following table sets forth the costs and
expenses, other than underwriting discounts and commissions, payable in
connection with the offerings described in this registration statement, all of
which will be paid by the registrant. All such expenses other than
the registration fee are estimates.
|
Securities
and Exchange Commission registration fee
|
$ | 29,475 | ||
|
Legal fees
and
expenses
|
80,000 | |||
|
Accounting
fees and
expenses
|
80,000 | |||
|
Printing and
engraving
expenses
|
35,000 | |||
|
Rating agency
fees
|
25,000 | |||
|
Trustee fees
and
expenses
|
20,000 | |||
|
Miscellaneous
expenses
|
15,000 | |||
|
Total
|
$ | 284,475 |
__________
Item
15. Indemnification
of Directors and Officers.
Section 145 of the Delaware General Corporation
Law (“DGCL”)
provides as follows:
A corporation shall have power to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was serving at
the request of the corporation as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust or other enterprise,
against expenses (including attorneys' fees), judgments, fines and amounts paid
in settlement actually and reasonably incurred by the person in connection with
such action, suit or proceeding if the person acted in good faith and in a
manner the person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe the person's conduct was
unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the person did not act in good
faith and in a manner which the person reasonably believed to be in or not
opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had reasonable cause to believe that the person's
conduct was unlawful.
A
corporation shall have power to indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the corporation to procure a judgment in its favor by
reason of the fact that the person is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against expenses (including attorneys'
fees) actually and reasonably incurred by the person in connection with the
defense or settlement of such action or suit if the person acted in good faith
and in a manner the person reasonably believed to be in or not opposed to the
best interests of the corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall have
been adjudged to be liable to the corporation unless and only to the extent that
the Court of Chancery or the court in which such action or suit was brought
shall determine upon application that, despite the adjudication of liability but
in view of all the circumstances of the case, such person is fairly and
reasonably entitled to indemnity for such expenses which the Court of Chancery
or such other court shall deem proper.
As
permitted by Section 102 of the DGCL, BorgWarner Inc.’s restated
certificate of incorporation provides that no director shall be liable to
BorgWarner Inc. or its stockholders for monetary damages for breach of fiduciary
duty as a director other than (i) for breaches of the director’s duty of loyalty
to BorgWarner Inc. and its stockholders, (ii) for acts or omissions not in good
faith or which involve intentional misconduct or a knowing violation of law,
(iii) for the unlawful payment of dividends or unlawful stock purchases or
redemptions under Section 174 of the DGCL, or (iv) for any transaction from
which the director derived an improper personal benefit.
BorgWarner Inc.’s
restated certificate of incorporation provides for indemnification of its
directors and officers to the fullest extent permitted by the DGCL, and allows
BorgWarner Inc. to advance or reimburse litigation expenses upon submission by
the director, officer or employee of an undertaking to repay such advances or
reimbursements if it is ultimately determined that indemnification is not
available to such director or officer.
The registrant
maintains directors and officers liability insurance for the benefit of its
directors and officers.
For information
concerning the registrant’s undertaking to submit to adjudication the issue of
indemnification for violation of the securities laws, see Item 17
hereof.
Item
16. Exhibits.
|
Exhibit
Number
|
Description of Exhibits
|
|
|
1.1
|
–
|
Form of
Underwriting Agreement.(1)
|
|
3.1/4.1
|
–
|
Restated
Certificate of Incorporation of registrant (incorporated by reference to
Exhibit 3.1 to the registrant’s Quarterly Report on Form 10-Q for the
quarter ended September 30, 1993).
|
|
3.2/4.2
|
–
|
Amended and
Restated By-Laws of registrant (incorporated by reference to Exhibit 3.1
to the registrant’s Report on Form 8-K filed November 14,
2007).
|
|
3.3/4.3
|
-
|
Certificate
of Designations, Preferences and Rights of Series A Junior Participating
Preferred Stock (incorporated by reference to Exhibit 3.3 of the
registrant’s Annual Report on Form 10-K for the year ended December 31,
1999).
|
|
3.4/4.4
|
-
|
Certificate
of Ownership and Merger Merging BorgWarner Inc. into Borg-Warner
Automotive, Inc. (incorporated by reference to Exhibit 99.1 of the
registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31,
2000).
|
|
4.5
|
-
|
Indenture,
dated as of February 15, 1999, between Borg-Warner Automotive, Inc. and
The Bank of New York Trust Company, N.A. (successor in interest to The
First National Bank of Chicago), as trustee (incorporated by reference to
Exhibit 4.1 to Amendment No. 1 to Registration Statement No. 333-66879
filed November 6, 1998).
|
|
4.6
|
(Senior Debt)
Indenture, dated as of September 23, 1999, between Borg-Warner Automotive,
Inc. and The Bank of New York Trust Company, N.A. (successor in interest
to Chase Manhattan Trust Company, National Association), as trustee,
(incorporated by reference to Exhibit No. 4.1 to the Company’s Report on
Form 8-K filed October 6, 1999).
|
|
|
4.7
|
-
|
Rights
Agreement, dated as of July 22, 1998, between Borg-Warner Automotive, Inc.
and Mellon Investor Services, L.L.C. (incorporated by reference to Exhibit
4.1 to the Registration Statement on Form 8-A filed on July 24,
1998).
|
|
4.9
|
–
|
Form of
Subordinated Debt Indenture.
(1)
|
|
4.10
|
–
|
Form of
Senior Debt Securities.
(1)
|
|
4.11
|
–
|
Form of
Subordinated Debt Securities.
(1)
|
|
4.12
|
–
|
Form of
Deposit Agreement.
(1)
|
|
4.13
|
–
|
Form of
Depositary Receipts.
(1)
|
|
4.14
|
–
|
Form of
Warrant Agreement.
(1)
|
|
4.15
|
–
|
Form of
Warrants.
(1)
|
|
4.16
|
–
|
Form of Unit
Agreement.
(1)
|
|
4.17
|
–
|
Form of
Units.
(1)
|
|
5.1
|
_
|
Opinion of
the Miller Canfield Paddock and Stone, P.L.C., counsel to the Company, on
the validity of the securities being registered.
(2)
|
|
12.1
|
–
|
Computation
of Ratio of Earnings to Fixed Charges.
(2)
|
|
23.1
|
–
|
Consent of
Deloitte & Touche LLP.
(2)
|
|
24.1
|
–
|
Powers of
Attorney
|
|
25.1
|
–
|
Form T-1
Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of the Subordinated Trustee under the Subordinated Debt
Indenture.
(3)
|
|
25.2
|
–
|
Form T-1
Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of the trustee under the (Senior Debt) Indenture, dated as of
September 23, 1999, between Borg-Warner Automotive, Inc. and The Bank of
New York Trust Company, N.A. (successor in interest to Chase Manhattan
Trust Company, National Association), as trustee.
(2)
|
(1)
To be filed by amendment or as an exhibit to a current report on Form 8-K and
incorporated by reference.
(2)
Filed herewith.
|
(3)
|
To be filed
by amendment or as an exhibit to a current report on Form 8-K and
incorporated by reference, or incorporated by reference from a subsequent
filing in accordance with Section 305(b)(2) of the Trust Indenture Act of
1939, as applicable.
|
Item
17. Undertakings.
The undersigned
registrant hereby undertakes:
(1) To
file, during any period in which offers or sales are being made, a post
effective amendment to this registration statement:
(i) To include any
prospectus required by Section 10(a)(3) of the Securities Act of 1993, as
amended (the “Securities
Act”);
(ii) To reflect in the
prospectus any facts or events arising after the effective date of the
registration statement (or the most recent post-effective amendment thereof)
which, individually or in the aggregate, represent a fundamental change in the
information set forth in the registration statement. Notwithstanding
the foregoing, any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume
and price represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the “Calculation of Registration Fee” table in the
effective registration statement; and
(iii) To include any
material information with respect to the plan of distribution not previously
disclosed in the registration statement or any material change to such
information in the registration statement;
provided, however, that paragraphs
(1)(i), (1)(ii) and (1)(iii) above do not apply if 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 Exchange Act that are incorporated by reference in the registration
statement; or is contained in a form of prospectus filed pursuant to Rule 424(b)
that is part of this registration statement.
(2) That,
for the purpose of determining any liability under the Securities Act, each such
post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To
remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
(4) That,
for the purposes of determining liability under the Securities Act of 1933 to
any purchaser:
(A) Each
prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to
be part of the registration statement as of the date the filed prospectus was
deemed part of and included in the registration statement; and
(B) Each
prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as
part of a registration statement in reliance on Rule 430B relating to an
offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of
providing the information required by Section 10(a) of the Securities Act of
1933 shall be deemed to be part of and included in the registration statement as
of the earlier of the date such form of prospectus is first used after
effectiveness or the date of the first contract of sale of securities in the
offering described in the prospectus. As provided in Rule 430B, for
liability purposes of the issuer and any person that is at the date an
underwriter, such date shall be deemed to be a new effective date of the
registration statement relating to the securities in the registration statement
to which that prospectus relates, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering
thereof. Provided, however, that no statement made in a registration
statement or prospectus that is part of the registration statement or made in a
document incorporated or deemed incorporated by reference into the registration
statement or prospectus that is part of the registration statement will, as to a
purchaser with a time of contract of sale prior to such effective date,
supersede or modify any statement that was made in the registration statement or
prospectus that was part of the registration statement or made in any such
document immediately prior to such effective date.
(5) That,
for the purpose of determining liability of the registrant under the Securities
Act of 1933 to any purchaser in the initial distribution of the
securities:
The undersigned
registrant undertakes that a primary offering of securities of the undersigned
registrant pursuant to this registration statement, regardless of the
underwriting method used to sell the securities to the purchaser, if the
securities are offered or sold to such purchaser by means of any of the
following communications, the undersigned registrant will be a seller to the
purchaser and will be considered to offer or sell such securities to such
purchaser:
(i) Any
preliminary prospectus or prospectus of the undersigned registrant relating to
the offering required to be filed pursuant to Rule 424;
(ii) Any
free writing prospectus relating to the offering prepared by or on behalf of the
undersigned registrant or sued or referred to by the undersigned
registrant;
(iii) The
portion of any other free writing prospectus relating to the offering containing
material information about the undersigned registrant or its securities provided
by or on behalf o the undersigned registrant; and
(iv) Any
other communication that is an offer in the offering made by the undersigned
registrant to the purchaser.
The undersigned
registrant hereby further undertakes that, for purposes of determining any
liability under the Securities Act, each filing of the registrant’s annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan’s annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
Insofar as
indemnification for liabilities arising under the Securities Act may be
permitted to directors, officers and controlling persons of the registrant
pursuant to the provisions set forth in response to Item 15, 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
Securities Act and is, therefore, unenforceable. In the event that a
claim for indemnification against such liabilities (other than the payment by
the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question of whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such
issue.
The undersigned
registrant hereby undertakes to file an application for the purpose of
determining the eligibility of the trustee to act under subsection (a) of
Section 310 of the Trust Indenture Act in accordance with the rules and
regulations prescribed by the Commission under Section 305(b)(2) of the Trust
Indenture Act.
II-
SIGNATURES
Pursuant to the
requirements of the Securities Act of 1933, as amended, BorgWarner Inc.
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the City of Auburn Hills, State of Michigan, on March 4,
2008.
BORGWARNER
INC.
/s/ Timothy M.
Manganello
By: ______________________
Timothy M.
Manganello
Pursuant to the
requirements of the Securities Act of 1933, as amended, this registration
statement has been signed by the following persons in the capacities and on the
dates indicated.
|
Signature
|
Capacity
|
Date
|
|
/s/ Timothy
M. Manganello
Timothy M. Manganello
|
Chairman of
the Board, Director, Chief Executive Officer (Principal Executive
Officer)
|
March 4,
2008
|
|
/s/ Robin J.
Adams
Robin J. Adams
|
Executive
Vice President, Chief Financial Officer and Chief Administrative Officer
& Director (Principal Financial Officer)
|
March 4,
2008
|
|
/s/ Jeffrey
L. Obermayer
Jeffrey L. Obermayer
|
Vice
President and Controller (Principal Accounting Officer)
|
March 4,
2008
|
|
*
Phyllis O. Bonanno
|
Director
|
March 4,
2008
|
|
*
David T. Brown
|
Director
|
March 4,
2008
|
|
*
Jere A. Drummond
|
Director
|
March 4,
2008
|
|
*
Paul E. Glaske
|
Director
|
March 4,
2008
|
| *
Alexis P. Michas
|
Director
|
March
4, 2008
|
|
*
Ernest
J. Novak,
Jr.
|
Director
|
March
4, 2008
|
|
*
Richard O.
Schaum
|
Director
|
March
4, 2008
|
| *
Thomas T. Stallkamp
|
Director
|
March 4,
2008
|
|
/s/ Timothy M. Manganello
Timothy M. Manganello
|
As
attorney-in-fact for those individuals marked by an
asterisk.
|
March 4,
2008
|
INDEX TO
EXHIBITS
|
Exhibit
Number
|
Description of Exhibits
|
|
|
1.1
|
–
|
Form of
Underwriting Agreement.(1)
|
|
3.1/4.1
|
–
|
Restated
Certificate of Incorporation of registrant (incorporated by reference to
Exhibit 3.1 to the registrant’s Quarterly Report on Form 10-Q for the
quarter ended September 30, 1993).
|
|
3.2/4.2
|
–
|
Amended and
Restated By-Laws of registrant (incorporated by reference to Exhibit 3.2
to the registrant’s Quarterly Report on Form 10-Q for the year ended
December 31, 2003).
|
|
3.3/4.3
|
-
|
Certificate
of Designations, Preferences and Rights of Series A Junior Participating
Preferred Stock (incorporated by reference to Exhibit 3.3 of the
registrant’s Annual Report on Form 10-K for the year ended December 31,
1999).
|
|
3.4/4.4
|
-
|
Certificate
of Ownership and Merger Merging BorgWarner Inc. into Borg-Warner
Automotive, Inc. (incorporated by reference to Exhibit 99.1 of the
registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31,
2000).
|
|
4.5
|
-
|
Indenture,
dated as of February 15, 1999, between Borg-Warner Automotive, Inc. and
The Bank of New York Trust Company, N.A. (successor in interest to The
First National Bank of Chicago), as trustee (incorporated by reference to
Exhibit 4.1 to Amendment No. 1 to Registration Statement No. 333-66879
filed November 6, 1998).
|
|
4.6
|
(Senior Debt)
Indenture, dated as of September 23, 1999, between Borg-Warner Automotive,
Inc. and The Bank of New York Trust Company, N.A. (successor in interest
to Chase Manhattan Trust Company, National Association), as trustee,
(incorporated by reference to Exhibit No. 4.1 to the Company’s Report on
Form 8-K filed October 6, 1999).
|
|
|
4.7
|
-
|
Rights
Agreement, dated as of July 22, 1998, between Borg-Warner Automotive, Inc.
and Mellon Investor Services, L.L.C. (incorporated by reference to Exhibit
4.1 to the Registration Statement on Form 8-A filed on July 24,
1998).
|
|
4.9
|
–
|
Form of
Subordinated Debt Indenture.
(1)
|
|
4.10
|
–
|
Form of
Senior Debt Securities.
(1)
|
|
4.11
|
–
|
Form of
Subordinated Debt Securities.
(1)
|
|
4.12
|
–
|
Form of
Deposit Agreement.
(1)
|
|
4.13
|
–
|
Form of
Depositary Receipts.
(1)
|
|
4.14
|
–
|
Form of
Warrant Agreement.
(1)
|
|
4.15
|
–
|
Form of
Warrants.
(1)
|
|
4.16
|
–
|
Form of Unit
Agreement.
(1)
|
|
4.17
|
–
|
Form of
Units.
(1)
|
|
5.1
|
_
|
Opinion of
Miller Canfield Paddock and Stone, P.L.C., counsel to the Company, on
the validity of the securities being registered.
(2)
|
|
12.1
|
–
|
Computation
of Ratio of Earnings to Fixed Charges.
(2)
|
|
23.1
|
–
|
Consent of
Deloitte & Touche LLP.
(2)
|
|
24.1
|
–
|
Power of
Attorney
|
|
25.1
|
–
|
Form T-1
Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of the Subordinated Trustee under the Subordinated Debt
Indenture.
(3)
|
|
25.2
|
–
|
Form T-1
Statement of Eligibility under the Trust Indenture Act of 1939, as
amended, of the trustee under the (Senior Debt) Indenture, dated as of
September 23, 1999, between Borg-Warner Automotive, Inc. and The Bank of
New York Trust Company, N.A. (successor in interest to Chase Manhattan
Trust Company, National Association), as trustee.
(2)
|
|
(1)
|
To be filed
by amendment or as an exhibit to a current report on Form 8-K and
incorporated by reference.
|
| (2) | Filed herewith. |
| (3) | To be filed by amendment or as an exhibit to a current report on Form 8-K and incorporated by reference, or incorporated by reference from a subsequent filing in accordance with Section 305(b)(2) of the Trust Indenture Act of 1939, as applicable. |